Thursday, 5 December 1985 The DEPUTY PRESIDENT (Senator Hamer) took the chair at 10 a.m., and read prayers. The Clerk —Petitions have been lodged for presentation as follows: To the Honourable the President and members of the Senate in Parliament assembled. We the undersigned citizens of the Commonwealth do humbly pray that the Commonwealth Government: 1. Uphold the principle that the seeds and cuttings of plants are a public resource and a common heritage to all and that accordingly seeds should be freely available to all, freely multipliable, able to be sold, exchanged, exported and imported by anyone who wishes. This is seen as a matter of national food security. 2. Recognise that plant breeding is a highly co-operative venture often involving private enterprise at the very last stages after basic seed collection, storage, and research has been publicly funded. 3. In view of the aforementioned paragraphs, recognise that any system giving `property' or ownership rights over seeds to individuals, organisations or enterprises is inappropriate and unjust. 4. Recognise that legislation establishing plant patenting schemes overseas has had serious adverse effects, namely: (i) a slowing down of scientific information exchange and exchanges in basic plant breeding materials, that is, germ; (ii) subordination and/or curtailment of public breeding programmes; (iii) farmer unrest at seed prices; (iv) monopoly control of seed production and sales has passed into the hands of giant petrochemical and drug corporations also marketing crop chemicals. (v) increased uniformity of crop varieties leading to a vulnerability in pest and disease attack. 5. Reject any proposal to legislate for any system such as the drafted Plant Variety Rights Act, which gives exclusive ownership rights over seeds to individuals, organisations or enterprises. And your petitioners in duty bound will ever pray. by Senator Zakharov (from 93 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 a Government decision to force, at the expense of viewers, the transfer of WIN TV (and any future local broadcaster) from VHF to UHF transmission, while excluding Sydney metropolitan T.V. stations from this requirement, will place in jeopardy the future of the Illawarra and South Coast region's only local commercial T.V. operator. Your petitioners request the Senate to protect the interests of the hundreds of thousands of television viewers within the area from Wollongong to the Victorian border served by WIN TV, by preventing the Government from taking this unwarranted and discriminatory action which disadvantages both viewers and advertisers on the South Coast to the benefit of the metropolitan networks. And your petitioners as in duty bound will ever pray. by Senator Michael Baume (from 931 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 the proposed Australian Bill of Rights Bill 1985 will endanger the Federal system in Australia, the State and Federal criminal justice systems, the State and Federal Police Force, the State and Federal education systems, the independence of the churches and religious associations, marriage and the family, children, the unborn, the handicapped, the aged and the infirm, employer and employee relationships and Australian society generally. Your petitioners therefore humbly pray: That your Honourable House defer debate on the Bill for twelve months and circulate the Bill for twelve months for the widest possible debate, scrutiny and discussion, and your petitioners, as in duty bound, will ever pray. by Senators Peter Baume (from 206 citizens) and Brownhill (from 15 citizens). To the Honourable the President and members of the Senate in Parliament assembled. The petition of the undersigned shows: That human embryos deserve legal protection to enable the development of their full human potential. Your petitioners request that the Senate, in Parliament assembled, should: Pass Senator Harradine's Bill to prohibit experiments involving the use of human embryos created by in vitro fertilisation. And your petitioners as in duty bound will ever pray. by Senator Morris (from 838 citizens). To the Honourable the President and members of the Senate in Parliament assembled: The petition of the undersigned citizens of Australia respectfully showeth objection to the Metric system and request the Government to restore the Imperial system. And your petitioners as in duty bound will ever pray. by Senator Bjelke-Petersen (from 21 citizens). To the Honourable the President and the members of the Senate in Parliament assembled: The petition of certain citizens of Australia shows that woodchipping and clearfelling will destroy the Otway Forests, water catchments and jobs in tourism. Your petitioners therefore pray that you will protect the Otway Forests for the future and refuse any licence to export woodchips from the Otways. by Senator Sanders (from 100 citizens). To the Honourable the President and members of the Senate in Parliament. We the undersigned express our concern over the sale of the Belconnen Mall due to the likely detrimental effect on the provision of community facilities presently existing in the Belconnen Mall. 1. In particular we seek guarantees that the present Child Care Centre and Community Facilities be retained by incorporating the same into the conditions of sale of the Belconnen Mall and that the services will receive the same real level of funding and support currently provided by the Canberra Commercial Development Authority. 2. That a financial commitment to the Building of Stage 4 of the Belconnen Mall listed under Section 14C in the Ordinance of the Canberra Commercial Development Authority be undertaken. Stage 4 to consist of community facilities such as community hall, large glassed enclosed community park, exhibition space, health and fitness club, ice rink, amusement centre and office accommodation. Your petitioners therefore humbly pray that this petition be considered. by Senator Vigor (from 128 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 widespread serious ill health caused by smoking tobacco. And your petitioners as in duty bound will ever pray. by Senator Vigor (from 75 citizens). To the Honourable President and members of the Senate in Parliament assembled. The petition of the undersigned citizens of the Commonwealth of Australia respectfully showeth: That the proposed Human Embryo Experimentation Bill is a retrogressive step which could deprive thousands of couples of the chance to have children. The planned prohibition on experimentation on a human embryo would have the effect of ending the breakthroughs made in the study of infertility. Your petitioners most humbly pray that the Senate in Parliament assembled should seek the prevention of the passage of the Human Embryo Experimentation Bill. And your petitioners as in duty bound will ever pray. by Senator Short (from 16 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: 1. In this aging Australian society children are our most precious resource. 2. We request that any changes to the Child Care Act should ensure the protection of these children by providing for quality care by mothercraft nurses or other trained child care professionals. 3. We urge that funding provided under the Child Care Act should ensure the maintenance of the present standards of 75 per cent of award wages and conditions for approved child care professionals. 4. We also ask that available child care places be provided according to the needs of the children rather than through restricting access according to the work-related needs of parents. And your petitioners as in duty bound will ever pray. by Senator Grimes (from 2,414 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 deplore the discriminatory proposal to introduce a National Identity Card as outlined in the Government's September 1985 Tax Package. The proposal is a gross invasion of an individuals privacy and no matter how mild in introduction will quickly become an Orwellian monster which will mutilate forever the traditional freedoms of Australians, for which thousands of gallant men and women have laid down their lives in time of war. In time the proposal could lead to a situation just as horrific as Hitler's Germany and Moscow's KGB. Your Petitioners therefore humbly pray that the Senate in Parliament assembled will reject the National Identity Card proposal. And your petitioners as in duty bound will ever pray. by Senator Grimes (from 17 citizens). Petitions received. Senator CHIPP(Victoria-Leader of the Australian Democrats) —by leave-As the Senate would know, the constitution of the Australian Democrats prescribes that all members of the party should have an opportunity of voting for all policy matters and leadership positions. As the Senate also would know, due to an error outside the control of the party certain members were deprived of a vote in the ballot counted in August and another ballot for deputy leadership was conducted. In that ballot, which was counted last evening, Senator Janine Haines was elected Deputy Leader of the Australian Democrats and I congratulate her on her success. I also place on record the outstanding loyalty and magnificent service given to myself and the party by Senator Colin Mason, who has served with great distinction as Deputy Leader since the formation of the party in 1977. Senator COLSTON(Queensland) —I give notice that, on the next day of sitting, I shall move: That the Senate- (a) congratulates the New Zealand cricket team on winning the three Test series against Australia; (b) extends its congratulations to Australia's captain, Mr Allan Border, and those Australians who played in the three Tests for their dedication to the game of cricket and for their sportsmanship; and (c) wishes Mr Border and the Australian team well in the forthcoming matches throughout the summer. Senator MacGIBBON(Queensland) —I give notice that, on the next day of sitting, I shall move: That the Senate- (a) congratulates the Liberal Party and National Party for their consistent support over many years for genuine superannuation schemes and other proposals to make life easier and more rewarding for all Australians who wish to provide for their own retirement; (b) condemns the Australian Labor Government and in particular the Treasurer (Mr Keating) for misleading the Australian public by promoting and supporting union-controlled phoney superannuation schemes which are nothing more than pay rises designed to escape the restrictions of the mythical accord; (c) notes that, unlike genuine superannuation schemes, all these phoney superannuation schemes will be funded entirely by the employer, with no contribution from employees; (d) notes that the funds for these schemes, which will accrue to thousands of millions of dollars, will be administered by trustees nominated by the union movement, despite the fact that unionists will not have contributed to the funds; (e) notes that the union movement will inevitably use these vast resources for the political advantage of its political surrogate, the Australian Labor Party, and will take a percentage also for its own purposes; and (f) notes that these union-based superannuation schemes will have the effect of making unionism compulsory in the Australian workforce because only union members will be able to join the scheme. Senator CHANEY(Western Australia-Leader of the Opposition) —I give notice that, on the next day of sitting, I shall move: That the following matter be referred to the Standing Committee on Industry and Trade: The proposed establishment of inward duty free shops and its impact on Customs administration and barrier control. Senator GRIMES(Tasmania-Manager of Government Business) —I give notice that, on the next day of sitting, I shall move: That the Senate authorises the broadcasting and re-broadcasting by Australian radio and television stations of sound recordings of excerpts of its proceedings during 1986, subject to the conditions determined for the purpose by the Joint Committee on the Broadcasting of Parliamentary Proceedings. Senator MACKLIN(Queensland) —I give notice that, on the next day of sitting, I shall move: That the Senate- (a) noting that this week is the 40th anniversary of the opening of the prosecution case at the Nuremburg Trials at the end of World War II; (b) rejects the defence claims that a subordinate should carry out all the orders of a superior; (c) endorses the statement by the Chief Prosecutor, Judge Jackson, made in his opening address, that-`The common sense of mankind demands that the law shall not stop with the punishment of petty crimes by little people. It must also reach people who possess themselves of great power and make deliberate and concerted use of it to set in motion evils which leave no home in the world untouched; and (d) recognises that this statement applies as much today in a world of nuclear peril as it did 40 years ago. Senator COONEY(Victoria) —I seek leave to amend business of the Senate, Notice of Motion No. 1, standing in my name for this day of sitting to read: That the words `if the charge is not a prescribed charge' appearing in paragraph 477 (6) (c) of the Crimes Act 1900 (New South Wales) in its application to the Australian Capital Territory as contained in section 4 of the Crimes (Amendment) Ordinance (No. 3) 1985, as contained in Australian Capital Territory Ordinance No. 40 of 1985, and made under the Seat of Government (Administration) Act 1910, be disallowed. Leave granted. Senator COONEY(Victoria) —I give notice that, four sitting days after today, I shall move: That the First Home Owners Regulations (Amendment) as contained in Statutory Rules 1985 No. 267 and made under the First Home Owners Act 1983, be disallowed. Senator COONEY(Victoria) — I give notice that, four sitting days after today, I shall move: That the Defence Determinations as contained in Determination Nos 64 and 65 of 1985, and made under section 58B of the Defence Act 1903, be disallowed. Senator COONEY(Victoria) —I give notice that, four sitting days after today, I shall move: That the Blood Donations (Acquired Immune Deficiency Syndrome) (Amendment) Ordinance 1985, as contained in the Australian Capital Territory Ordinance No. 55 of 1985 and made under the Seat of Government (Administration) Act 1910, be disallowed. Senator COONEY(Victoria) —I give notice that, four sitting days after today, I shall move: That the Extradition (Commonwealth Countries) Regulations (Amendment), as contained in Statutory Rules 1985 No. 264 and made under the Extradition (Foreign States) Act 1966, be disallowed. Senator COONEY(Victoria) —I seek leave to withdraw Business of the Senate, Notice of Motion No. 2, standing in my name for this day of sitting, in relation to disallowance of the Crimes (Amendment) Ordinance (No. 4) 1985. Leave granted. Senator VALLENTINE(Western Australia) —I give notice that, on the next day of sitting, I shall move: That the Senate- (a) notes the fact that it is impossible to separate the civil and military uses of uranium and the likelihood that Australian uranium is being used in nuclear weapons and bombs; (b) notes the comments of the Conservative member of the European Parliament, Sir Henry Plumb, when recently in Australia, that under Euratom, Australian uranium can be passed from one European country to another and that this makes a farce of our banning sales of uranium to France; (c) expresses its concern at the predicted announcement of the go-ahead for the Roxby Downs uranium mine in South Australia; (d) expresses its concern at the adverse environmental impact of the Roxby Downs mine, especially its enormous consumption of water, in the light of serious water contamination problems at the Ranger mine in the Northern Territory; (e) calls on the Australian Labor Party to include in its policy platform and legislation a commitment to prohibit the storing of nuclear waste on Australian territory; and (f) laments that the electors of South Australia are being given a so-called `choice', when the two major parties are supporting the Roxby Downs uranium project. Senator CHILDS(New South Wales) —I give notice that, on the next day of sitting, I shall move- (1) That, if the Senate be not sitting when the Standing Committee on Industry and Trade has completed its third report on the Development of Closer Economic Relations between Australia and New Zealand, the Committee may send 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 authorised 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. (2) That the foregoing provisions of this resolution, insofar as they are inconsistent with the Standing Orders, have effect notwithstanding anything contained in the Standing Orders. Senator GRIMES(Tasmania-Manager of Government Business) —I table papers in accordance with the list circulated to honourable senators, and I ask that the list be incorporated in Hansard. Leave granted. The list read as follows- 1. Australian Honey Board-annual report 1984-85-pursuant to sub-section 30 (3) of the Honey Industry Act 1962-together with the text of a statement by the Minister for Primary Industry relating to the report. 2. The Snowy Mountains Hydro-Electric Authority-annual report 1984-85-pursuant to section 32 of the Snowy Mountains Hydro-Electric Power Act 1949. 3. Wheat Research Act-annual report 1984-85-pursuant to section 18 of the Wheat Research Act 1957. 4. Department of Industry Technology and Commerce-annual report 1984-85. 5. Public Service Board-annual report-1984-85-pursuant to section 22 of the Public Service Act 1922. 6. Commonwealth Ombudsman and Defence Force Ombudsman-annual reports 1984-85-pursuant to sub-section 19 (1) and 19F (3) of the Ombudsman Act 1976. 7. Federal Police Disciplinary Tribunal-annual report 1984-85-pursuant to section 86 of the Complaints (Australian Federal Police) Act 1981. 8. Australian Security Intelligence Organisation-report 1984-85. 9. Administrative Review Council-annual report 1984-85-pursuant to section 58 of the Administrative Appeals Tribunal Act 1975. 10. Security Appeals Tribunal-annual report 1984-85-pursuant to sub-section 83 (1) of the Australian Security Intelligence Organisation Act 1979. 11. Office of Australian War Graves-annual report 1984-85-pursuant to section 13 of the War Graves Act 1980. 12. Repatriation Commission-annual report 1984-85-pursuant to section 122 of the Repatriation Act 1920. 13. Defence Service Homes Corporation-annual report 1984-85 pursuant to section 50 (B) of the Defence Service Homes Act 1918. 14. Freedom of expression and section 116 of the Broadcasting and Television Act 1942-report No. 16 by the Human Rights Commission-pursuant to section 30 of the Human Rights Commission Act 1981. 15. Trans Australia Airlines-annual report 1984-85-pursuant to section 40 of the Australian National Airlines Act 1945. 16. Australian Marine Sciences and Technologies Advisory Committee-annual report 1984. 17. Australian Capital Territory Apprenticeship Board-annual report 1984-85-pursuant to section 47 of the Australian Capital Territory Apprenticeship Ordinance and Regulations 1936. 18. Independent Schools (Loans Guarantee) Act 1969-report 1983-84-statements of payments made in 1983-84-pursuant to section 8 of the Independent Schools Loans Guarantee Act 1969. 19. Australian Capital Territory Schools Authority-annual report 1984-85-pursuant to section 63M (1) of the Audit Act 1901. 20. Department of Primary Industry-annual report 1984-85. 21. Australian Children's Television Foundation- annual report 1984-85. 22. Australian biological resources study-annual report 1984-85. 23. Department of Sport, Recreation and Tourism-annual report 1984-85. 24. Australian bi-centennial road development program-annual report 1984-85-pursuant to section 27 of the ABRD Trust Fund Act 1982. Motion (by Senator Durack) agreed to: That leave be given to introduce a Bill for an Act to amend the Family Law Act 1975 with respect to maintenance and the enforcement of decrees. Bill presented by Senator Durack, and read a first time. Senator DURACK(Western Australia)(10.13) —by leave-I move: That the Bill be now read a second time. I seek leave to incorporate my second reading speech in Hansard. Leave granted. The speech read as follows- The Family Law Act passed in 1975 not only made a revolutionary change to family relationships by abolishing the concept of fault but also introduced major changes in the responsibility for maintaining a former spouse and the children of the marriage. The Act emphasises that the right to maintenance solely depends upon the inability of the claimant to support his or herself whether such inability arose from having the care of children or because of age or incapacity. This obligation is entirely non-sexist. As far as the children of the marriage are concerned the obligation is placed on both parents according to their respective financial abilities to maintain children up to the age of eighteen years. In giving effect to these principles the Family Court is obliged to take into account a large number of considerations which are set out in section 75. Section 75 (1) (e) provides that the court should take into account `the responsibility of either party to support any other person' and section 75 (2) (m) requires that the court in a situation where `a former spouse is cohabitating with another person to have regard to the financial circumstances relating to the cohabitation'. These considerations have qualified the general responsibility laid down by the previous sections and have in practice led to some confusion where a parent who would otherwise be liable to pay an adequate and perhaps substantial sum for the maintenance of his or her children has successfully reduced that amount where other responsibilities have been assumed following the break-up of a marriage. The overall result has been outlined by the Institute of Family Studies in the report entitled `Cost of Children in Australia' published in August 1984, which established that the level of maintenance being ordered by courts in respect of children is significantly less than the actual cost of their maintenance. This result has exposed an important social issue which requires to be addressed by the Parliament. In addition to this situation another provision of section 75 of the Family Law Act provides that the court shall take into account `the eligibility of either party for a pension or allowance or benefit under any law of Australia or of a State or Territory . . . or the rate of any such pension, allowance or benefit being paid to either party'. At the time the Family Law Act was passed the government of the day had recently introduced the supporting parents benefit. Since then there has been an astronomic rise in the cost of that benefit to the Australian taxpayer as the following table demonstrates: Year Number Per cent increase Expendi- ture Per cent increase $m 1974... 26,286 . . 40.6 . . 1975... 36,015 37.01 76.1 87.43 1976... 45,542 26.45 127.2 67.14 1977... 50,954 11.88 158.5 24.60 1978... 57,433 12.71 192.8 21.64 1979... 62,498 8.81 226.7 17.58 1980... 70,425 12.68 259.6 14.51 1981... 106,631 51.41 412.4 58.85 1982... 123,942 16.23 605.9 46.92 1983... 140,228 13.14 727.7 20.10 1984... 153,589 9.52 889.6 22.25 1974-84... . . 484.3 . . . . Source: Department of Social Security, Ten Year Statistical Summary; Department of Social Security, Annual Report 1983-84. There is a great deal of evidence to establish, and wide recognition of the fact, that these two events are related. Although there is justification for a court having regard to a social security benefit available to either party where there may be a low income by one and no income enjoyed by the other there can be no justification for a court taking into account the existence of such a benefit in the case of parents who can afford to pay for the maintenance of their children. Unfortunately that seems to be the case. However the problem is by no means confined to orders by a court being influenced by this statutory signal which the Parliament unfortunately gave to them when it passed the Family Law Act. Most maintenance obligations do not arise out of court orders but by agreement between the parties or by orders made by the consent of the parties. It does seem that the taxpayer has been ripped off by such agreements in much the same way as he has been by tax avoidance schemes. One might also say that in recent years there has been a growth industry of maintenance avoidance and that the payment of maintenance has virtually become optional. There is yet another unfortunate aspect of the Family Law Act and its administration. Over the years there have been growing complaints that maintenance orders are simply being ignored and that there is no adequate machinery to enforce their payment. A recent survey in Victoria showed that 75 per cent of such orders were simply being ignored. This may be due to a combination of factors. The availability of a meagre but steady income under the supporting parents benefit is an important factor which gives the supporting parent a reliable income and relieves the recipient of the hassle of chasing a bad payer. It also must have the effect of reducing the source of moral responsibility of the should be payer of maintenance when it is known social security will provide. There is also dissatisfaction with the access arrangements under the Act which persuades many parents who are deprived of custody of a child, an excuse for not meeting their obligations to maintain that child. There has also no doubt been an erosion of moral and social values whereby many people have decided to repudiate such responsibility. However there can be no doubt that one important factor is the inadequacy of the machinery to enforce the payment of maintenance under the Family Law Act. Successive governments have examined this problem but have not provided a solution. The present Government is particularly delinquent because although the problem was identified several years ago it has taken no steps to rectify it. Soon after he became Attorney-General, Senator Gareth Evans set up an inquiry into this question and obtained a departmental report but since then nothing has transpired. It is not possible for a private member to introduce legislation to set up such machinery but it is possible to propose amendments to the Family Law Act which removes an impediment to the enforcement of maintenance orders. One such impediment is section 107 of the Family Law Act which provides that `no person shall be imprisoned . . . by reason of . . . failure to comply with' a maintenance order. Although the following section of the Act provides a power to punish for contempt for wilful disobedience of any decree of the Family Court this more general provision has not proved to be an effective substitute for a direct method of enforcement by arrest. The Bill which I have introduced today addresses these three deficiencies in the Family Law Act. Clause 3 adds two further sub-sections to section 75. The first prevents the court taking into account the eligibility of a party of a marriage who is claiming maintenance for any benefit under the Social Security Act or the Repatriation Act. It is necessary to go further than simply deleting the present requirement that the court `shall' take into account such eligibility because the court may well decide to do so of its own volition in the absence of a clear signal from the Parliament in terms of this amendment. This should not result in any injustice to a person who is on a low income and being sued for maintenance by a former spouse who is in fact receiving a social security benefit because other provisions in sections 72 and 75 make it clear that the court must have regard to the relative financial circumstances of the parties. The second new sub-section makes it clear that the court in determining the amount of maintenance to be paid shall give priority to the needs of the party or children for which provision is claimed in accordance with the sequence of time when those responsibilities were attained. This is based upon the view that the acquisition of responsibilities for children during a marriage should take precedence over the acquisition of subsequent responsibilities acquired by either a subsequent marriage or a subsequent defacto relationship. That does not mean that maintenance should not be paid for such subsequent obligations but simply provides a means by which the court can determine the priority. Any injustice which in the particular circumstances of a case may seem to arise from these new sub-sections can be rectified by the general directive to the court to take into account any fact or circumstance which the justice of the case requires. Clause 4 of the Bill deals with the problem of maintenance avoidance. Sections 86 and 87 of the Family Law Act deal with agreements between the parties. Section 86 provides for agreements being registered with the court but these agreements do not prevent either party seeking to modify an agreement by a subsequent claim for maintenance. To prevent parties entering into agreements under this section the Government should observe the requirement of section 83AAD of the Social Security Act that it is a condition of the payment of a benefit that steps are taken to enforce the right of maintenance. It is unreasonable to require courts to examine all such agreements before allowing them to be registered. The changes which have been proposed to section 75 will no doubt encourage claimants and their legal advisers to seek to maximise the payment of maintenance. Agreements under section 87 require the approval of the court because these prevent either party, except in certain extreme circumstances, from coming back to the court to seek any variation of maintenance. These are the ones favoured by the better-off sections of the community for maintenance avoidance purposes. The Bill provides a simple amendment to exclude the maintenance for a child of the marriage from the effect of section 87. That should greatly discourage parties entering into agreements which limit the right to obtain proper maintenance for a child by a responsible parent. Clause 5 of the Bill simply repeals section 107 and clause 6 requires that rules of court shall make provision for enforcement of maintenance by commitment to prison. Clearly these provisions are better made by rules of court than inserting a lengthy new code in the Act itself. In my opinion these amendments proposed to the Family Law Act go somewhat towards redressing the problem which I have identified earlier in this speech. Unfortunately these amendments on their own will not be entirely effective. The Government itself must also give urgent consideration to its own policies. The prime example is the decision of this Government soon after coming into office to abandon the policy of its predecessor which required a recipient of supporting parents benefit to take reasonable steps to enforce their rights to maintenance under the Family Law Act. The Government should also be giving urgent consideration to the adequacy of the machinery for enforcing maintenance against those growing number of people who are simply refusing to pay. It may well be that the cheapest way of doing this would be to provide legal aid for those entitled to maintenance to assist them to enforce their rights. Another but not necessarily alternative method would be an additional assessment through the taxation system which appears to have been recognised by an as yet unpublished report by the Family Law Council. None of these matters can be properly addressed by a private member's Bill but it is my earnest hope that the passage of this Bill by the Parliament would prove a catalyst towards solving a problem of growing magnitude towards which the present Government has adopted a thoroughly cavalier attitude. It should be remembered that when I introduced an amendment to remove from the Family Law Act the requirement to take into account the eligibility for a pension, during the extensive amendments made in 1983, the Government and all Labor senators opposed my amendment which in consequence was defeated. Noises are now emerging from the Government-I refer to the speech by the Minister for Social Security (Mr Howe) to the annual general meeting of the Australian Council of Social Service on 12 September 1985-and even some Labor senators which suggests a change of attitude since 1983. This Bill will give those senators an opportunity to repair the damage which they did in 1983. It needs to be made clear that this Bill does not remove existing social security entitlements. What it does is to ensure that where private resources are available they are called upon before the general body of taxpayers. I believe most Australians would regard that as the right priority. I commend the Bill to the Senate. Debate (on motion by Senator Robertson) adjourned. Motion (by Senator Grimes) agreed to: That, unless otherwise ordered, the hours meeting for the remainder of this day be until 6.30 p.m. and then from 8 p.m. to 10.30 p.m. Motion (by Senator Cooney) agreed to: That, Business of the Senate, Notice of Motion No. 1 standing in my name for this day for the disallowance of the Crimes (Amendment) Ordinance (No. 3) 1985 be postponed till a later hour of the day. Senator GARETH EVANS(Victoria-Minister for Resources and Energy) —For the information of honourable senators I table the report of the Royal Commission into British Nuclear Tests in Australia, dated 25 November 1985. I seek leave to make a statement relating to the report. Leave granted. Senator GARETH EVANS —by leave-I move: That the Senate take note of the report. The Royal Commission was established by the Government in July 1984 in response to public concern about the events which took place during the atomic tests in Australia and in particular the possible effects of the tests on people's health. The report is the result of a comprehensive investigation involving hearings at many locations in Australia and in London. Numerous witnesses were called and evidence was collected from contemporary records of the United Kingdom and Australian Governments. The sifting of all this information presented a formidable task to the members of the Royal Commission and its staff. Seven recommendations are contained in the report, dealing with clean up of the test sites and compensation arrangements. I will be giving careful but urgent consideration to these recommendations before proposing to the Government appropriate actions to be taken. Certain of the recommendations call for discussions with the British Government, and I am already in contact with the United Kingdom Minister with responsibility for these issues. Other recommendations affect State governments and Aboriginal interests and here too consultations are necessary. The Government will announce its detailed response to all the recommendations as soon as possible. The documentation accumulated by the Royal Commission will be of interest to many who wish to research aspects of this subject. As many of these documents are not yet 30 years old, I have recommended to the Prime Minister (Mr Hawke) that he approve accelerated release, wherever practicable, under the provisions of the Archives Act 1983. The Prime Minister has agreed to take this course of action as soon as the necessary review and clearances have been completed. Senator Durack —I thought I should seek leave to make a statement. I am not sure that this is the appropriate time to debate the issue. The DEPUTY PRESIDENT —The motion is: That the Senate take note of the report. Senator Durack —I understood that comments were to be made by leave, so that the motion would be debated fully at a later stage. Senator GARETH EVANS —Under those circumstances, I seek leave to continue my remarks later. Leave granted; debate adjourned. Senator DURACK(Western Australia) —by leave-I am glad that we are taking note of this report and statement in this way because it is clearly a matter which will need to be given very great consideration. It deserves very great debate in the Senate, no doubt at a more appropriate time when we will all be better informed about the nature of the report, the attitude that is exhibited by the report, and its conclusions. No doubt the Government, which has not yet had the opportunity to give the report very close consideration, will want to do so because it will create major problems for the Government. The report is a massive two-volume document. The very short time in which the report has been available for the Opposition to consider has been quite inadequate for us to be able to make any worthwhile comments on it at all. Indeed, we have barely had time to read the short document headed `Conclusions and Recommendations'. There are 200 conclusions. It is a bit easier to read the recommendations, which amount to only seven. The pages of that summary, mainly dealing with the report's conclusions, may be designed to lead to a good deal of disquiet in the Australian population, which may or may not be justified on a deeper consideration of the report and the way in which the evidence has been dealt with. I am in no position to make any comment about it. I instance, as the reason for my concern, the very first of the 200 conclusions, which reads: The Royal Commission received no evidence that disturbed the overwhelming impression that the original decision to lend Australia- to lend Australia- to the United Kingdom for the purpose of the latter's nuclear test program was taken by Australian Prime Minister Menzies without reference to his Cabinet. However, subsequent conclusions indicate that clearly the Australian Cabinet took a considerable interest in the matter from any early stage and made decisions. Whether those decisions now are being criticised, challenged or whatever is beside the point. As a piece of legal reasoning, this first conclusion that I have just quoted must receive the booby price because here is an assumption based upon what is described as an overwhelming impression-that is the assumption-and then a conclusion that there is no evidence to dispel that assumption. Mr Justice McClelland allegedly has a legal reputation. If that is the level of his reasoning, it does not bode well for any assessment we may make of his other conclusions. Senator Withers —That is typical of judicial royal commissions. Senator DURACK —Senator Withers may well have some fair comment about that. There are also some very heavy criticisms indeed of Professor Titterton, who was the Chairman of the Committee that was set up in the fairly early stages, known as the Atomic Weapons Test Safety Committee. Again one is not in a position to assess whether these conclusions about Professor Titterton's approach to the matter, alleged conflicts of interest and other issues are justified. I think it is a matter which will need to be given very close consideration indeed. The main concern, no doubt, of the Australian people at this time is what residual effect these tests have had on the Australian population and on the sites. There are some conclusions about these matters which will require, as I said, very earnest consideration and decisions by the Government. Although the Commission has found that by reason of the major detonation at the major trials and fall-out across Australia it is probable that cancers which would not otherwise have occurred have occurred in the Australian population and that the exposure to radiation as participants in the trial program has increased the risk of cancer among what are called nuclear veterans, the Commission then makes a very important conclusion. I think this conclusion is very important for both the Government and Australians who may be otherwise disturbed by these findings. I quote finding 75: The Royal Commission has been unable to quantify the probable increase in the risk of cancer among the participants in the trial program or among the Australian population in general. That finding tends to confirm the results of work that was done on this matter by the Fraser Government, and particularly the work of Senator Sir John Carrick, who was the Minister responsible at the time of this survey of those who had been involved in the trial program. No doubt he may have something to say, either today or on another occasion; nevertheless, there is there an inability by the Commission to find evidence under which it could in fact find what the degree of risk was for anyone who was associated with the program. The recommendation that there should be a reversal of the onus of proof as far as claimants are concerned-not only members of the armed forces but also those who were present at the relevant times-is a recommendation which will have to be considered very seriously from the point of view of costs that would be involved. It has been recommended that the costs be borne by the Australian Government. It has been recommended that the cost of the clean-up of the sites which is still required be borne by the UK Government. I can well understand Senator Evans's statement that there will have to be some no doubt very tense negotiations with the British Government about that recommendation. In conclusion, I would like to say this: It is all very well to make these findings and recommendations in the light of hindsight. Whether they are justified or not-I am certainly not in a position to say whether they are without further study-the fact of the matter is that these tests were conducted in Australia in the Cold War period and with the very intense security consciousness of that day and age. With the benefit of hindsight and with the prejudices which seem to be evident from a brief reading of some of these findings and conclusions, I think that one has to face the study of this report with a certain amount of scepticism. For my part, I express the concern that I have to do that. Senator Sir John Carrick —Mr Deputy President, I seek leave to make a statement. The DEPUTY PRESIDENT —Is leave granted? Senator Grimes —We have an arrangement on this, Senator. Senator Watson —This is not an executive; it is a parliament. Senator Grimes —If the Opposition is going to carry on like that, leave is not granted. The DEPUTY PRESIDENT —Is leave granted? Senator Grimes —No. Senator Chipp —I take a point of order. In view of Senator Sir John Carrick's massive involvement in this matter, would it not be reasonable to give him five minutes? The DEPUTY PRESIDENT —Order! It is in the hands of the Senate. Is leave granted? Senator Grimes —No. We came to agreements. I am sorry. The DEPUTY PRESIDENT —I draw the attention of honourable senators to the fact that a motion has been moved to debate this report later. Anything done now must be done by leave. Senator SANDERS(Tasmania) —by leave-First of all, I wish to express my appreciation, and I think the appreciation of all honourable senators in this place, to the staff of the Royal Commission into British Nuclear Tests and the Royal Commissioner himself on the production of a very valuable work which will lay the foundation for a number of very interesting studies into the effects of nuclear testing. Having said that, I go on to address the report itself and point out that it is a perfect example of the dangers of the great and powerful friend syndrome. Our great and powerful friend at the time the atomic testing program was going on was Britain, a former colonial master. We were led to support its testing program against the best interests of Australia and indeed against the doubts of many Australian scientists because of our overwhelming support for Britain itself. History, in the form of this report, should teach us the folly of pandering to overseas interests and putting them ahead of the interests of Australians. I point out that the nuclear damage from our present United States involvement could far exceed anything that has happened in any previous testing program. In looking through the conclusions and recommendations, I find over and over again a reference to the role of Sir Ernest Titterton in this program. Sir Ernest Titterton was and is a very well-known atomic scientist. The Royal Commission found that he was very closely allied to the British Government in these tests, often to the detriment of Australia. Over and over again, as we look through the conclusions, we find that he has been criticised for withholding information, for manipulating information, for controlling information which would alarm not only the populace but also scientists in Australia. On page 8 of the report, under the heading `Conclusions', it is stated: Bearing in mind that the yield given in the planning document was about half that of the actual Totem explosions, the categorical and all-embracing nature of the assurance of safety given by Martin and Titterton gave legitimacy to the Australian Government's decision to allow the tests to take place. So Sir Ernest Titteron was instrumental in the first instance in allowing the tests to go ahead. Page 10 of the report states: The Royal Commission considers that Titterton recommended to the Minister for Supply that the 1959 series of minor trials be approved by the Prime Minister, without prior consultation with the AWTSC. . . . Through his direct channel of communication with Titterton, Penney sought advice on the best way of gaining approval for the Vixen A extension of the 1959 series, including the burning of plutonium. I think Sir Ernest Titterton can be held almost personally responsible for much of what went on during this testing program and for the great suffering which has resulted from it. I advise honourable senators to get this report and to look at its conclusions and recommendations. I think they will find that, as Senator Durack has pointed out, it is very critical of Sir Ernest Titterton's role. Today Sir Ernest Titterton is still apologising for the atomic field. He is one of the foremost exponents of nuclear power in Australia-the so-called peaceful uses of nuclear power. He is at the forefront in trying to establish enrichment facilities, uranium mines and nuclear power plants in Australia. His advocacy of that course should be evaluated in terms of his previous activities, which led to a number of improper and unhealthy procedures in the nuclear testing program. I point out one thing in a general scientific philosophical sense. This report is a tremendous indication of the need for social responsibility in science. The original inventors of the atomic bomb have seen the error of their ways. They wish that they had used some control over their development. They did not and now the world is suffering. I urge all members of the scientific community-I count myself as one of them-to examine their goals and abandon any program, such as atomic weaponry, which would work to the detriment of society and humanity. I move on briefly to the recommendations, and I will take no more time than did Senator Durack. Senator Durack said that there was no increase in risk. Page 21 of the report, in reference to the Buffalo tests, states: . . . participation at the tests, including residence in the village during the Kite explosion, has increased the risk of cancer to those participants who were exposed to radiation. . . There is a recommendation that the burden of proof be shifted to the Commonwealth and that compensation should be paid. However, I point out that a very valuable, in fact essential document has not as yet been released to those veterans claiming compensation. That is a book called the blue book, which is a record of their radiation dosages. During these tests personnel on the site were issued with dosimeters, which were little badges with film strips in them, and records were kept of the amount of radiation they received. This information is absolutely necessary to veterans seeking compensation. Indeed, some have already died because of their exposure. These records are not forthcoming. The British Government claims that they are still classified militarily, after some three decades-which is absolute rubbish. They have been presented to the Australian Government. I urge the Australian Government to release that data to the veterans' organisations. Another argument is that medical confidentiality is involved. That argument can also be dismissed because the patients themselves are seeking the records. It seems criminal that these veterans who have suffered radiation exposure and all the hazards that come from radiation exposure, including the cancerous results and the passing of diseases to their offspring, are not able to request compensation because neither the Government of Great Britain, which has been seen to be culpable in this matter, nor the Government of Australia, which is claiming damages, sees fit to release this data which is necessary for the veterans to obtain compensation. I will conclude my remarks there, and at a later date I hope to continue them. Senator VALLENTINE(Western Australia) —by leave-The report of the Royal Commission into British Nuclear Tests in Australia confirms what Australians have long suspected-that the Australian land and the Australian people, particularly the Aboriginal people, were used in a most callous way by the British Government to suit its own interests. Information about the tests was withheld from the public, the media and even the Cabinet of the day in the initial stages. I quote from page 7 of the conclusions and recommendations of the report: The Australian Government was placed in a position where it was forced to accept UK assurances on the safety aspects of the test without any critical examination by its own scientists. It further states: There was virtually complete government control of the Australian media reporting of the Hurricane test and the lead-up to it, thus ensuring that the Australian news media reported only what the UK Government wished. There was no opportunity for the Australian public to have an understanding of the nature of the Hurricane test and so make any critical analysis of the conduct of it. This was to be a recurrent theme throughout the entire weapons testing program. I think that that is an indictment of both the Liberal Government of the day and the Government of the UK. The Australian Government agreed to make the mainland available with no independent advice or analysis, and little consideration or consultation. Federal Cabinet was not informed until the preparation of the Emu site was well under way. So, once again we have an example of the Australian people being used as a colonial client state in the most outrageous manner. People are still suffering from the effects of that high-handed attitude by the British Government and the grovelling subservience of the Australian government of the day. The Atomic Weapons Test Safety Committee was established late in the day but the membership of that Committee was vetted by the United Kingdom authorities. That is referred to on page 8 of the conclusions and recommendations of the report. Even when an Australian consultative committee was established, the membership of that committee was at the decision of the United Kingdom Goverment. There are many aspects of this report which call into question the whole decision-making process in the Australian Government. Right from the early 1950s secrecy has been very much a part of the whole nuclear scenario. The secrecy that surrounds all things nuclear in this country has continued from these testings right through to the agreements to establish United States bases on our soil, and now, the visitation of United States warships armed with nuclear weapons and powered by nuclear generators. It is very necessary for the Australian people to understand that some people are still suffering from the effects of these tests 30 years on, and that our land is still suffering. That applies particularly to the Aboriginal people and the service people who were involved. They were not adequately prepared for the dangers involved with the tests. They were told to turn their backs to the blast. How ridiculous, when the scientists who were conducting the tests knew very well that they were dealing with very dangerous materials although the general public may not have been aware of that fact. We must never allow the situation to occur again where our land and our people are used by another nation against our own interests. Uranium mining has many similar consequences on the land and the people, and we should end altogether Australia's involvement in the nuclear fuel cycle by putting an end to uranium mining in this country. Furthermore, as we continue to protest French testing in the Pacific, United States testing underground in the United States and also in the Pacific, and Chinese testing, we need to be mindful that the Soviet Union has undertaken a moratorium on all nuclear testing which it would be prepared to extend beyond the 1 January deadline if the United States Government reciprocated its initiative. Finally, I endorse the recommendation that some small part of the damage that has been incurred by the continent of Australia and its people could be undone by ensuring that the British Government undertake the clean-up and compensation requirements, and bear the costs. Senator HARRADINE(Tasmania) —I seek leave to make a short statement about this matter. Leave not granted. Consideration resumed from 4 December, on motion by Senator Gietzelt: That the Bill be now read a second time. Debate (on motion by Senator Grimes) adjourned. Consideration resumed from 4 December. TAXATION LAWS AMENDMENT BILL (No. 4) 1985 Clause 6 (Meals provided to clients, et cetera, in in-house dining facilities). Senator MESSNER(South Australia)(10.44) —There is a problem with the way in which this Bill is being handled. The Income Tax Assessment Amendment Bill (No. 2) 1985 has suddenly appeared on today's Notice Paper. In effect, that is a Bill to amend the Taxation Laws Amendment Bill (No. 4) so as to provide that water conservation expenses are spread over three years as opposed to the five years set down in the Taxation Laws Amendment Bill (No. 4). It would suit our purposes to effect passage of the Income Tax Assessment Amendment Bill (No. 2) so that we could then get on with an effective debate on the Taxation Laws Amendment Bill (No. 4) in respect of water conservation, which is still open for later debate. I am not sure how the procedure might be handled, but surely it would be more logical to proceed in that fashion. Senator GRIMES(Tasmania-Manager of Government Business)(10.45) —The difficulty I see with the procedure that Senate Messner is suggesting is that apart from the physical difficulty that we would have to come out of Committee, go back into the Senate and then come back into Committee again, if we did that we would in fact be amending a bit of legislation that we have not dealt with. That seems to me to be not a very sensible way to proceed. Although I claim no expertise is this area, it seems to me that the order as it is now is the sensible order. Senator SIDDONS(Victoria)(10.46) —Last night we were in the middle of discussing The Taxation Laws Amendment Bill (No. 4). It is a very important Bill. I believe we should continue with what we were doing last evening. The TEMPORARY CHAIRMAN(Senator Jones) —The Committee is debating clause 6 of the Taxation Laws Amendment Bill (No. 4). A motion would have to be passed to enable us to come out of Committee and to proceed in another manner. At the moment we are discussing clause 6. The question is that clause 6 stand as printed. Senator MESSNER(South Australia)(10.47) —Just to make the point clear, I am not trying to make a federal case out of this matter. It seems to me to be quite a reasonable proposition to debate the real point at issue-that is, whether we will oppose a clause in respect of a three-year write off of water conservation expenses or a five-year write off when it is plainly the Government's decision to change it from five years to three. It seems to me to be logical to arrange the business in such a way that we actually debate what we are meant to be debating rather than something that is presently in the Bill and obviously is not the Government's intention. The TEMPORARY CHAIRMAN —I am in the hands of the Committee. The Committee is dealing with clause 6. There is a motion before the Committee. I intend to deal with that. Senator VIGOR(South Australia)(10.48) —When the debate was interrupted last night I was in full flight on the matter of entertainment tax. I had stated that this tax was a tax which has been forced disproportionately on small business; that it falls on the hospitality industry which is a very important industry; that the tax would bite very widely and would affect our export industry, tourism, which currently earns around $1.5 billion in foreign exchange; that it would affect the wine industry which has experienced a 35 per cent fall off in bottled wine sales, which is having enormous effect on my own State; and that it would affect various industries such as the laundry industry, the taxi industry and the seafood industry and a vast number of areas within the community. The cost has not been properly considered by the Government. I wish to continue by pointing out that although the Government is claiming that $310m will be raised this year or $330m in a full year, independent estimates of the amount that will come in from clause 9 of the Taxation Laws Amendment Bill (No. 4) are $79m. These estimates appear to have more justification and to be more basic figures. This measure will affect all these industries. I do not believe the costs of unemployment and the suffering within the community have been taken into account. There are enormous tax avoidance rorts in the community which the Government has chosen to ignore and which should have been tackled. I would like to mention a few. There is the rort of transfer pricing which is indulged in by big business. This is one of the major concerns of the Taxation Office, as set out at page 45 of the annual report of the Commissioner of Taxation for 1984-85. In fact, the area of international business transactions is where most tax frauds are perpetrated. Many `honest' citizens are prepared to defraud governments in the name of their employer whereas they personally would consider such acts immoral. I wish that we could apply in all these matters the ability to pursue right into the organisations the people who actually make the decisions. The difficulty facing the Commissioner of Taxation in tracing such frauds with the current income tax laws is that proof of avoidance by the departments depends on co-operative investigations by overseas governments. A very simple amendment to the Act giving the Commissioner discretionary powers to assess and declare fair costs and prices would give the Commissioner of Taxation the teeth he requires. A number of other rorts of this type are in existence and any one of them could have raised much more money. In fact, according to estimates by Eric Risstrom, transfer pricing could have raised 10 times the amount of money proposed to be raised from the restaurant industry. An efficiency audit of the Taxation Office conducted by the Auditor-General highlighted another area, which was the non-declaration of interest earned as income. The Taxation Office, again in its latest report at pages 51 to 52, estimates the tax lost in this area to amount to $300m to $500m per annum. All of these are much more unacceptable rorts than the few `free' lunches which people may be having. Throwing away our international competitiveness in terms of negotiating international contracts in a way in which international people expect those contracts to be negotiated-with proper entertainment facilities-is really throwing out the baby with the bath water. There was a statement by the Trade Practices Commission in its 1984-85 annual report that it was finding the burden of paying for litigation against large multinational corporations more than the Australian Government could afford to pay. I believe that this is most disturbing and that that is why the small people are being hit in this type of tax, rather than the Government trying to tackle the problems with the big organisations. It is a fact that the large corporations have an annual turnover which in some cases exceeds the Australian gross national product and which makes it possible for them essentially to stand over our Government. Australian business already has much less protection against large corporations than that which exists in most member countries of the Organisation for Economic Co-operation and Development. We have very little protection against monopolies. We offer no support to the tourist industry and, what is more, the suppliers to the restaurant industry get no support either. This is really serious in the sense that we are willing to let big business get away with enormous tax rorts which cost the taxpayer almost 10 times the amount involved in this measure. We are willing to hit the small battler in the restaurant, the small businessman who cannot afford his own entertainment facilities within his company and the small Australian generally. That is why I support the Opposition's stand on this; that is, that we should simply have substantiation of these deductions. I take one small example in my State, and that is in the poultry industry. This is a very current matter. In South Australia the Manos poultry business is finding itself under attack on all fronts by the Inghams-Amatil conglomerate which controls 87.5 per cent of the meat bird market in Australia and 67 per cent of the South Australian market, where Manos holds 30 per cent. That attack is divided three ways, one of which is by Inghams-Amatil selling meat birds at very depressed prices in a market where it competes with Manos. In fact that company is using the Government's introduction of this tax to squeeze Manos because Manos has to compete in a market which has been depressed because this particular area, the broiler industry, has been hit by this tax-or at least that is the claim. The bigger company is also affecting Manos by restricting the sale of day-old chicks and by raising their price to increase the cost of production for Manos since day-old chicks are provided through the larger company. When the Trade Practices Commission feels itself unable to tackle such large corporations because of the high costs involved what chance have a small businessman and the Prices Surveillance Authority to do anything about it? The Government has actually created here new taxes which further increase the financial pressure on Australians and hence the pressure to cheat. I believe that we really have a problem in this case because what is happening is that all small business-- Senator Walters —I raise a point of order. We are dealing with clause 6. Is this at all associated with clause 6? I believe that this comes in a later clause. Senator VIGOR —The current clause deals with in-house entertainment and the flow-on to the poultry industry is, I believe, relevant in that case. I was not going to talk much further on clause 9. I am quite happy to continue my remarks at a later stage. However, I believe that it is extremely important to deal with this matter now. In order to expedite things I was trying to deal with both clauses, which are related, in my general remarks. But I am happy at this stage to say that I support the Opposition in opposing clause 6, which deals with in-house entertainment, and will continue my remarks when we deal with clause 9. Senator MICHAEL BAUME(New South Wales)(10.57) —I do not want to deal at this point with the general issues relating to entertainment expenses. It is obviously simply a device by which the Government can raise money out of this industry without having an impact on the consumer price index. In fact a more practical and sensible method of raising income from this industry, if the Government were honest, if it wished to raise money in this way or to save a negative tax element, would be to impose a service tax, but of course that would have an impact on the cost of living, and this Government is so keen to doctor the cost of living artificially down. Because of its embarrassment as a result of its incompetent economic management it will do anything to doctor the situation-even at the expense of destroying the viability of this industry. I want to talk about that in greater detail when we come to clause 9, which is the essential clause. However, this clause, which relates to deductions not allowable for entertainment expenses, in in-house dining facilities except for employees, is clearly discriminatory against small businessmen, as Senator Vigor said. Deductions will be available only for expenses on entertainment in-house at dining facilities for employees and, in particular, the facilities used must be wholly or principally for food and drink. The implications of this are simple. This measure discriminates in the first place against all self-employed persons, including sole traders or partnerships. I note in the definitions in a later clause that the word `employee' is defined to include a director. How about the Government getting off its tail and including self-employed people, partners and others in that definition? If that definition is supposed to extend from director to other such people, how about saying so? If it does not, will the Government get up and say: `No, we are determinedly and deliberately discriminating against self-employed people, partnerships or sole traders in this way.'? It seems to me that once again the Government does not know what it is doing. The simple and clear matter of principle is that surely the form of the operating entity, whether it be a partnership, a sole trader or a company, should not affect the tax deductibility of the expenditure. I know that that point has been raised with the Government. A well known firm of accountants has raised it. I would like to see a coherent response from the Government. The other point about discrimination, which is of some significance, relates to in-house dining facilities being made available only where those facilities are to be used wholly or principally for food and drinks for employees, which includes directors. Naturally only large businesses will have such a facility. For example, a board room/training room cannot be used for entertainment and a canteen may not be available. A small business might be able to afford a board room or a training room, but not a canteen as well. This seems to me to discriminate very significantly against small businesses. Obviously it is uneconomic to force a small business which seeks this deduction to have two such rooms-one a canteen and the other, for example, a training room. That simply lacks good business principles. The basic point is that, as usual, this Government is discriminating in this matter against the small Australian businessman. That is a pattern of behaviour we have seen through this Government's legislation for the last two and a half years. In conclusion, I raise the point made by Senator Vigor. How on earth the Government thinks it can police the situation is beyond me. Unless we get some clear indication from the Minister for Finance (Senator Walsh) about how he intends to police this effectively, I believe this is a nonsensical provision and one that certainly deserves rejection by the Opposition. Senator WALTERS(Tasmania)(11.03) —If dignitaries are being entertained by a Minister to a luncheon or a dinner, can the Minister at the table tell me who pays? If it is the Minister who pays, as I presume it would be, is he entitled to claim that as a tax deduction? As I understand it, in-house dining facilities are for employees only, not for clients or guests. Whether the Minister is entertaining in-house or in a restaurant, does he pay the bill? If so, is he entitled to claim that as a tax deduction? Senator WALSH(Western Australia-Minister for Finance)(11.04) —I do not know whether Senator Walters is talking about the existing arrangements. I do not know whether this applies in all cases, but normally when guests of the Government, other foreign visitors, or even in some cases domestic people are being entertained at a function by the Government, say at a dinner hosted by a Minister, the Department concerned pays the bill. I want to make a couple of other points. Senator Vigor made some ridiculous reference to a 35 per cent decline in bottled wine sales. I do not know from which unreliable source he obtained that figure, but information from the Australian Bureau of Statistics on sales of Australian wine in glass containers of one litre capacity and under, which are by definition bottled wine sales, shows that for the most recent month for which statistics are available, that is October 1985, sales were in fact marginally-about 1 1/2 per cent-higher than they were in October 1984. The figures also show that there was in fact-I would not suggest that this is a long term trend; I think it is a bit of a statistical quirk-an increase in sales of bottled dry red of about 25 per cent. Senator Michael Baume asserted that the tax on the free lunch levied on the supplier is a substitute for a services tax. That, of course, is patently untrue. A services tax would be applied to everybody who had a restaurant meal. This tax will apply only to those who provide the free lunch, to a very privileged minority which Senator Baume represents. I note the honourable senator's reference to the consumer price index. The policy which the discredited former Treasurer followed in government when Senator Baume was one of his advisers was to boost the CPI as much as he could. He was highly successful at that. He got it up to 11 1/2 per cent in his last disastrous year as Treasurer. I find it quite fitting that the debate on this particular rort should be led by a man like Senator Baume who a few years ago was writing prospectuses soliciting capital for shonky companies from gullible investors when he was a partner in Patrick Partners, a partner in a firm which was up to its ears in short selling and reckless speculation and which ultimately defaulted on its debts. Senator Messner —I take a point of order. There is absolutely no call for the Minister to launch into that kind of tirade, which has absolutely no relevance at all to the matter before the Chair. There is a very important question at issue in relation to this Bill. The Minister is just showing his extra sensitivity to the major points which the Opposition is seeking to bring forward. Nothing at all ought to be addressed against Senator Baume who, as a member of this place, deserves to be shown by all senators the honour and respect that we try to accord Government members. The TEMPORARY CHAIRMAN(Senator Jones) —There is no point of order but I ask the Minister to keep to the matter before the Chair. Senator WALSH —I have virtually finished my comments, Mr Chairman. I repeat: It is very fitting that the attack on this particular rort should be led on behalf of the Opposition by someone with Senator Baume's record in business. Senator WALTERS(Tasmania)(11.07) —The Minister for Finance has just told me that it is the taxpayer who pays when a Minister entertains dignitaries. Senator Walsh —No, that is not what I said. Senator WALTERS —The Minister did not just say: `Guests of the Government'. He very clearly added to that list. He has just told me that the taxpayers pay whenever a Minister entertains for business reasons. Can the Minister tell me who pays when shadow Ministers entertain in the same circumstances? Senator WALSH(Western Australia-Minister for Finance)(11.08) —I would not know. Senator Walters should find that out from her own Party. I do not know the sources of the Opposition's funds. I said that the normal practice was for the departments to pay for official entertainment-official entertainment being that which is recognised as being on behalf of not just the Government but the nation. There may be occasions on which individual Ministers pay for some entertaining. I have done it under particular circumstances which I do not intend to go into. It has not been claimed as a tax deduction. Under the new tax arrangements, any entertainment of that nature by a Minister in the future will not be allowable as a deduction either. Senator WALTERS(Tasmania)(11.09) —I can assure the Minister for Finance that shadow Ministers pay for entertainment out of their own pockets. However, to date they have been able to-- Senator Walsh —Yes, but how did it get into their pockets? Senator WALTERS —Mr Temporary Chairman, are you going to allow that sort of comment coming from the Minister? If so, I can assure the Minister-- The TEMPORARY CHAIRMAN —Order! I do not need any direction from Senator Walters. Senator WALTERS —I can assure you, Mr Temporary Chairman, that the Minister is going to find it very difficult to get his legislation through this place today if he is going to continue in that vein. Senator Walsh —Oh well, we will sit here on Christmas eve then. Senator WALTERS —I am very happy to sit till Christmas eve if the Minister is going to take that attitude. If the Minister will not be polite, and answer the questions that are rightfully put to him, he can sit there until New Year's eve. I again assure the Minister that there is no financial arrangement for shadow Ministers. They pay out of their own pockets. Until now they have been entitled to deduct such expenses as a very legitimate entertainment allowance because they have been conducting business with overseas dignitaries and official guests who enter this country. The Minister is now telling me, I presume, that the shadow Ministers are no longer entitled to entertain dignitaries or official guests of this country, but the Minister is able to do so. Can he tell me why the discrimination exists and what justification is there for it? Will the Minister answer the question? Senator Walsh —It is a silly question. There is nothing to answer. Senator MICHAEL BAUME(New South Wales)(11.11) —I had raised some serious questions, particularly one relating to definition, which the Minister has chosen not to answer. I do not expect him to answer difficult questions. All I expect from him is in fact what we got, which was a tirade of personal abuse to which I am accustomed. I assure the Minister that if he thinks he can intimidate me out of asking questions because I would be worried that he might open his vile mouth and pour out that nonsense again, he is wasting his time. He can keep it up. All I stress to him is this: Every time he fails to answer a proper question on a serious matter like this, by resorting to personal abuse, he simply diminishes his own stature and he certainly diminishes the stature of the position he occupies-hopefully temporarily-in this chamber. I simply ask the Minister: Does he intend to answer the question I asked about whether the definition of `employee' extends not only to directors but also to partners and self-employed? I wonder whether the Minister might also be kind enough, when he insists on continuing his personal abuse through the calls to order by the Chair, to provide me with a copy of that personal abuse as quickly as possible because unfortunately I cannot hear it. I may once again have the problem of having difficulty with the final Hansard record which may well not coincide with my recollection and the recollection of other senators of what actually happened. It is very difficult to respond to lies and deception from the Minister-and I use those words vigorously -when one cannot hear them because he talks continuously through calls to order from the Chair. It is a most improper practice. It is a deceitful and deceptive practice. It is a practice that is totally in keeping with the Minister's character. Senator Robert Ray —Mr Temporary Chairman, I raise a point of order. We are not involved in a debate on the Standing Orders or any other debate. If the honourable senator wants the Minister to withdraw, he can ask for that to be done. We are considering a Bill in Committee. If the Minister said something offensive, he should ask for it to be withdrawn. Senator Michael Baume —Mr Temporary Chairman, I take a point of order. My point of order is that I was complaining that what the Minister was saying was inaudible to me. I could not tell whether I could or should object. For the senator to come to the Minister's defence demeans the senator. Senator WALSH(Western Australia-Minister for Finance)(11.14) —I am quite happy to repeat what I said if Senator Baume did not hear it. I said that he was a partner in a firm which was up to its ears in short selling and reckless speculation and which had ultimately defaulted on its debts. That is what I said and that is what the record shows. In regard to the question that he asked about whether a sole trader will be affected by the provision in clause 6, the answer is that a sole trader was never entitled to obtain a deduction under section 51 for his own entertainment or his own dinner. So the sole trader will not be affected by it, because the sole trader was never entitled to claim a deduction. Senator Michael Baume —What about the partner? Senator WALSH —It is the same for partners. Senator PARER(Queensland)(11.15) —Clause 6 seems to me to be one of tokenism. I would like to give the Minister a couple of examples to which he might wish to reply. The problem I have with it is one of definition. An example would be, say, a construction site-this happens throughout Australia-where arrangements are made between the sub-contractors, who get meals in messes and canteens. I presume that under this definition, for every one of those meals provided, the taxpayer will have to include an amount of $30 in assessable income. The other example is in respect of visitors to companies, mines or whatever. I know that many people in this chamber have done that. It is not unusual to go to those places and be provided with a meal in a canteen. I would like to know whether under those circumstances the taxpayer will now be required to pay $30 for every one of those meals. The TEMPORARY CHAIRMAN(Senator Jones) —I call Senator Watson. Senator Parer —I did ask the Minister a question. The TEMPORARY CHAIRMAN —It is up to the Minister whether he decides to answer. Senator WALSH(Western Australia-Minister for Finance)(11.16) —I am willing to answer it. I inform Senator Parer that I am advised that in the circumstances which he outlined-I think his term was `visitors to construction sites'-the cost of providing the meal would not be allowable to the company. But it would not necessarily have $30 imputed as taxable income. The option would be available to impute the actual cost, which under the circumstances that he outlined, I would imagine, would be a good deal less than $30. Senator Parer —What about a sub-contractor? Senator WALSH —Subject to confirmation, I would expect the answer to be the same. In regard to visitors to a construction site who were provided with a meal in the canteen, the employer, contractor or sub-contractor-subject to confirmation-would have imputed as income a figure, but not necessarily $30. It could alternatively be the cost of the meal which under those circumstances would be a good deal less than $30, I would expect. Senator Messner —Is the cost deductible, though? Senator WALSH —No. Senator WATSON(Tasmania)(11.18) —I remind the Committee of a statement which was made by the Treasurer (Mr Keating) in his tax reform deliberations that there would be a disallowance across the board for entertainment expenses. Yet we find that the legislation provides for a number of exceptions. Therefore, I think there will be quite a spate of legal challenges. There will be many problems associated with this clause. I think this clause also is a manifestation of the fact that the Government likes to deal with big unions and big business, to the exclusion of small business, because the availability of deductibility for in-house dining and recreational facilities will be available only to those businessess which have the resources to cater adequately for their employees on their own premises. So it appears that the Government is totally unconcerned about small business, those businessess that are unable to provide the resources to give in-house dining facilities to their employees. I believe there is a discrimination between the benefits given to the private sector and the benefits given to the public sector. One has only to see the introduction dates for private sector fringe benefit taxation to see that there is a discrepancy of 9 months. One wonders whether government departments will be subject to fringe benefit taxation on expenses incurred by their employees after 1 July 1986, whereas this legislation, in relation to this clause, applies from 20 September 1985. Senator MESSNER(South Australia)(11.20) —I just want to go back to the point made by Senator Parer and to reiterate for the Minister's benefit that we are talking about a contractor or an operator at a mining site whose visitors have a meal in the in-house canteen dining facilities. The question that Senator Parer sought to ask, as I understand it, was whether, in the first place, the cost of that meal would be deductible, as it would be for any employee subject, as the Bill spells it out, to the imputation of the $30 amount being classed as income to the company, or whether it would be a double tax. Senator MICHAEL BAUME(New South Wales)(11.21) —I wish to pursue the question of whether partners in a partnership will receive a benefit, particularly in light of the Minister's comment that they are not in fact entitled to any deduction at present. As I understand the present arrangement, it seems that that is not the case. If partners in a partnership rather than directors of a company have in-house arrangements and use them, that expense should be deductible, as it would be if they were directors. I wonder how the Minister can distinguish between the role of partners in a partnership and directors of a company. Many of the legal firms in Sydney, for example, have a large number of partners and are employers of a large number of employees. Why should they be distinguished, and will the Minister-- Senator Watson —Is it a generic term or a specific legal term? Senator MICHAEL BAUME —That is a fair comment. The important question is this: Why does the Government seek to distinguish between partners in such situations who are employers and directors of corporations who are also employers? Unless the Government can clearly indicate why there should be such a distinction, I cannot see why we should accept Senator Walsh's assertion, which seems to be unreasonable, that partners are not and have not been subject to such a benefit. Senator WATSON(Tasmania)(11.23) —I support the comments made by Senator Michael Baume because in recent years partnership law has extended quite considerably the number of partners that may legally join a partnership. Previously there was a restriction of about 20, but now the permitted number has been lifted. Given the increased size, it seems fairly discretionary that the word `company' has been selected and has been interpreted in a legal sense rather than in a generic sense. I ask the Minister to give consideration to including significant partnerships under this definition. Senator WALSH(Western Australia-Minister for Finance)(11.24) —With regard to Senator Messner's point, if $30 or some lower figure related to the actual cost-this goes back to Senator Parer's question-is imputed as income, the cost of providing the meal will be allowed as a deduction. In other words, there is no double taxation. The other question was about directors and partners. If the point made by honourable senators opposite is valid, it applies with equal force to the existing law which has existed for as long as I am aware-that is, that partners at no stage could claim deductions for their own entertainment, lunches, dinners or whatever. Senator Michael Baume —But directors can. Senator WALSH —That is in the existing law. Directors could claim a deduction because in that case there was a separate legal entity-the company-and the `directors' were employees of the company. Senator PARER(Queensland)(11.25) —I wish to clarify something in my mind by asking a question of the Minister. I am not talking about visitors to sites. If an employer is engaged in an expansion, he has a choice. He can either use his own employees or subcontract. A subcontractor's job may be for six months or as long as 12 months. So to all intents and purposes the use of a subcontractor means that a man really has engaged de facto employees, but he has decided to choose that route rather than use his own people. Senator Robert Ray —For specific reasons, too, for which advantages accrue. Senator PARER —There could be a dozen reasons for his wanting to do it. I believe that this interpretation of clause 6 of the Bill cannot be the intent of the Government. It is almost as though it were drafted by some cloistered fools. If the employer's employees go to their canteen, that is okay, but if subcontractors go there-this is often arranged because messes and canteens already exist-there will be no deduction. This proposal will change the whole face of industry and will influence the thinking of people when they make decisions. I just do not understand it. Could the Minister explain it? Does the Government intend to amend this clause in some way to take account of what is general practice throughout Australia? Senator WALSH(Western Australia-Minister for Finance)(11.26) —I am waiting for some further advice on that question. I make the point that a subcontractor by definition cannot be an employee. If a subcontractor becomes an employee and is regarded by the taxation law as an employee, the payments from the prime contractor or the principal to the subcontractor would have to be subject to pay as you earn deductions, which they are not. As I understand it, and this is subject to confirmation and further advice from the advisers sitting beside me, in the circumstances the honourable senators outlined relating to a genuine subcontractor who would not be subject to withholding tax either, the subcontractor's employees would not have access to the dining facilities which may be available to the employees of the principal contractor or the principal firm. Senator Messner —That is absurd. Senator WALSH —Senator Messner may think it is absurd, but a subcontractor is a subcontractor and not an employee. Senator ARCHER(Tasmania)(11.27) —The Minister referred to an amount of $30 or some lesser sum. I am unable to find in the Bill reference to the lesser sum to which he referred. I ask him to tell me where it is, because I think it is important that we should know whether we are talking about $5 meals or $30 meals. Senator WALSH(Western Australia-Minister for Finance)(11.28) —It is either $30 imputed or the actual deduction claimed that will be denied. Senator Archer —Where does it say that? Senator WALSH —The Bill states implicity that those expenses are rendered ineligible for a deduction under section 51 of the principal Act. I refer to proposed new paragraph (b) of section 26AAAC (1). I am also advised that there is an election under section 51AE (5) (f) in the principal Act. Senator MICHAEL BAUME(New South Wales)(11.28) —Everything that we have heard in this last incredible half an hour demonstrates the nonsense involved in this kind of legislation and the absurd situations that develop the more governments interfere in such a ridiculous way in normal, long-established practices by introducing this kind of tax arrangement. It is an absolute nonsense. I remind the Minister of the reality of the meaning of the word `partnership'. As the Minister well knows, there are employee partners in many partnerships-people whose names are on a firm's letterhead, but who are in fact employees. Senator Walsh —You should know. Senator MICHAEL BAUME —The Minister well knows that I was an employee, even though he keeps making false accusations against me. He knows perfectly well that employees are classified as partners for letterhead purposes. Senator Robert Ray —Why do they do that? Senator MICHAEL BAUME —It is done because of the good name of the employees concerned. I thank Senator Robert Ray for giving me the opportunity to say so. That is a well known and widely established practice. Employees' names appear on lawyers' letterheads and accountants' letterheads. I raise the point that this once again confuses the situation or at least underlines another of the stupidities emerging in this legislation, where in directors may be classed as employees because there is a corporate structure but partners may not. Okay, that situation has existed for a long time, but this law will extend that situation in an absurd way. I take this opportunity to remind Senator Walsh that in the future when he seeks to blackguard me he might describe me accurately-not simply as a partner of a firm which failed 10 years ago-as a non-equity, non-owner employee partner. Senator WALTERS(Tasmania)(11.30) —I have two matters to raise. I will deal firstly with the matter I brought up previously, which the Minister refused to answer. Seeing he refused to answer it, I now ask him whether I am accurate when I say that the taxpayer pays for Government Ministers to entertain official guests, as he described them, but does not pay for shadow Ministers to entertain those same guests. Senator WALSH(Western Australia-Minister for Finance)(11.30) —That is the position now and, as far as I know, it has always been the position. Lots of facilities are available to Government Ministers which are not available to people who might hold equivalent positions in their own political parties-that is, shadow Ministers-when they are not in government. I suppose it is a bit hard for the Liberal Party of Australia to accept this, because it thinks it has some divine right to be in government. However, that has been the practice as long as I have been a Minister. Senator WALTERS(Tasmania)(11.31) —That has not always been the case, as the Minister well knows, because there has been a tax deduction for Opposition members. Now he is going to discriminate completely against the Opposition. It will be all very well for the Prime Minister (Mr Hawke) and the Ministers of the Government to entertain at the taxpayers' expense, but it will not be all right for anyone else. It seems to me to be very discriminatory. I now refer to the other matter, to which Senator Parer referred; that is, the contractors. Can the Minister explain how contractors, or a company, such as the Tasmanian Hydro-Electric Commission, which has its workers out in isolated areas, will say to its contractors: `I'm sorry, you are not allowed to use our canteen, only our employees can'. Can the Minister explain to me the sense of that arrangement and what will occur practically, on the ground, in that situation? Senator WATSON(Tasmania)(11.32) —I think Senator Parer referred to tokenism in relation to the problems associated with contractors working in remote areas. A number of these contractors employ a considerable number of casual employees and sub-contractors, and the sub-contractors employ a considerable number of employees. I ask: How will the Australian Taxation Office verify or police the numbers of people, who might be sub-contractors, who come in to the company canteen on any particular day? Forty people might come in one day and 10 might come in the next; it often depends on the vagaries of the weather. How does the Government intend to police this particular aspect? I think it is completely impractical. Senator ROBERT RAY(Victoria)(11.34) —I want to comment on Senator Walters's remarks about Opposition spokesmen and the position they are in. If Senator Walters has a concern with that, we have an appropriate mechanism. She can go to the Remuneration Tribunal and put in a submission to say that shadow Ministers should be allowed an allowance for entertainment-taxable, of course, the same as for the rest of the community. If Senator Walters has evidence of any cases of Government Ministers using an entertainment allowance for bogus entertainment, she should bring it up now; but of course she does not have that evidence. There is no difference between the level of Government entertainment now and the level under Senator Walters's Government in its 7 1/2 years and its previous 23 years. The one difference now-and we might have to review this-is our treatment of shadow Ministers in this Parliament. They get far better conditions now than any of our shadow Ministers used to get, and Senator Walters knows it. I think she is skating on very thin ice when she complains about the treatment of shadow Ministers now. Let them get up and complain if the conditions are not good enough. Senator WALTERS(Tasmania)(11.35) —It seems extraordinary to me that Senator Robert Ray would come into this chamber halfway through the debate and pretend to know what we are talking about. He obviously does not have a clue what I was referring to. I was not suggesting that Ministers are over-using. There was no suggestion of that. What I am saying is that Ministers, according to the Minister at the table, get all their entertainment paid by the taxpayer, but when this legislation comes in Opposition members will be unable to claim exactly the same type of entertainment as a tax deduction. That is what I am claiming, which the Minister has assured me is correct. Senator Ray has not understood the situation. I do not expect him to when he comes in halfway through the debate. Senator ROBERT RAY(Victoria)(11.36) —I have been listening to the debate. I did not make the sort of claim that Senator Walters said I made; I made a claim in relation to another point. It is not true that all money spent by Ministers on the entertainment of people from overseas, or other people, comes from the Government. I know that many Ministers dig into their own pockets to pay for much of the entertainment. When they do that in the future, none of that will be tax deductible. In fact, the people in the community who will be hit most by any of these tax measures are the Ministers. Given the way in which their salaries and allowances are made up, they will have to pay the most-far more than back benchers or any other section of the community-looking at it on the basis of percentage of disposable income. Senator MICHAEL BAUME(New South Wales)(11.38) —I want to comment on a response by Senator Walsh to a very sound point made by Senator Vigor. Senator Vigor expressed concern about the impact on the wine industry that would clearly and inevitably flow and is already flowing from this Government's attack on entertainment in general. The Minister quoted statistics of bottled wine sales as evidence of his claim that so far the Government's assaults by way of sales tax and so on have not damaged the wine industry. That is a nonsensical point, as the Minister knows perfectly well. He has the capacity to look at the discount sales, the extraordinary price cuts and the way in which wine companies have been cutting each other's throats to get rid of the stocks of wine they had because of the impact of this Government's anti-wine industry policy. There have been sales increases in volume terms in the wine industry; as the Minister pointed out, by an `enormous' 1 1/2 per cent. The Minister quoted the October figure, yet only a little while ago, when he defended his offensive wine tax, he talked about a much greater increase and how wonderfully well the wine industry was doing. The reality, as the Minister knows, as a result of this Government's action, which is the latest in a series of such actions, is that the wine industry has been put under intolerable pressure. There have been massive disposals at cut-throat prices. There will be continual forced mergers, people going broke and so on in the wine industry as a direct result of this Government's actions. For the Minister to defend those actions, on the basis of forced disposals at discount prices of wine stocks, shows the extent of deception he can enter into. Senator WALSH(Western Australia-Minister for Finance)(11.40) —On that last point, given that the Federal Treasurer of the Liberal Party of Australia, wearing his hat as Chairman of Carlton and United Breweries, is getting around lobbying for a heavier tax on wine, that is a question which the Liberal Party had better sort out internally. Senator Walters raised a question about sub-contractors at the Hydro-Electric Commission. This applies not only to the Hydro-Electric Commission but also to others. If the employees of such sub-contractors were to eat in the prime contractor's or the principal's canteen, the principal or prime contractor would have the option of charging the employees for that meal. Providing that charge fully covered the cost of providing the meal, the effect of that would be tax neutral. If there was a subsidy in it, to the extent that there was a subsidy, that would be disallowed through not completely allowing the cost of providing the meal as a deduction under section 51. Senator Watson asked-I presume this was a smart-Alick question-how the Government is going to police who goes into the canteen and how often. The Government is not going to police who goes into canteens. It draws attention to the fact-this is a fair enough point to make-that some of these provisions will not be easy to administer. What the Opposition would have us do is apply it right across the board to magnify a thousandfold the administrative difficulties because it argues that the legitimate business lunch should be allowed as a deduction and the rort should not be. It is precisely for the reason that battalions of bureaucrats would be required in the Australian Taxation Office to enforce the policy that the Opposition advocates that the Government has adopted the policy that it has. Senator WALTERS(Tasmania)(11.42) —The Minister has already said that there are legitimate lunches and he has been able to say that Ministers, of course, conduct legitimate lunches and that the taxpayer can pay for them. If it is so easy for him to decide that Ministers of the Government have legitimate lunches and he can identify those, why can he not also identify the ligitimate lunches of those who are out in the community? Senator MESSNER(South Australia)(11.43) —The last half hour has demonstrated the stupidity and the absurdity of this particular legislation. Certainly, we have found out now just how ill thought out the Government's approach to this particular piece of legislation has been. Quite obviously it is something that is going to become more and more important in the debate later on as we get down into some of the other sections concerning entertainment. At this stage I just rise to make the point that we will be opposing this clause, for obvious reasons. If we did not know it before-I had regarded it previously as a consequential matter-now that the clause has been explained by the Minister obviously it now stands to be defeated on its own merits or demerits. Question put: That the clause stand as printed. The Committee divided. (The Temporary Chairman-Senator J. Haines) Ayes . . . . . . . . . . . 38 Noes . . . . . . . . . . . 29 —— Majority . . . . . . . . . 9 —— Aulich, T. Harradine, B.Black, J. R. Jones, G. N.Bolkus, N. McIntosh, G. D. (Teller)Childs, B. K. McKiernan, J. P.Chipp, D. L. Macklin, M. J.Coates, J. Maguire, G. R.Colston, M. A. Mason, C. V. J.Cook, P. F. S. Morris, J.Cooney, B. Ray, RobertCrowley, R. A. Reynolds, M.Devlin, R. Richardson, G. F.Elstob, R. C. Robertson, E. A.Evans, Gareth Ryan, S. M.Foreman, D. J. Sanders, N. K.Georges, G. Sibraa, K. W.Gietzelt, A. T. Siddons, J. R.Giles, P. J. Tate, M. C.Grimes, D. J. Walsh, P. A.Haines, J. Zakharov, A. O. Archer, B. R. MacGibbon, D. J.Baume, Michael Messner, A. J.Baume, Peter Parer, W. R.Bjelke-Petersen, F. I. Puplick, C. J. G.Boswell, R. L. D. Rae, PeterBrownhill, D. G. C. Reid, M. E.Carrick, Sir John Sheil, G.Collard, S. J. Short, J. R.Crichton-Browne, N. A. Teague, B. C.Durack, P. D. Vanstone, A. E.Guilfoyle, Dame Margaret Vigor, D. B.Hamer, D. J. Walters, M. S.Kilgariff, B. F. (Teller) Watson, J. O. W.Knowles, S. C. Withers, R. G.Lewis, A. W. R. Coleman, R. N. Hill, R.McClelland, Douglas Townley, M.Button, J. N. Chaney, F. M. Question so resolved in the affirmative. Clauses 7 and 8-by leave-taken together, and agreed to. Clause 9. Senator ARCHER(Tasmania)(11.50) —Clause 9 is another of these areas that require a certain amount of exposure. I would like the Minister and the Australian Democrats to give the matter a little thought. Why are we attacking the private sector? Why are we attacking the business generation sector? Why are we attacking the sector of the community that at least is generating jobs? I thought that Senator Vigor-I give him credit for it-showed that very clearly. I hope he will be able to convince his colleagues what a good understanding he has of the subject, how much experience he has had and what a feeling he has for it. I have noticed that those who spoke most vehemently on this matter are, in the main, people who have had either no or very little experience in the areas where business needs to be done at all hours of the working day, and substantially that includes meal hours. I think all Government members would agree that not enough of them have occupied positions in management, sales, promotion, public relations and other areas where the use of every minute of the day is absolutely essential. As I identify it, there are 10 things that will arise from this piece of legislation: One, it will produce a push by the unions to get meals in their awards; two, it will require eating facilities in factories and offices Australia-wide-- Senator Robert Ray —I take a point of order. Madam Temporary Chairman, I think you are sitting in the wrong spot. The honourable senator is making a second reading speech. The TEMPORARY CHAIRMAN(Senator Haines) —Senator Archer, I ask you to confine your remarks to the clause at hand. Senator ARCHER —I am speaking to clause 9, Madam Temporary Chairman. Everybody but Senator Ray would understand that. Third, it will replace restaurant meals with office meals; four, it will transfer work from restaurant staff to office staff; five, it will reduce the viability and hence the availability of facilities to tourist and non-business customers; six, it will eliminate the opportunities for considerable part-time and full-time work; seven, it will create a farce in turning meal-times into seminar times; eight, it will merely change one method of claiming meal costs for another; nine, it will still rely on the Australian Taxation Office acting and using its powers provided by the legislation; and 10, the cost of administration, if ever it were dealt with, would be enormous. If we are to endeavour to do something that is reasonably fair and reasonably decent it has to be even-handed. We also ought to look at what will flow on from this legislation. If the Minister believes that there are sufficient areas of abuse that warrant this sort of attention, he will find that people who wear gum boots or wet weather gear or uniforms or protective clothing at work may also abuse the privilege and wear those things at home to do their gardening or to go fishing and so on. Does the Minister intend to eliminate those sorts of things also? It is absolute nonsense to implement provisions such as this. If the provisions of the existing Act were enforced by the slovenly people in the Taxation Office who are supposed to administer them, we would not need this type of legislation now. The rules have been adequately clear. The fact that the Taxation Office has seen fit not to use them is on its head, not on ours. Senator MICHAEL BAUME(New South Wales)(11.55) —Clause 9 proposes to insert new section 51AE in the principal Act to introduce a general prohibition on the deduction of entertainment expenses. The explanatory memorandum states: Under the existing law, losses or outgoings incurred in entertaining existing or prospective clients, business associates, employees, etc., may qualify for deduction provided the expenditure in question is incurred in the course of gaining or producing assessable income or is-- I stress the next word- necessarily incurred in carrying on a business for the purpose of gaining or producing such income. There is no doubt-the Opposition would not pretend to the contrary-that there has been abuse, and even large scale abuse, of the existing law. There is no doubt, as many Government senators have pointed out, that some people take their wives to dinner and do all sorts of non-productive entertaining, in commercial terms, which they falsely claim as business entertainment. Senator Archer —About which the Taxation Office does nothing. Senator MICHAEL BAUME —As the honourable senator says, frankly, the Taxation Office has the capacity to block that now. The law refers to `necessarily'-I stress that word-`incurred in carrying on a business for the purpose of gaining or producing such income'. Obviously, the word `necessarily' has not been adequately policed by the Tax Office. There may be difficulties, and that is one of the reasons why the Opposition is very keen to establish what is a proper guidance, a proper definition, if you like, of the sort of expense that should be deductible. The reality is this: In the earning of income there are many expenses necessarily incurred involving entertainment, and I stress the word `necessarily'. Yet this Government is saying publicly that it is too hard to fix up the tax law to cover this abuse. The Government says: `It is too hard to do it, therefore we will cancel everything'. Recognise this: One of the benefits that come to the Government from adopting this intellectually indolent approach is that it saves a lot more money. In other words, the Government receives a bonus payment for being dopy, for being indolent. The Government gets a bonus payment, if you like, for being deceptive to the extent that it is mounting a campaign against this kind of deduction, on the basis that it is abused, while totally ignoring the fact that there are genuine deductions, that there is expense that is necessarily incurred in the earning of income that it intends to ban in a discriminatory and offensive way affecting, of course, the business community, particularly the small business community, of this nation. It seems to me that if this Government were fair dinkum, if it were honest in its attacks on the abuse that has taken place, its No. 1 task would be to seek to eradicate the abuse without creating disruptions and dislocations in particular industries and the economy generally. The Government does not seek to do it honourably or properly. It seeks to save as much money as possible by destroying a particular industry and seriously denting the many associated industries without any concern whatsoever for the economic consequences and without any concern for the fact that it is breaching a reasonable and proper principle that has existed in the tax law for many years; that is, that expenses necessarily incurred should be proper deductions. We have not heard any justification from the Government for extending this legislation wider than to simply block the abuses, apart from the fact that it would be administratively difficult. We have heard that story before. The fact is that at the moment the Taxation Office is changing the administrative basis on which tax collections are made by, in fact, saying that it will have an audit system and that there will be self-assessment. If it is good enough for the Taxation Office to cope with its administrative difficulties in the area of income tax by adopting this approach, why can it not do the same sort of thing in this area of abuse? Why cannot it simply lift its penalties in this area, have audits in this area and put the people who abuse this kind of law at the same risk as it puts people who abuse the income tax law? The reality is this Government is simply out to make a quid and it will make a quid no matter what the impact is on this system. The fascinating thing about this matter is, as I have said, that the Treasurer (Mr Keating) has claimed that the only way to eradicate abuse is to disallow the whole operation. Senator Maguire —Hear, hear! Senator MICHAEL BAUME —I heard an honourable senator say `hear, hear!'. That sums up the mental capacity of this Government genuinely to seek solutions to a serious problem which will cause enormous unemployment-I take the points that Senator Vigor made last night and this morning-and cause disruption. It will be of major concern particularly to an industry-the entertainment industry-which this Government claims to be trying to encourage so that it can cope with an influx of tourism in Australia. There is no doubt that the further this Government kicks down our currency as a result of its incredible economic policies, the greater the opportunities should be for our tourist industry because it will be far cheaper for visitors from overseas to come to Australia. After all they will be able to convert their real money into the South Pacific peso, which is what the Australian dollar appears to be becoming under the policies of this Government. We have an industry which should be gearing up to cope with the influx of tourism that one of the Government's departments is endeavouring to encourage. Yet at the same time this Government is effectively destroying it and doing what it can to make it impossible for it to survive in an effective and widespread way, apart from the questions of employment, particularly the employment of young and relatively unskilled people in many aspects of the entertainment industry. There is no doubt that something has to be done and I encourage the Government to think seriously about the amendment that Senator Messner will move to this clause. There are many sub-clauses to this clause. I think it would probably be more appropriate to go into some of these matters later in the debate. I simply wanted to start debate on this clause by dramatising that there is a way of solving the problem and the Government has deliberately chosen not to take it. It has deliberately chosen to be disruptive and damaging to an industry in which many thousands of Australians are employed and many thousands of Australians are now put at risk. I hope that the Australian people recognise that the only reason clause 6 was passed-if the Committee passes this clause it will cause damage to the industries I have mentioned and to employment-was that the Australian Democrats decided to support the Government as the offset to a deal with it. It is vital to remember that the Australian Democrats are the reason clause 6 was passed. Senator Messner —Excluding Senator Vigor. Senator MICHAEL BAUME —Excluding Senator Vigor; I take the honourable senator's point. The Democrats are the people who have allowed this offensive Labor legislation to be passed. The whole world knows that this is Labor legislation but it is important that the people of Australia recognise that this Labor legislation would have failed but for the Australian Democrats. They are the people who are doing the destructive work; they are the people who are doing the work for the Labor Party in this area; they are the people who are refusing to accept the reality that there is a better way to solve this problem than the bone-headed, offensive but money raising, money-saving way the Government has set about. There is no doubt that the Government is in financial trouble. It does have financial difficulties; it has great budgetary problems and will have even more next year. That is why, in order to get himself out of its problem, it is seeking to attack with such vigour these industries that are providing so many jobs for so many Australians. Senator ELSTOB(South Australia)(12.05) —Members of the Australian Labor Party have been asked not to enter this debate but it has gone too far. The Opposition has shed crocodile tears. Perhaps I should not call honourable senators opposite the Opposition as they are fighting so much amongst themselves that they have left the opposition to the Australian Democrats. That is what has happened. Let us get down to the facts as to what is happening in the Australian community today. I know of a case where 20 people went to dinner and a doctor brought out a slip of paper and said: `Sign the doctor's certificate'. Senator Parer —Were you there? Senator ELSTOB —I was not there; the matter was reported to me. I was not given the names, otherwise I would report them. That is the type of abuse that is going on. One man abused him and walked out, saying: `I will never have anything to do with you again'. He told me that. That is the type of abuse that the wage and salary earners of this country have been paying for. They have paid up to $30 a week more than they should in taxation. The Opposition's crocodile tears are a disgrace. This abuse has been going on year after year. The people who get up, put their coat on and go to work every day and never get any thanks are the ones who have been overcharged in taxation. It is easy for the so-called Opposition to laugh and snigger. Certainly there will be little hiccups with any new legislation but the Government can adjust for those hiccups. The abuse of the system has gone on for far too long. Somebody has to pay taxation in this country. If it is not picked up by one person it must be picked up by another. I am sick and tired of sitting here hour after hour listening to abuses of the tax system. It is all right for the Opposition; it is not acting as an opposition. Honourable senators opposite are all fighting amongst themselves. They are not doing the work; it is being left to the Democrats. They should be called first at Question Time. They are the people who have done the opposing. Members of the Liberal-National parties are not worthy of being called the Opposition and I for one am not going to sit here any longer and listen to all the nonsense they have been carrying on with. It is a disgrace to the people who have worked in this country year after year and been exploited and overcharged with taxation. Honourable senators opposite have supported corrupt people, tax dodgers and exploiters while ordinary people have picked up the bill. It is a thorough disgrace. To say that the Government has done deals with the Democrats is a disgrace. They have acted as the official Opposition. Over the last few weeks I have been tempted to raise a point of order when honourable senators opposite have been called the Opposition as a courtesy. Members of the Liberal and National parties are no longer the Opposition. They fight continually amongst themselves and are not doing their work. The TEMPORARY CHAIRMAN(Senator Haines) —Order! I ask all honourable senators to remember that the question before the Committee is that clause 9 stand as printed. I ask all honourable senators to confine their remarks to the contents of clause 9. Senator SIDDONS(Victoria)(12.09) —I am impelled to draw the Committee's attention to the facts of what we are debating. If passed, the proposed amendment will have the effect of blocking this legislation. It is as simple as that. I ask Opposition senators what I asked them yesterday: Do they want to block the legislation and billions of dollars-worth of tax cuts for all Australians? Is that what they are about? If they vote for the amendment and get it carried, the whole tax reform package is blocked and goes out of the window, and with it goes billions of dollars-worth of tax cuts to all Australians. Opposition senators can talk forever. We are very happy to be here next week, and during January; so they can keep going; there is no problem. It is very easy to bounce up and down with all the little nit-picking points which all of us can dream up whilst on our feet without giving the matter much thought. The Australian Democrats are perfectly happy to debate this matter for as long as the Opposition wants. But let us let the people of Australia know what is going on. What is under debate is a proposed amendment which would have the effect of blocking the whole tax package. If that happens: No tax cuts. Senator MESSNER(South Australia)(12.11) —I move: (2) Clause 9, proposed new section 51AE, leave out the section, insert the following section: `51AE A deduction is not allowable under sub-section 51 (1) in respect of an entertainment expense incurred, except in respect of an entertainment expense which the Commissioner is reasonably satisfied is directly attributable to gaining or producing assessable income or directly attributable to the purpose of gaining or producing assessable income.'. I shall restate the amendment so that we know what we are talking about, and especially for Senator Elstob's benefit, because he has obviously missed the point entirely. The amendment states that a deduction for entertainment expenses: . . . is not allowable under sub-section 51 (1) in respect of an entertainment expense incurred, except in respect of an entertainment expense which the Commissioner is reasonably satisfied is directly attributable to gaining or producing assessable income or directly attributable to the purpose of gaining or producing assessable income. The point is quite clear. The Opposition does not support any abuse of entertainment expenses in any form whatsoever. The whole point of this amendment is to ensure that the only deductions that would be allowable for tax purposes for entertainment are in respect of legitimately incurred expenses that lead to the generation of assessable income. That clearly answers the point that Senator Elstob was trying to make during his tirade. All Government senators, even the Treasurer (Mr Keating) and even Senator Walsh in his saner moments-- Senator Puplick —Which saner moments? Senator MESSNER —There are not many of them-time and again have told us that there are expenses which are legitimately incurred in earning assessable income and that they should be allowed as a deduction. But then they go on to say: `We are not going to allow any expenses even though they are legitimately incurred, because we do not believe that we can control the situation'. Our amendment would give those who administer the law the framework and opportunity to be able to decide what kinds of expenses should be allowed, and it would leave the administration of that to the Commissioner of Taxation. That is the thrust of our amendment. That is precisely how the law ought to be administered. It ought to be simple and clear to people as to how they should incur expenses in the earning of income, so that they can make a decision on that basis and then claim them as a deduction. As to whether it is a properly incurred expense, it is the job of the Commissioner of Taxation to ensure that he is allowing only those deductions properly incurred, and that is the job of the advisers. Senator Maguire —That is a job creation scheme. Senator MESSNER —No; Senator Maguire does not have to take my word for it; he can take the Commissioner's word for it. He should look at the report of the Commissioner for Taxation for the last financial year. Next year, the Commissioner will introduce a new system of assessment called self-assessment. He will also set up more and more people to undertake checking procedures and audit in relation to the self-assessment procedures. This is going in precisely the opposite direction to what Senator Maguire and his Government are trying to put down here. I support what the Commissioner of Taxation is doing, as spelt out in his report, because that is the proper way to go in the administration of taxation law-not the confusion of stupid thoughts, the mishmash of a dog's breakfast, in this legislation. That is the point of the Opposition's amendment. We want to ensure that the legislation is proper and that people who properly incur expenses do so in the knowledge that, under the normal procedures of checking by the Commissioner of Taxation, they will be allowed expenses. There are many reasons other than those as to why the Opposition is taking such a strong stand on this matter, which is one of great principle. The Government would trivialise and has trivialised the argument by talking about whether people get a free lunch, and so on. That is not the question. What is at issue here is whether a government can tell people in what way they are to generate their own incomes. Having introduced this form of legislative control over tax deductions, where will the Government stop next? Perhaps next week it will introduce a prohibition on advertising. That expense, in the same way as any other expense, cannot be checked according to the Government's rules, and that would be in the same situation, because it may not be directly related to the generation of income. So it is with travel expenses. People who go to call on customers in order to generate income may not get an immediate response from that customer, but perhaps from a second or third call they may. Is the Government now going to disallow the cost of that first call? Is that the kind of thinking that runs in the back of the Government's mind? I am sure it is. So we can expect that this measure is merely the thin edge of the wedge as far as this kind of measure which the Government is proposing is concerned. Clause 9, of course, sets down the general provisions with regard to non-deductibility of entertainment expenses and is really quite confusing in many of the issues it raises. But I suppose that the most absurd provision of all is where it says that a deduction for entertainment will not be allowable except where that entertainment is made generally available to the public. In what way can that be related to the income generation of the business or of the taxpayer? I ask the Minister in what way he can relate the general principles of the tax law to that kind of proposition. It seems to me to be absurd that the exclusions in sub-section (d) (ii)-such people who cannot attract the entertainment deductions-are the very people who are most likely to generate income for the taxpayer. The exclusions are-would the Committee believe?-clients and customers. We can get a deduction for entertainment of the general public, but we cannot get a deduction for clients and customers-the very people upon whom we rely to generate income. How on earth can the Minister justify his position in relation to the general principles of the law? How can he answer that? The Government then says that journalists are to be excluded from the allowance of entertainment expenses. Surely, if a business is out to try and expand its capacity and its clientele, it needs the media to extend that idea across the community. Yet, we exclude the very people who can give businesses the opportunity of expanding their incomes, upon which they pay tax. It is just incongruous. It is totally ill thought-out and based on misunderstandings of the general principles of the law and has no relationship to proper thinking. The rest of this clause is shot through with that kind of stupidity. It is full of that kind of poor thinking, which is based on egalitarian thoughts of a confused mould. The Government obviously has no appreciation of just what it intends with this law. It has sought to use as a scapegoat one particular section of the economy because it believes that it can make out a political case against that group and make is sound plausible. That is the reason for the attack on entertainment expenses. That is why every day the Minister refers to the free lunch which, of course, is nothing of the kind and which is contributed to by the individual concerned; albeit a deduction is allowable. The Treasurer continually refers to entertainment as a tax shelter. Of course it is not a tax shelter. By the general principle of the tax law, what is deductible to one person is taxable to another. Entertainment falls exactly into that category, in that a deduction that might be allowable to a taxpayer would mean income to the restaurateur, the supplier of food or services, or the employee who works as a waitress in that restaurant. Obviously, there is no tax shelter at all involved in this. It is a normal commercial kind of operation where deductions are allowable on one side and income is assessed on the other. That is obviously, again, a total misunderstanding on the part of the Government of the general principles of taxation. The Opposition has moved an amendment to this clause. It now seems obvious that it will fail because only Senator Vigor of the Australian Democrats has the courage to face up to the real issues in this debate. I wish him well in his future political career. Senator Chipp —No one is frightened of you. You are the least frightening person in this place. Senator MESSNER —I thank Senator Chipp. The Democrats are supporting what is an oppressive, ill thought-out piece of legislation which has absolutely no basis when considered against the general principles of the tax law. Senator ROBERT RAY(Victoria)(12.22) —It is not surprising that we on the Government side will oppose Senator Messner's amendment because it would have the effect of virtually negating the whole Bill. I wish first of all to direct my remarks to the comments made by Senator Michael Baume who said that the whole blame for this clause and this Bill has to lie with the Australian Democrats. I want to share some of that blame. I am quite happy to do so. I am quite happy to say that in the factories and the hotels of this country the average person thinks that this is the greatest bit of legislation introduced. Those people who pull a pie and sauce out of a brown paper bag or have their fish and chips and vinegar, and pay for it themselves, think this legislation is terrific. They do not have quite the communication powers of the people who oppose this Bill and they do not have quite the lobby groups and pressure groups to put pressure on the weak individuals opposite to make them respond. I take full blame and full credit for this Bill-I am happy to do so-and, I am happy to say, so do a majority of Australians. The fact is that in regard to taxation the Australian Labor Party has been willing to take some tough options. We have not been willing to take all of them-I admit that-but we are willing to take some. Honourable senators opposite are willing to vote for tax cuts and for all sorts of benefits to the community, but they are not willing to support one new tax. If they are, let them say it here today. They oppose the capital gains tax and all sorts of new taxes, but they are very happy to see us give billions of dollars in tax cuts. How do they intend to balance the books? There has been only one occasion in this Parliament when the Liberal Party of Australia has said `We will show some guts over taxation'-that was in 1982-and what happened? The Party was in deep political trouble with bottom of the harbour schemes. Some-not all-honourable senators opposite voted for retrospective legislation. Some of them showed the guts to do that; then they showed no consistency from that point on. They will no longer support retrospective legislation. We have consistent members on this side of the chamber. We on our side have always voted for retrospective legislation. Some of the Democrats have always opposed it. They have always been consistent, but not the Liberal Party. The only time those opposite made a tough decision on tax was when they were in deep electoral trouble in 1982. Political amnesia has taken over since then. Opposition senators must know that the entertainment area is the fastest growing tax dodging area in this country. That is the problem. It is not only today's problem. It was the rate of growth of that problem that was going to blow out future Budgets. It is an area that just had to be clamped down upon. I think one point is forgotten by those opposite when they continually bleat about the effects of this legislation on the entertainment industry, particularly restaurants. Once the tax cuts come in, there will be a major increase in disposable income, and much of that disposable income will find its way into restaurants. It is clear from household surveys and other factors that when people get a higher income they tend to spend it on entertainment, restaurants and eating-all those sorts of areas. With the devaluation of the dollar and increased tourism to this country, people will again get a boost in this area. It is unsustainable to have an industry in this country that is reputedly solely based on some sort of a tax dodge. That being the case, if this clause goes down, this Bill will go down and many of the tax cuts that we are about to hand out in future years will go down. I want to end on one note. Senator Messner has pointed to one Democrat senator and talked about courage. I am not going to comment on his assessment of courage with regard to that individual, but where is the courage in the Opposition? Why does it not come out and tell us what its tax policies are going to be? In government it never showed any courage at all in relation to taxation, and those opposite know it. Every time Mr Howard came up with a tough decision-I will give him some credit; he rolled a lot into Cabinet, apparently-he was rolled straight back out. Honourable senators opposite should have a look at their own side before they talk about courage. Senator BOLKUS(South Australia)(12.27) —I wish to enter this debate very briefly. I do so to expose the amendment that has been moved by Senator Messner. It is no wonder that when the A team of the Opposition went to Adelaide last week to try to salvage whatever John Howard had ruined Senator Messner was left in Adelaide. Senator Walsh —Left in Canberra. Senator BOLKUS —Sorry, he was left in Canberra, perhaps due to excess luggage. When one compares the amendment moved by the Opposition with the current provisions of the legislation one finds what a fraud Senator Messner is trying to enforce upon the Australian Senate, the Australian Parliament and the Australian people. It is very easy for Senator Messner to say we should allow deductibility where `the Commissioner is reasonably satisfied that that expense is directly attributable to gaining or producing assessable income or directly attributable to the purpose of gaining or producing assessable income'. It sounds good, and it pleases his electorate, the whole five per cent of Australia's population. When we look at the current section 51 of the Income Tax Assessment Act, what do we find? We find precisely the same words. We find that Senator Messner has lifted out of current legislation precisely the same words. No wounder he is a failed accountant chased out of Adelaide! Let us look at section 51 of the Income Tax Assessment Act as it now applies. It states: All losses and outgoings to the extent to which they are incurred in gaining or producing the assessable income, or are necessarily incurred in carrying on a business for the purpose of gaining or producing such income . . . The terminology is the same. One or two words may be different, but the terminology is the same. That exposes what is going on here today. The Opposition, trying to perpetrate a fraud on the Australian electorate, is putting up what seems to be a palatable and acceptable provision, but it means nothing. It is no wonder that within a short period Senator Michael Buame will be sitting on the front bench in place of Senator Messner. We have had a good look at the Opposition's amendment and we have seen what sort of a fraud it is. There is only one way in which the Messner proposals can be enforced to a greater extent that the law is now. At the moment it is just unenforceable. Senator Messner, in government, would have to enlist a whole band of restaurant sniffers, people who went around restaurants checking people out. That is the only way Senator Messner would be able to enforce this proposal. Senator Maguire —A great job creation scheme. Senator BOLKUS —It is a great job creation scheme, as Senator Maguire interjects. In essence, we are dealing with a sham that is intended to perpetuate a rort, which, as Senator Robert Ray mentioned, is the fastest growing rort in the Australian taxation system and one which at the moment is enjoyed by less than 5 per cent of the Australian population. I hope that the Committee can see this provision for the fraud that it is. In closing, I for one will probably be gratified if some more vitality is produced on the Opposition front bench when the change is made. Senator WATSON(Tasmania)(12.31) —I support the amendment which has been moved by my colleague Senator Messner. The Government very conveniently overlooks the fact that the coalition-the Liberal-National parties-supports the Government's objective of eliminating abuse of business meals and entertainment, but it strongly believes that there are workable alternatives-this is the crux of it-available to the Government which would not have the same disastrous effects or consequences that are involved in the Government's plan. We believe that abuse can be eliminated by strict substantiation provisions. The Government has already indicated that it would regard such expenses at seminars, canteens and boardrooms as being acceptable for deduction. I ask: Why discriminate? Large business can use the substitutes through advertising. Again, why discriminate? I remind the Committee of the words of John Stone when he commented on the Government's attempts to sell the new meal tax. He stated that they are `a model of how to write propaganda for an otherwise largely empty case'. The Government's real motive might be confusing, but its effects are clear-it will strike against small business and jobs and it will strike against the Australian Workers Union members working out in the bush on construction sites. This Government has attempted to push it all on to big business and abuses of the system. The Government has acknowledged that there are problems. Senator Elstob has said that they will be patched up or fixed up later on. Now is the time to fix them up before the employees, the members of the AWU who are working out in the bush on construction sites, are victimised by this legislation and by the proposed new section that is under debate today. Despite the volume of the legislation-it goes to over 100 pages-Australian taxpayers have not been given a clear definition of what entertainment is. Some weeks ago the Treasurer (Mr Keating) made a pathetic attempt. I think he explained in the Parliament that entertainment is about purpose and circumstances. That does not go very far in defining what entertainment is. The legislation should tell us what entertainment is all about-it should define it. How is the business community to work out what is entertainment if the Government, the parliamentary draftsmen and the Treasurer are unable to put into effect what they mean by the word `entertainment'? Let them define it. Let us have some clear legislation so that businesses can know what it is all about-legislation that does not victimise some of the poorer sections of the community, those who are outside the pubs of this town, as Senator Robert Ray mentioned, those who are working on construction sites for subcontractors in the bush. Senator MESSNER(South Australia)(12.34) —Mr Temporary Chairman-- Senator Chipp —Haven't you had a fair go? Senator MESSNER —I think Senator Chipp and I had better go outside for a while. The Minister for Finance (Senator Walsh) is about to respond to this point. I did not think he was going to respond, but if there is a reasonable chance of getting this legislation through by lunch time I am prepared to give way to him to hear his reply. I just want to make one point about Senator Bolkus and his remarks. It is pretty clear that he has absolutely misread proposed new section 51AE as contained in the Taxation Laws Amendment Bill (No. 4). There is no reference in that to deduction of expenses which are directly attributable to the production of income. That is not in that section at all. The point of this amendment is to provide for deduction of entertainment expenses. That is the fundamental misunderstanding which Senator Bolkus has. One has to appreciate that Senator Bolkus is capable of misunderstanding a lot of things, as he misunderstands laws about telephones from time to time, as I understand it. That is likely to lead, I would think, to quite definite problems in the Committee if people can be misled in the way he has put his argument. I repeat that the Opposition's position is simple. We do not stand for the abuse of entertainment expenses at all. The purpose of our amendment is to provide that only properly incurred and legitimate expenses can be deducted against the production of assessable income. That is the purpose of this amendment. It is not the purpose of this Opposition to drive a cart and horse through the proposed legislation, but rather to provide the legislative framework for the Commissioner of Taxation to administer the entertainment expense deduction in a reasonable and proper manner so that legitimate expenses can be allowed against assessable income. Senator WALSH(Western Australia-Minister for Finance)(12.27) —I shall be brief. The rationale for this amendment is the Opposition's claim that expenditure incurred necessarily in the earning of income must be deductible from taxable income. It is acknowledged even by the Opposition that a great deal, I will not try to quantify it, implicitly a majority-our belief is that it is an overwhelming majority-of entertainment expenses for which deductions are presently claimed are not necessarily incurred in the earning of income at all. As Senator Robert Ray has said, this is a gigantic rort. The Opposition acknowledges that, to a significant degree, it is a rort. However, the Opposition claims that the legitimate expense incurred in the earning of income should continue to be allowed and elevates that proposition to a high moral principle-a moral principle, albeit, which is applied very selectively. If the Opposition seriously supported the principle that expenditure necessarily incurred in the earning of income must be deductible from taxable income, it would be moving an amendment to allow travel-to-work expenses as expenses which are deductible from taxable income. It never suggested that when in government; it is not suggesting it in opposition. The reason, of course, is not hard to see. The free lunch is the indulgence of a privileged minority. Travelling to work is an expense incurred by almost everybody who has an income. The Opposition stands here to protect the indulgences of the privileged minorities while ignoring the needs of the great majority. Like Senator Robert Ray, I want to share with the Democrats what the Opposition calls the blame for this legislation because, like Senator Ray, I have found that out there in the community in general the public thinks this legislation is great. The public knows that this is a long standing rort, rapidly expanding, which must be closed off, and this legislation will close it off. Self-indulgent and self-interested bleating is always cosmetically more acceptable if it is disguised as concern about somebody else's job and somebody else's welfare, which is precisely the way in which it has been disguised by the Opposition. The alleged effects on the restaurant industry are flatly contradicted by the October employment statistics issued by the Commonwealth Employment Service. I have one final point: For an Opposition which habitually proclaims that the paramount principle in taxation law should be certainty before the law, I find it incongruous, to say the least, that it moves an amendment which contains words such as `which the Commission is reasonably satisfied'. On the one hand we have this alleged commitment to certainty before the law and on the other hand the use of such loose language as `which the Commissioner is reasonably satisfied'. The Commissioner would have to make an entirely subjective judgment in a myr- iad of cases and decisions, exercising his discretion in ways that the wisest and most honest Commissioner of Taxation-I am not suggesting that any Commissioner of Taxation has ever been less than honest-could never adequately discharge. The policy adopted by the Government is that it is known that overwhelmingly this section has been abused. It is a rort. It is also known that the amendment put up by the Opposition is not administratively feasible, nor would it make good taxation law. The preferred option is to close the whole rort entirely in one clean hit now and finish it off for good. The amendment proposed by the Opposition would maintain the rort in perpetuity. Senator VIGOR(South Australia)(12.41) —I intend to support the Opposition's amendment. Undoubtedly, as Senator Walsh has said, there have been a number of misuses of entertainment provisions in the past, yet I believe that it is not the small businessman who has been misusing this provision. Small business in Australia works very hard against great disadvantages and, in particular, the high interest rates it must pay on its capital operating finance. There is no margin for rorts in small business. Where there are rorts the problems can be solved by giving the Australian Taxation Office the right to require substantiation of claims for these types of expenses. I support the Opposition's amendment because it moves towards that basis. There was the chance earlier that my colleagues might have supported me. I supported this stance within my party room and feel that I cannot go forward now into the Committee and support the legislation, which frankly I believe will not work. The Government is actually creating new taxes which further increase the financial pressure on Australian small business and also the pressure to cheat. Exactly the same arguments as Senator Walsh made against the amendment hold against the clause the Government has proposed. The alternative to business submitting to the provisions of this clause when it finds its competitive edge eroded is to join the underground economy and to pay cash for things. I believe that the Government will lose much more money through that type of rort than it will through the one which it claims currently exists. Any tax which pushes honest Australians with initiative into dishonest practices is a bad tax. This is really a very important problem for Australia. If we are going to force small individuals into the cash economy we will have real problems. I wish to come back to the problem of the Government citing figures at us to try to justify its case. It has been doing that to the Democrats party room and my colleagues believe in those figures. I must say that I do not. Today Senator Walsh called into question figures I have obtained from the Parliamentary Library and from personal research within the industry. I have, in fact, checked the figures that Senator Walsh put up against me and said did not illustrate my point. The Bureau of Statistics says, under the category for sales and stocks of Australian wine and brandy, that overall sales for July to October 1985-86 total 110.8 million litres and for July to October 1984-85, 111.5 million litres. I am informed that they are the latest figures available, unless Senator Walsh in his position of Minister for Finance or somebody else has later figures, which I would be delighted to have. There is a decline of less than one per cent in that period. However the tax was obtained for only about one-tenth of the total period covered by those figures. I conclude these remarks by saying that I believe the Government presents rubbery figures in this particular case, and I will be continuing my remarks on that subject. Progress reported. Motion (by Senator Grimes) agreed to: That, unless otherwise ordered, until 2 p.m. this day, matters of public interest may be discussed by senators, provided that no senator shall speak for more than 15 minutes. Senator COLSTON(Queensland)(12.47) —I wish to use this opportunity to raise a matter which is disturbing to me as a senator for Queensland. Certain information has been provided to me by the Royal Queensland Theatre Company. It appears from a letter I have received that Queensland is being short-changed in funds for theatre in education projects. The letter I have received outlines the excellent work being carried out by Roadwork, the theatre in education team in Queensland. All of the letter is pertinent; therefore, I would like to read it to the Senate. It reads thus: Dear Senator Colston, The first activity the RQTC ever presented when it began operations in 1970 was a Secondary Schools Company with a programme designed to tour schools throughout the State. This was a deliberate decision to emphasise the importance the Company placed (and places) on Theatre-in-Education. In subsequent years we have improved and enlarged this aspect of our work. We now call our TIE Team ROADWORK, which comprises a Secondary Schools and a Primary Schools Company. Both companies tour schools throughout Queensland. We have for the past 15 years run two residential training courses for Secondary School students: the Theatre Experience and Theatre Techniques Weeks. In 1983 we inaugurated the Queensland Youth Theatre which services young people in the metropolitan area of Brisbane, and this activity continues to flourish. In order to keep admission prices to ROADWORK as low as possible, we have used monies from the subvention granted to us by the Queensland State Government and from the Theatre Board of the Australia Council. In the latter case a proportion of these funds was always specially `ear-marked` for our TIE activity. In 1984 the Theatre Board withdrew funding for ROADWORK. We believed the decision to be a bad one and wrong for a number of specific reasons, so we asked the Theatre Board to review the decision. This request was granted, but in the event the same decision was reached: no funding. We then appealed to the Australia Council itself who overturned the Theatre Board's decision and funding for ROADWORK in 1985 was restored. 1985 also saw the introduction of ceiling funding for theatre companies by the Theatre Board. Such ceilinged funds are designed to cover Main House activities only. Thus funding for TIE in 1986 comes under Special Projects and is the subject of a separate submission for subvention. Our submission for Roadwork in 1986 was once again refused by the Theatre Board. In fourteen years our TIE company has performed to more than 1 1/2 million children in an area nearly one quarter the size of the Australian Continent. The Theatre Board's decision to deprive Queensland students of a theatrical experience which is culturally enriching and which builds our audience for the future is reprehensible. It is all the more iniquitous that when the interest in theatre studies in schools is rapidly increasing. In 1979 427 students enrolled for Speech and Drama at Board level. In 1985 this figure had grown to 10,390, an increase of 2,033.5 per cent. In 1983 Production and Performance was registered with the Board and two years later there are over 60 schools including it in their syllabi. When we include Theatre which is also a Board subject the total number of students studying courses related to the work of Roadwork is 13,305, which is 19 per cent of the total student population of Queensland. It is worth drawing attention to the fact that the Theatre Board acknowledges that Queensland receives less than an equitable amount of its project funds and is seeking ways to redress this situation. ROADWORK is the only TIE Team in Queensland. It would appear that we have been refused funding so that smaller States with more numerous TIE companies can have their funding increased. It would be interesting to have comparative breakdowns of monies spent on TIE and youth activities in Queensland against those spent in other States. We recognise that in support of the `arms length' funding principle we cannot ask you to intervene on our behalf, but we bring this matter to your attention because the school students in your electorate are being disadvantaged by the Theatre Board's decision. We shall do our utmost to find the necessary funds to continue with ROADWORK in 1986 but if we are not successful we shall have to truncate this valuable and valued service to the students of Queensland. With all good wishes, Sincerely, Alan Edwards, Director Mr Acting Deputy President, there are questions raised by this letter which must be given prompt answers, and I ask the Minister for Arts, Heritage and Environment, Mr Cohen, to provide answers as soon as he can. Firstly, has the Theatre Board acknowledged that Queensland does receive less than an equitable amount of project funds? Secondly, what is being done to redress this situation? Thirdly, has Roadwork been refused funding so that smaller States with more numerous theatre in education companies can have their funding increased? Finally, can comparative breakdowns be given, as outlined in Mr Edwards's letter? If they cannot, I would like to know why not. This matter is an important one for Queensland and, again, I ask for a prompt reply from the Minister concerned, Mr Cohen. Senator MASON(New South Wales)(12.58) —Mr Acting Deputy President, I do not want this parliamentary session to end without expressing my concern and disappointment at the failure of the Northern Territory Government to release Mrs Lindy Chamberlain on licence pending an independent judicial inquiry into the new evidence in the case. That decision was based on a report on the matter prepared by the Northern Territory Solicitor-General, Mr Brian Martin. That report is already attracting widespread criticism for its inaccuracy, bias and general failure to address the issues raised, and I predict that over the next few weeks criticism of it will become more general and comprehensive throughout the community and especially throughout the legal community. It is interesting to note that most of the criticism now is not coming from the Chamberlain defence but from independent legal authorities and scientific people, and the information I get is that many groups are now working on an overall critique of the Martin report. The Chamberlain defence itself, of course, is preparing a rebuttal in detail which will be available to all honourable senators within another month or so. Senator Puplick —Will you send it to all senators? Senator MASON —I will make sure that all senators get a copy of it, Senator Puplick; that is vital. Already the report is attracting criticism from a key scientific personality in the matter-Dr Siegfried Baudner of the German firm Beringwerke, the makers of the blood testing reagent that occupies such a key position in the disputed Chamberlain evidence. The Northern Territory Solicitor-General, Mr Martin, and Dr Simon Baxter went to Germany to talk to Dr Baudner earlier this year. Dr Baudner, in contrast to what Mr Martin says in his report, believes that the information he gave them should have led to a re-opening of the Chamberlain case and he has expressed his deep concern. He is quoted in yesterdays Melbourne Age as saying: I had the feeling the test is very problematic and that there would be a reopening of the case. Dr Baudner feels so strongly about the matter that he is reported by the Age as saying that he is prepared to come to Australia to discuss it further in a proper scientific setting, and of course what he does say should be said in an open judicial inquiry so that the community knows what is going on in this matter. Another development of some importance is a signed statement by the seven crown witnesses, the people who were actually at Ayers Rock when the baby Azaria disappeared and whose testimony is plainly crucial and was crucial to the crown case in every possible respect. All seven of these people-Max and Amy Whittaker, Gregory and Sally Lowe, Rosalie Whittaker and J. and W. J. West-signed the following statement late last month: We, the undersigned, who were present at Ayers Rock camping ground the night Azaria Chamberlain disappeared, know that Mrs Lindy Chamberlain had no opportunity to commit the alleged homicide for which she is now serving a life sentence in Berrimah Jail, Darwin. Though we were Crown witnesses at the trial, we feel insufficient weight was given to our evidence, and all of our evidence was not elicited. We demand, therefore, that there be an unfettered judicial review of this terrible miscarriage of justice. How can anybody discount that statement by the witnesses, signed and that they are prepared to swear to, that in fact their evidence was not properly elicited and that a lot of their evidence was ignored. How can anybody claim that there is any sense in that? We can only look withsome sympathy at their demand that there be an unfettered judicial review of this terrible miscarriage of justice. In the light of this kind of situation the failure of the Northern Territory to undertake anything other than secret inquiries into the Chamberlain case becomes more and more mysterious and less and less easy to justify on any basis whatsoever. Why then is this apparent cover-up being maintained? Some of the thousands of letters I have had on this case shed possible light on this. Up until now I have held my hand in this matter but I think it is reasonable at this stage to say that in particular one I received quite recently has given me the gravest cause for uneasiness because it indicates that evidence would be available from a person in a key position in the Northern Territory Public Service at the time of the Chamberlain affair. I make no judgments on the statements in the letter other than that the person, who does not wish to be named but whose identity I know and who seems to be of quite respectable background, claims: What was in the files was `absolute dynamite' to the top administrators at the time. Mr Acting Deputy President, I make no comment on that other than to say that if that sort of evidence is available it should be made to an open inquiry. Senator Gareth Evans —It is just irresponsible to say that without giving chapter and verse. That could mean anything. Senator MASON —The honourable senator is not listening to me. I have said that I make no comment on that other than to say that if that sort of evidence is available it should be given to an open inquiry. Would he dispute that statement? Senator Gareth Evans —Don't set hares running unless you are prepared to give substance to them. Senator MASON —Senator Evans was Attorney-General here not long ago. His attitudes on this matter astounds me. Senator Gareth Evans —You are the worst enemy the Chamberlains could possibly have at the moment, the way you are conducting yourself in this matter. It is just incredibly counterproductive. Wake up to yourself. Senator MASON —That would probably be one of the most hotly disputed statements the Minister could make; however, that aside, I hope we can keep this matter apart from the area of personal attack. I am surprised to have got such an attack from the Minister in connection with this matter. To my mind that open inquiry is absolutely necessary and I shall continue to press for it. Last week I sent a circular to all senators and members of Parliament, in good conscience and I hope above any party political considerations, asking whether or not, if a conscience vote were available-and it is disgraceful that parties here have decided there should not be a con- science vote-they would vote for a federal inquiry. So far I have had 48 responses, and more are coming in every day. Of those a small majority-25 to 23 at this stage-would vote for an inquiry. I regard that as a degree of concern within this Parliament which is significant and important and I give credit to those people who feel that there is reason to get this out of the closed offices of public servants in Darwin. That is where the inquiry has been carried out, with all respect to Mr Martin; it was a secret inquiry made in a public servant's office in Darwin, and that is not adequate. I know that many people here feel that the Chamberlain case has dragged on long enough and they are not willing to give it their attention. With all respect, I urge any of my colleagues who might be in that category-I do not think there are very many-not to underrate the importance of the matter and especially the enormous underlying issue. We are in this place as members of parliament and I think we have a plain duty to maintain a fair and just law. The making of law is our business; surely whether that law is fair and just is our responsibility. Can we allow a situation to continue and let such a wide range of expert legal opinion and such a large section of the community believe that government in one way or another is failing in its duty to provide simple justice to all of our people? If we allow that impression to continue and to grow it must lead to a widespread loss of respect for the processes of law which I suggest is intolerable in any decent society. I had a letter only this morning from a lady in Queensland-it is so typical of the many letters that are coming in-that says some things that I will quote because I feel that they do indicate the community's feelings on the matter. This lady says: We the people change governments but still the bureaucrats are the same and refuse the parliamentarians any say. We the people no longer govern the country. Unless the Government of the day can say to the bureaucrats that the people want a further inquiry into the Chamberlain case, we are a banana republic. No longer are we governed by the people, for the people. One might think that is simplistic and naive, but it is not. It is an indictment of those who think they know best in this matter and who think, for whatever reasons, that it is perfectly all right for Mrs Chamberlain to stay in gaol, whether or not there is new evidence and for any amount of time to drag by without anything being done about it. Mr Deputy President, I ask honourable senators, through you, to consider this matter carefully over the Christmas period so that we can look at it again. I assure you that I will be bringing forward my Bill again in February and I will continue to bring it forward as long as I am in this place and as long as the Chamberlain matter is not resolved. Senator KILGARIFF(Northern Territory)(1.02) —Recently an article published in the Bulletin gave details of Soviet testing of nuclear weapons near Midway Island late last year. The article, entitled `Peacenicks silent as Soviets test super missiles in the Pacific', was written by Dr Leslie Kemney, a senior lecturer at the School of Nuclear Engineering at the University of New South Wales. Dr Kemney states that since 1969 the Soviets have regularly tested nuclear-capable weapons in our region. He says that the Defence Department confirmed recent tests, occurring on 10 and 11 July, 8 and 9 August and 6, 17, 18 and 25 December, 1984. Missiles tested included the huge multi-warhead SS18S first strike weapons the pupose of which would be to initiate a nuclear attack. The point which is very well made by Dr Kemney in his article is that while peace groups and anti-nuclear activists have protested loudly at the French testing at Mururoa, the presence of nuclear-powered ships of our ally the United States in our ports and the testing of the MX missile in the Pacific, there has been a deafening silence from the peace groups in relation to the Soviet tests. This demonstrates the sheer hypocrisy of the peace movement and it also gives a clear insight into its politics. Parties such as the Nuclear Disarmament Party have claimed to be parties for peace not concerned with the ideological differences between East and West, yet within the peace movement there is a clear reluctance to upset the pro-Soviet sympathisers who tend to dominate these organisations. It is extremely unfortunate that many of those involved in the peace movement, who I have no doubt are generally committed to peace, and manipulated by its radical left wing leaders are the first to march in the streets when the United States wants to test MX missiles in the Pacific but the last to inform their fellow peace activists when the Soviets test nuclear missiles in the area. The peace movement does itself, and Australia, a great disservice by failing to acquaint its members with the facts in relation to Soviet activity and armaments in this region of the world. Peace activists seem to be unaware of, or indifferent to, the fact that Cam Ranh Bay in Vietnam has become the largest permanent base for the Soviet fleet outside the Soviet Union and Eastern Europe. I understand that there are 26 ships located at the base as well as a squadron of MIG23 aircraft and a considerable number of the latest large continent-spanning reconnaissance bomber aircraft. Vietnam is paying dearly for the millions of dollars worth of Soviet support which is necessary to keep the Vietnamese armed forces operational. The Union of Soviet Socialist Republics maintains about six to eight sophisticated warships at the base and as many support ships, and about five to six submarines some of which are Victor class nuclear powered attack submarines. Only a few weeks ago the huge Soviet battle cruiser Frunze entered the Pacific Ocean. This vessel is a 35,000 tonne nuclear armed and nuclear powered cruiser and its entry into the Pacific represents a major escalation of Soviet forces in the region. The battle cruiser is part of a task force, the rest of which consists of the 7,000 tonne Sovremenny class guided missile destroyer Osmotritel'Nyi and the 4,500 tonne Kashin class destroyer Strogy. I understand that the task force is being kept under surveillance to determine whether it will be based in Cam Ranh Bay in Vietnam, but all indications are that it will be. There has been sufficient publicity surrounding the presence of these vessels to alert anyone concerned about the military build up in this region to the fact that the Soviets have dramatically increased their military capability in the Pacific. But not a word have I heard from any of the peace activists; not a word has been said about the introduction of another nuclear armed vessel in the region. Not only has the peace movement ignored the build up in the Pacific but also there seems to be no appreciation amongst many members of the peace movement of the nature of Soviet military activity in other parts of the world. Take the example of Afghanistan. We see there the Soviets, having invaded the country six years ago, systematically wiping out the people. There is evidence that chemical weapons have been used against the Afghans, and yet we hear virtually nothing from peace groups on this matter. Of course United States activities in El Salvador come in for automatic criticism and condemnation, but not the Russians in Afghanistan. This is a perfect example of the double standards operating within the peace movement, and the insistence upon unconditional unilateral disarmament which is mouthed by so many of the movement's left wing leaders amounts to a recipe for increased instability in the balance which exists between East and West. The West disarming unilaterally would not advance the cause of peace; it would be far more likely to destabilise the situation. We all want peace and we must all work to achieve the dismantling of the arsen-als of nuclear weapons around the world, but it cannot be done unilaterally. There must be mutual verification of disarmament. Those who advocate the closure of the joint defence facilities in Australia at Pine Gap, Nurrungar and North-West Cape are naive if they have not realised that these bases contribute to the balance of deterrence which has at least assisted in preventing the outbreak of a nuclear war over the past 40 years. Nuclear war capability has existed since the end of World War II but so has the deterrence. The role played by the joint facilities includes surveillance and verification, both of which are essential to deterrence. Professor Harry Gelber, an international relations and strategic studies specialist with the University of Tasmania, recently commented in an article on peace activists: They say they want the joint American-Australian facilities removed, but say nothing about the damage to verification that this would cause, the damage of Western surveillance and intelligence, and consequently the increased danger of war. It should be of considerable concern to all of us that peace groups persist with calls for our withdrawal from ANZUS and the removal of the joint facilities, and I have recently become aware of a peace publication which gives me great cause for concern indeed. The publication, Work For A Just Peace, which has been prepared by the Catholic Commission for Justice and Peace, is said to have been approved for discussion and reflection by a more than two-thirds majority vote of the Catholic bishops of Australia. Given the content of the publication, I find this quite surprising. The report of the Commission clearly supports the unilateral approach which has been adopted by the Australian Democrats, the Nuclear Disarmament Party and other left wing organisations, but it is to be noted not by the Labor or coalition parties. I might comment in passing that that is not to say that there are not very many in the Labor Party who wish to see an end to the ANZUS alliance and the removal of the joint facilities. However, the publication is also hostile to uranium mining even though the extension of that aspect of the nuclear debate is not shared by peace movements in other countries. In any case, I believe that the conclusions drawn by the Commission are both reckless and regrettable, particularly given the complexity and highly political nature of the issue and the divisiveness which the Commission is causing within the Catholic Church-and amongst other people, too, for that matter. The other matter in relation to this document which must be mentioned is that there seems to be some doubt as to just how many Catholic bishops have approved the document under discussion. There have been reports indicating that less than half of the 44 Catholic bishops responded to the Commission's inquiries on the paper. Twenty voted for the paper and one voted against it. The remaining 23, as I understand, who did not respond at all were taken to have given their approval. If this is the case, it seems to me that the Commission is guilty of gross misrepresentation and the Catholic bishops should move immediately to clarify the situation. Another matter requiring clarification goes to the funding of the publication. I understand that the CCJP received approximately $250,000 which came out of donations, so it is said in the media-it is not refuted-from members of the church who gave in the belief that the money was going to help the poor and needy of the world, not to fund a publication the conclusions of which many Catholics would heartily disagree with. Understandably there is a good deal of concern about this aspect of the activities of the Commission and I believe that, quite rightly, the suggestion of an inquiry into the possible misuse of funds has been mooted. With the world in the situation that it is today, with not only the threat of nuclear war hanging over our heads but also the reality of more conventional wars going on around the globe and the problems of famine and other natural disasters, many in Australia are contributing to national and international relief funds. But to find that $250,000 of the money given to Project Compassion, for example, is used to fund the Catholic Commission for Justice and Peace has given many Catholics, both lay people and priests, great cause for concern. The administration of the church must realise that we are not living in the Middle Ages. We are living in an age of public and financial accountability, and I would hope that the administration realises this and comes forward to explain just what is happening and indeed refunds the moneys used in the production of this publication to the cause for which this money was intended. It has been said in the media this week-it has been said in many places and once again it has not been refuted-that there has been deceit practised in the name of peace and that essentially there have been fraudulent claims, which raises the question of elementary honesty. They are serious charges. In view of the need to reassure the Catholic and the wider Australian communities of the integrity of fund raising campaigns for the poor and needy of the world, the matter which I and a number of others have raised must be answered. Senator McKIERNAN(Western Australia)(1.13) —The subject I raise in today's matter of public interest debate is of particular interest to the people in the State that I represent in this chamber; that is, Western Australia. It is also a subject that is of interest to all citizens of this country, as it is of interest to all fairminded people all over the world. The matter to which I refer is that of the concept or principle of one vote one value-a principle that does not apply in my home State, a principle that did not apply to the people of Western Australia when they elected the State government at the last election, nor indeed will apply when the next State election is held. Much publicity and debate has been focused in the last month or so on the blatant redistribution of State electoral boundaries in Queensland, and rightly so. It is disgusting that such a gerrymander could happen in the State of a country that professes on the world stage to being a democracy. The people of Queensland are rightly outraged about what is planned for them, just as the people of Western Australia are outraged about what is imposed on them in my home State. I wish to spend a few moments outlining some recent figures on electoral enrolments in Western Australia. I will use these figures to prove that equal universal suffrage does not exist in Western Australia, particularly in the election of members of the Legislative Council. I will use the figures to prove that some individual votes in parts of Western Australia are equal to 11 times the value of those votes of other citizens in a different part of the State. By way of background I inform the Senate that there are some 37 seats in the Legislative Assembly, and 17 provinces in the Legislative Council each electing two members, giving a total of 34 Council members. Of all the Australian States and Territories, electoral enrolments for the Western Australian Parliament show by far the greatest variations. The only other Houses in this country where unequal enrolments are possible are the Tasmanian Legislative Council and, of course, the Queensland House of Assembly. In the Commonwealth House of Representatives and most State parliaments electoral enrolments may vary by only 10 per cent. However, that is not the case in Western Australia. To give an indication of what I mean, the average number of voters in the Assembly districts contained in the metropolitan area of Perth at the moment is 19,653 and the average number of Assembly voters in districts in the rural areas of Western Australia is 10,222, giving an overall State average of 15,186. The highest enrolment is in the Assembly seat of Murdoch, with 27,991 voters-a variation of 84.3 per cent over the State average. It is by far the largest seat in terms of numbers of voters. The lowest seat, Murchison-Eyre, with 3,563 electors, is 76.5 per cent below the average State enrolment figure. In the Legislative Council the average enrolment for those seats in the metropolitan area is 84,227. For the rural area it comes right back to 27,600, giving an average State enrolment of 50,917. The province with the highest number of enrollees is the North-East Metropolitan Province, with 95,224-87 per cent over the State average. The lowest, Lower North, with 8,588 voters, is 83.1 per cent below the State average-an enormous variation from what applies to national seats and seats in most other States of this country. To show how minorities can control the State I will give some examples of what is possible under the present distribution. The 29 districts with the lowest enrolment elect 29 of the 57 members in the Legislative Assembly, so they can control the Assembly. Their total numbers of enrollees need only amount to around 35 per cent. We could be governed by a minority of 35.5 per cent. The Assembly district with the highest enrolment contains over 7 1/2 times as many electors as the district with the lowest enrolment. The nine Legislative Council provinces with the lowest enrolments elect 18 of the 34 councillors, so it can control the Legislative Council with only 27.8 per cent of the vote. The four Legislative Council provinces with the lowest enrolments together contain a lower number of electors than the province with the highest number of enrollees at the moment. In other words, the four lowest together total 85,507 voters, as opposed to North-East Metropolitan with 95,224. The four together can elect eight representatives; North-East Metropolitan can elect only two. In the Legislative Council the ratio of voters for the North-East Metropolitan Province and Lower North Province is over 11:1. The votes of people in Murchison, in Lower North, have 11 times the value of the votes of people in North-East Metropolitan Province. Part of the reason for the anomalies that I have just outlined-some of them involve population growth as well, which enlarges the variation-is that the State is divided up into three electoral areas. This is not done by any electoral commissioner; it is done by the Parliament itself. Earlier this week, I think it was Tuesday, Senator Walsh outlined the gerrymander that had been sought in the northern area of our State. The boundaries of the seat of Kimberley were redrawn to include the inland mining areas. We have had three separate, distinct boundary areas drawn up by parliament supposedly to give the rural voters votes equal in value to those of people in the metropolitan area. The State is divided into three areas-the Metropolitan area; the Agricultural, Mining and Pastoral area, and the North-West Murchison-Eyre area. The seat of Kimberly, which is by far the most distant seat from Perth, actually has an enrolment of 17,728, which is equivalent to that in a number of metropolitan seats. It is a blatant abuse of the powers of parliament by the previous Western Australian State Government. But the abuse of parliamentary power really comes to the fore in the activities of the Council, acting in its position as a House of review, and what it has done to various pieces of legislation over the last 20-odd years. During the life of the present Burke Labor Government, whose term of office is getting on for three years, the Council, in its wisdom, has rejected 10 pieces of legislation. Some of them-not all of them, of course-have dealt with electoral reform. The Court, and later O'Connor, coalition Government was in office for nine years. In that nine-year period the Council did not seek to exercise its power of veto on one occasion. The government previous to that was the Tonkin Labor Government. Again, it was in office for three years and the Council sought on 21 occasions to reject that Government's legislation. Before that we had the Brand coalition Government in office for 12 years, and in that 12 years only one piece of legislation was rejected by the Council. Prior to that the Hawke Labor Government was in office for six years, and 20 pieces of legislation were rejected in that time. From those figures, Labor has been in office for 12 years and has had 51 pieces of legislation rejected, but the coalition was in office for 21 years and had one piece of legislation rejected. I do not need to say, for the benefit of other than Western Australians listening to this broadcast, that the Legislative Council in the Western Australian Parliament is controlled by the Opposition parties. Senator PUPLICK(New South Wales)(1.24) —In making a few remarks on a matter of public interest I want to move very much away from the contentious matters which have been raised before the chamber so far today and in fact take the unusual step of congratulating the Australian Postal Commission on one particular part of its activities; that is, its production of Australian postage stamps. Each year since 1981 Australia Post has produced in a very beautiful book a collection of Australian stamps. The book comes complete with the details of the stamp in question-the technical details of the stamp, the technical details of the printer and of the engraving, and details of the designer of the Australian stamp. There is some background about the matters and designs featured on the stamps, together with the actual stamps themselves which are provided separately but are to be inserted in the relevant pages of the album. This has been a novel undertaking by Australia Post and it has, I think, been a very great credit to it. Not only has it been a very great credit to Australia Post but among serious philatelists the albums have become something of a significant collectors item, to the extent that the first of these books, which was published in 1981 and which went on sale in Australian post offices for, if my memory serves me correctly, around $19, can now be purchased only through stamp dealers and those interested in selling it, and its current value is in the vicinity of $90 to $100. That is a fairly substantial capital gain in a period of four years. The collection for 1985 is the best collection of Australian stamps that has been produced in any one year, and I want to say a few words in congratulating Australia Post and drawing attention to a few things which appear in the 1985 collection. It is clear that the quality of printing of Australian postage stamps has improved out of all recognition in the course of the last five or six years. Honourable senators will undoubtedly recall the fiasco which occurred in 1979 when one of the stamps in the Australian train series had to be reprinted, and it was reprinted using a colour different from that with which it was originally issued. The difference in colour between the two issues led to a greast deal of financial speculation and a great deal of interest in that reprinted issue which should not have occurred because stamps in the one series should not be printed with two distinguishable colours. However, in this year's collection there are a number of quite outstanding productions and these are important to the extent that for many people overseas knowledge of Australia and indeed knowledge of many foreign countries is very much obtained, particularly by children in the first instance, from postage stamps-from collections of postage stamps and from individual stamps, having the history, the animals, the geography and the colours of the particular country concerned. There are a number of stamps in the 1985 collection to which attention should be drawn. The first are those in the colonial military uniform series; a series of five 33c stamps printed se-tennant and designed by Pam Andrews. These are among the best produced stamps seen in Australia for many years. The second set to which I draw attention is again a series of five 33c stamps produced se-tennant showing classic children's books. The stamps were designed by Peter Leuvers and feature the stories of Elves and Fairies, the Magic Pudding, Ginger Meggs, Blinkey Bill and Snugglepot and Cuddlepie, which undoubtedly are part of the cultural background of almost all Australian children. The printing and design of these stamps and the commemorative envelopes that go with them are amongst the best that have been seen. The excellent conservation series, which features stamps dealing with the conservation of the soil, of pure air, of precious water and of energy resources, again is indicative of the sort of interests which are significant in the Australian community. Six stamps were produced this year in the second of the marine life series, again part of the illustration of the quite unique flora and fauna which abound in Australia, and which our stamps reflect brilliantly. The collection, as always, contains an Antarctic series and Gary Emery, the designer of this year's series, has produced five stamps in that set. Antarctic stamps tend to appreciate very rapidly in value; the first mint set of Australian Antarctic Territory stamps, which had a face value of less than $2, now sells for well in excess of $25. There have been a number of exciting philatelic developments this year as far as the Antarctic is concerned. The work of Project Blizzard involving the restoration of Mawson's Hut, the operation of the Oceanic Research Foundation, the agreement of the Commonwealth to provide special post markers for the Commonwealth Bay base and the involvement in Sydney of my own stamp dealer Robert Kennedy, and his colleagues in the Oceanic Research Foundation are producing a wonderful new interest in Antarctic developments. I want to draw attention particularly to two series of stamps which appear in this year's collection. Again they are stamps designed by Garry Emery, and they are part of the Australian bicentennial collection. Last year the first part of the bicentennial stamp collection, known as the First Australians, was issued. This year there are two sets of stamps in the bicentennial collection. The first is a series of stamps featuring early Australian explorers and it is produced not only as four quite wonderful separate 33c stamps-again it is an excellent piece of printing done by Cambec Press in Melbourne-but also as a miniature sheet, which is quite unusual for Australian stamps. The stamps are a significant contribution to learning about the history of the early explorers. That series was followed later in the year by another Emery-designed set of stamps showing artefacts taken from significant Australian coastal shipwrecks. Those, together with the First Australians series, make up part of the bicentennial collection which will run to a number of volumes. That collection is also being produced separately by Australia Post and the stamps, in terms of their historical value, will be of great interest not only to collectors in Australia but also to people overseas. The final ones to which I draw attention are this year's Christmas stamps, designed by Scott Harsthorne and printed by Leigh-Mardon Pty Ltd in Melbourne. The series features five stamps which have an extraordinarily unique combination of woodcut drawings by Albert Durer and modern Christmas decorations. As somebody who has been a long time and fairly serious philatelist, I have had a look at this year's Christmas stamps from around the world. Many thousands have been produced and I have absolutely no hesitation in saying that this collection of Australian Christmas stamps, in terms of their design, in terms of their execution, and in terms of their printing, must rank as one of the two or three very best series of postage stamps issued for the 1985 Christmas season. The designer, Mr Harsthorne, and the printers deserve enormous congratulations for the concept of the stamps and for the quality of their production. Australia Post is one of those institutions which from time to time get a thorough kicking from both sides of the chamber. Very often it deserves that thorough kicking but equally, when it produces a volume such as that which it has produced this year for its 1985 collection, when it produces postage stamps which are a credit to it, to the designers and to the printers and indeed which reflect very well upon Australia as a nation, it is also deserving of some congratulations. Seeing that this is the time when we are supposed to talk about matters of public interest and it is generally accepted that philately is the largest single hobby practised anywhere on the surface of this planet, this is a matter of public interest and I think Australia Post and all those who have been associated with the 1985 collection should be congratulated for a job extremely well done. Senator FOREMAN(South Australia)(1.35) —Mr Deputy President, today I want to make a few remarks about the 1985-86 Budget and the economic environment in which we find ourselves-a happier environment, both socially and economically, than the one present when the Hawke Government brought down its first Budget in 1983. Let me for a moment briefly describe what conditions were like when the Hawke Government came to power in 1983. It is essential to understand the predicament Australia was in at that time and the measures that the Hawke Government has taken to bring about a dramatic reversal of Australia's fortunes since then. The condition of the Treasury in March 1983 is best summed up by saying-it is from a well known nursery rhyme-that Mother Hubbard's cupboard was bare. I suppose that it is really best described as Mother Howard's cupboard being bare, and it was becoming barer by the moment. Not only was the Treasury empty but it was also mortgaged. The last time Mr Howard was in control of the nation's finances he was already about the business of privatisation, or selling off the nation's assets. He was mortgaging the future of our country with the largest increases in the national debt Australia had ever witnessed. Consider for the moment the figures at June 1976. Commonwealth borrowings stood at $20 billion but by the end of the Fraser-Howard period this figure had risen to more than $39 billion. Despite all the rhetoric about reducing deficits, reducing the size of government, promoting economic growth and much more, the Fraser-Howard years were a disaster. It should be pointed out, though, that some efforts were made in the early years of the Fraser Administration to come to grips with the economy. Full credit must be given to the former Treasurer, Mr Lynch, for attempting to control the deficit. But when Mr Howard took over economic caution was thrown to the wind. Mr Howard's five years added some $13 billion dollars to the deficit, or a full third of the entire national debt. He added $13 billion of the $19 billion increase over all the Fraser years. Had the public of Australia not been presented with the untimely but fortunate opportunity to pass judgment on the Howard economic morass in March 1983, a further $10 billion would have been added in the next Budget. The fact of the matter was that Mr Howard had lost control of the situation. As Michelle Grattan in the Age of 8 December 1982 noted in an article entitled `Budget deficit soars to $4,000m': The Federal Government's $1,674m budget deficit has blown out to an enormous estimated $4,000m in less than four months. Despite massive increases in spending, despite regular assurances that the good times were near at hand, employment prospects from 1975 to 1983 became progressively bleaker. Unemployment eventually rose to more than 700,000 by the end of the Fraser Government's life. The Fraser-Howard Administration failed to produce even the rhetoric, blaming overseas conditions, the drought and the unemployed. The level of inflation was over 11 per cent and showed no sign of easing. A wages pause became the catchcry; the solution to the woes that beset the Government. In reality it was simply a clutch at a straw, and was seen to be such in March 1983. The level of inflation in the Fraser years was like the level of unemployment; there was always a promise that soon things would be better. These promises, of course, are now filed away with the naive expectation that the Australian electorate might wish in some near time in the future to hear them once more. One of the saddest parts of the latter Fraser-Howard years is that it was obvious that the Government had lost control. Instead of management we were presented with indecision. This indecision was felt by industry and the community. I refer to an article by David Potts, economics editor of the Australian, on 15 December 1982. He stated: The Government has officially disowned the Budget and is now forecasting the worst economic downturn since the Great Depression. Potts went on to say in the same article: The Treasury now predicts the economy will shrink by 2 per cent in real terms this financial year, its Budget estimates was `some decline'. A fall in real gross domestic product of 2 per cent over the year would be the worst since before the war. In 1974-75, widely regarded as a year of recession, the gross domestic product grew by 1.2 per cent. In 1961-62, the `credit squeeze' year, the gross domestic product grew by the same amount. The worst year for economic growth in the post-war years was a fall of 0.8 per cent in 1952-53. David Potts also passed judgment on another aspect of the last Howard Budget. He summed up what most of the community was feeling at that point: The vagueness of the Budget forecasts compared with the quite explicit new estimates is likely to refuel speculation that the Budget figures were fudged. The speculation was refuelled and finally the truth was starting to emerge. Again in the Age of 15 December 1982 Michelle Grattan, in an article entitled `Howard's gloomy forecast for 1983' summarised Mr Howard's latest Budget update as follows: Australia's gross domestic product is expected to be down about 2 per cent this financial year and private business investment is likely to fall by 15 to 20 per cent. Private consumption is likely to show little, if any, growth. The housing industry will continue to worsen and unemployment is likely to be 10 per cent in February. When the Hawke Labor Government came to power in 1983 it was faced with a crisis in the economy which was unparalleled since World War II. It was not that it was an economy that was deep in recession; the problem was that its whole direction had to be reversed because it was diving deeper into recession by the day. The Hawke Government had a vision of an Australia that could be prosperous once more, an Australia that could be employed once more and one that could be confident of its future. It was this vision that lay at the foundations of the first Keating Budget-an Australia where profits as well as decent and justifiable wage levels could exist hand in hand; an atmosphere where investment would be encouraged because of positive signs of growth; and an atmosphere in which 500,000 more people would be employed in the first three years. The accord followed and despite the jeerings of those opposite it has been the mainstay of the unprecedented growth that has been achieved ever since its introduction. Confrontation, the real name of Liberal industrial relations, has been replaced with consultation and a period of industrial harmony; a harmony under threat only in the non-Labor States, and chiefly Queensland in which the recession continues unabated. The trade union movement and employers, as well as many other interested parties, took part in the National Economic Summit Conference because goodwill on all sides demanded a change of course. The period of growth that has followed the Hawke Government's coming to office has been astounding. The target of 500,000 jobs is well on the way to reality, with more than 444,000 already created. The third successive year of strong economic growth will see Australia experience a 4.5 per cent growth in gross domestic product this year. The 1985-86 Budget seeks to continue and re-inforce the developments of the last 30 months. One specific target for this Budget has been the priority that has and must be given to the youth of Australia. The details of this scheme merit some note because of the sheer size of its vision. In 1985-86 some 10,000 16- and 17-year-old school leavers will be offered traineeships. By the Bicentennial year, 1988-89, the number will be expanded to 75,000. The cost for 1985-86 will be $15.7m. The traineeships will last a minimum of 12 months and include at least 13 weeks of instruction in relevant courses in appropriate institutions. The remainder of the time will be spent in on the job training. For employers to be eligible to take on trainees, stringent requirments first have to be met. Employers will need to demonstrate that they can provide high quality job training and pay the appropriate trainee wages. It is important to note that the new trainee system has evolved from the recommendations of the Kirby Committee of Inquiry into Labour Market Programs. Furthermore, it is being introduced following wide consultation with Federal, State and Territory governments, trade unions, employer groups and youth organisations. Contrast the positive steps the Government has taken in this direction with the suggestions emanating from the Opposition quarters. The most original suggestions from the Opposition so far call for cuts in youth wages so that sweat shop labour can once more return. This is not a solution, merely a way to exploit a sad situation which sees higher youth unemployment than there ought to be. It is designed to test supposed economic solutions on a social group with the least say in its own defence. This step is the thin edge of the economic wedge. The deregulation of youth wages is the first step towards total deregulation of the labour market and the consequent erosion of hard fought for living standards. Mr Howard is not satisfied with his attempts between 1978 and 1983, and now he wants a chance to show what he can really do. The Opposition is on the path towards the total destruction of just wage awards established over many years. Mr Peter Shack, formerly the Shadow Minister for Employment and Industrial Relations, stated in an article in the Australian of 14-15 September 1985 on the dispute involving McDonald's Family Restaurants in Western Australia: In response to concerns about high youth unemployment, the Western Australian Industrial Commission decided in July this year that employers who are able to create jobs for young people in addition to their present workforces, could hire them at less than award rates. There can only be winners as a result of this ruling, not losers. Young people who are presently employed will continue to be paid at existing award rates. Unemployed youth will get a crack at jobs that did not, and would not, exist except for the Western Australian Industrial Commission's ruling. Even if all of the winners are winners, some will clearly be winning more in their pay packet each week than others. Of course it will not be long before this two-tiered system of employment gravitates to one level and formerly employed and unemployed youth will get a crack at a job-naturally the one with the lightest pay packet. Mr Shack's wisdom in employment-some might call his cynical exploitation-is now to be seen in the education portfolio as the result of the recent reshuffle. The fiscal management in this Budget is also exemplary. The Budget provides for growth in employment as well as reduction in the deficit to $4,900m. It is important to note that such projections in the last two years have been on target despite the detractors who, when they had their chance, muffed it. The growth outlay has been kept to our trilogy of promises. This Budget estimates that gross domestic product will rise 4 1/2 per cent. Real household disposal income will rise by 3 per cent after tax and average weekly earnings will also rise by approximately 8 per cent, despite the bouyant economy and the depreciation of the Australian dollar. Inflation will be pegged to about 8 per cent. The growth in employment will mean a decline in the number of employed, from 8.7 per cent in June 1985 to 7.5 per cent or 8 per cent by June 1986. The fall in unemployment will mean a decrease in the actual monthly average number of unemployed from 581,700 in 1984-85 to 540,000 in 1985-86. The DEPUTY PRESIDENT —Order! The honourable senator's time has expired. Senator MICHAEL BAUME(New South Wales)(1.49) —Mr Deputy President, the speech we have just heard reflects one of the main problems I want to discuss today, and that is the decline of standards in Parliament. The decline of standards I refer to in regard of the speech just concluded relates not simply to the content, which is appalling and nonsensical, but to the fact that the speech was totally read-and, I might say, read badly. If a senator does not know enough about a subject to get up in this place and talk about it without having to read his speech, he should not get up at all. We are supposed to be people of competence in this place. Senator Robert Ray —You patronising twerp. He was elected with as many votes as you were, you little pissant. Senator MICHAEL BAUME —I hope that interjection is recorded, and I will pause to make certain that it is. That is another example. The DEPUTY PRESIDENT —Order! Senator Robert Ray, you will withdraw that remark. Senator Robert Ray —Mr Deputy President, I withdraw the remark. Senator Grimes —I rise on a point of order, Mr Deputy President. May I ask you, gently, whether the attack by Senator Baume on Senator Foreman-it can only can be described as a patronising, arrogant attack on the capacities of another senator-is in keeping with the Standing Orders, and I ask also whether Senator Baume is going to make the same complaint about the number of people on his side who read their speeches every time they get up. The DEPUTY PRESIDENT —Order! Nothing Senator Baume said was against Standing Orders. Senator MICHAEL BAUME —Thank you, Mr Deputy President. As I understand the Standing Orders, they specifically preclude people from reading their speeches. I am making a general comment about the decline of standards in this chamber and-- Senator Grimes —On a point of order, Mr Deputy President. If it is reasonable for Senator Michael Baume to make the remarks he has made, unscathed, about Senator Foreman, is it then reasonable for me or Senator Walsh to give detailed comments about the morality of Senator Baume's activities in the firm of Patrick Partners before he came into this chamber? The DEPUTY PRESIDENT —Order! It is not in order to reflect on the integrity of the senator. I will deal with remarks like that as they arise; I am not going to give hypothetical rulings. Nothing that Senator Baume has said in this debate is out of order. Senator MICHAEL BAUME —Thank you, Mr Deputy President. This is another example of the decline of standards in this place. That was a deliberate attempt, on a false point of order, to impugn my integrity because in fact I am raising a matter which the Minister does not want to hear. Senator Grimes —I don't have to impugn your integrity. You were a crook before you got in here and you are a crook now. The DEPUTY PRESIDENT —Order! Senator Grimes, that remark was quite improper and you should withdraw it. Senator Grimes —I am indignant for the large number of people who are poverty stricken and on pensions in this country as a result of his activities. The DEPUTY PRESIDENT —Senator Grimes, it is not subject to debate. You have to withdraw the remark. Senator Grimes —I withdraw. The DEPUTY PRESIDENT —Senator Baume, it would help the debate if you did not respond to the previous interjections. I have ruled on the point of order. Senator MICHAEL BAUME —I would require the withdrawal of the last statement, which is totally untrue and improper. Senator Tate —Mr Deputy President, I think more people should have the benefit of this arrogant diatribe and I call your attention to the state of the House. The DEPUTY PRESIDENT —It is an agreement, which is not enforcable by Standing Orders, that quorums should not be called during this time but if you insist I will call one. Senator Grimes —It is also an agreement, Mr Deputy President, that we do not indulge in provocative and contentious debate during this time. (Quorum formed) Senator MICHAEL BAUME —I was making a general point about declining standards in the Parliament and used as an example something that obviously offended members of the Australian Labor Party. I regret that they have such sensitivity on this matter. I want to deal with the fact that in a general discussion on Sunday the leading Australian members of the Press Gallery said they regarded the Treasurer (Mr Keating) as the outstanding parliamentary performer for the latest session. I want to draw the attention of honourable senators to the staggering difference between what would in normal terms be regarded as outstanding performance in the chamber-in other words, ability, determination and the capacity to argue and present a sound case-and the habits and behaviour of the Treasurer, who achieved this accolade. I quote, in great length if I may, the sort of invective that the Treasurer has consistently used to achieve this accolade from the Gallery: `Those dummies and dimwits'; `that dimwitted members of the Opposition'; `they are jokes-absolute jokes'; `those dummies opposite should just shut up'; `some of the mugs on the other side'; `don't be so damned stupid'; `the clowns opposite'; `the blockheads opposite'; and `a swill, a pig sty, and that is the limit of their capacity'. He is talking about the Opposition. I continue: `the honourable members opposite want to be sleazebags'; `damn them for the cheats they are'; `you ought to be bloody well ashamed of yourselves'; `you are frauds'; `you people are beneath contempt'; `you are an abject insult to every decent moral member of the Parliament'; `fraud and humbug'; `they are irrelevant, useless and immoral'. Senator Gareth Evans —Hear, hear! Senator MICHAEL BAUME —Hear, hear! I hear. I am talking about the standards that are now acceptable in this Parliament, and another Minister in this place regards them as acceptable. `He is a leading member of the ratpack', says Mr Keating; `Coalition members have always been cheats, cheats, cheats, and will always be cheats, cheats, cheats, and always defend cheat, cheats, cheats'; `the blackguards on the front bench opposite'; `You boxhead, you would not know. You are flat out counting past ten'; `Shut up! `Sit down and shut up you big pig; `Why do you not shut up, you clown?' `This man has a criminal intellect'; `I would not trust him with a jam jar full of 5c bits'; `the jokers opposite'; `Business thinks they are mugs and hill-billies'; and `While all the fiscal and tax harlots opposite'. That is an example of the style of a man who is regarded by the media as an outstanding parliamentary performer. It is a style which is disgraceful; it is a style which demeans the Parliament, and it is a style which senators opposite, members of the Government, find attractive and support. It depresses me that the media finds this kind of style attractive enough to give him a good run, but I will say of Michelle Grattan that in her article on the annual awards for the Class of `85, she says of Paul Keating: `Dripping with political style, but please, Bob, ask him to watch his language. He is going over the top in Parliament-`sleazebags', `harlots'-and the corridors reverberate with unprintable Keatingisms. Senator Gareth Evans —You should hear him in Cabinet. Senator MICHAEL BAUME —`You should hear him in Cabinet', the Minister says, and I believe it. Senator Robert Ray —You will never be in Cabinet. Senator MICHAEL BAUME —No; I will never be in Cabinet with Paul Keating and I am proud of that. I would not want to be in a Cabinet with a man of such status, such standing, such contempt as he shows for the parliamentary process and the proper behaviour that should exist in this Parliament. We have this kind of behaviour now intruding into this chamber. We have heard today from the expert in this area, Senator Walsh, his persistent personal abuse, and we have heard Senator Grimes consistently behaving in this way. Surely if we are going to be an effective chamber we should be dealing with issues, not personalities. The DEPUTY PRESIDENT —Order! It being 2 p.m., the debate is concluded. Senator GRIMES(Tasmania-Manager of Government Business) —I inform honourable senators that Senator Gietzelt will not be here at Question Time. Any questions to be directed to him should be directed to me. INDUSTRIAL RESEARCH AND DEVELOPMENT Senator BJELKE-PETERSEN —My question is addressed to the Minister for Industry, Technology and Commerce. I do not think he is in the chamber. Senator Peter Baume —Ask the question anyway. It is 2 p.m. It is Question Time. Senator BJELKE-PETERSEN —I refer the Minister to his Government's decision to replace the commencement grant scheme for industry research with tax concessions for companies spending more than $20,000 on research and development. As the majority of commencement grants were under $20,000, does the Minister agree that this new scheme will effectively prevent many small businesses from qualifying for government assistance in the important area of industry research? In the light of widespread concern in the small business community over the impending abolition of the commencement grant scheme, will the Minister advise whether his Government will reverse its decision to wind up the scheme after 30 June next year? Senator GRIMES —The good senator seems to have disappeared from the face of the earth at the moment. Senator Peter Baume —He should be here for Question Time. Senator GRIMES —Of course he should be here. I will find out why he is not. Neither Senator Walsh nor I have the information or the skill to answer that question, so I will refer it to Senator Button when and if he turns up. Senator BOLKUS —I ask the Minister representing the Treasurer whether his attention has been drawn to claims published in Monday's Advertiser newspaper that `Labor is pushing your interest rates through the ceiling'. Has he also seen a claim by Liberal Opposition Leader Howard that promises made by Mr Hawke and Mr Bannon about the present ceiling on housing loan interest rates were `worthless'? Can the Minister say whether there is any basis in fact to these claims? Senator WALSH —There is no basis of fact in the advertisements the Liberal Party is running in South Australia. Senator Bolkus is absolutely correct about that. He is correct also, as far as I know, in what he said about Mr Howard and-- Senator Bolkus —Olsen. Senator WALSH —Yes, that is his name. I am glad that the Labor Party knows his name, even though evidently the Federal Leader of the Liberal Party does not. He gets him confused with Mr Bannon, although the difference between the two should be very clear to him by next Sunday morning-indeed, probably on Saturday night. The Advertiser newspaper has reported the things to which Senator Bolkus referred, but of course there is no truth in either of those claims. In fact, as I said in Question Time, I think last Monday, and repeated on a previous occasion, the Treasurer gave firm assurances some weeks ago that this Government will not deregulate housing interest rates. By contrast, of course, a Liberal government would. Mr Howard said in the House of Representatives on 13 September that a Liberal government would do that. When Mr Howard was Treasurer, he lifted the ceiling on housing loan interest rates by 3 per cent on three separate occasions within 18 months. If a Liberal government were to be elected we could expect interest rates on housing loans to go up by another 3 per cent probably, just as they went up by 3 per cent in the last 18 months of Mr Howard's treasurership. Contrary, of course, to the advertisements and all the other wild claims that have been made and published in the Adelaide Advertiser, home mortgage interest rates would undoubtedly be increased if Liberal policy, as expounded by the Liberal Party Leader, Mr Howard, were ever implemented. As I have previously noted, the South Australian Premier, Mr Bannon-he is the Premier, not the Opposition Leader, as Mr Howard appears to think-has already pointed out that the effect of the deregulation of bank interest rates for housing loans would add about $70 a month to the repayment obligations of the typical borrower. That is the sort of slug which can be expected if Liberal policy is implemented. The DEPUTY PRESIDENT —Senator Bjelke-Petersen, it might be helpful if you repeated your question now that Senator Button is here. Senator BJELKE-PETERSEN —Thank you, Mr Deputy President. I refer the Minister to the Government's decision to replace the commencement grant scheme for industry research with tax concessions for companies spending more than $20,000 on research and development. As the majority of commencement grants were under $20,000, does the Minister agree that this new scheme will effectively prevent many small businesses from qualifying for government assistance in the important area of industry research? In the light of widespread concern in the small business community over the impending abolition of the commencement grant scheme, will the Minister advise whether his Government will reverse its decision to wind up the scheme after 30 June next year? Senator BUTTON —There is no question of the Government reversing any decision. We have not made such a decision as Senator Bjelke-Petersen referred to in her question. What the Government has done is to introduce a 150 per cent tax deduction in respect of research and development done by companies in Australia as a broad incentive to industry generally. It may be that there are a number of categories of companies which would not be able to avail themselves of that incentive. For example, there may be a number of small high technology companies which may not have sufficient cash flow or may not be generating profits. Those companies would be unable to claim the tax incentive. We are looking to have two complementary schemes, one being the general tax incentive available to all business and, alongside that, a revised form of the Australian industrial research and development incentives scheme-AIRDIS-which is what Senator Bjelke-Petersen is asking about. It is true that that scheme expires under a sunset clause in the legislation on 30 June next year, but it will be replaced by a scheme which will work to a similar purpose but which will be more closely targeted to the interests of small business and companies which do not have sufficient cash flow to take advantage of the tax incentive. So the two things will mesh together. They will provide the best research and development incentive scheme that this country has ever had-- Senator Durack —Ha, ha! Senator BUTTON —I say that advisedly. Senator Durack laughs, for goodness sake. He took part in a government-- Senator Durack —Everything is the best that ever was. Senator BUTTON —Pretty well, but let us deal with the issue in question. The honourable senator presided in government over this country for a period of eight years in which millions and millions of dollars of taxpayers' money were spent on various forms of research and development incentives. What happened in those eight years? Research and development in Australia went down in the private sector. It went down all the time. The reason it went down was that the system of incentives was wrong. The previous Government never had any system for evaluating the incentives which were in place and the results got worse and worse. I am saying that the system of incentives for research and development which this Government will have in place by the beginning of next year-the 150 per cent tax deduction, the revised form of the industrial research and development scheme, plus the existence of investment companies under the management and investment companies scheme, the MIC scheme, to assist new companies to raise venture capital-will together provide the best, most comprehensive and relevant system of incentives this country has had. Senator Durack might legitimately chide me and the Government about some shortcomings which he perceives that we have. I think that is quite legitimate. But I think he missed his mark in picking this example. Senator Dame MARGARET GUILFOYLE —I direct a question to the Minister representing the Treasurer. I noted the reported speech of the Governor of the Reserve Bank of Australia yesterday in which he said that the pace of growth in the economy needed to be slowed a little and that the Board of the Reserve Bank has confirmed this week that the very firm current stance on monetary policy will continue. In the light of the Treasurer's statement this week that if for some reason the Government were to become convinced that the overall policy response to the depreciation of the dollar was not the correct one it obviously would not stand idly by and let monetary policy take the full brunt, I ask: What revisions have been made to the projections in the current Budget? Have preparations commenced for a mini-Budget early next year? Senator WALSH —No provisions are being made for a mini-Budget and none are likely to be made. On the questions of the effect of changes to the exchange rate on Budget outcomes, I want to stress that the figures I am about to give are very much ball park figures and dependent upon a number of other variables. If the assumptions about any of those other variables are wrong, the outcome figures could be substantially different. But the rule of thumb is that for every one cent reduction in the value of the Australian dollar vis-a-vis the United States dollar, matched by a one-unit movement in the trade weighted index, which is not the same thing as one per cent-it is about 1.4 per cent-outlays would increase by about $50m and receipts would increase by about $100m. The principal reason for the increase in receipts-remember that I stipulated a change vis-a-vis the Australian dollar and the United States dollar-is that under the import parity pricing regime for oil a change of one cent in the United States-Australian dollar exchange rate has quite significant revenue implications. It is likely to happen for other reasons also. The major cause of increased outlays with a depreciation of the Australian dollar vis-a-vis the United States dollar is in defence equipment. I have put in a lot of qualifications. The ball park figures are that for one unit movements outlays will increase by about $50m and receipts will increase by about $100m, and therefore the deficit will be reduced by about $50m. Senator JONES —Has the attention of the Minister for Finance been drawn to Commonwealth Employment Service figures that reveal a staggering rise in job vacancies in the New South Wales catering industry and a vast improvement in the South Australian catering industry? How does this equate with the claims made by restaurants and catering associations and some individual restaurateurs that the Federal Government's measures to stamp out tax cheating at the dining table are causing great hardship in that industry? Senator WALSH —I have not seen the particular figures to which Senator Jones has referred; that is, an increase of 140 per cent in job vacancies in the catering industry in New South Wales. But I have seen reports that CES vacancies notified for restaurants, hotels, clubs and so on for October 1985-which is the most recent month for which we have statistics, for five States and two Territories-show very significant increases in the number of vacancies notified in October 1984. So, far from there being mass retrenchments in the catering industry, as had been predicted by various Jeremiahs opposite, in fact there has been a very big increase in the number of vacancies advertised. In particular, the South Australian vacancies notified increased by 12.3 per cent for October 1985 over October 1984. So the claims of difficulties in obtaining employment in the catering industry are clearly false. An article in the Daily Telegraph of 2 December reported Mr Les Rogers, the National President of the Restaurant and Catering Association, as claiming that there would be massive decreases in jobs and so on and massive unemployment in the industry due to the changed taxation treatment; in other words, the sort of hysterical nonsense we listened to for most of the morning. This is flatly contradicted by the CES figures for New South Wales for October 1985, which show that vacancies notified increased from 1,679 in October 1984 to 2,589 in October 1985. That is an increase of just over 54 per cent, which is not quite as high as the figure cited by Senator Jones, but unquestionably it is still a staggering increase in the number of vacancies. Moreover, only three cases of retrenchment could be identified in the 24 regional CES offices in New South Wales-an increase of 900 in the number of job vacancies and only three cases of retrenchment could be identified. One can draw two conclusions from this: First, that beyond any doubt the claims being made by the Opposition are ludicrous. Secondly-a more general observation-that it is incongruous, to say the least, that a political party which prides itself on adopting some sort of spartan attitude to the economy could believe that one can construct an economy on a foundation of a free lunch. Senator HAINES —Is the Minister representing the Minister for Health aware of a recent report in the Sun-Herald regarding danger to the central nervous system for people who take vitamin B tablets on a daily basis? Is he aware that Professor Truswell, Professor of Human Nutrition at Sydney University, and the Poisons Schedule Committee of the National Health and Medical Research Council have expressed alarm at the increasing number of people who are suffering from vitamin inducted peripheral nerve damage, and that both Professor Truswell and the National Health and Medical Research Council have recommended that vitamin B6 in doses greater than 50 milligrams be supplied on prescription only? Given the increasing number of people who seem to believe in the value of taking megadoses of vitamins each day and the many articles which are appearing in newspapers and magazines recommending vitamin B6 in particular for relief from things such as pre- menstrual tension and stress, and given that the tablets are available in health shops and pharmacies in doses as high as 100 times the recommended 2 milligram dose, when will the Government act to limit the availability of megadoses of vitamin B6 to prescription only? Senator GRIMES —Both the Minister for Health and the Government are aware of the increasing numbers of articles which are written in medical journals, and in newspapers for that matter, on the dangers of overdosing with vitamins, and in particular vitamin B6, but also many of the other vitamins which people commonly use. We are also aware that Australian people are amongst the greatest consumers of off the shelf vitamins per capita in the world. That has largely been due to a boom in the keep fit and look after your own health industry in recent years. It has been causing considerable concern to both this Government and previous governments, because not only are we amongst the greatest consumers of vitamins per capita but also we are amongst the greatest consumers of off the shelf medication per se. Vitamin B6 in doses in excess of 50 milligrams can cause central nervous system damage, but so can other vitamins which are taken in excessive doses, such as vitamin A. Vitamin C, if it does not cause direct damage, can certainly interfere with biochemical tests if people are ill. The belief that if something is good for people in small doses, it must be much better for them in large doses is a common belief in Australia. There are many people who believe that the same applies to alcohol. Probably the only thing we can really say that about is, I suppose, sex. I know that in fact Dr Blewett has asked his Department and the National Health and Medical Research Council to look at this matter. I also know that every time anyone at a State or Federal level suggests that there should be some controls over off-the-shelf vitamins, we get flooded with even more mail from the various vested interests than I get over child care. However, in view of the fact that serious reports have been made, I think it is time that the Government took a long hard look at this practice. I will refer the matter again to Dr Blewett who I am sure is looking at it. I will let Senator Haines know whether any details are available. Senator FOREMAN —Has the Leader of the Government in the Senate seen the provocative advertisements placed in South Australian newspapers claiming that South Australia's motor car industry is being driven to the wall by the Government? Can the Minister comment on the claims and outline the present situation of the industry? Senator BUTTON —It just so happens that not only have I seen the provocative advertisements on this issue in the South Australian newspapers but also I happen to have a copy of one of them with me. I display it to honourable senators opposite so that those of them who are incapably illiterate, if I might put it in those terms, at least will be capable of seeing how big and provocative that advertisement is. Of course, the advertisement is outrageous, misleading and ignorant. Senator Short —What does it say? Senator BUTTON —It says a number of things. Perhaps the honourable senator can see from where he is sitting that the advertisement says that thousands of workers will join the dole as a result of the fringe benefits tax and its impact on the motor vehicle industry. I would be very surprised if Senator Short was projecting that. Of course, Senator Messner has projected this in the Senate. He has talked in terms very similar to the terms of the advertisement-that is, he has talked in a very misleading and ignorant way. I am not sure who wrote the advertisement but it sounds to me suspiciously like the speech made by Senator Messner. Perhaps it is the same script writer. Let me make a couple of points. The motor vehicle industry currently is enjoying record sales and record registrations as it has done for the last two years. I believe it has benefited enormously from the Government's policy on the car industry. If one looks at the figures for the last three or four years, one sees that in 1982 there was a miserable increase of 1.7 per cent in total vehicle sales and a mere 0.3 per cent in passenger car sales. In 1984, the first full year of this Government, there was a 12.5 per cent increase in total vehicle sales and an increase of over 10 per cent in passenger car sales compared with the previous year. The South Australian motor vehicle industry has benefited by that general improvement of the industry as a whole. More importantly, the motor vehicle industry now has the confidence to invest and modernise, as reflected in the activities of a number of major manufacturing companies. For example, the Ford Motor Co. of Australia Ltd has invested $350m on the design and production of a new vehicle for 1988. Mitsubishi, an important South Australian company, has enjoyed singular success with Magna. Mitsubishi has no fears-and this has been articulated by its managing director-about the future of that company in South Australia. Senator Aulich —A good product. Senator BUTTON —It is making a good product. That is the important thing. Senator Chaney —Are you talking up Mitsubishi? Senator BUTTON —Yes, I am talking up Mitsubishi and I do not retreat from that. Senator Chaney —Ford tomorrow, perhaps. Senator BUTTON —No, I am talking up the industry of which Mitsubishi is an important part in South Australia. The honourable senator wants to stir me on this issue. I am sure that any Mitsubishi people who happen to be listening to Question Time today will know that Senator Chaney has accused me of talking up Mitsubishi, as if that had to be done in respect of this very well recognised South Australian company. The second point I would like to make relates to the impact of the motor vehicle plan and investment on the component industry. For the first time we are seeing substantial exports from this country from the component sector of the motor vehicle manufacturing industry. There have also been very great improvements in management techniques throughout the industry. Component producers are achieving some success, particularly in export markets-Dunlop with its Pulsar battery and new technology invented and developed in Australia; the Girlock brake company which again operates in South Australia and which exports successfully and ROH of South Australia which is a big exporter of aluminium wheels. All of those components are manufactured by the South Australian vehicle industry. Of course, the largest exporter in the Australian manufacturing sector is General Motors-Holden's Ltd which exports engines to Europe from its Fishermans Bend plant. I mentioned Mitsubishi in passing but Senator Chaney has provoked me to return to that point. Mitsubishi, of course, has recently announced what I think is a very successful exploration of export markets for its Magna vehicle. These things are important to the industry throughout Australia. They are very important to South Australia which for a long time has been regarded as one of the major centres of the motor vehicle industry. The important point which I seek to make is that the industry is building sound foundations for the future, in terms of technology, marketing skills and so on. These are the important things. The advertisement to which I referred is, as I said, typical of the somewhat ignorant comments which are made about the effects of the fringe benefits tax. I remind honourable senators that any impact on the motor vehicle industry as a result of the fringe benefits tax will be an impact on record production in this country, and that is something which I think has to be recognised. Senator WALTERS —I direct my question to the Minister representing the Minister for Aviation. During the consideration of the Appropriation Bills last week I was assured that I would get an answer to a question I asked before I left this place tomorrow. One of the urgent problems confronting the Tasmanian apple and pear industry is the limited availability of cheap air freight facilities to overseas markets. Is it a fact that overseas owned freight aircraft, which regularly bring goods into Australia, fly out without full loads? Is this practice being pursued in order to protect the interests of Qantas Airways Ltd? Senator GRIMES —I have perused Senator Gietzelt's brief and I am afraid that I cannot find the information which Senator Walters requires. However, this is an important matter. I will endeavour to obtain the information before Senator Walters leaves here tomorrow evening-indeed, I hope before all of us leave here tomorrow evening. Senator MAGUIRE —Can the Minister representing the Treasurer say whether the Government believes that the new building approvals figures indicate that the housing industry is operating at satisfactory levels? How do building approvals in South Australia compare with those of recent years? What would be the impact on the housing industry and on home buyers of the Liberal Opposition's policy of deregulating housing interest rates, principally by scrapping the 13 1/2 per cent ceiling on bank home loan interest, compared with the policies of this Government? Senator WALSH —The Australian Bureau of Statistics figures on building approvals for October, which were released earlier this week, show that in October 1985 some 14,783 approvals were registered compared with 14,031 in the previous October-that is, an increase of around 5 per cent nationally. However, in South Australia, which Senator Maguire mentioned, I think it is even more important to look at the enormous increase in the number of building approvals over the longer term and, in particular, to the quite remarkable improvement that has taken place in the last three years. For example, in the three years from November 1979 to October 1982 some 23,700 approvals in total were issued. In the three years from November 1982 to October 1985 some 38,800 approvals were issued. That represents an increase of 64 per cent for the three years ended October 1985 as against the figure for the three years ended October 1982. It is certainly not, of course, coincidental that for the second period when the figure for building approvals was 64 per cent higher, there was a Labor government in South Australia and for the earlier period there was a Liberal government, as indeed there was nationally. So the South Australian economy, along with the economies of the rest of the country, with the possible exception of Queensland, has of course benefited a great deal from the recovery which has taken place over the last three years and the very satisfactory growth rates which have been recorded over the last three years under the joint management of the Bannon Government in South Australia and the Federal Labor Government in Canberra. That recovery would be placed in jeopardy, however, I regret to say, if a Liberal government should be re-elected and the Liberal Party was given the opportunity to implement its policy of lifting the ceiling on housing interest rates. Indeed, the present Leader of the Liberal Party lifted the ceiling on housing interest rates on three occasions in the last 18 months during which he was Treasurer-by a full 3 per cent, from 10 1/2 per cent as it was prior to 2 December 1980, to 13 1/2 per cent in March 1982. Over that period of less than 18 months the ceiling on housing loan interest rates increased by 3 per cent through three separate increases. I can only say again to Senator Maguire that it would be a tragedy to South Australia and the nation more generally if this man should ever get the opportunity to implement the sorts of policies he implemented when he was Treasurer, and even more so the sorts of policies which he is now advocating-policies which not even the Government of which he was a member and not even Malcolm Fraser actually advocated or implemented when they were in government. Senator BOSWELL —I refer the Minister representing the Treasurer to the Government's decision to exempt 20 per cent of the value of business goodwill, including farming businesses, when applying the capital gains tax. As a farmer, has the Minister ever heard of any farm being sold with a goodwill component in it? Can the Minister explain this 20 per cent capital gains tax deduction and how it will work in regard to rural properties and farms? Senator WALSH —Several responses, I think, are required to that question. Senator Boswell referred to me as a farmer. That is right, of course. As I told the Senate yesterday, I got more dirt under my fingernails as a farmer than any of the moleskin wearing high-heel boot wearing creatures on the other side of the House ever did. As a farmer over the long term, I have not known there to be any real capital gain on the sale of agricultural land. That point is worth making because it demonstrates that the capital gains tax over the long term, if history is any guide, will have absolutely no impact on agriculture, other than possibly to deter foolish people in times of short term speculative booms from paying far too much for agricultural land and getting themselves into a position of a liquidity squeeze, if not outright insolvency, because of that; in other words, doing the sort of thing which a number of farmers, regrettably, did in the early 1980s, particularly sugar cane farmers in Senator Boswell's State of Queensland. One of the causes of a large number of farmers having liquidity problems today was the absence of a real capital gains tax in the early 1980s. Such an absence encouraged them to get caught up in a speculative boom and to pay far too much for agricultural land, to incur debts which they could not service and which in some cases have induced insolvency today. The second point is that I do not see how there can be a goodwill component in the sale of a farm, given that agricultural products by and large are marketed anonymously. I could never see that point; I still cannot. That, of course, emphasises again the substantially phoney nature of the campaign that the Liberal Party of Australia was running on the so-called goodwill issue. In regard to other businesses in which a product or service marketed is not anonymous, as it normally is in relation to agriculture, there will sometimes be a difference between the market-realised price of a business and the salvage value or in situ value of the physical assets of the business. That is referred to as goodwill. I was not involved in the negotiations between the Treasurer and the Australian Democrats. But Mr Keating, on behalf of the Government, made a concession to the Democrats, as I understand it, in order to secure the passage of the overwhelming majority of the greatest tax reform package which this country has ever seen, which has cemented the accord for another two years, with the economic benefits that flow from it and the tax cuts of which all Australians except the tax cheats will reap the benefits in 1986 and 1987. Senator BOSWELL —Mr Deputy President, I ask a supplementary question. Is the Minister denying on behalf of his Government the deal that the Government and the Australian Democrats worked out between them? Is the Minister saying that there will be no capital gains tax on farms? Senator WALSH —The capital gains tax, with the limited adjustment-a not terribly significant adjustment-which has already been mentioned, will apply to real gains realised on property purchased after 19 September 1985. They are the facts. I am not repudiating the deal that Mr Keating did with the Democrats. My own opinion, if the honourable senator wants it, is that it would be better without that small adjustment. But that was a very small price to pay in order to secure the passage through the Senate of the legislation which, as I said before, comprises the greatest tax reform package which this country has ever seen. Senator VALLENTINE —I address my question to the Minister representing the Minister for Foreign Affairs. In light of the importance of the report tabled here today on British nuclear testing in Australia and the long term negative consequences of those tests, in view of the fact that the International Physicians for the Prevention of Nuclear War have launched a world-wide campaign to persuade the United States to reciprocate the announcement by the Soviet Union of a moratorium on the testing of nuclear weapons until January 1986-since reiterated by Mr Gorbachev's proposal following the Geneva Summit to extend this test ban if the United States follows suit-and in view of the Australian Government's commitment to seeking a comprehensive test ban and our purported special relationship with the United States, will the Government immediately press the United States to support the Soviet initiative? Senator GARETH EVANS —I will refer that question to the Minister for Foreign Affairs for such detailed response as he cares to make. I simply make the point, as was acknowledged in Senator Vallentine's opening salvo, that Australia is very firmly committed to comprehensive test bans by every country in the world, including both the Soviet Union and the United States. We have pressed that point with a great deal of vigour at the Committee on Disarmament meetings and sessions held in Geneva-as Senator Vallentine well knows, as I met her there earlier in the year-and, similarly, in the current session of the United Nations General Assembly. The cause has been very vigorously pressed by Australia in that respect-not, regrettably, with much response from either the United States or the Soviet Union. But I assure her, as I am sure the Foreign Minister will when I refer her question to him, that we are doing everything we conceivably can to get that point across. Senator VALLENTINE —I ask a supplementary question. The particular aspect that I was concerned about was not so much a criticism of the Government's push for a comprehensive test ban treaty, but the specific aspect of the initiative made by Mr Gorbachev which has not been reciprocated by the United States. Can I have an assurance that I will get an answer to that question in this place tomorrow? If the Government is not pressing the United States to support the initiative, I want to know why it is not. Senator GARETH EVANS —I will respond to the question in an appropriately constructive spirit. I will see whether I can find Mr Hayden in time to give an answer tomorrow. Senator PARER —My question is directed to the Minister representing the Treasurer and the Minister for Employment and Industrial Relations. In the union superannuation funds a commission from premiums is paid to union-controlled trustee companies. Can the Minister advise the final destination of those commissions which, for occupational superannuation, would be of the order of $150m a year? Can the Minister assure the Senate that these commissions will not end up in union coffers? Senator WALSH —I do not know on what basis, if any, that figure of $150m was plucked out. I did hear a question from the Opposition a few days ago in which it was asserted that the total superannuation payment would be in excess of $6 billion, that it would add $6 billion to the national wage bill. Given that, at present gross domestic product, 3 per cent of the total share of wages and salaries paid is of the order of $4.5 billion, and a substantial component of that is in the public sector which would not be affected by the decision made the other day, the $6 billion claim is wildly inaccurate. I do not know whether the $150m to which Senator Parer referred is equally inaccurate, nor do I know whether there is any substance whatsoever to the other details in his question in which he asked about so-called premiums or commissions which would be paid somewhere or other. I will ask Mr Willis whether there is any definitive information to supply on that matter. While I am on the subject of superannuation, and related to the question that Senator Parer asked, I did hear on AM this morning, a Mr Brunsdon and Sir Roderick Proctor, who, I understand, is a lackey of the Queensland Premier, making assertions about superannuation. I begin to wonder just what this Government has to do to stop some of these people whingeing. They have been given by this Government the lowest real unit labour costs in more than 15 years, the lowest level of industrial disputation for 17 years, profit share at its highest level for the last 15 years-it is back to the levels of the late 1960s-and still they are whingeing because the prices and incomes accord provided for, subject to a determination of the Australian Conciliation and Arbitration Commission, some of the productivity increase which has taken place in the last few years to be harvested in the form of superannuation. When I hear these characters whingeing about these things I wonder whether they would rather have a wage increase, with the on-costs that go with it; alternatively, are they arguing that productivity improvements in perpetuity should accrue entirely to profits, especially given that the level of profits is higher than it has been since the late 1960s-it is back to the late 1960s level? I am not saying that the level is too high, but I am saying that it is a very reasonable proposition-I would be surprised if there are not some people, even honourable senators on the other side of the chamber, who can see this-that some portion of productivity gain should accrue to the work force and some portion, or capital, if you like should accrue to the employer. I think that is an eminently reasonable proposition, and the accord provides for that to happen. I, as a member of a government which has delivered to the business sector more than any government has delivered in the last 15 years, really am sick of this whingeing. We have delivered higher rates of economic growth on a sustained basis than any government has delivered, even in a longer period; the lowest real unit labour costs in 15 years; the lowest level of industrial disputes; and a profit share restored to the level of the late 1960s, which the last tory government never did deliver. I wonder what this Government has to do before Joh Bjelke-Petersen's lackeys will stop whingeing. Senator CROWLEY —Has the Minister representing the Attorney-General seen the article in Australian Business on 27 November 1985 titled `How to get divorced without getting ruined'? While the article refers to `spouse' and could purport to be non-sexist, the occasional reference to `your wife' indicates that the article is addressed to men, as does the content. In view of the difficulties so many women have in getting maintenance awarded, let alone in having it paid, and in getting adequate, sufficient or fair property settlement, can the Minister comment on this article and say whether he will consider circulating a balanced critique of the article to the Family Court judges? Senator GARETH EVANS —I have seen the article, written by a Sydney family law solicitor, which advocates the hiring of family law experts who would use various devices to frustrate the objects of the Family Law Act to prevent fair and equitable financial arrangements for divorcing spouses. The article is quite directly and unashamedly directed to rich businessmen who feel threatened by Family Court property proceedings. Some of the flavour of it can best be conveyed by the following quotations: If you arrive in a property division area of the Family Court and all your money stands in your name or in the joint names of your wife and yourself, you have no hope of avoiding the carving that takes place there. But, if your property has been held judiciously in companies and in trusts, it is possible to avoid not only major surgery but sometimes all surgery. . . . . To put yourself in this situation, you must substitute trustees, accountants and lawyers for your good wife. But, after 20 years or so of marriage and the taking of substantial strides down the path toward being a multimillionaire, they can appear more attractive. The article goes on a little later to state: Remember these don'ts: 1. Don't let your spouse be the trustee of the family settlement. 2. Don't let your spouse be the appointor of the family settlement. 3. Don't let your spouse know about the family settlement. 4. Don't make your spouse an equal shareholder in the family company. 5. Don't make your spouse a responsible director in the family company. 6. If your spouse is a shareholder and a director in the family company, then have a holding or an umbrella company in which he or she has no control. 7. Under no circumstances let your spouse acquire a substantial credit loan account in any company operated by you. Always make sure that any credits to loan accounts are spent just as quickly as they are amassed. That article would be bad enough were it written by some journalist, but it is written, of course, as I said, by someone who purports to be a member of an honourable profession. One would have thought that the person in question would have sheltered under a cloak of anonymity, but not so. His name and his photograph are shown there, as large as life. He is Mr Peter Twigg, of the firm of Adrian Twigg and Co., whose other main claim to fame, of course, is that he was appointed a member of the Government's top family law advisory council-the Family Law Council-for the period 1979-1982, by the then Attorney-General, Senator Peter Durack. So that is the sort of sensitivity there was in the previous Government's appointments relating to the family law subject. I think that is a disgraceful article. I have referred it to the Attorney-General and he has indicated that he is considering taking the matter up with the Acting Chief Judge of the Family Court and the Law Society of New South Wales. Senator ARCHER —Has the attention of the Minister representing the Special Minister of State and the Attorney-General been drawn to a petition containing 16,000 signatures presented this week to the Prime Minister by Ruth Mackay, daughter of the murdered anti-drug campaigner Donald Mackay, and Dr Richard Smith, Chairman of the Griffith Concerned Citizens Committee? Will the Government proceed to accede to the request contained in the petition that the Griffith drug ring and its national links be given as a reference to the National Crime Authority for attention? Senator GARETH EVANS —I have no briefing on this matter. I was not aware of that petition. I will certainly chase it up and find out what is going on. I had understood that those matters were still within the domain of Mr Justice Stewart. Senator Chaney —It is funny how you know so much about a silly article by a man named Twigg but cannot answer a perfectly serious question. Now we know what you read. That is typical. Senator GARETH EVANS —I will let that thoroughly, comprehensively wimpish contribution stand on its own terms in Hansard. Senator Chaney —What else do you read at night? Senator GARETH EVANS —This is real class! I ask Senator Chaney whether we could have more of these comments in Hansard. I do not know anything about the circumstances of the request that has been made, but I will chase the matter up with the Special Minister of State as soon as possible. Senator McKIERNAN —My question is directed to the Minister representing the Minister for Aviation. The Minister would be aware of a front page article by John Spiers in this morning's Australian headed `Age may be factor in 747 collapse'. It related to the collapse of the undercarriage of a Boeing 747 aircraft on landing at Rio de Janiero yesterday. Has the Minister any further information which may help to allay the fears of the travelling public about the safety of such aircraft, especially in the light of the apparent beat-up which this article appears to be? Senator GRIMES —I suppose all of us have read the article in the Sydney Morning Herald yesterday concerning the Boeing 747 collapse. Senator Walters —He is a bit out of date. Senator GRIMES —Some of us have a bit of trouble catching up. Mr Spiers commented, as Senator McKiernan said, that it is believed age would have been a factor in this case, and referred to other accidents of this type. He said that many aircraft that he would describe as geriatric were flying in the air. Mr Spiers, I think, has done what many journalists and politicians do at various times; he has not let the facts get in the way of a good story. It appears from the Department of Aviation, firstly, that the aircraft concerned was a relatively new one and, secondly, that the undercarriage was down when the aircraft landed, but that the aircraft left the runway and hit a series of obstructions which would have made the undercarriage fail on any aircraft of any age. The accident seems to have little relevance to the claim of broad concern about aircraft safety and structural safety. The Department of Aviation, like other aviation authorities in the world, has no reservations concerning the integrity of the Boeing 747 type and in particular the safety of those aircraft operated by Qantas Airways Ltd. In fact, adequate structural inspection procedures are in place on all Australian airlines' aircraft to cover any concerns about any aging aspects. Senator Peter Baume —Apart from that, it was a good story. Senator GRIMES —The article, apart from all those factual errors, as Senator Baume said, was a good story, dreamt up, I suppose, because Mr Spiers had nothing better to do at the time. Senator VIGOR —My question of the Minister representing the Minister for Health relates to the Government's refusal to accede to Commissioner Caesar's request that he be allowed to examine staffing levels in the Australian Capital Territory health system. On what grounds did the Government last night refuse to agree to a review by the Australian Conciliation and Arbitration Commission of the circumstances-in particular, nurse staffing levels-which gave rise to the present nurses dispute in the Australian Capital Territory? Given that apparently no extra funds will be available in 1985-86, and that hence no extra nurses will be employed, can the Minister provide details of the nature and extent of the reduction in health services to the residents of the Australian Capital Territory in the second half of 1985-86? Senator GRIMES —The Minister for Health has in fact agreed to set up an independent inquiry to deal with the issues arising out of the current industrial dispute involving members of the Royal Australian Nursing Federation and to implement recommendations on the issue of nurses' work loads immediately that inquiry reports. The second term of reference of the inquiry relates to nursing staff resources. The Minister agreed some days ago to place these recommendations before the Government in the context of the development of the 1986-87 Budget. I do not think that he can do otherwise. Yesterday Commissioner Caesar offered to undertake this inquiry if all the parties to the dispute would agree to abide by his recommendations. The Minister for Health sensibly welcomes the involvement of the Conciliation and Arbitration Commission in the area of its jurisdiction. However, Dr Blewett pointed out that, as Commissioner Caesar noted in his statement of 26 November, the jurisdiction of the Commission is with industrial matters. The Minister said that he would not be able to make a commitment for extra resources without first taking such a recommendation to the Government, and that would be possible only within the context of the 1986-87 Budget. The Government has funded the Australian Capital Territory Health Authority to a level that enables it to maintain its services in 1985-86 at the same level as last year. We do not believe that there is any case for an increase in funding beyond that level in this financial year, so that is the reason why Dr Blewett could not make that commitment. No government could make the sort of commitment for which Commissioner Caesar asked. Days before that we had agreed to set up an independent inquiry of the type that Senator Vigor and Commissioner Caesar obviously think is needed. We certainly wish this ongoing dispute to be settled. The difficulty for nurses at the moment is that more and more nurses are returning to work. My understanding is that yesterday more nurses were at work at the Royal Canberra Hospital than work could be found for. That is the situation of the dispute at the moment. I will seek further information from the Minister if Senator Vigor needs it. Senator VIGOR —I have a supplementary question. Following the Minister's answer, I would like to know when the Parliament can expect accurate information on the recent reported daily imbalances between nursing needs and nursing staff hours available in the Australian Capital Territory? Senator GRIMES —I will seek that information from the Minister for Health, as I said, and provide it for Senator Vigor. We do not want to have a situation where half of the staff of the Australian Capital Territory Health Authority are providing information for answers to Senator Vigor's questions in the way that he apparently thinks other departments can. Senator MORRIS —Is the Minister representing the Minister for Communications aware of the concern of the people of Parkes at the downgrading of its Telecom office? In view of the social and economic effects of Telecom facilities in rural New South Wales, can the Minister advise of the future of that office? Senator WALSH —After a furious scratch around, I have discovered that I have a note on this. I am advised by Mr Duffy that Telecom Australia does not intend altering the current status of the Parkes Telecom office, which is an outpost of the Dubbo district. Existing staff who directly provide service to the customer will continue to be based in Parkes. However, a small number of clerical positions involved with basic internal administration matters, concerning accounting and personnel functions, will be progressively transferred to Dubbo. These transfers will be made either as a result of a direct request by the staff concerned or as the positions become vacant. So, Emily Renshaw and all the other people of the Parkes telephone exchange have no need to worry. Senator MICHAEL BAUME —Is the Minister representing the Minister for Defence aware that the Canberra Times obtained under the provisions of the Freedom of Information Act, and only after an appeal to the Administrative Appeals Tribunal, a copy of a report prepared by the Defence Facilities Policy Committee that revealed that the Army does not need the much disputed artillery and infantry centre between Bathurst and Orange, or a manoeuvre area near Cobar? Will the Minister table that report in Parliament? If not, why not? As the report apparently indicates that there is no sound military reason for acquiring this land, will the Government now cancel the Army's land grab in New South Wales and stop harassing my constituents? Senator GARETH EVANS —The honourable senator's constituents are sufficiently harassed by having him as their member not to need anything else to add to their burden. I am advised in relation to this matter by the Minister for Defence that papers prepared by the Defence Facilities Policy Committee on Army training area proposals, released yesterday under the Freedom of Information Act, are part of the decision-making process connected with those proposals. The papers have been released in the public interest. I do not imagine, under those circumstances, that there would be any difficulty about tabling them-but I will need to check that with the Minister-so the community at large is aware of the issues which have to be taken into account before final decisions are made on the proposals. The views expressed in the papers show that Defence has not treated the proposals lightly or superficially, but has subjected them to searching analysis. The need for the training areas has been examined most comprehensively and final decisions will not be made until all feasible options have been considered thoroughly. Final decisions, I repeat, have not yet been made. The areas of Cobar and Bathurst-Orange had been offered by the New South Wales Government and it had been decided to examine them in detail. However, decisions about them will not be made until military suitability and environmental impact assessments have been completed. These assessments will be brought together in environmental impact statements, which it is hoped will be completed and released for public consideration early in 1986. The types of issues covered in the papers which have just been released will be addressed in the environmental impact statement and it is hoped that release of the papers now will assist the process of public consideration. The Minister for Defence, in his briefing note to me, adds a further rider, which I put on the public record, for what it is worth: `It is hoped too that the information contained in the papers will be treated responsibly by the media'. Senator MICHAEL BAUME —I ask a supplementary question. Do I get the impression from the Minister that the Government was happy to release this information in the public interest? If so, how does that square with the fact that after the Canberra Times sought the release of this information in March under the freedom of information provisions, access was refused by the permanent head of that Department, Sir William Cole, on national security grounds? Senator GARETH EVANS —Sir William Cole's views about what is in the public interest may well be different from those of the Minister or other members of his Department. That has been the case in the past, I suspect, and may well be again in the future. The point is that the papers have been released, whatever views might have been formed along the way, and they have been released as a contribution to an informed public debate. I only hope that the honourable senator will respond in the same spirit, and not in his usual churlish and carping fashion, to what is a genuine attempt on behalf of the Minister to inform the public, including Senator Michael Baume-difficult though that task may prove to be. Senator McINTOSH —I direct my question to the Minister representing the Minister for Foreign Affairs. Can the Minister advise the Senate on the current status of the Antarctic Treaty following its consideration by the United Nations General Assembly recently? What importance does the Government place on the continued viability of the Treaty? Senator GARETH EVANS —I am able to advise the Senate that three resolutions on An- tarctica were adopted in the first Committee of the United Nations General Assembly three days ago on 2 December. They call, among other things, for the United Nations Secretary-General to update his study on Antarctica, and for the Antarctic Treaty consultative parties to report on their negotiations to establish a minerals regime and to exclude South Africa from Antarctic meetings. These resolutions attracted around 80 positive votes on each. About 35 states did not participate in the vote and an equal number absented themselves. With one or two exceptions, parties to the Antarctic Treaty did not participate because of the failure of Malaysia and its friends to adhere to the tradition of consensus in the handling of the Antarctic item. The vote was very satisfactory from Austra- lia's point of view. Notwithstanding our objections to elements of the resolutions, the principal resolution did contain formal recognition by the General Assembly of the Antarctic Treaty system, and we regard this as very positive. For the future, we hope that the poor result they obtained will persuade Malaysia and its friends to seek consensus next year. The Antarctic Treaty is important to Australia and we hope that Malaysia, as a close regional friend, would take account of that. It is also important to the world, as a successful instrument for disarmament and peaceful co-operation. Senator MISSEN —My question is directed to the Leader of the Government in the Senate representing the Prime Minister. I refer the Minister to his answer to my question without notice on 11 November 1985 concerning any discussion that took place at the recent Commonwealth Heads of Government Meeting in Nassau in respect of the deteriorating human rights situation in Sri Lanka. In the light of the Minister's response that no action was taken by the Australian Government or any other Western government to raise the situation of Sri Lanka at that meeting, I ask: Firstly, what is the present position of the Australian Government's policy in respect of Sri Lanka, and has it altered its policy and procedure in regard to the admission and protection of Tamil refugees? Secondly, why is the Government now advising many Tamils who were granted refugee status in Australia in the years since 1983 to return to Sri Lanka or they will be deported? Thirdly, does the Government consider that it is now safe for them to return to Sri Lanka and, if so, on what grounds was this judgment made? Senator BUTTON —Senator Missen has pursued this matter at Question Time on previous occasions. I can indicate, of course, that the Government remains concerned about the communal problems in Sri Lanka and particularly the violence and human suffering which has accompanied those disturbances. It believes that an early political solution to the problem is essential and it hopes that direct political dialogue over the problems can soon be resumed. Following the disturbances, arrangements were made to expedite consideration of Sri Lankan migrant entry cases to Australia and to approve for entry under the special humanitarian program those who were adversely affected by the disturbances-mainly Tamil people. More than 730 persons have been given special visas under the special humanitarian program. In addition, temporary entrants to Australia who had fears about returning to Sri Lanka have been permitted to extend their entry permits and they will not be threatened with deportation. The Government is constantly monitoring the situation and the arrangements under the two programs I have mentioned will remain in force as long as they are required. Senator GRIMES —On 2 December Senator Townley asked Senator Gietzelt a question without notice concerning the nationality of the person who selects pilots chosen to fly for Qantas and whether some Qantas pilots are in fact foreign pilots. The answer I have been given is as follows: Qantas pilot selection is, in fact, not made by one person. There are nine separate selection steps involved in the procedure and no single member of Qantas's staff is involved in all of the steps. The present Qantas pilot selection policy requires an applicant, inter alia, to hold Australian permanent residence status and Australian pilot licences. Senator GARETH EVANS —Senator Kilgariff asked me a question a couple of days ago about an article in the Bulletin relating to nuclear testing in the Pacific to which I promised to give him an answer as soon as possible. I am now able to do that, courtesy of the Minister for Foreign Affairs, in the following terms: The honourable senator's question addresses two separate issues. Firstly, the Government's particular condemnation of French nuclear testing arises from the fact that France conducts its tests in the South Pacific region-- Senator Chipp —If it is a long answer, why don't you incorporate it? Senator GARETH EVANS —I am happy to incorporate it. I am just observing the spirit and conventions of this place. Mr Deputy President, I ask leave for the answer to be incorporated in Hansard. Leave granted. The answer read as follows- TESTING IN THE PACIFIC The Honourable Senator's question addresses two separate issues. 2. The Government's particular condemnation of French nuclear testing arises from the fact that France conducts its tests in the South Pacific region contrary to the expressed wish of the people of the region. More broadly, there is the Government's long-standing concern to see the conclusion of a Comprehensive Test Ban Treaty which would bring about an end to all testing by all countries in all environments for all time. It places the highest priority on the conclusion of such an agreement. 3. As to missile tests, the United States, the Soviet Union and China all test nuclear capable ballistic missiles to impact points in the Pacific. The Government understands that since 1975 all Soviet tests into the Pacific have been to impact areas in the North Pacific. The United States also has a Pacific missile test range, with an impact area near Kwajalein Atoll in the North Pacific. The Government has not protested to either country regarding its missile tests in the North Pacific and has no plans to do so. The testing of delivery vehicles is, of course, an entirely different thing from test explosions, not least in terms of possible environmental consequences. Senator PETER RAE(Victoria) —I seek leave to make a personal explanation. Leave granted. Senator PETER RAE —I wish to refer briefly to the fact that on 2 December, during the debate on the Health Legislation Amendment Bill (No. 2) 1985, while Senator Peter Baume was speaking I interjected in relation to the Commonwealth Serum Laboratories and said: It does not pay proper rates or proper rent. I emphasise the word `proper'. Later in that debate on 3 December Senator Grimes said: Senator Peter Rae, by interjection last night, extended that argument. He said that CSL had such an advantage in that it did not have to pay rents and rates. That is quite false. Senator Walters said: He didn't say that. Senator Grimes then said: Senator Peter Rae did say that last night by interjection, but it is quite false. In fact, CSL does pay rent to the Commonwealth and it pays rates to the Woodend Council in Melbourne of about $760,000 per annum. Senator Grimes talked about people having knee-jerk responses, and a little later he gave some further information which elaborated on what he had already said about the $760,000. I simply wish to point out that in 1980 the Senate Standing Committee on Finance and Government Operations investigated CSL and its financial statements and in a report, which is Parliamentary Paper No. 59/1980, the Committee reported: CSL's main buildings are situated at Parkville in Melbourne on about 33 acres of land owned by the Commonwealth. This land is in fact the most important of the assets in the custody of CSL which were referred to earlier. Because CSL does not own the land, its value is not included in the `Fixed Assets' listed in CSL's balance sheet for 1978-79. I might say also that it is not listed in CSL's balance sheet for 1983-84, which is the most recent one available. The report further stated: The Committee notes that this fact alone lessens the comparability of CSL's balance sheet with that of any similar public listed company. It went on: CSL informed the Committee that rent is in fact paid to the Commonwealth for the land, although no formal lease agreement has ever existed. The report continues: The rent . . . was believed to include some amount in respect of rates, although the Commonwealth does not pay rates to the Municipal Authority. The land on which CSL pays this amount of rent is prime Melbourne inner city real estate. While an accurate assessment of its commercial value is not available and may present some difficulty due to uncertainty in relation to its alternative uses and future zoning, there can be no doubt that the amount paid by CSL is far less than the economic rent. CSL stated in evidence that because part of the land was used for `national interest' purposes, it assumed that the rent was calculated for only that part used for commerical purposes. The situation is obviously both informal and unclear. The Committee is concerned that this arrangement means that CSL's financial statements do not fully reflect either its available resources or the extent of the taxpayers subvention to its activities, because the true value of the land which it uses is not shown. To this extent CSL's statements do not disclose as much as those of a comparable public company. Commercial comparability is not available. The report went on to talk about rates and indicated that the fact that no full rating contribution was made also gave CSL an advantage which was not enjoyed by its competitors and made its performance lacking in comparability. I add, in case Senator Grimes thinks that there is something different in the most recent report, that I am sure that everybody would be delighted to have the most recent report tabled. I understand from CSL that it has been sent into the bureacuracy, but it has not emerged from there. It is now five months since the end of the financial year for which the report was due and CSL is therefore out of time in presenting its report. If that report provides information which shows that I am wrong, obviously it is the fault of CSL and the Government in not getting that information out in time which has caused any error. I believe that there is unlikely to be any error as I understand that the rental expense was only $708,000 in 1984-85. The figure may have gone up this year to $877,000, but it is still an extremely low amount to pay for the very valuable land and buildings which are occupied and used by the Commonwealth Serum Laboratories. I believe that the land to which Senator Grimes referred is land of relatively low value which is owned by CSL and which is in a different area entirely and is not the extremely valuable 33 acres of land on the outskirts of the city of Melbourne. In other words, I believe that what I said was accurate and I object to being called a liar in relation to it. Senator WATSON(Tasmania)(3.13) —I move: That the Senate take note of the paper. The Department of Industry, Technology and Commerce has an important role in advising and implementing government policy in relation to Australian manufacturing and service industries and technology and it is a focal point of interaction between business, unions and Federal and State governments. I draw the Senate's attention to a significant paragraph of the report, and that is the one which states that the Australian economy has grown up around a framework of government intervention in industries and the key question for government is how to modify the framework of intervention so as to improve the ability of the economy to achieve the required structural change. The plight of manufacturing industry must continue to exercise some concern for both the Minister for Industry, Technology and Commerce (Senator Button) and his Department. Over the past 15 years we have seen the loss of 150,000 jobs. Of those 150,000 jobs, 140,000 were actually lost during the Whitlam years. Our inability to compete internationally and the failure of our industries to exploit modern technology and opportunities for growth, particularly in the Pacific region, have caused us problems. Those problems have been manifested very much in the form of a relative decline in our standard of living. For example, 40 years ago Australia ranked fourth amongst the most prosperous nations in the world, whereas today Australia is ranked seventeenth. I think that we were all very much relieved in Australia when the current Australian Labor Party Government showed that it had a much more responsible attitude to the preservation of the manufacturing sector in Australia. I think it is true that the manufacturing sector must be rejuvenated. It needs government co-operation to recover from the slump. At the same time, government needs to ensure that its relative policies in manufacturing interact properly with its tax policies so that good work done in, say, the manufacturing area is not dissipated by ideological beliefs imposed through taxation measures which react against manufacturing industry. However, I believe that on all sides there is now a very much wider recognition of the need to preserve our manufacturing industries in Australia. I think that we have passed the time when many of our academics suggested that we should abandon our current manufacturing industries in favour of high technology industries. I think that this has been dispelled by the realisation that the costs, both economic and social, in terms of dislocation could never be recouped. Last year Australian industry was so uncompetitive internationally that our firms supplied only $1m of the $200m worth of products which were ordered world-wide by the United Nations Children's Fund. Many of our manufacturers are reluctant to tender in the international field. I think the question that needs to be asked is: Why do Australian manufacturers and service industries not take more advantage of the opportunities around us? Firstly, we have to recognise that many of these industries, particularly in South East Asia in future will suffer tax consequences as a result of the new tax reform measures. Also, many of those industries face tremendous competition from other international suppliers who receive tremendous levels of assistance and subsidies from their own respective governments. There is also the problem of our own industrial disputations and stoppages. It is felt that Australia is not always a reliable supplier as far as the rest of the world is concerned. Many of our industries are faced with high labour and transport costs which undermine our international competitiveness. There is also labour market rigidity, which is a barrier to the development of more efficient and export-related industries. Many of the wage fixing practices are an incredible obstacle to effective overseas competition and also the domestic rationalisation of our industries. Thus it is almost impossible to institute any form of structural change in response to international demand. I commend the report to the Senate. Question resolved in the affirmative. Senator JESSOP(South Australia)(3.18) —I move: That the Senate take note of the paper. The report of the Snowy Mountains Hydro-electric Authority is quite significant. I automatically tie the Snowy Mountains Hydro-electric Authority in with the Snowy Mountains Engineering Corporation, because I think that they are both synonymous and work together in very important respects. The Snowy Mountains Engineering Corporation has adopted a very important role internationally with respect to assisting other countries technologically with respect to engineering works. It seems to me that the importance of these two authorities escapes the notice of government. I refer particularly to the problem of water resource development in Australia. The Authority did make a false start when it used the New South Wales Public Works Department to construct an early dam with consequent overruns of cost and time. Thereafter it concentrated on investigation and design and it used the private sector to construct the remainder of the works with consequent world records being set for dam and tunnel construction. Contracts were completed on time and final costs were less than those estimated. The Snowy Mountains Authority is an excellent example of how to use the private sector and to develop a mix of public and private enterprise. Strangely this type of management was introduced in South Australia by the Tonkin Liberal Government which was able, through attrition, to reduce the number of public employees by 4,500 thereby saving the taxpayers of South Australia of the order of $60m a year. It is the policy that the John Olsen government is determined to follow after Saturday when it will be elected to govern that State. The Snowy Mountains Engineering Corporation and the Hydro-electric Authority have earned a reputation throughout the world for engineering and design expertise. They have supervised construction in collaboration with great engineering contractors in Australia and overseas. We ought to be utilising their expertise in a much more effective way in Australia. I have always said that one of our priceless resources happens to be water. I have a great regard for instrumentalities such as the River Murray Commission. It is my concern that we need to address ourselves to the establishment of a national water authority which ought to incorporate the Snowy Mountains Hydro-electric Authority, the Snowy Mountains Engineering Corporation and the River Murray Commission in order to come to grips with the fact that by the year 2000 in the northern Spencer Gulf area of South Australia, for example, the demand for water will exceed supply. I am sure Senator Grimes would appreciate the fact that we cannot do anything about the development of Australian enterprise, mining, agriculture or cope with the increase in population looking forward to the year 2000 and beyond, unless we do something about a national water resources policy. An ideal way to come to grips with that is to utilise the expertise available in the River Murray Commission with respect to advisory matters, the Snowy Mountains Hydro-electric Authority, which is recognised world wide as an engineering organisation and SMEC and come to grips with the problems that will face Australia beyond the year 2000. I commend the report to the Senate. It is about time we recognised that uranium is not our most important resource; coal is not our most important resource. Water happens to be the most vital resource for Australia's continued development beyond the year 2000. Question resolved in the affirmative. Senator HARRADINE(Tasmania)(3.24) —I move: That the Senate take note of the paper. The Public Service Board 1984-85 annual report is a most important report. It details the circumstances of the Commonwealth Public Service as at 31 December 1984. This year a special chapter is devoted to `Youth Employment in the Australian Public Service-A Statistical Profile'. I am pleased that the Commonwealth Public Service Board, after many statements by me in this chamber, has at least spent a considerable amount of time dealing with, if not justifying, the lamentable situation of youth employment in the Public Service. The figures speak for themselves. The annual report of the Public Service Board which has been tabled today reveals that youth employment in the Public Service has sunk to an all time low and `without explicit policy intervention it will decline further over the next five years'. That is a tragedy; it is quite extraordinary particularly in view of the full page advertisements that are currently being splashed around the nation asking youth to ring the Prime Minister (Mr Hawke) to tell him what ought to be done. I will tell him; I do not have to ring him. I am not a youth anyhow. He should get his Ministers to give youth a fair share of employment opportunities in their departments. The position, as revealed by this document, shows that in 1966 youth comprised some 22.2 per cent of permanent Public Service staff. This figure declined to 6.3 per cent in 1984 and the projected figure for 1985 is 5.5 per cent-the very year which is supposed to be International Youth Year, the very year in which the Government proposed that youth be priority one. I notice photographs of the Minister for Finance and the Minister Assisting the Prime Minister for Public Service Matters, Senator Walsh, and the Minister for Trade, Mr Dawkins, at the beginning of the report. Those Ministers have a specific task and ought to develop explicit policy intervention measures to ensure that youth has its fair share of jobs. Of course they will say that the Commonwealth intends to introduce youth traineeships. These have been categorised by some Public Service unions as attempts to supplant full time, permanent jobs with temporary traineeships. The argument presumably put by the Government is that traineeships will give youth a better chance to be appointed to the permanent Public Service staff. Who is youth competing with? Our young people are competing with experienced adults and if they are not given a fair go and a fair share of appointment opportunities they will always miss the boat. Page 118 of the report states: The most significant points to emerge from Figure 4 are the very substantial and steady decline in appointments of persons aged less than 21 years-in this age group representation of men among total new appointments fell from 29.8 per cent to 9.5 per cent, while women's representation fell from 34.1 per cent to 20.5 per cent--- Clearly this tragic state of affairs for youth has been brought about by deliberate policy decisions which still remain in force denying jobs particularly to young girls who want to join the Public Service. It is a tragedy which needs rectification and urgent attention. The DEPUTY PRESIDENT —Order! The honourable senator's time has expired. Question resolved in the affirmative. Senator ARCHER(Tasmania) —I move: That the Senate take note of the paper. I seek leave to continue my remarks later. Leave granted; debate adjourned. Senator DURACK(Western Australia)(3.30) —I move: That the Senate take note of the paper. I just want to say a few words about this important report, which the Parliament now receives annually from the Australian Security Intelligence Organisation. It is a report which has to have regard to the fact that it is a secret intelligence organisation and, therefore, it must continue to preserve those secrets and discretions which are so vital to its purpose. Nevertheless, by this report, it is able to provide the Parliament and the public of Australia with a good deal of information which, I think, is proving beneficial to the public acceptance, understanding and support of the organisation, although that has always been very widespread in Australia. At the same time, there has always been a number of very vocal critics of the organisation, which may have caused some disquiet from time to time. The sort of information we are receiving from the organisation helps to dispel that. I believe that a subsequent report which has been tabled, namely that from the Security Appeals Tribunal, is very interesting in that only one appeal was heard and, in fact, only two appeals were awaiting hearing at the end of last year-the period covered by this report-against security assessment by the organisation. It seems to me to be a real triumph for the organisation that so few people who are affected in any way by the security assessments made by the organisation have been displeased enough to exercise their rights of appeal to the Security Appeals Tribunal. Of course, there is also the fact that during the year covered by this report Mr Justice Hope presented to this Parliament his outstanding report on the security and intelligence organisations, in May this year, and gave ASIO in particular a very good bill of health as a result of his second and, of course-as we have come to expect from him-intensive survey of the organisation. The organisation reports here that it has already been implementing, as far as it can-by managerial decision, not by statutory changes-the recommendations of Mr Justice Hope. But of course, those recommendations, as I have said, are really only the icing on the cake. In fact, the organisation has been cleaning itself up since Mr Justice Hope's earlier reports back in 1977. That process has been highly successful, and the organisation, as Mr Justice Hope says, is in very good shape. I note that this report covers the period of the last year in office of Mr Harvey Barnett. That is acknowledged by the present Director-General of the Australian Security Intelligence Organisation in his letter to the Attorney-General (Mr Lionel Bowen), pointing out that this report covers a period for which Mr Barnett was entirely responsible. Mr Barnett decided to retire shortly after the period covered by this report, having been Director-General for four years. I would like to place on record my appreciation of the work performed by Mr Barnett as a most worthy successor to Mr Justice Woodward. Mr Barnett came to office as Director-General of ASIO after many years of experience and distinguished service as an intelligence officer. He was a man of very high professional capacities and commitments as an intelligence officer. In some ways it was an experiment to appoint a purely intelligence officer such as Mr Barnett to head the organisation, but in my opinion it was a very successful appointment. That has been confirmed by the report of Mr Justice Hope. Mr Barnett was appointed for a term of five years, and he retired a year earlier than necessary. I think he had some very trying times in his last year or so in office with the Ivanov affair and the Combe affair; but of course, the Ivanov affair was a very oustanding example of the professional work of the organisation and Mr Barnett himself. The DEPUTY PRESIDENT —Order! The honourable senator's time has expired. Senator CHIPP(Victoria-Leader of the Australian Democrats)(3.36) —I just add my personal tribute to Mr Harvey Barnett. I am very privileged to have such an extremely distinguished Australian as a personal friend. I join with Senator Durack in paying him the highest tributes on behalf of myself and my Party. Senator GARETH EVANS(Victoria-Minister for Resources and Energy)(3.36) —Since I am in the chamber, I think it would be inappropriate if I did not add a word or two on this subject. I was, of course, Attorney-General during the last part of Mr Harvey Barnett's tenure as Director-General of the Australian Security Intelligence Organisation. I simply say for the record that he served me, the Government and his country very well indeed. Question resolved in the affirmative. Senator MACKLIN(Queensland)(3.37) —I move: That the Senate take note of the paper. The annual report of the Office of Australian War Graves is always a slim volume, but it is an important one. I wanted to raise just one issue. It is not included in the report, but I understand that the Office of Australian War Graves is discussing certain matters with the Government of the German Democratic Republic, which I visited recently with a parliamentary delegation. We visited a war grave outside Berlin which is maintained by the Government of the GDR in an exemplary fashion. There are 30 Australian war graves there. They are all of prisoners of war in World War I, who were taken from the front line in France into Germany. All those buried there seem to have died towards the end of that war, some indeed a week or two prior to the cessation of hostitilities. As I understand it, the Office of Australian War Graves is having discussions with the Government of the German Democratic Republic in order to come to an arrangement whereby those graves will come under treatment by the competent authorities which are currently based in the Federal Republic of Germany. I place on record my appreciation of the work which has been done by the Government of the German Democratic Republic with regard to those graves. It is a very useful comment on the growing relationship between ourselves and that country that those graves have been maintained in such an exemplary fashion. The relatives of the fallen soldiers buried there can certainly rest assured, if they have been unable to visit the graves, that they have been given every due respect and that every care has been taken to ensure that the honour to which they are due has been accorded them. Question resolved in the affirmative. Senator PUPLICK(New South Wales)(3.39) —I move: That the Senate take note of the paper. We had a debate last Friday about section 116 of the Broadcasting and Television Act in which I moved, on behalf of the Opposition, that section 116 (2) of that Act be repealed. With the support of the Australian Democrats and in the teeth of the opposition of the Government, that amendment was carried and is now forwarded to the House of Representatives for its concurrence. It is therefore with a great deal of interest and satisfaction that I see that the Human Rights Commission, in report No. 16 on Freedom of Expression and section 116 of the Broadcasting and Television Act 1942, recommends the amendment of section 116 (2). Senator Chipp —It just shows how brilliant you are. Senator PUPLICK —It does indeed. It shows a meeting of minds on the matter. It recommends that section 116 (2) be modified so that if there is to be any exclusion of the dramatisation of political material on television it should be confined to the so-called `election period', which is defined within the relevant section of the Broadcasting and Television Act. The report goes on, interestingly enough, to make recommendations about section 116 (3) and to suggest that that section of the Act be amended so that all registered political parties as defined in section 4 (1) of the Commonwealth Electoral Act 1918 with validly nominated candidates standing for election should have the benefit of the reasonable opportunities rule; that is, some access to time on television provided free during part of the electoral processes. I do not want to detain the Senate any longer, other than to say that I hope the Government, in determining its attitude to the Senate's amendment to section 116 (2), will be guided by the suggestions made by the Human Rights Commission and will therefore find it within its collective heart to support the amendment which was made by the Senate, supported by the Liberal and National parties and by the Australian Democrats, and which has now received the endorsement of the Human Rights Commission, most of the recommendations of which usually find favour with the Government, and rightly so. Question resolved in the affirmative. Senator PUPLICK(New South Wales) —On behalf of Senator Archer, I move: That the Senate take note of the paper. I seek leave to continue my remarks later. Leave granted; debate adjourned. Senator PUPLICK(New South Wales) —On behalf of Senator Archer, I move: That the Senate take note of the paper. I seek leave to continue my remarks later. Leave granted; debate adjourned. Senator VIGOR(South Australia) —I move: That the Senate take note of the paper. I seek leave to continue my remarks later. Leave granted; debate adjourned. Senator PUPLICK(New South Wales) —On behalf of Senator Archer, I move: That the Senate take note of the paper. I seek leave to continue my remarks later. Leave granted; debate adjourned. Senator VIGOR(South Australia) —I move: That the Senate take note of the paper. I seek leave to continue my remarks later. Leave granted; debate adjourned. Senator VIGOR(South Australia) —I move: That the Senate take note of the paper. I seek leave to continue my remarks later. Leave granted; debate adjourned. The DEPUTY PRESIDENT —In accordance with usual practice, I table a list of parliamentary committee reports to which the Government has not responded within the prescribed period. This list has been circulated to honourable senators. With the concurrence of the Senate, the list will be incorporated in Hansard. Leave granted. The list read as follows- DEPUTY-PRESIDENT'S REPORT TO THE SENATE ON GOVERNMENT RESPONSES OUTSTANDING TO PARLIAMENTARY COMMITTEE REPORTS Title of Report Date tabled Government response SENATE STANDING COMMITTEES Constitutional and Legal Affairs 1. Burden of Proof in Criminal Proceedings... 25.11.82 I: 2. 6.83 I: 15.12.83 I: 22.10.84 I: 31. 5.85 2. `Makarrata' between the Commonwealth and Aboriginal people... 13.9.83 I: 22.10.84 I: 31. 5.85 3. Conscientious Objection to Conscripted Military Service... 28.5.85 - 4. Commonwealth Law Making Power and the Privilege of Freedom of Speech in State Parliaments... 30.5.85 - Education and the Arts 1. Tenure of Employment of Academics... 9.9.82 I: 15.12.83 I: 22.10.84 I: 31. 5.85 2. A National Language Policy... 21.2.85 I: 28.5.85 I: 31.5.85 3. Examination of Annual Reports (Third Report) Children's Television Standards... 21.8.85 - Finance and Government Operations 1. Statutory Authorities of the Commonwealth-5th Report... 16.9.82 I: 11.11.82 I: 15.12.83 I: 22.10.84 I: 31. 5.85 2. Superannuation Fund Investment Trust and the Commissioner for Superannuation-Annual Reports 1980-81... 1.12.83 I: 22.10.84 3. Practical Operation of the Prescribed Payments System of Taxation... 4.9.84 I: 31. 5.85 4. Report on Policy Questions Underlying Division 312 of Appropriation Bill (No. 1) 1983-84... 19.10.84 I: 31. 5.85 5. Report on Changes in the Presentation of the Appropriations and Departmental Explanatory Notes... 30.5.85 - 6. The Superannuation Fund Investment Trust... 21.8.85 - Foreign Affairs and Defence 1. Australia's Defence Co-operation with its Neighbours in the Asian-Pacific Region... 23.10.84 I: 31. 5.85 Industry and Trade 1. Development of the Australian Fishing Industry... 21.4.83 I: 15.12.83 I: 22.10.84 I: 31. 5.85 2. Australia-China Trade... 23.8.84 I: 31. 5.85 I: 11. 9.85 3. The Development of Closer Economic Relations between Australia and New Zealand (First Report)... 11.10.84 I: 31. 5.85 4. The Development of Closer Economic Relations between Australia and New Zealand (Second Report)... 20.8.85 - National Resources 1. Development of the bauxite, alumina and aluminium industries... 25.11.81 I: 15.12.83 I: 16.10.84 I: 31. 5.85 Science, Technology and the Environment 1. Land Use Policy in Australia... 21.2.85 I: 31. 5.85 2. Examination of Annual Reports. Royal Australian Institute of Public Administration... 21.8.85 - Social Welfare 1. Another side to the drug debate-a medicated society?... 14.5.81 I: 15.12.83 I: 22.10.84 I: 31. 5.85 2. Children in Institutional and Other Forms of Care. A National Perspective... 22.8.85 - SENATE SELECT COMMITTEES 1. The Future of the Government Clothing Factory at Coburg... 14.10.82 - 2. Statutory Authority Financing Vol. 1:... 8.9.83 I: 15.12.83 I: 22.10.84 I: 31. 5.85 Vol. 2:... 13.10.83 I: 15.12.83 I: 22.10.84 I: 31. 5.85 3. Allegations Concerning a Judge... 21.2.85 - 4. Private Hospitals and Nursing Homes in Australia... 21.2.85 I: 31. 5.85 I: 21. 8.85 5. Video Material... 28.3.85 I: 31. 5.85 6. Animal Welfare-Export of live sheep for Australia... 20.8.85 - JOINT COMMITTEES Australian Capital Territory 1. Planning in the ACT: procedures, processes and community involvement... 4.4.79 I: 9.10.79 2. Parliamentary Zone Draft Development Plan... 1.3.84 I: 31. 5.85 Foreign Affairs and Defence 1. Disarmament and Arms Control... 11.10.84 - 2. Report on the Jackson Report on Australia's Overseas Aid Program... 23.5.85 - Note-I: Interim response only, as at 3 December 1985. Senator MISSEN(Victoria)(3.41) —by leave-I move: That the Senate take note of the paper. I think we should always so move on these occasions. One of the excellent practices that have been followed in this chamber in the last few years is that of presenting an assessment at the end of each session of what has happened to committee reports. On this occasion, Mr Deputy President, you have presented a report which, if my calculations are correct, deals with 35 committee reports. In no case has there been a final response from the Government. There have, of course, been a number of interim reponses. I have not had the opportunity of looking at the responses which relate to other committees, but I can say with regard to the Senate Standing Committee on Constitutional and Legal Affairs, for example in respect of the report entitled `Burden of Proof in Criminal Proceedings', that there are four interim responses but that the matter is far from finalised in any way, and that the Government's policy is not at all clear to the Committee. We, like all the other committees, have no final response from the Government. It is worth pointing out that the previous Government undertook to respond to reports within six months and that this Government, when it came to office, undertook to respond within three months. In fact, some of these reports were tabled as long ago as 1982 or 1983 and most of them were tabled prior to this year. In practically all cases one may say that the Government is technically in default. I think this is a serious matter and one which the Senate must look at when it has more leisure. Nothing is more frustrating to Senate committees than to find that their reports are neglected or the Government's responses to them are not finalised and they have become out of date, and to have someone suggest that the inquiries should be undertaken again. I think it is an alarming trend on the part of the Government that it is not responding finally to committee reports. It has adopted the habit in a number of cases of giving interim responses, which very often just say `We have a department looking into it', and telling us nothing about the substantive part of the report. Consequently, I think we should all look to our committees during the recess to see where the Government has not responded and where we should press on to get immediate responses from the Government. If this practice goes on one can see the decline and fall of the Senate system. Question resolved in the affirmative. Senator ZAKHAROV(Victoria)(3.43) —On behalf of the Senate Standing Committee on National Resources, I present a report on the natural resources of the Australian Antarctic Territory, together with the transcript of evidence. Ordered that the report be printed. Senator ZAKHAROV —by leave-I move: That the Senate take note of the report. I seek leave to have my speech incorporated in Hansard. Leave granted. The speech read as follows- On behalf of the members of the Senate Standing Committee on National Resources, it gives me great pleasure to table the Committee's report on the natural resources of the Australian Antarctic Territory. In recent years interest in Antarctica has increased and broadened, while debate over the resource potential of the region has reached many public forums. These forums include the United Nations General Assembly-which is presently debating the political and legal status of Antarctica, particularly whether it should be considered the common heritage of mankind-and environmental and conservation groups concerned that the fragile Antarctic environment be protected from damage caused by human activities. The Committee found the assessment of the resources of the Australian Antarctic Territory-and of Antarctica generally-to be highly subjective and speculative, particularly in relation to mineral resources. Although the whole question of the possible exploitation of mineral resources is being covered during negotiations by Antarctic Treaty parties to establish a Minerals Regime, the Committee believes that technical and economic restraints would in any case prevent the rational exploitation of onshore mineral resources in Antarctica for many years to come. However, technological advances may allow the economic exploitation of offshore reserves of hydrocarbons in the short-to medium-term future, provided political, environmental and legal questions are resolved. While more is known about the marine living resources of Antarctica due to their exploitation for over 200 years, the Committee remains concerned that the impacts of harvesting these resources are presently only guessed at. With commercial attention now being focussed on the krill and fish resources of the region, the Committee hopes that lessons of the past have been learned, and has recommended that research be conducted into the impacts of marine living resource harvesting before expansion of exploitation above current levels. The Committee has also made a number of specific recommendations aimed at increasing the effectiveness of the Convention for the Conservation of Antarctic Marine Living Resources-CCAMLR. The adequacy of existing and proposed Antarctic environment protection and conservation measures was also addressed by many witnesses. The fragility of the Antarctic environment was expressed repeatedly to the Committee. The view was also put that the wildnerness value of Antarctica and its value as a pristine laboratory for scientific research are its most important resources. Evidence presented to the Committee pointed to a number of inadequacies in existing environmental protection measures. To rectify this the Committee has recommended that a Conservation Convention be adopted by the Antarctic Treaty nations to co-ordinate and strengthen existing environmental protection measures, but which would permit resource exploitation under stringent environmental controls. As a first step the Committee believes that land use priorities should be determined by the Antarctic Treaty nations and a system of multiple land use management established. The Committee regards the proposal to establish the whole of Antarctica as a World Park as impractical and favours a system of multiple land use management. The Committee supports Australia's involvement in the Minerals Regime negotiations and has recommended that Australia during these negotiations have as a basic objective the protection of the unique Antarctic environment and its dependent ecosystem. The Committee is pleased to note that the Antarctic Treaty nations have recognised that environmental protection must be a basic consideration of any Antarctic Minerals Regime. The Committee has also made a number of specific recommendations in the area of environmental protection including: That the scope and purpose of the present system of Specially Protected Areas and Sites of Specific Scientific Interest be reviewed; that the Antarctic environment be granted the same level of protection as is presently afforded to Antarctic flora and fauna; and that international environmental impact assessment procedures be adopted by the Antarctic Treaty nations. The Committee learned of the impacts human activities have already had on the Antarctic environment, particularly in the vicinity of stations. Members of the Committee who visited Australia's Casey station during the 1984-85 summer saw some of these impacts for themselves. However, I am pleased to report that substantial efforts have been made by the Antarctic Division to both clean up and protect the immediate environs of Australia's Antarctic stations. As mentioned above, the political and legal status of Antarctica has been questioned in the United Nations General Assembly. The Committee is of the view that the Antarctic Treaty and subsidiary arrangements, which have been successful for almost 25 years, should be continued, particularly as the Antarctic Treaty system has shown itself to be capable of adaptation to meet new needs. The Committee concluded that the concept of the common heritage of mankind advocated by some nations is not appropriate for the region. The Committee has therefore recommended that Australia maintain its sovereignty claim and continue to support the Antarctic Treaty system. In making these recommendations, the Committee has considered the extent to which Australia's Antarctic effort substantiates both its claim to approximately 42 per cent of Antarctica and its right to involvement in Antarctic decision-making. It is the Committee's firm view that the amount of funds allocated to Australia's Antarctic activities are not commensurate with the size of Australia's claim and the importance of Australia being represented in Antarctic decision-making forums. In particular, the Committee believes that Australia's Antarctic scientific program has been appallingly underfunded to date and has recommended that a substantial increase in funds be made to enable a major scientific program to proceed and that priority areas for research be determined including the need for research in the social sciences. The Committee acknowledges the recent increase in funds to Antarctic activities allocated in the 1985-86 Budget, but considers that even this represents only a token gesture in terms of the desirable level of Australia's contribution to scientific knowledge about Antarctica. The Committee believes that if an Australian station is established in the eastern sector of the AAT it should not inhibit a substantial increase in research funding. For these reasons, the Committee believes there is an urgent need for Australia to re-examine the purpose and objectives of its presence in Antarctica, with a view to establishing a clear sense of direction and overall policy framework. In addition, the Committee has recommended that a comprehensive study be undertaken of Australia's Antarctic transport options. The question of transport of equipment, supplies and personnel to and from Antarctica has been `under consideration' for many years now with various options alternatively favoured and discarded. The Committee has recommended that the study be carried out by an external agency. On that note, I should like to reiterate the contents of a recent press statement by the Committee regarding the Greenpeace expedition to Antarctica this summer. Transport to Antarctica is a very specialised operation, fraught with difficulties. This has been shown by the plight of the Nella Dan which is an ice strengthened polar vessel manned by an experienced crew. The Committee believes that the risks faced by the Greenpeace expedition are great, the consequences, should assistance be required by the expedition, would be unacceptably costly, in terms of risks to life and equipment and disruption of scientific programs. The Committee therefore urges Greenpeace to reconsider its plan. Other issues on which the Committee has made recommendations include: The need for an assessment of the resource potential of icebergs; the need for Antarctic tourism to be controlled to ensure minimum environmental damage; that the necessity of establishing permanent marine reserves and sanctuaries to protect potentially endangered species be examined; and that an external agency review the adequacy of the Antarctic Division's selection and training procedures. In conclusion, I wish to thank the present members of the Committee, Senator Robertson, Chairman during the last Parliament and former Senator Primmer who served as Chairman until 30 June this year, and Senator Georges, who served in the early stage of the inquiry, for their assistance and co-operation. I thank all the individuals and organisations who made submissions or assisted the Committee in any other way. I would like to thank the Honourable Barry Jones, Minister for Science for facilitating the visit of Committee members to Antarctica during the 1984-85 season, the staff of the Antarctic Division, especially the personnel on Voyage 4 and the staff at Casey Station. Finally, I would like to thank the staff who worked on this inquiry, particularly Peter Roberts (Secretary) Judy Ryan, Pippa Carron and Jane Palmer (Research Officers) and June Fallick (Steno-secretary). I commend the report to the Senate. Senator ZAKHAROV —I seek leave to continue my remarks later. Leave granted; debate adjourned. Debate resumed. Senator GIETZELT(New South Wales-Minister for Veterans' Affairs)(3.44) —by leave-The Senate is being asked to extend the sunset clause which was imposed six months ago and which is to expire at midnight this evening. There has been considerable discussion within the veteran community, and in particular with the leaders of the ex-service organisations, over the last few days about the possible passage of the Repatriation Legislation Amendment (Extension of Operation) Bill and the issues relating to the provisions of the Veterans' Entitlements Bill. Substantial agreement has been reached within the veterans' organisations on the passage of the Bill now before the Senate. Considerable progress has been made in discussions with the Australian Democrats and the Opposition on the same matters. One matter remains unresolved although some progress has been made towards reaching a satisfactory conclusion. The main ex-service organisations have indicated that they are satisfied with the position of the Veterans' Entitlements Bill regarding the standard of proof arrangements to apply to claims lodged before 15 May 1985. I and my officers have had the opportunity to discuss these matters with a number of ex-service leaders and with honourable senators opposite. I will quote from a letter I have just received from Sir William Keys, the National President of the Returned Services League of Australia. It is dated 5 December 1985. It states: 5 December 1985 Dear Minister, Following discussions between all major veterans groups and subsequently the Government and the Australian Democrats the RSL would agree to extension of the Sunset Clause and will make no further claims for the extension of benefits embodied in the VEB subject to the following guarantees: (a) that the VEB would be brought on for debate as early as possible in the Autumn Sittings 1985; (b) that the 40 year rule will not be invoked adversely to any claimant in the period of the Sunset Clause leading up to the enactment of the VEB; (c) that there will be rights of review available under the VEB in respect of any adverse determination made during the whole period of the extended Sunset Clause; (d) that the standard of proof that will apply to applications for pensions lodged prior to the 15th May 1985 will be that contained in Clause 42 of the Veterans Entitlements Bill (Transitional Provisions and Consequential Amendments) Bill being that of the pre-6th June 1985 Section 47 standard of proof subject only to a ``reasonable hypothesis''; (e) that new entlistees to the Australian Defence Force will continue to be covered under the VEB until proclamation to be made by the Governor-General of the new military compensation scheme. The RSL notes the agreement for the extension of the service pension to allied veterans. The RSL is pleased to note that you have agreed to consider recommendations of the Senate Scrutiny of Bills Committee and the clause of the VEB relating to uniformity of the AIDS legislation. On the basis of the foregoing, The Returned Services League of Australia is happy to give an assurance that ``there will be no further proposals to extend benefits embodied in the VEB or new issues raised which could give rise to amendments to the VEB'' prior to this enactment. Any new proposals will be put forward for consideration in the Budget context. This assurance is related only to extensions of benefits or new issues and will be subject, in due course, to ratification by the National Executive of the RSL. You will appreciate that it would be impossible to seek such ratification in the time available. Further, the League reserves the right to take whatever action is necessary to bring about the resolution of any errors, omissions or anomalies which might yet be found in the VEB and prior to its debate during the Autumn Session. Yours sincerely SIR WILLIAM KEYS National President Senator GIETZELT —The Senate has had an opportunity, as indeed has the House of Representatives, to consider the consolidation of the Veterans' Entitlements Bill, which brings into one piece of legislation some 90 Bills over a long period. There are many tangible benefits in the Veterans' Entitlements Bill. The Government recognises that it is in the interests of the veteran community to have the passage of that Bill. Because of circumstances it is not possible for that to happen on the date for which it was planned, that is, this week. Therefore, as a result of the negotiations that have taken place with the Opposition, the Democrats and the veteran community we have reached a measure of agreement which will give us the opportunity in the first few weeks of the autumn session to review the Bill and put it into place. The Government has made many concessions in the Veterans' Entitlements Bill. It has recognised its commitment to the veteran community and has recognised its sacrifices. We believe that the Veterans' Entitlements Bill is a big achievement in paying tribute to those who served their country in wartime situations. The Repatriation Legislation Amendment (Extension of Operation) Bill will extend the sunset clause for six months. We give a guarantee that the Senate and, indeed, the Parliament will have the opportunity when Parliament resumes in February to resolve the outstanding issues in the interests of the veteran community. In those circumstances, I commend the Bill to the Senate. Senator LEWIS(Victoria)(3.54) —We thought we had an understanding that a joint statement by the Government, the Opposition parties and the Australian Democrats would be incorporated in Hansard. I thought the Minister for Veterans' Affairs (Senator Gietzelt) was going to do it, but he is indicating for me to do it. Therefore, I seek leave to incorporate a copy of this joint statement in Hansard. Leave granted. The statement read as follows- JOINT STATEMENT ON THE VETERANS' ENTITLEMENTS BILL AMENDMENTS AND EXTENSION OF THE SUNSET CLAUSE Following discussions with ex-service organisations and with the Opposition and the Australian Democrats, the Government has accepted certain amendments and requests carried by the Senate to the VEB and agreed to the following action. The Government will accept amendments made to the VEB by the Senate to provide for a continuation of Repatriation cover for new enlistees to the Defence Force up to a date to be proclaimed by the Governor-General not being before enactment of legislation for a Military Compensation Scheme. The Government will also accept the Senate's amendment of the VEB to delete the reference to the cut-off date of 1 September 1957 for eligibility for allied veterans for the service pension. The Government has agreed that it will amend the VEB to delete the provision that related to AIDS. It is also to be made clear that rights of review will be available under the VEB in respect of adverse disability and war widow pension decisions made under the Repatriation Legislation in the period until the VEB comes into effect. The Government, the Opposition and the Democrats have not yet agreed on the resolution of the method of dealing with those claims for disability and war widow's pensions and applications for review lodged before 15 May 1985, (that is the ``retrospectivity'' issue). This issue will not be determined finally until the VEB is dealt with in the autumn session of the Parliament. In the Senate on 28 November 1985 Senator Durack said that he believed that the proper approach to interpretation of section 47, as it stood before 6 June 1985, required that there had to be some material before a determining authority before it would be able to make the judgment on whether it was satisfied beyond reasonable doubt that there was no sufficient ground to grant the claim. The Government confirms that the intention of Clause 119 of the VEB is to achieve that interpretation and the explanatory memorandum will be amended accordingly. When the VEB is reintroduced in the autumn sittings the Government agrees to make a statement responding to the 16th Report of the Senate Scrutiny of Bills Committee, and to the various other amendments proposed by the Opposition and the Australian Democrats that were adopted by the Senate. As a consequence of agreements which have been reached, the Repatriation Legislation Amendment (Extension of Operation) Bill 1985 will not be opposed by the Opposition and the Australian Democrats. This will extend the interim arrangements until the Parliament sits next year. The Sunset Clause provision is to be extended on the understanding that the VEB, in an amended form, will be brought forward as early as possible in the autumn sittings in 1986. There is also a clear understanding that the Repatriation Commission will not reject any claims in the interim on the basis of the application of the ``40 Year Rule'', nor on the ``onus of proof'' provisions where the more rigorous application of these provisions appears in the interim measures. Such claims will be put aside and determined after the VEB is in effect. Senator LEWIS —I thank the Senate. The Senate is actually debating the Repatriation Legislation Amendment (Extension of Operation) Bill 1985, which will extend the operation of the Repatriation Legislation Amendment Act for a further six months pursuant to the provisions of the sunset clause which the Opposition parties and the Australian Democrats inserted in the legislation in May. The reason the Government is in the position where it has to have an extension of the sunset clause is that the Veterans' Entitlements Bill has not yet come out of the House of Representatives; it is still held in the House of Representatives pending the House dealing with certain amendments which the Senate passed to that legislation. The Minister has just made a very moderate and sound speech about the matter. I certainly do not want to whip up any arguments at this late stage in the negotiations other than to say that the Opposition parties totally reject the allegations made in the second reading speech of the Minister which was incorporated in Hansard yesterday. There is an allegation that the whole of this legislation is blocked because of `the obstruction and intransigence of the Opposition'. The Opposition totally rejects that; it is frankly untrue. The legislation is blocked in the House of Representatives, not in the Senate. The only point I would like to make about what is happening at present relates to the joint statement which I have just incorporated in Hansard. The Opposition is relieved for the sake of the ex-service community that the Government has come to realise that there were a number of grave injustices in the Veterans' Entitlements Bill which was presented to the Senate. The amendments moved by the Senate overcome most of those injustices. The Opposition parties are delighted that the Government has finally accepted the amendments of substance to the Bill which we moved in the Senate. We thank the Minister for his actions in achieving this result. Senator MACKLIN(Queensland)(3.58) —The Senate is discussing the Repatriation Legislation Amendment (Extension of Operation) Bill, which, as Senator Lewis has already said, extends the provisions of the sunset clause for another 12 months. I emphasise the point that the Minister for Veterans' Affairs (Senator Gietzelt) raised in the statement he just made, by leave. It is our hope that the main legislation-that is the Veterans' Entitlements Bill-will be dealt with as early as possible in the New Year. As I indicated previously, we have supported the consolidation of the veterans' legislation. We are interested in how the final outstanding obstacles which were referred to in the joint statement-the problems of retrospectivity and the items dealing with the people who had gone into the determination system or into the appeal system prior to 15 May this year-will be dealt with. That matter has to be resolved. I believe that there are at least some grounds for hoping that that can be satisfactorily resolved by the time we return in February and, I hope, debate the full legislation. I am grateful that the Government, in looking at the amendments and requests which were voted on and passed by the Senate, has found that now it is able to accept the major ones. They are the one dealing with allied veterans who became citizens of this country after 1 September 1957; the one dealing with the new enlistees in the defence forces to the effect that they will remain within the repatriation system until such time as a military compensation Bill is brought before this chamber and passed; and the acceptance by the Government of a desire to look at, I think, some 32 other amendments, most of which are based upon the report of the Senate Standing Committee for the Scrutiny of Bills and deal with a number of technical items. I believe that many of those matters may be able to be resolved to everybody's satisfaction. I believe that the final legislation will very largely reflect the views of all political parties and all veterans' organisations in this country. If that comes about in February it certainly will be a major achievement and, indeed, will be a milestone in the history of the treatment of veterans in this country. Hopefully, combined with the speedier operation of the repatriation system which is now showing up, flowing from previous legislation, that will provide a firm base for the future for so many people in this country who depend upon the system for support. In many cases people depend upon it for their livelihood and for medical treatment that is required to be provided to them as an obligation undertaken by the Commonwealth for the service they have performed for their country. Question resolved in the affirmative. Bill read a second time, and passed through its remaining stages without amendment or debate. Consideration resumed. Senator VIGOR(South Australia)(4.05) —When the luncheon break intervened I was justifying the figures I had quoted earlier in the day and which were attacked by Senator Walsh. In fact, I said that a 35 per cent reduction in bottle sales had been claimed by wine companies in relation to the distribution of bottles from warehouses. That figure came from the Business Against Non-Deductibility organisation, which collected this information from various wine companies in Australia, who had supplied the figures for bottles sold since 19 September. In fact, although the latest Australian Bureau of Statistics figures, which covered the period from July to October, suggested a drop of only one per cent over that period, the people who are actually selling the wine have claimed a 35 per cent reduction in bottle sales. From the latest figures I obtained from the Parliamentary Library, over that same period there was a total drop of 9 per cent in wine sales-both bulk wines and bottled wines. The figures we have from the Government are fairly limited. We asked the Government for its working papers on this subject; I have never seen them. However, I have seen the BIS-Shrapnel report, the executive summary of which I incorporated in Hansard last night. The figures were $330m in revenue according to the Government and $79m in revenue according to BIS-Shrapnel. Who is right? Considering the history of the Government in terms of supplying figures to us, I prefer to trust the BIS-Shrapnel figures. The suspicion arises that the figures were calculated from a very small sample of tax returns which were used to predict the revenue forgone, without any further analysis. The attitude of the Treasurer (Mr Keating) when he was asked in Parliament to provide details on how Treasury arrived at its estimates increases my concern. In the House of Representatives he was asked that question by Mr Carlton and he stated that no previous Treasurer had been asked to justify his figures in that way. In a democracy I believe that Parliament has the right to question the basis of a law and the types of figures on which that law is based before it is passed. In this case the Treasurer laughed off the question, which can be seen on page 3564 of Hansard for 25 November 1985. As I have said, the Treasurer's basis for doing that was that no former Treasurer had ever been asked to justify reasons for imposing a tax. I believe that that was, in fact, false. Treasurers may have been asked for such information. If they have not provided it, that is a disgrace. I believe that it is quite beneficial and proper for a Treasurer and the Department of Finance to examine critically the estimates and assertions of other parties. They cannot then expect their assertions and assumptions to be clothed in the mystique of a professional judgment. I remind the Senate of the rubbery figures of some of former Treasurer Lynch's Budgets-the concealed blowout before the 1983 election. More recently, last year there was the massive overestimate of a $2 billion provisional tax increase, which failed to take account of the forecast fall of 10 per cent in farm incomes. The attempt of the Treasurer to blame this on tax evasion and avoidance by farmers in the face of their increased economic distress was, I believe, in very bad taste. Earlier this year economic experts in social welfare disagreed with aspects of the Treasurer's White Paper on taxation reform. It transpired that officers of the Treasury had manipulated available statistics until they supported the outcome the Government wished to achieve. The figures given in the submissions of Treasury and Finance to the Self National Inquiry into Local Government Finance were incorrect. Those figures were strongly argued but were based on a 1976 survey, which in turn was based on statistics from the 1960s. The Self inquiry completely rejected these figures and arguments. I quote from chapter 4.8 of the report: Both the Commonwealth Treasury and Department of Finance have relied heavily on Groenewegen's 1976 study of rate effort in New South Wales. This survey was based on data from the 1960s, and so predates the introduction of general revenue-sharing. How can one argue for the abolition of general revenue sharing without looking at the changes which led to it? I really feel that we have to examine figures before we can accept Treasury estimates. This is another of the reasons why I am supporting the Opposition's amendment to put in substantiation, which is, I believe, the only sensible way of forcing people to obey the law and also of making the law sensible, in that I believe firmly that costs properly incurred in achieving income should be totally claimable as part of taxable income. Senator WALTERS(Tasmania)(4.11) —I wonder whether the Minister for Finance really understands the situation at the moment, because small business is actually losing heart. Senator Siddons —Oh, come on, Senator! We have heard all this before. Senator WALTERS —No, you have not. Small business is losing heart. Indeed, the owners of one small business told me the other day that, while their employees are entitled to a 17.5 per cent holiday loading, sick pay, three or four weeks holiday and have no capital at risk, et cetera, they were not entitled to any holiday pay at all-indeed, they lost pay when they went on holiday and did not have any income while they were on holiday-did not get any income should they be sick, certainly did not have a 17 1/2 per cent holiday loading and had a considerable amount of money at risk, and as a result they were getting out and had taken jobs as employees so that they would be able to accept all these benefits that employees are able to accept. I think that the Minister is certainly overlooking the feeling at present abroad in small business. I think the Australian Democrats have underestimated the feeling abroad in small business. I think that is underlined by the misunderstandings that have been spoken about today. We have only to look at the history of the present Prime Minister (Mr Hawke). He tried to run Bourkes store. Look at what happened to that enterprise. It went broke. Then he went on to ACTU-Solo Enterprises Pty Ltd. What happened there? That went broke. Of course, the Australian Council of Trade Unions under him also took up a travel agency business. So he has not got a very good history in the area of business. Senator Chipp —On a point of order, Madam Temporary Chairman: It is one thing to have to have the whole Senate chamber kept back to hear this moronic nonsense, but it is another thing for you to allow Senator Walters to talk about matters that are totally irrelevant to the clause being debated. If she wants to talk anywhere, let her do it, but let her not hold up 76 senators who have urgent business to do when she and her colleagues from Tasmania have repeated exactly the same point over and over again. The TEMPORARY CHAIRMAN(Senator Haines) —There is in fact no point of order. This is a very wide-ranging clause, but I ask Senator Walters to confine her question to the Minister to specifics within the clause, given that we have been on this clause for some hours. Senator WALTERS —Thank you, Madam Temporary Chairman. Of course, Senator Chipp is well aware that there is no point of order. I ask the Minister whether he is really aware of the despondency in small business about the present situation. Can he please explain to us what will happen if so many others take the action that small business groups are already taking? Question put: That the words proposed to be left out (Senator Messner's amendment) be left out. The Committee divided. (The Temporary Chairman-Senator J. Haines) Ayes . . . . . . . . . . . 28 Noes . . . . . . . . . . . 37 —— Majority . . . . . . . . . 9 —— Archer, B. R. MacGibbon, D. J.Baume, Michael Messner, A. J.Baume, Peter Parer, W. R.Bjelke-Petersen, F. I. Puplick, C. J. G.Brownhill, D. G. C. Rae, PeterCarrick, Sir John Reid, M. E.Collard, S. J. Sheil, G.Crichton-Browne, N. A. Short, J. R.Durack, P. D. Townley, M.Guilfoyle, Dame Margaret Vanstone, A. E.Hamer, D. J. Vigor, D. B.Hill, R. Walters, M. S.Kilgariff, B. F. (Teller) Watson, J. O. W.Lewis, A. W. R. Withers, R. G. Aulich, T. Harradine, B.Black, J. R. Jones, G. N.Bolkus, N. McIntosh, G. D. (Teller)Childs, B. K. McKiernan, J. P.Chipp, D. L. Macklin, M. J.Coates, J. Maguire, G. R.Colston, M. A. Mason, C. V. J.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 Sanders, N. K.Foreman, D. J. Sibraa, K. W.Georges, G. Siddons, J. R.Gietzelt, A. T. Tate, M. C.Giles, P. J. Walsh, P. A.Grimes, D. J. Zakharov, A. O.Haines, J. Boswell, R. L. D. Button, J. N.Chaney, F. M. Coleman, R. N.Knowles, S. C. McClelland, DouglasTeague, B. C. Morris, J. Question so resolved in the negative. Original question put: That the clause be agreed to. The Committee divided. (The Temporary Chairman-Senator J. Haines) Ayes . . . . . . . . . . . 36 Noes . . . . . . . . . . . 28 —— Majority . . . . . . . . . 8 —— Aulich, T. Haines, J.Black, J. R. Jones, G. N.Bolkus, N. McIntosh, G. D. (Teller)Childs, B. K. McKiernan, J. P.Chipp, D. L. Macklin, M. J.Coates, J. Maguire, G. R.Colston, M. A. Mason, C. V. J.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 Sanders, N. K.Foreman, D. J. Sibraa, K. W.Georges, G. Siddons, J. R.Gietzelt, A. T. Tate, M. C.Giles, P. J. Walsh, P. A.Grimes, D. J. Zakharov, A. O. Archer, B. R. MacGibbon, D. J.Baume, Michael Messner, A. J.Baume, Peter Parer, W. R.Bjelke-Petersen, F. I. Puplick, C. J. G.Brownhill, D. G. C. Rae, PeterCarrick, Sir John Reid, M. E.Collard, S. J. Sheil, G.Crichton-Browne, N. A. Short, J. R.Durack, P. D. Townley, M.Guilfoyle, Dame Margaret Vanstone, A. E.Hamer, D. J. Vigor, D. B.Hill, R. Walters, M. S.Kilgariff, B. F. (Teller) Watson, J. O. W.Lewis, A. W. R. Withers, R. G. Coleman, R. N. Boswell, R. L. D.McClelland, Douglas Teague, B. C.Morris, J. Chaney, F. M.Button, J. N. Knowles, S. C. Question so resolved in the affirmative. Clause 10 agreed to. Clause 11 (Deduction of expenditure on conserving or conveying water). Senator MESSNER(South Australia)(4.26) —I indicate that the Opposition will be opposing this clause which deals with changes to water conservation. In passing I note that listed for debate later on the red sheet is Income Tax Assessment Amendment Bill (No. 2) 1985, which in effect amends this present Bill so as to allow deductions on a three-year basis rather than on the five-year basis that is indicated in this Bill. The Opposition will not be opposing that particular Bill but I would like it to be noted that the Opposition stands for the total write-off in one year of water conservation expenditure. Whilst we will not be calling for a division on that second Bill later on, we will of course be opposing it just as strongly as we do this particular clause as it is set out in this Bill. The arguments in respect of this matter were canvassed fairly widely during the second reading debate. It is clear that the question of water conservation in Australia is most important. We are the driest continent in the world and consequently should be doing as much as possible, particularly in agriculture, to ensure that we protect our water resources. The purpose of the write-off in one year of water conservation expenditure is clearly designed to encourage that kind of activity amongst farmers and agriculturalists generally. We on this side believe that it is a most worthwhile encouragement and incentive to be incorporated into the law, and as a result we will be opposing this clause. There is one matter I would like to observe, and that is the statement made last night during the second reading debate by Senator Chipp, that people in fact write off the cost of their swimming pools in this way. If that is so, that is obviously an abuse and I cannot see that it would be allowable under any proper administration of the tax law. Clearly the law is not designed to encourage people to put in swimming pools and then to write off their cost. We are talking about properly substantiated expenditure in respect of water conservation, and those matters can be checked out and are checked out in the daily operation of the Taxation Office. The Opposition will be opposing this clause and requesting a division on it. Senator WALSH(Western Australia-Minister for Finance)(4.29) —Senator Messner has said virtually everything that need be said. The Government will not accept the Opposition's amendment but the subsequent Bill will change the period from five years to three years. Question put: That the clause stand as printed. The Committee divided. (The Temporary Chairman-Senator J. Haines) Ayes . . . . . . . . . . . 38 Noes . . . . . . . . . . . 27 —— Majority . . . . . . . . . 11 —— Aulich, T. Jones, G. N.Black, J. R. McIntosh, G. D. (Teller)Bolkus, 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. Morris, J.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 Sanders, N. K.Foreman, D. J. Sibraa, K. W.Gietzelt, A. T. Siddons, J. R.Giles, P. J. Tate, M. C.Grimes, D. J. Vigor, D. B.Haines, J. Walsh, P. A.Harradine, B. Zakharov, A. O. Archer, B. R. MacGibbon, D. J.Baume, Michael Messner, A. J.Baume, Peter Parer, W. R.Bjelke-Petersen, F. I. Puplick, C. J. G.Brownhill, D. G. C. Rae, PeterCarrick, Sir John Reid, M. E.Collard, S. J. Sheil, G.Crichton-Browne, N. A. Short, J. R.Durack, P. D. Townley, M.Guilfoyle, Dame Margaret Vanstone, A. E.Hamer, D. J. Walters, M. S.Hill, R. Watson, J. O. W.Kilgariff, B. F. (Teller) Withers, R. G.Lewis, A. W. R. Coleman, R. N. Boswell, R. L. D.McClelland, Douglas Teague, B. C.Morris, J. Chaney, F. M.Button, J. N. Knowles, S. C. Question so resolved in the affirmative. Clauses 12 to 22-by leave-taken together. Senator MICHAEL BAUME(New South Wales)(4.36) —I want to deal very briefly with the principle of substantiation of certain expenses contained in clause 14. This clause inserts new subdivision F in Division 3 of Part III of the principal Act to introduce rules requiring substantiation of employment related expenses of employees and car and travel expenses claims by employees and self-employed persons. The Committee is well aware of the impact that changes in the rules relating to motor vehicle use will have on the motor vehicle industry. Of course, the voters in South Australia are very aware of the economic consequences for that State of changes in the tax arrangements for motor vehicles. I simply want to make the point fairly briefly that the Government is seeking to introduce a system of substantiation to solve what it considers to be abuses of the tax system such as rip-offs or whatever other emotive word the Minister chooses to use at the time. The fact is that this problem is to be resolved by effective substantiation requirements. The Government would not be introducing substantiation requirements if they were not effective. Therefore, it seems reasonable to make the assumption that the Government believes the substantiation requirements in this legislation are sufficiently effective, no matter what their consequences on various industries may be. If it is reasonable to introduce substantiation requirments to solve a problem or to raise more money in this instance, how can the Government claim that substantiation arrangements are inappropriate in respect of entertainment expenses? Here we have a case of simple incompetence, in logical terms, by the Government. It is okay, acceptable and reasonable to have substantiation requirements as set out in clause 14 when they relate to belting the South Australian motor vehicle industry, but it is not reasonable to have them when the Government would much prefer to belt even harder the entertainment industry. I think it would be inappropriate, despite the pressures of time, to allow this clause to be put to a vote without at least making a criticism and a complaint about the lack of logic and the unfair and discriminatory nature of the Government's measures. Senator MESSNER(South Australia)(4.39) —I wish briefly to make a similar point. It appears to me that the kind of substantiation requirement set out in clause 14 is more appropriate to the guidelines, rules and regulations by which a department might administer the tax law rather than the law into which it is to be incorporated. Certainly we would not have been expecting to amend the legislation to incorporate the principle of substantiation that we see as being necessary in relation to entertainment expenses. The reason for that is obvious. When such arrangements and detailed matters are fixed into legislation, it becomes a major project for the Government, in the event of the discovery of avoidance techniques, to be able quickly to alter the law. Consequently that avoidance could continue for some time. For that reason I believe the Government is not approaching the question of substantiation in a proper way. It is altering the legislation so as to be seen to be doing something and not for the purposes of what would be considered to be proper administration by the Commissioner of Taxation. While we do not oppose these clauses-obviously not, because they fall in line with our general thinking as to how the Department should operate-we do believe that the Government has got it wrong in this case in writing this requirement into the law in such detail, which can only provide opportunities for accountants and lawyers to benefit in the future. Clauses agreed to. Clause 23 agreed to. Remainder of Bill-by leave-taken as a whole, and agreed to. Bills reported without amendment or requests; report adopted. Bills (on motion by Senator Walsh) read a third time. Debate resumed from 3 December, on motion by Senator Grimes: That the Bill be now read a second time. Senator MESSNER(South Australia)(4.42) —I merely indicate, as I did in regard to clause 11 of the Taxation Laws Amendment Bill (No. 4), that we will not oppose the Income Tax Assessment Amendment Bill (No. 2), but wish to register our protest at the fact that this Bill does provide for the write-off of water conservation expenses over three years. Whereas it would be our intention in the normal course to oppose that measure, we have done so already in respect of clause 11 of the previous Bill. Consequently, I point out that the arguments that were made during that debate are relevant to this Bill. Senator CHIPP(Victoria-Leader of the Australian Democrats)(4.43) —The Income Tax Assessment Amendment Bill (No. 2) 1985 involves one of the 15 concessions that the Australian Democrats requested and the Government agreed to. In our discussions with the Government we first said that we would like the expenditure on water conservation written off over one year, as is the present situation. I was persuaded, as was Senator Siddons, by the Treasurer, Mr Keating, that in the past this has facilitated unscrupulous people undertaking a tax rort. We think that the lessening of the period from five to three years is a reasonable compromise, for which we thank the Government. Question resolved in the affirmative. Bill read a second time, and passed through its remaining stages without amendment or debate. Debate resumed from 2 December, on motion by Senator Grimes: That the Bills be now read a first time. Question resolved in the affirmative. Bills read a first time. Senator WALSH(Western Australia-Minister for Finance)(4.45) —I move: That the Bills be now read a second time. I seek leave to incorporate the second reading speeches in Hansard. Leave granted. The speeches read as follows- CUSTOMS AND EXCISE LEGISLIATION AMENDMENT BILL (No. 2) 1985 This Bill proposes amendments to Customs and Excise Laws. The most important measures are the amendments required to facilitate the introduction of inwards duty free shopping and the amendments required to enable a full rebate of the excise on diesel fuel to be paid to eligible primary producers. The other provisions of the Bill are of a technical or administrative nature and I will provide brief details of these later. The amendments related to inwards duty free shopping are part of a legislative package necessary to introduce this duty free and sales tax free facility at international airports in Australia. My colleague the Treasurer will bring forward the complementary changes to the Sales Tax laws. The necessary changes to the Customs and Excise Tariffs and regulations will be undertaken separately. In September 1984 the Government announced that it had approved the introduction of limited inwards duty free shopping at international airports. The shops are to be located in airports at a point somewhere between the disembarkation area and the Customs Barrier so as to enable the goods that are sold to incoming overseas passengers to be taken direct to the customs barrier for clearance. The only goods to be sold duty free at the shops will be spirituous liquor, tobacco products and perfume. Introduction of restricted inwards duty free shopping will not however, alter the duty free concessions available to a passenger, which currently are limited to 1 litre of spirituous liquor and 250 grams of tobacco products. There is no specific limit on the amount of perfume which may be brought in by a passenger duty free, provided the amount does not represent a commercial quantity. It might be noted that the Industries Assistance Commission has reviewed the passenger concessions recently and its report is being studied. I should make it quite clear that the facility to purchase inwards duty free will be confined to international airports. The provisions of clauses 9 and 19 of the Bill therefore provide for Ministerial declarations to make immediate changes to the diesel fuel rebate whenever they occur for policy or other reasons such as a change in the CPI index. The Ministerial declarations are of course subject to the usual disallowance procedures. I now turn to the technical and administrative amendments contained in this Bill. Clause 8 of the Bill introduces revised rules of origin for goods produced in Forum Island Countries. These new rules stem from the July 1984 meeting of the Regional Committee on Trade held in Kirabati. At that meeting Forum Island Countries asked Australia and New Zealand to include either or both countries inputs in the calculation of Forum Island content of goods for the determination of eligibility for preferential tariff treatment. All parties have now agreed that the rules should be extended to provide for a minimum Forum Island Countries content of 25 per cent of the factory cost of goods where there is sufficient additional Australian or relevant New Zealand content to comply with the minimum 50 per cent factory cost rule for preferential tariff purposes. The amendments to the working days and hours provisions of the Customs Act, contained in clause 5 of the Bill, provide for the Comptroller-General of Customs to determine the fees for the services of officers during normal working hours but at places where such services are not normally provided free of charge. The Comptroller-General already has the power to determine the fees for officers services outside normal working hours and the proposed amendment is designed to provide uniformity in the manner of determining fees for officers services. Provision is made in clause 13 for the determinations of the Comptroller-General to be reviewable by the Administrative Appeals Tribunal. The opportunity has been taken to also include a provision for the review of determinations made under the existing Act. Clause 11 of the Bill proposes several minor changes to the powers to search persons suspected of carrying prohibited imports or prohibited exports. The changes, which are proposed as a consequence of complaints to the Commonwealth Ombudsman will permit the Comptroller-General of Customs to limit the classes of Customs officers who are to be empowered to direct a search. The changes will also remove the present requirement that the same officer who established a reasonable cause for the search also conduct the search. The first amendment is aimed at providing a legal basis for guidelines to prescribe only senior and experienced officers to establish the reasonable cause for a search. The second amendment is similar to an amendment made to section 196 of the Act by the Parliament in 1979 but not proclaimed pending further review of the search provisions. When proposing the similar amendments to section 196 of the Customs Act the then Minister said and I quote: `This amendment will allow a person to be detained and searched by an officer other than the officer who has established a reasonable cause for the search. It is clear that in certain instances it would not be practicable for the latter officer to be continuously available at the location at which the person was detained or apprehended.' The Government proposes the amendment in this Bill for the same reasons. The Commonwealth Ombudsman concurs with the proposed changes designed to rectify deficiencies in the existing search procedures. The opportunity is also being taken to make a drafting correction to the provisions which relate to the sex of the persons who are to conduct a search. Financial Impact Statement The introduction of inwards duty free shops is expected to benefit airport concessions revenues by about $5m in a full year. Other revenue effects of the shops are not quantifiable at this stage nor are the administrative costs. The rebate of duty on diesel fuel at the full rate of the excise duty payable is expected to cost about $35.5m in a full year and $24m in 1985-86. Changes to the rebate for fuel used in mining operations is expected to cost approximately $350,000. The other provisions of the Bill have no direct financial implications. I commend the Bill to the Senate. CUSTOMS TARIFF AMENDMENT BILL (No. 2) 1985 The Customs Tariff Amendment Bill (No. 2) 1985 which is now before the Senate covers a wide range of amendments to the Customs Tariff Act 1982. In summary, the Bill includes three clauses relating to sections of the Principal Act and eight clauses which correspond to schedules which incorporate changes- (i) initially introduced by gazette notice and subsequently proposed in the House of Representatives as Customs Tariff proposals; (ii) introduced directly by Customs Tariff proposals; or (iii) which are being introduced by this Bill. Clauses 3 and 4 of the Bill contain amendments to sections 15 and 21 of the principal Act that are complementary to the insertion of new sub-section 151 (5A) in the Customs Act which is contained in the Customs and Excise Legislation Bill (No. 2) 1985. The Customs Tariff Act amendments keep the complementary provisions determining the duty rates applicable to goods from preferential sources in line with the relevant rules of origin provisions in the Customs Act. These amendments will come into effect at the same time as the relevant amendment to the Customs Act. Clause 5 of the Bill will repeal section 30 of the principal Act on and from the eighteenth of October 1984. That date coincides with the operative date of changes made to the Industries Assistance Commission Act 1973 which, among other matters, abolished the temporary assistance authority and changed other provisions relating to temporary assistance. This action has removed the need to retain section 30 of the Customs Tariff Act which deals with temporary rates of duty. Schedule 1 to the Bill is operative on and from the first of January 1985 and provides for the duty free entry under quota of new woven polypropylene bags of Forum Island origin. This concession follows the Government's agreement to a request by the Forum Island countries for increased access for these goods under the South Pacific Regional Trade and Economic Co-operation Agreement. Schedule 2 to the Bill, operative on and from the ninth of February 1985, reduces the rate of duty applying to certain engine-powered lawnmowers of New Zealand origin from 7% to 5%. This reduction follows a review of a compensating charge applied to certain New Zealand lawnmowers which had been in place since the Australia-New Zealand Closer Economic Relations-Trade Agreement came into effect. The charge resulted from the different duty treatment accorded lawnmower engines when imported into New Zealand or Australia. Following the Government's decision on the Industries Assistance Commission report on lawnmowers, certain engines and parts, the general tariff rate on certain lawnmower engines was lowered to 25% and a bounty of $6 per engine introduced. These arrangements led to a review of the compensating charge applied to New Zealand lawnmowers. A further review of the New Zealand rate will be undertaken before the thirty-first of December 1986. The change contained in Schedule 3 is operative on and from the twenty-third of May 1985 and amends the Customs Tariff description of imported rum. This change is complementary to an excise tariff change and is done to reflect the revised standard for rum in accordance with the Government's decision on National Health and Medical Research Council Review of Wines and Spirits Legislation. Duty rates are not altered by this change. Schedule 4 to the Bill is operative on and from the first of July 1985 and contains changes which- (i) correctly reflect the official titles of countries and places specified in Schedule 1 to the principal Act. Duty rates are not affected by these amendments; (ii) amend various provisions of the Principal Act by removing redundant phasing rates of duty and amalgamating certain tariff classifications where removal of phasing rates has made this action possible; (iii) implement new arrangements to increase access for certain furniture and furniture components of New Zealand origin following consultations and agreement under the Anzcerta to provide liberalised arrangements for these goods; (iv) amend item 56 in Part I of Schedule 4 to the principal Act. This change extends to prescribed shipbuilders concessional entry of goods used in the construction or modification of bountiable vessels following an amendment to the Bounty (Ships) Act 1980 which enabled these shipbuilders to be registered for bounty purposes. Schedule 4 to this Bill also includes a number of changes which continue implementation of the Government's decision on the Industries Assistance Commission report on the commercial by-law system. That decision provided for the introduction of a commercial tariff concession system which came into operation on the first of July 1983 but provided a two-year transitional period during which concessions under the commercial by-law system were to be phased out. Accordingly, those items or parts of items in Part I of Schedule 4 to the Principal Act which included a reference to commercial by-law system criteria are omitted from the first of July 1985. The decision to implement the commercial tariff concession system and subsequent decisions made by the Government in respect of particular goods do, however, require the continuation of certain concessional arrangements that would have otherwise lapsed on the first of July 1985. Accordingly, changes to the Customs Tariff Act are being made to maintain concessional entry of certain goods, as follows: (1) goods entered under end-use under security provisions; (2) goods imported to meet shortfall and fallshort situations; (3) goods imported to enable the testing and evaluation of motor vehicles or motor vehicle components under the plan known as the passenger motor vehicle manufacturing plan; (4) goods imported for use as prototypes for the manufacture of similar goods in Australia; and (5) goods imported for use in petroleum exploration and development. Concessional treatment for these goods is being maintained by providing new items 57 to 62 in Part I of Schedule 4 to the Principal Act. The concession in respect of goods entered under end-use under security provisions is, however, of an interim nature as these goods are currently the subject of inquiries by the IAC. Similarly, the long term future of the concession for goods imported to meet shortfall or fallshort situations is to be determined by the Government following reviews by the IAC. In this respect some of these goods are already under reference to the Commission. Finally, Schedule 4 to the Bill contains changes which introduce part of the new assistance arrangements for metal working machine tools and robots. The Government's decision on these arrangements was announced on the thirtieth of May 1985. Measures related to the bounty aspects of the arrangements were included in the Bounty (Metal Working Machings and Robots) Bill 1985 which was introduced earlier in this sittings. That Bill proposes that the basis on which bounty is calculated be changed from Australian content to a value added principle. The new bounty scheme incorporates different rates of bounty for high and low technology machines and extends coverage of the scheme to include robots and machines such as flame and laster cutting machines and flexible manufacturing cells and systems. The bounty also extends to parts and accessories for these goods and parts and accessories for use as original equipment in the production of all bountiable metal working machine tools. To complement the bounty arrangements, this Schedule contains those Customs tariff changes where duties are being lowered, as follows: the insertion of new provisions at minimum rates for gas-operated appliances and laser or electric operated metal working machines or apparatus when incorporating a computer control. These amendments have also resulted in new legal notes to define the term `computer control'; and a new item in Part I of Schedule 4 to the principal Act to enable concessional entry of certain robots, and parts and accessories of a kind used solely or principally therewith. Schedule 5 to the Bill is operative from 8 pm on Budget night, the twentieth of August 1985. This Schedule contains certain tariff changes which increase the customs duty on imported manufactured tobacco by $5 per kilogram. These changes are complementary to changes proposed to the Excise Tariff Act which increase excise duty on locally produced manufactured tobacco by the same amount. Schedule 6 to the Bill is operative on and from a date seven days after the date of royal assent. This Schedule incorporates further changes arising from the Government's decision on assistance arrangements for metal working machine tools and robots. Some of the goods covered by that decision are not subject to the bounty assistance arrangements to which I have already referred. As these changes involve an increase in the rate of duty applying to certain metal working machine tools and parts and accessories therefor, the increased rates are not being brought into effect until seven days after the date of royal assent. Schedule 6 also contains a minor change in the demarcation point between dutiable and duty free tractors following a government decision on assistance arrangements to apply to agricultural wheeled tractors and certain parts. Other amendments contained in Schedule 6 ensure that the Customs Tariff Act uses correct spelling, grammatical and drafting forms. The need for these changes was identified during the ongoing review of the principal Act and they are not directed towards questions of industries assistance. A further change relates to the rate of duty applying to chenille fabrics. These goods were under reference in the IAC's 1981 report on miscellaneous textile products. At that time the IAC recommended that Chenille fabrics continue to be dutiable at minimum rates but drew attention to the possibility that imports of fabrics containing Chenille yarn might erode the assistance provided to other fabrics. Accordingly, the IAC suggested that imports of Chenille fabrics be monitored. The government agreed with this approach. As a result of this monitoring, evidence of increasing imports of Chenille fabrics was considered by the Textiles, Clothing and Footwear Advisory Committee. The Committee concluded, in its May 1985 report, that imports of fabrics containing Chenille yarn were in fact eroding, and had the potential to further erode, assistance to woven man-made fibre fabrics. The Committee, therefore, recommended that imports of man-made fibre fabrics containing 20%, or less, by weight of Chenille yarn be dutiable at 40%-the base quota rate for the equivalent man-made fibre fabrics. The Government has accepted that recommendation. Schedule 6 also introduces: (1) two amendments to restore levels of assistance considered to have been removed by judgments of the Administrative Appeals Tribunal; and (2) three amendments to maintain the technical accuracy, remove a potential ambiguity and restore the intended coverage of certain provisions of the principal Act. Advice received from the Attorney-General's Department states that it is in order for such changes to be introduced directly by a Bill to amend the Customs Tariff Act. This procedure is being followed for goods known as polypropylene grass yarns and certain photographic chemicals which, as a result of AAT judgments, have had their intended levels of assistance substantially reduced. The level of assistance for polypropylene grass yarns, which are principally used for the production of outdoor carpet, was last considered by the IAC in its 1981 miscellaneous textile products report. Two major local manufacturers gave evidence to the IAC which recommended that the existing general tariff rate of 30% be maintained. The Government accepted the IAC's recommendation. An importer of polypropylene grass yarns subsequently challenged the tariff classification of these yarns and obtained a ruling that such yarns were classified in a different tariff item from the one in which the 30% rate of duty applied. As a result, the importer was able to enter goods which competed directly with the Australian product at minimum rates. Local manufacturers have made representations to the government concerning their loss of assistance and requested that assistance levels be restored to that recommended by the IAC. After consideration of this matter, the government accepts that intended assistance levels should be restored and, accordingly, an appropriate amendment to the Customs Tariff Act is being made by this Bill. In respect of certain photographic chemicals, the wording of the relevant provision was amended as a result of the Govenment's decision on the IAC report on Customs Tariff simplification but a general rate of duty of 15% was maintained. An importer challenged the tariff classification applied to certain imported photographic chemicals before the AAT and the tribunal ruled that the wording contained in the simplified customs tariff enabled entry of the goods at minimum rates of duty. The terms of reference for the tariff simplification inquiry required that levels of assistance not be substantially altered. The revised wording applying to the photographic chemicals in question has, however, had the effect of substantially altering the intended level of assistance for such goods. Accordingly, the Government proposes in this Bill to restore the assistance level for the photographic chemicals involved. The other changes in Schedule 6 which are being introduced directly by Bill relate to: (i) the correct definition of goods known as ethylene oxide derivatives. The Government has accepted the need for these changes after considering technical advice received from officers of the Australian Government Analytical Laboratories; (ii) the removal of a potential ambiguity in the tariff description applying to certain plastic coated man-made fibre fabrics. As presently worded, the description might be interpreted as applying to a different range of plastic coated fabrics than intended; and (iii) a change in the tariff description of certain wrapping paper following research which confirms that the relevant provision should not apply to papers produced by a coating process. Schedule 7 to the Bill introduces new assistance arrangements for the production of heavy commercial motor vehicles, parts and accessories, effective from the first of January 1986. In deciding upon these changes, the Government recognised that the level of activity and employment in the industry is related to the level of activity in the assembly sector. In recent years, the assistance afforded assembly activity has been high, the industry has become more fragmented and local content and market share have declined. Accordingly, the Government has decided that a modest reduction in assistance levels is warranted and could lead to an improvement in the structure of the industry whilst restraining costs and maintaining significant employment levels. The new arrangements are reflected in the introduction of a uniform 20% general rate of duty for general purpose heavy commercial vehicles, most special purpose vehicles and fire-engines. This represents an increase in duties in respect of certain small fire-engines but a reduction in respect of the other vehicles to which I have referred. Split rates of duty on crane lorries are replaced by a single 30% general rate of duty. The current bounty arrangements on selected components will be phased out over a period of three years and be progressively replaced by an equivalent customs tariff which, by the first of January 1989 will reach a general rate of duty of 25%. The change from bounty to tariff assistance is not designed to alter the level of assistance accorded these components. Filters, which presently attract general rates of duty of 2%, 25% or 35% depending upon their tariff classification, will become dutiable at a uniform rate of 25%. Filters of New Zealand origin will, however, remain dutiable at current rates. In addition, the Government has asked the automotive industry council to advise on what additional local components would be competitive with imports at the 25% general tariff rate. Schedule 7 also includes changes to the customs value criteria applying to certain footwear from the first of January 1986. These changes arise from the Government's acceptance of a recommendation by the Textiles, Clothing and Footwear Advisory Committee, in its May 1985 report, that the value of certain footwear increase from $1.15 to $1.35 per pair to help maintain the basic character of footwear not subject to quota. The value criterion of certain non-leather footwear is also increased from $9.50 to $11 per pair to help maintain the basic character of the product mix covered by two footwear quota categories. These changes also include the developing country arrangements for footwear to apply during 1986 under the Textiles, Clothing and Footwear Sectoral Policy. Among the developing country arrangements is an increase from $3 per pair to $3.50 per pair in the value criterion for hand-made leather footwear. Schedule 8 to the Bill is operative on and from the day on which certain sections of the Customs and Excise Legislation Amendment Bill (No. 2) 1985 come into operation. The change contained in Schedule 8 relates to an amendment to item 15 in Part I of Schedule 4 to the Customs Tariff Act to enable the duty free entry of certain goods purchased at airports by passengers arriving from overseas. This change is complementary to the changes being proposed to other Customs and Excise Legislation to implement the Government's decision in respect of inwards duty free shopping. Financial Impact The revenues raised by customs duties are regarded as incidental to their prime function of assistance to industry. With this proviso in mind, it has been possible to make estimates of the expected losses and gains in customs revenue in respect of the following new arrangements: A revenue gain of approximately $1 million per annum could be expected in respect of metal working machine tools and robots; and A reduction of some $4 million per annum in revenue is anticipated in relation to the heavy commercial motor vehicle changes. This reduction could be offset to some extent by increased imports of certain vehicles. In both of the above cases there is also complementary bounty legislation. The bounty payments to be outlaid under the respective pieces of legislation also need to be taken into account to obtain the total impact of these assistance arrangements. For the financial year 1986/87 it is anticipated that a total of $16 million will be outlaid under the two bounty schemes. In regard to the provision to enable the introduction of inwards duty free shopping, the second reading speech for the Customs and Excise Legislation Amendment Bill (No. 2) 1985 addresses the question of financial impact. The changes in respect of polypropylene grass yarns and photographic chemicals, which are designed to restore levels of assistance considered to have been removed by administrative appeals tribunal judgments, have a financial impact when judged against the revenue which would otherwise have been collected under the tariff classifications applied by the tribunal. For polypropylene grass yarns, the change will result in approximately a $0.3 million gain in a full year. The change on photographic chemicals is expected to result in a gain of $0.7 million in a financial year. The government's decision to increase the duty on certain chenille fabrics may, by reducing the possibility of fabrics containing minimal chenille yarn being used in substitution for other fabrics, result in a $0.2 million gain in a full financial year. All the other changes in the Bill are expected to have minimal financial impact. There are no significant administrative costs associated with the Bill. A summary of amendments for each schedule to the Bill has been prepared. Copies are available from the records and tables office. I commend the Bill. CUSTOMS UNDERTAKINGS (PENALTIES) AMENDMENT BILL 1985 This Bill is related to the Customs and Excise Legislation Amendment Bill (No. 2) 1985. It proposes several technical and formal amendments to the Customs Undertakings (Penalties) Act 1981 as a consequence of the changes made to the tender quota arrangements in the Customs Act by the Customs and Excise Legislation Amendment Act 1985 passed earlier this year. The Customs Undertakings (Penalties) Act 1981 provides for the imposition of penalties for Breaches of Undertakings required to be given for the purposes of the tender quota arrangements of Part 15 of the Customs Act 1901. Part 15 of the Customs Act was altered this year to- (1) enable the Minister administering the Customs Act to determine the periods of validity for which tender quota schemes are to run; (2) change the requirements of the tender quota undertaking so that tenderers need only undertake to enter the relevant goods for home consumption and not also undertake to import the goods; and, consequently, (3) change the importation requirement of quota instruments to a requirement that the goods be entered for home consumption. Financial Impact Statement The provisions of this Bill have no direct financial implications. I commend the Bill to the Senate. Senator WALSH —Mr Deputy President, may I claim your indulgence to suggest that we debate these Customs Bills cognately with order of the day No. 5, a package of four sales tax Bills. I understand agreement has been reached on this matter. The DEPUTY PRESIDENT —Is leave granted? There being no objection, it is so ordered. [COGNATE BILLS: SALES TAX (EXEMPTIONS AND CLASSIFICATIONS) AMENDMENT BILL (No. 2) 1985 SALES TAX ASSESSMENT BILL (No. 11) 1985 SALES TAX BILL (No. 11A) 1985 SALES TAX BILL (No. 11B) 1985] Senator CHANEY(Western Australia-Leader of the Opposition)(4.46) —The Senate is now debating the three Customs Bills which are before us-the Customs and Excise Legislation Amendment Bill (No. 2) 1985, the Customs Tariff Amendment Bill (No. 2) 1985 and the Customs Undertaking (Penalties) Amendment Bill 1985-along with a number of sales tax Bills which are effectively consequential to the provision in one of the Bills which provides for inward duty free shopping. The Opposition is happy to deal with the matters together, the only really contentious issue in the Bills being the issue of duty free shopping, with respect to which the Opposition proposes to move amendments. The Bills which are before us contain a very large number of fairly disparate elements which could be grouped together as amendments to industry assistance arrangements, amendments to various Customs arrangements and the introduction of inward duty free shopping, to which I have already referred. The Customs Tariff Amendment Bill (No. 2) is very detailed and makes numerous changes to the principal Act. If I may touch on a few of those changes, it removes, for example, provisions for temporary assistance. This is simply a tidying up procedure and is the result of changes to the charter of the Industries Assistance Commission following the Uhrig Review of the IAC. There are new rules for the definition of rules of origin to facilitate products from Forum Island countries. Again, it will not make a substantial impact on Australian trade; but it is a matter of importance to those Forum Island countries of the Pacific. There is an amendment to the description of rum which has arisen as a result of the Government's acceptance of the recommendations of the review of wines and spirits legislation conducted by the National Health and Medical Research Council. Rather more significantly, there is the implementation of decisions on metal working machine tools and robots, heavy commercial vehicles and agricultural wheeled tractors. In respect of those matters there have been other opportunities to debate the policy issues involved. I do not intend to touch on them today because of the lateness of the session and because there have been other opportunities to debate the issues which properly arise with respect to the Government's decisions in that area. I wish to raise with the Minister for Industry, Technology and Commerce (Senator Button) a point with respect to tariffs on metal working machine tools and I will return to that a little later. The Bills also relate to Budget decisions to increase the excise on tobacco and restore levels of assistance for certain goods, the levels of assistance for which have been reduced as a result of Administrative Appeals Tribunal decisions. If I may refer to the metal working machine tools point and the amendments in relation to the AAT rulings, the tariff on certain imported parts and accessories under this Bill is to increase from minimum rates of 2 per cent to 25 per cent. In the House of Representatives the Opposition moved an amendment in relation to this provision. However, after further discussion with the Government we will not put forward this amendment in the Senate, as the major manufacturer has confirmed its preparedness not to oppose tariff concessional order applications and has indicated a general commitment to co-operation in that area. All that I would seek with respect to the amendment that was moved in the House of Representatives is a commitment from the Minister that the Government will expedite any applications for commercial tariff concessions which affect spare parts which are not manufactured in Australia. I understand that there is no difficulty in the Minister giving that commitment to deal with applications expeditiously. We will not pursue an amendment with respect to those parts of the Bill. The matter which I wish to address principally and which will be the subject of further comment by Senator Puplick, who will be speaking in this debate, relates to the amendments to the Customs and Excise Act which provide for inward duty free shopping. This is also referred to in the Sales Tax Bills, as I said before. We will oppose those Bills if we successfully see the removal of the provisions relating to inward duty free shopping. The only other matter which I would like to refer to before I deal with inward duty free shopping is the rebate on the diesel fuel excise. That has the very strong support of the Opposition. I simply wish to remind the Senate that we moved an amendment in the Senate on 21 May 1985 to achieve this rebate. The Government resisted that amendment. I note that Senator Button was extremely sceptical at that time about the assistance that the proposed change would provide for the primary producers we were seeking to assist. In May 1985 Senator Button said: The problems of the wheat growers of Western Australia or the sugar growers of Queensland are not susceptible to the easy solutions suggested in Senator Chaney's speech that if we fix up the diesel fuel rebate, we have gone some way towards solving their problems. I interjected at that point and said: They could think it was very helpful. I am delighted that over the succeeding months Senator Button obviously has come to the same view, and the Government has made this important concession to primary producers. Let me say now that the Government has made this concession that I join with Senator Button in saying that it is certainly no total answer to the very serious difficulties that those primary producers face, but I am sure that the additional concession is one which will be welcomed by them. The Opposition supports this change which has been put forward in the Budget. It regrets that the change could not be wider, but believes that the sections of the community which will benefit from that extended concession warrant the relief which has now been provided. The only other thing I wish to say on this matter is to remind the Senate that those primary producers had a full fuel rebate until the 1983 Budget, and it was this Government's action in indexing the fuel excise and not indexing the rebate which opened up a gap which persisted over the next two financial years. We think that that was undesirable in principle. We suggest to the Government that where it considers an industry is entitled to an excise rebate it should be given the full rebate rather than the partial rebate which has applied over recent years. We think that would make for a tidier arrangement and also for a more rational one. There is a good deal of material in the form of submissions which were made to the IAC on the pluses and minuses of inward duty free shopping. The Opposition is not opposing in principle the idea that there should be inward duty free shopping, although I do raise the question of what precisely is the logic in providing additional shopping concessions for those Australians who are fortunate enough to travel overseas. It does appear to me that we have come quite a long way from what I would have thought was the original rationale behind those general concessions; namely, that people who were overseas were likely to make some purchases and that they might be given some concessions on their return to Australia. There is now such a range of opportunities to pick up concessions that, effectively, we seem to be providing additional cheaper shopping possibilities for those Australians who are fortunate enough to be able to go overseas. Having looked at the arguments put forward by the Treasury and by others with respect to the pluses and minuses, the Opposition does not take a stance that inward duty free shopping should be opposed as a matter of principle. In the lead-up to the last election, as part of our aviation policy, we did commit ourselves to inward duty free shopping. I make that quite clear. We are, however, particularly concerned about one aspect of the proposal, and that is the extent to which it will lead to a weakening of the barrier control which is imposed by the Australian Customs Service to prevent the illicit entry into Australia of goods on which duty has not been paid or, more importantly in this context, the illicit introduction of drugs into Australia. It is quite clear that there are concerns within the Customs Service about the further insertion of people between the point of exit from an aircraft and the Customs barrier. The proposal which the Government has put forward will mean that more individuals will be coming to work behind the barrier. There will be an opening up of opportunities for the transfer of goods from passengers to other people. Notwithstanding that, of course, there will be Customs supervision of the people who will work behind the barrier. It is undoubtedly true that the introduction of inward duty free shopping will simply add further complexities to an already complex situation within which control of drugs is a very real difficulty. It is the intention of the Opposition to move amendments which would remove provisions from two of the Bills which are before us which relate to inward duty free shopping, and, as I evidenced in a notice of motion this morning, to send the relevant provisions off to a Senate standing committee for examination and report to the Senate. Our purpose is not to determine whether or not it is desirable as a matter of economics or of general policy to introduce inward duty free shopping. We do not propose at this stage to oppose the Government's policy in that regard. What we are saying is that we wish to have a careful examination of the doubts which have been raised by the Customs Service and which are reflected in the IAC draft report on passenger concessions about the effect of this proposal on barrier control. The IAC report states: A number of submissions including Customs have expressed concern about difficulties which supermarket style inward duty free shops would pose for control of prohibited imports. Part of the conclusion in the draft report of the IAC states that the Commission does not believe that inward duty free shopping helps to achieve any of the objectives proposed by those in favour of the arrangements. The Commission went on to say: Indeed, the probability is that it would hinder Customs in processing passengers and achieving the other objectives of barrier control. If there is any doubt in this matter, that doubt should be exercised in favour of delay and of referring this matter for inquiry by a Senate committee. It is reasonable that the Senate be quite satisfied that the changes proposed by the Government will not result in a further significant opening for the illicit introduction of drugs to this country, and we should have a very high degree of satisfaction about that matter before we are prepared to allow these provisions to pass. I know that the Australian Democrats will be raising some other arguments relating to the advantages which will flow to Qantas Airways Ltd in not having grog on board the plane, and various other matters. To avoid double treatment, I will leave them to be dealt with by my colleague Senator Puplick. I wish to make it very clear on behalf of the Opposition that we do not believe that any commercial advantage should be taken in circumstances where it may be possible for Australia to become more open to elicit drugs. We think that the balance in this matter is quite clear and that no arguments relating to commercial advantage can carry any great weight in a proposal of this sort. The argument relating to safety is likely to be raised, and Senator Puplick will address that matter also. I simply wish to say, as someone who flies on 200 or 300 flights a year, since I live a long way from Canberra, that the least of my fears is that I will be killed by a flying or flaming bottle. I suspect that, if I run the risk in flying, along with my fellow passengers, that risk is very minimally increased by the carriage of alcohol on flights. Given that commercial flights invariably carry large quantities of alcohol for the consumption of passengers, that there are inevitably large amounts of alcohol in evidence on aircraft and that it may well lead people who have bought alcohol and carried it on to the aircraft-which they are entitled to do-to feel free to drink it on the aircraft, knowing that they can replenish their supplies on arrival, I can only say that that is a very marginal argument. Again, it is one that I do not think should carry too much weight with us. I know that serious consideration has been given already by the Democrats to the proposition the Opposition is putting forward, but I say to them with great earnestness that a few months delay with respect to this proposal for inwards duty free shopping is a very small price to pay for a high element of certainty that we are doing our duty with respect to the question of barrier control. Having said that, I commend the rest of the legislation to the Senate and indicate the Opposition's support for it. Senator SANDERS(Tasmania)(5.00) —The Australian Democrats support the Customs and Excise Legislation Amendment Bill (No. 2). In so saying, I state that I believe Senator Chaney has missed the point. Honourable senators may know that I do not normally speak on taxation or customs measures, but these are not considered by us to be tax or customs measures. I am the Australian Democrats spokesman on aviation. This is an aviation matter which was brought up by the Minister for Aviation (Mr Peter Morris). I am afraid that the Opposition, as it wanders its way through its political career, does not know much about aviation. Opposition members may fly in the back of aircraft, but they do not study what goes on in the industry while they are sitting back drinking their duty free liquor. This is an aviation issue, for two reasons. Firstly, as Senator Chaney has stated, Qantas Airways Ltd, which carries a large number of passengers in and out of Australia, is concerned with the growing amount of duty free goods carried on board the aircraft. In many cases they are inflammable goods, such as liquor. Only three items are involved in these Bills-liquor, cigarettes and perfume. I have a letter from Senator John N. Button to Senator Chipp, which commits the Government to that course of action. Senator Chaney —He has never read the parables: `Put not your faith in princes'. Senator SANDERS —I have my faith in some people, princes or otherwise. The letter states: Dear Senator Chipp I refer to the provisions contained in a number of bills presently before the Senate which provide for the introduction of Inwards Duty Free Shopping. As previously discussed, I write to confirm that the Government will not under any circumstances move to extend these provisions to include further categories of goods other than those already announced to be covered, namely, tobacco products, alcohol and perfume. With kind regards Yours sincerely John N. Button Could anyone doubt a letter from a man of such obvious sincerity, who sits as practically the sole representative of his Government in this chamber? I believe Senator Button's letter. I think, with only these three items to be concerned with, the Qantas argument carries great weight, because it is worried about liquor. As Senator Puplick probably does not know-he will not now know because he has left the chamber-in the recent crash of the Boeing 737 in Manchester, England one of the greatest problems in evacuating the aircraft was the number of duty free articles under the seats and the glass from broken bottles. It is a safety hazard, and if the Opposition were interested in the welfare of people it would be concerned about the safety of passengers on aircraft. The other issue Qantas has brought up is that the extra fuel cost involved in carting around all those bottles of booze is $430,000 a year. So, what is the solution as far as it is concerned? The solution is to allow people to buy their duty free liquor when they get to Australia, thus furnishing Australian business an added boost and also making it possible for passengers to come in without having to carry their duty free liquor on board the aircraft. How else is this matter involved with aviation? It is part of the cost recovery program which is so dear to the hearts of the Department of Aviation and the Government. The Department of Aviation is funded, at least partially, out of cost recovery funds, which are generated through taxes or levies on the flying public. Any- one who flies on an airline pays, through his airfares, part of the cost recovery program. As a pilot and the former owner of an aircraft I have to pay money to the cost recovery fund. At one time I was paying $900 a year in cost recovery moneys for owning a Cessna 180. The Department of Aviation, of course, is quite an inefficient operation and this inefficiency should and must be eliminated. The bureaucracy is very heavily overpadded in the upper regions. Unfortunately, it is now seeking to eliminate the real services of the Department of Aviation, such as meteorological services, which is a mistake. I think perhaps we can sort out the bureaucratic inadequacies of the DOA, but we still need increased revenues. This program will bring in some $5m a year, which will be offset against other imposts on the flying public. When these Bills come in, flying will be cheaper for all aircraft users-passengers on commercial airlines, and general aviation pilots and passengers. It will make flying cheaper for everyone. So this is very much aviation legislation. Senator Chaney said that people who leave Australia, just because they have enough money to leave Australia, should not be rewarded by being able to buy duty free goods on their return. At issue here is not duty free goods, but where one buys them. Does one buy them in Singapore, Hong Kong, the previous port of embarkation, or in Australia? It makes infinitely good sense, if the Opposition would only study the program, to buy in Australia, thus keeping the dollars in Australia. Senator Chaney mentioned the concern of the Australian Customs Service on drugs. We are all interested in controlling drugs. Frankly, I see absolutely no disadvantage in this procedure as far as drug control is concerned. I wonder whether Senator Chaney and Senator Puplick have examined all the controls which will be applied in these instances? All access to the duty free sales outlets will be via a security inspection point in the first place. All staff will be security screened and checked, both in and out of the secure areas. There will be no additional access to bond stores, as the existing bond store operation will service sales both in and out. Staff rosters-this is a very important point-will be rotated randomly, so an individual staff member will not know when he will be rostered on a particular area. I expect that Senator Chaney's concern, although he did not express it, is that it would be possible for someone to buy a bottle of Johnny Walker Red Label in Singapore, take the bottle out, put a kilo of heroin in the container labelled `Johnny Walker', and put it back on a shelf on the air side of the Customs barrier at Sydney Airport or Tullamarine Airport. An employee-a drug runner-could come along, pick up the box and replace it with a box containing real Johnny Walker and thus get the drugs into the country. If the employee did not know where he would be working on that day, as those staff will not know, there is simply no way that that could work. What is to stop another customer from coming in and buying that box? It is a risky procedure, and it is the only one postulated by the Customs Service. It simply would not work. The other thing that must be noted, as I am sure all honourable senators have noted, is that there are an awful lot of people running around airports with security passes-baggage handlers and ground crews-and all sorts of ways of moving in and out. Trying to move drugs through this system would be very risky compared with the relative safety of moving them through the baggage system. There will be passenger surveillance by means of two 360-degree zoom video cameras which will be put in at the concessionaire's expense. Another way of stopping the importation of any drugs would be the simple mechanism of having a liquor display and simply allowing a passenger to choose whatever he wishes, then give him an invoice for that so that he carries the invoice through the Customs line and presents it at the bond store on the other side. There is no physical carrying of the material across the Customs barrier at all. This would eliminate any possibility-- Senator Puplick —This is not what the Bill proposes, though? Senator SANDERS —The Bill does not propose that. It certainly is not precluded in the Bill, either. As such, it could be implemented. Dragging in this drug item is simply another way for the Opposition, which has agreed to support this proposal-it was agreed in its 1980 document, although I may be wrong on the date-to bring in a red herring to oppose it. The Opposition seems to be in the business of opposing anything the Government puts up, no matter what its merits, and it goes to extreme lengths to justify itself. I do not wish to detain the Senate any longer. I am not disposed to indulge in grandstanding, as members of the Opposition have done for so many hours this week in this place. I rest my remarks at that point and reiterate that the Australian Democrats enthusiastically support this Bill and will oppose any amendments put up by the Opposition. Senator PUPLICK(New South Wales)(5.12) —In dealing with our opposition to inward duty free shopping I want to deal specifically with the comments made by Senator Sanders in support of this measure. The first point at issue is that the honourable senator says: `I have here a letter from Senator Button which restricts these things and which is going to restrict these things to only three'. One can almost see Senator Sanders getting off a plane somewhere, waving a piece of paper, and saying: `I have here a piece of paper. It has Senator Button's signature upon it. We will have peace in our time'. However, Senator Button has been specifically contradicted by the Minister responsible for promoting this legislation. Clause 4 (b) of the Customs and Excise Legislation Amendment Bill (No. 2) 1985 provides that the goods which can be sold at a duty free store are: goods included in a class of goods declared by the regulations to be a class of airport shop goods for the purposes of that section In other words, the regulations may declare any- thing to be a good for the purpose of inward duty free shopping. Senator Sanders says: `Here I have a letter from Senator Button which says that it will be only these three things'. I will read what the Minister who is responsible for this legislation had to say in the House of Representatives. In the House of Representatives on 28 November, at page 3868 of Hansard, the Minister for Sport, Recreation and Tourism, Mr John Brown, said: I think that it is a good reason for the future extending duty free shopping in Australia at the point of arrival beyond the three commodities catered for in this legislation. Mr Brown-the principal proponent of inward duty free shopping-has said in the House of Representatives that he looks forward to extending inward duty free shopping beyond the three items mentioned in Senator Button's letter. The Bill is drawn in such a way in clause 4 (b) that it would allow him to do precisely that. Next we have the extraordinary claim from Senator Sanders that in the Manchester aeroplane crash in August this year there were problems arising from the liquor carried on board. Senator Sanders —Duty free goods; don't distort the truth. Senator PUPLICK —You said liquor. I will come to the other duty free goods in a minute. I indicate to honourable senators that I had the Parliamentary Library take out all of the Press cuttings and all of the technical reports on the Manchester disaster. There is a fair number of them and not one of them refers to the question of liquor. They refer to the way in which the Pratt and Whitney JT8D15 engine combustion failure took place. As far as Senator Sanders is concerned, we know that he is an expert on everything which he has ever claimed to have had the slightest association. The other thing that was of significance was the allegation as far as packages under the seats is concerned. Anybody who has travelled on aircraft knows that when people buy duty free packages, particularly duty free liquor, they are more likely to put them in overhead cabins. In fact, the airline requirement is for the storage of these things in the overhead cabins. What cannot fit in the overhead lockers are the bulky items-the VCRs and all the rest of them-which are in no way covered by this proposal as far as inward duty free is concerned. They are the sorts of things that are more likely, if congestion is caused, to cause it. Senator Sanders shows me that he has managed to find an excellent article written by me which appeared in the International Tax Free Trader magazine. It is quite true that in terms of addressing a conference in Cannes last year and in addressing a conference in Bangkok this year, I discussed this matter at very considerable length. Senator Sanders wants to make the implication that he is the only person in this chamber who has any understanding of this particular part of the industry. Senator Sanders —I am saying that you have a financial interest in this and I don't. Senator PUPLICK —I am going to pause on that because Senator Sanders has now revealed, I guess, the sorts of low standards that he really has. `You have a financial interest in this', he says. I previously operated a consultancy business of which some duty free operators were clients. That consultancy business was entirely closed down by me, prior to my nominating for re-election to the Senate. The consultancy, in fact, was passed over by me to a firm, the principal of which happens to be a former private secretary to Bill Hayden. It is remarkable that Senator Sanders, the great white hope, the man of integrity and the man of honour, comes in here and makes an allegation that another senator has a financial interest in a matter before the Senate which is, in fact, absolutely untrue. It is just typical of the standards that Senator Sanders has. Senator Sanders says, of course, that aeroplane flights are going to be cheaper and that there are going to be reduced air fares because the airlines are allegedly going to be able to save some fuel on the particular flights concerned, despite the fact that the items of bulk and the items of weight are not liquor these days-they are primarily VCRs, electrical equipment and heavy equipment of that nature. Senator Sanders knows that there is going to be nothing done about that because he has a letter from Senator Button which says that those classes of goods are not going to be available in terms of inward duty free shopping. That argument is a nonsense. He says that there is going to be a saving to Qantas and that somehow Qantas is going to reduce its air fares because people have the opportunity to buy a bottle of liquor, 200 cigarettes and a certain amount of perfume when they arrive here. Of course, there are two things that he forgets. First, this legislation does not prevent passengers taking duty free liquor on board prior to their arrival in Australia, carrying it and taking it off the plane as they do at the moment if, for instance, they do not want to be stuck in the terrific congestion in the inward duty free shop at Sydney airport with a jumbo load of other shoppers-indeed, given the Sydney curfews, three jumbo loads of shoppers coming in at the one time-so that argument is specious. The second thing that is entirely specious about the argument is that one of the things that this measure will encourage, particularly in airlines which are hard up for cash money, is for them to carry duty free liquor on board and sell it to passengers, saying: `You may have been waiting to buy your duty free grog when you get to Sydney, but it will be very crowded when this jumbo arrives. There are three jumbos coming in between 6 and 7 in the morning. Why don't you buy the liquor from us on the aeroplane and take it off with you?' The airlines will carry more duty free grog on board aircraft in order to sell it to passengers. That is a fact. If Senator Sanders wants to look at the misbehaviour of the whole thing, and a criticism of Qantas for doing this, he might like to look at the judgment of Mr Justice Wilcox in a trade practices case of Steiner v. Magic Carpet Tours which was decided in October 1984 in which the judge specifically took Qantas to task for the amount of free liquor which it provides to passengers during their flights. As to the suggestion that many Australians appear to arrive in South East Asia intoxicated, the judge said: If that statement is correct it raises questions about the wisdom, in terms of Australia's reputation with its neighbours, of government and airline policies . . . unlimited free alcohol in flight-which tend to encourage excessive drinking. So criticisms are made of Qantas for the practice that it has at the moment. It is clear that what is likely to happen is that Qantas and other airlines will carry more duty free liquor on board in order to sell it to their passengers. If Senator Sanders is concerned about that matter, he ought to take that consideration into account. Senator Sanders said that people will buy their duty free goods in Australia. I suppose he does not give a hoot about the fact that the principal concessionaire at Sydney Airport is a non-Australian company which repatriates home most of its profits. It got the contract for the duty free shop at Sydney Airport by putting in what was undoubtedly a loss leading tender. It undercut other companies. It undercut Australian companies in order to get this contract. The contract was so bodgie that the company had to come back to the Government, once it had been given this monopoly contract, to renegotiate it. At page 1866 of the Senate Hansard of 13 May 1985 honourable senators will see an answer provided by Senator Gietzelt, representing the Minister for Aviation, to my question about why the contract had to be renegotiated. I asked: What were the terms of the new contract? The terms are set out in the Hansard. The contract had to be renegotiated. On 15 May I put on notice question No. 302 asking: How many other contracts have had to be renegotiated because they were so bad? To this day, that question remains unanswered on the Notice Paper. That is an indication of the sorts of people who Senator Sanders says ought to have this material made available to them. The concessionaire at Melbourne Airport has been criticised in the September 1984 report of the Auditor-General upon audits, examinations and inspections under the Audit and other Acts. This report is parliamentary paper No. 170 of that year. At page 112, under the heading `Location of Duty Free Premises at Melbourne International Airport', the Auditor-General criticises a lack of security at those premises. I turn to the question which the Leader of the Opposition, Senator Chaney, raised about barrier control and the problems that raises. The first and most important thing to say is that one has to look in the first instance to the fact that this will be a revenue losing operation. The details of that revenue loss are contained in the submission by the Australian Taxation Office to the Industries Assistance Commission inquiry on passenger concessions. Page 31 of the submission summarises its position-I do not have time to go into it now-which demonstrates clearly that inward duty free will be a loss to the Australian revenue. The Australian Democrats have been telling us for the last couple of weeks in respect of the tax package how much they are in favour of small business. The Australian Small Business Association, in its submission to the Industries Assistance Commission, said specifically that inward duty free shopping should not be introduced. It said that it would be deleterious to small business, that it extended the concept too far and could not be supported by it. On 6 May 1985 it put out a Press release headed `Small Business Condemns Inward Duty Free Decision'. Therefore, we come to the questions of security. I seek leave to incorporate in Hansard a submission made to the IAC in April 1985 by the Australian Customs Service. Leave granted. The submission read as follows- INDUSTRIES ASSISTANCE COMMISSION INQUIRY INTO PASSENGER AND CREW CONCESSIONS SUBMISSION BY THE AUSTRALIAN CUSTOMS SERVICE PASSENGER AND CREW PROCESSING AND FACILITATION As the authority responsible for the adminstration of the passenger concessions, it is not our role to comment on questions of fiscal policy (e.g. revenue foregone) or on matters not directly related to ACS operations (e.g. financing of airports, the effect on Australian industry or the efficiency of national resource allocation). The prime area of concern for the ACS in respect of passenger concessions is the facilitation of passengers and the allocation of resources to that function. The resource question involves Government consideration of the priorities it needs to apply in the allocation of resources to Government Administration, particularly in times of restraint, and ACS consideration of how it in turn should deploy resources to meet the Government's priorities. Philosophy Passenger concessions exist for two reasons. Firstly, to facilitate the inward movement of passengers and, second, to release passengers from duty liability on articles commonly carried as personal possessions and necessities purchased for the journey. There can be, of course, subsidiary reasons for the concessions; for example, they have been held to be a means of assisting migrants to overcome problems in bringing assets with them into Australia, and Australia grants concessions contained in international Conventions to which Australia is a signatory. The facilitation philosophy finds international acceptance in Annex F.3 to the Customs Co-operation Council Convention on The Simplification and Harmonization of Customs Procedures (the ``Kyoto'' Convention). Australia is a signatory to the Kyoto Convention, has acceded to a number of its Annexes and is at an advanced stage in the process of adopting Annex F.3. The Customs view is that concessions should be realistic. That is, they should recognise that people will make purchases and should avoid the need for collection of duty on reasonable purchases of the nature contemplated by the concessions. The latter should be structured in such a way that they can be interpreted easily and that travellers who know they must pay duty will do so voluntarily. The concessional regime should not provide an incentive for travellers to seek to evade duty. Equally, of course, general concessions, say on sales tax, can be overly generous and raise questions of equity in relation to the majority of the population. The Customs concern is to steer a line which will not create an atmosphere of policing and not encourage petty smuggling. It has to be said that, apart from resource questions, there is a matter of priorities involved. Relatively minor duty evasions cannot rate highly as compared with narcotics or quarantine breaches. At the same time, Customs deprecates the attitude of some regular travellers who move in what might be termed the ``loot'' area of concessions, that is, high value items not usually thought of as affordable by the average citizen. In that context, it should be noted that Australia's concessions are generous by international standards. The concessions are not, and should not be regarded as, a grant. Moreover, they are not linked in any way to the ``free port'' philosophy (which has sway, for example, in Hong Kong, Singapore and Fiji), which is much broader in concept and is based on quite different considerations, in that it is designed to encourage i.e. industrial development, investment, retail opportunities and commercial export incentive programs, and to bring in revenue. Administration An essential element for facilitating the entry of passengers by providing concessional treatment to goods carried by them is simplicity of administration. One aspect is that the concessions available should be sufficient to permit a relatively unimpeded flow through the Customs barrier for the majority of passengers, by keeping to a minimum the incidence of duty collection. If it were necessary (because of the non-existence of reasonable concessions) to collect duty from the majority of passengers, or to examine significantly more baggage to prevent smuggling, the increase in ACS staff resources needed to ensure that processing delays did not occur would be considerable. In the absence of allocation of additional resources in the Budget, which may not be possible, this would result in deployment of staff from another area of operations with inevitable consequences to it. Another aspect is that concessions should be able to be interpreted and applied without real difficulty, both by the passenger and the ACS. Difficulties in interpretation and application cause delay at the Customs Barrier. A factor in this is that exceptions to the rule should be kept to a minimum. Examples are concessions accorded serving crews (limited to once a year), migrants, tourists of different nationalities and constant travellers (e.g. couriers who may pass through the Customs barrier every 10 days). As a further example the existing concessions allow `Articles for personal hygiene, grooming or adornment'. An exception to this concession for, say, `items of jewellery, purchased overseas and exceeding $100 each in value' could cause considerable administrative difficulties for the ACS and could involve, for example: the registration of items of jewellery taken out of Australia by passengers and verification at time of re-importation; the registration of jewellery temporarily imported by tourists and verification on re-exportation; the valuation of all items of jewellery by the ACS-this would mean recruitment of a significant number of specialist staff; and an increase in the number of passengers from whom duty would be collected. All of the above would lead to additional delays in passenger processing (unless resources devoted to it were considerably increased) and negate the objective of facilitation. The above example is given as indicative of the type of administrative considerations that can arise. Changes introduced in the last ten years have sought to simplify the administration of the concessions available to passengers, afford reasonable facilitation for imports by passengers and minimise delays in processing times to ensure that airport facilities (in particular) do not become overloaded. The Effects of Changes in Concessions/Administration It may be worthwhile to illustrate the facilitation question by taking a specific element of the Commission's reference, that is, inwards duty free shopping (IDFS). Shopping by inward passengers could well aggravate queueing at major airports if subsequent flights arrive while passengers from earlier flights are still proceeding to the primary line. This would result in problems both for processing passengers at the primary line, and for congestion (from the carousels) in the Customs Hall, even to the extent of causing later baggage to be held in the basement awaiting space. There may be a tendency for passengers to confuse the extent of the concessions and overspend their allowance, thereby increasing congestion at the primary line as Customs would have to collect additional duty. Last minute shopping could cause amendments to baggage statements to be necessary on occasions, according to purchases, and the primary desk is not the place where passengers should complete/amend the statement. There is the further problem of completion of statements (in aircraft en route) where it is not then certain what will finally be in the baggage. Alterations could make for evidentiary difficulties later. Surveys conducted by the ACS indicate that if IDFS were available there would be an upward trend in both the number of passengers who purchase duty free goods and the value of those goods. This would have two effects in particular: (i) an increase in the revenue foregone; and (ii) an increase in processing time for each passenger, with a consequent increase in staff resources needed if delays were to be minimized. An additional problem is that IDFS staff would be located within the Customs area leading to an added risk of narcotics and message exchange. This would require additional Customs surveillance workload and increased manpower. The security screen would have to extend to checking IDFS staff each time they left the premises (e.g. lunch, visits to toilets, leaving work for the day). Monitoring would be required of deliveries to and from the IDFS and rubbish removal. There would be a requirement of police/character checks on IDFS staff. The above comments illustrate the implications which concessions and their administration can have: at the primary line, where the determination is made whether duty is payable; at the baggage channel, where the extent of concessions used is verified; and within duty free premises themselves, to ensure that the barrier is not being breached by shop personnel or others connected with duty free operations. Delays at the first point in the Customs clearance chain lead to an increased number of representations criticising inadequate facilitation. In a circumstance of resource pressures resulting from a particular concessions regime, there is some risk that the increased emphasis on verifying passenger concessions usage could be detrimental to Customs effectiveness in the high priority areas of narcotics, quarantine and community protection. Senator PUPLICK —I thank the Senate. That submission makes it abundantly clear that the Customs Service is concerned about security and smuggling issues. Because the submission is now in the Hansard, I will not read it. However, I draw attention to two other reports which relate to this. The first is the report of the Mahony Review of Customs Administration and Procedures (in New South Wales). That report specifically drew attention to the problems of security if inward duty free shopping were introduced. The reference can be found at pages 121 and 122 of the report. Today we received the annual report of the Department of Industry, Technology and Commerce. At pages 92 and 93 of the annual report which was presented to this Parliament only today, the Mahony report is raised specifically. The report says in part: The single major influence of the year under review was the Government's development of a national campaign against drug abuse. The report continues: . . . The Mahony report on the Review of Customs Administration and Procedures in New South Wales had recommended a tightening of barrier controls and this recommendation was also accepted by the Government as part of its national campaign. That tightening of barrier controls will be undermined by the introduction of inward duty free shopping. Arising from this will be the major problem of airport congestion at the terminals. The Daily Telegraph of 17 May 1985 reported that the Federal Government had been told that the international passenger terminal at Sydney Airport had become `alarmingly' congested. That complaint was made by international airlines. A comment was made in the IAC's draft report on passenger concessions. It is stated on pages 87 and 88 of the report: There seems little doubt that an inward duty free store would increase the security problems substantially. The Commission understands that authorities in the United States of America strongly oppose inward duty free shopping on security grounds. Again, because of lack of time, I will not go through all that the Commission had to say, but further on it states: If the export objective of duty free shopping is abandoned in favour of maximising passengers' utilisation of import concessions, there would be little to criticise in such a proposal. But that is not the proposal that the Government has come forward with. Its conclusion is: The Commission does not believe that inward duty free shopping helps to achieve any of these objectives-- those being passenger facilitation, immigration, cost effectiveness, and Customs administration- Indeed, the probability is that it would hinder Customs in processing passengers and achieving other objectives of barrier control. The Commission does not therefore consider that passenger import concessions should apply to goods purchased in Australia by arriving persons before they pass through the Customs barrier. Senator Sanders is the great expert on barrier control and Customs administration. He has told the Senate that, despite the lengthy hearings by the Industries Assistance Commission which says that inward duty free shopping will hamper its barrier operations, despite the submission by the Customs Service that it will hamper its barrier operations, he knows better. We have the whole sorry tale of the way in which this was introduced. The first report of the Bureau of Transport Economics was presented in September 1979. That report was sent to an interdepartmental committee which rejected its findings. Another interdepartmental committee was set up. That committee was under the chairmanship of Senator Button's Department. For various reasons, it passed from that Department's chairmanship. His Department has been consistently opposed to inward duty free shopping. His Department surrendered the chairmanship to Mr John Brown's Department of Sport, Recreation and Tourism. That Department sought to mislead the Senate and the Parliament in last year's annual report by the way in which it made its report on inward duty free shopping. I challenged the Department on that. The Senate Hansard of Estimates Committee D of 18 April 1985 shows that I challenged the Department on that and the Department had to make all sorts of excusses and retreats. Again, funnily enough, the report which has come in only today-the 1984-85 annual report of the Department of Sport, Recreation and Tourism-apologises in effect, at pages 92 and 93, for having misled people in last year's annual report; that is, the 1983-84 annual report. Page 110 of that report referred to inward duty free shopping. In answer to a Senate question it was indicated on 8 May that the interdepartmental committee report referred to at that time related to departmental inputs to the preparation of a Cabinet submission on inward duty free shopping. So the Department has been forced to back down on the way in which it has attempted to cover up in this whole operation. I do not have the time to explore all of the other matters which are of significance here-for instance, the submissions by the Fiji High Commission, the Fiji Visitors' Bureau and the Fiji National Duty Free Merchants Association to the IAC asking it not to proceed because of the damage that inward duty free would do to its small regional economies, and the submission by the Department of Foreign Affairs asking the IAC not to proceed. Finally I came back to drugs. I refer again to one of the comments in the IAC report which states: Incoming passengers could pass contraband to arrival shop staff who would later bring it through the barrier. On 27 November 1985, in the debate in the House of Representatives on page 3835 of Hansard Mr Fife, the honourable member for Hume and a former distinguished and respected Minister for Customs, who consistently rejected appeals for the introduction of inward duty free shopping because of the advice of his Customs advisers, stated that the Government was `running a risk that no responsible government should ever take'. The motion which has been moved by Senator Chaney, and which is fully supported by the Opposition, is a simple one. It acknowledges that there are arguments about the security provisions for control of inward duty free shopping. There are arguments that touch upon the fundamental question of whether a threat is posed to young people in Australia and to the Australian community in general, by the importation of drugs. That threat exists and has been identified by the Australian Customs Service, interdepartmental committees, the Mahoney review and in numerous submissions to the IAC and has been identified and rejected by previous Ministers for Customs because it posed too serious a challenge for it to be allowed to go ahead without further examination. On that basis further examination by a Senate committee is entirely justified and Senator Chaney's motion ought, for that reason alone, be supported. Those who fail to support it and fail to see the strength of that argument are determined to put political or commercial interests ahead of the fundamental interest of the security of young people and the whole Australian community in the vital war which we have to fight against organised crime and the drug trade. Senator BUTTON(Victoria-Minister for Industry, Technology and Commerce)(5.32) —I thank honourable senators for their contribution to this debate. As has been pointed out, there have been all sorts of views about the issue of inward duty free shopping, some of them informed, some of them less informed, some of them not informed at all and indeed some quite ignorant. Some of those views are highly speculative, and it is very difficult to draw conclusions about them. I understand some of the concerns which have been expressed by the Opposition. I have a great deal of confidence in the Australian Customs Service and the capacity of its officers. That is a very sustaining thought for the Minister responsible for Customs. I refer to all the views that have been expressed. Some of those expressed in the House of Representations were colourful. I particularly noted the contribution of Mr Ian Cameron, the honourable member for Maranoa and a member of the Opposition, in respect of inward duty free shopping. He stated: Unfortunately, the National Party of Australia is having its Christmas party tonight. I have not drunk too much rum but I have had a couple of whiskies. I am a bit more worldly than Government members. One of the problems I have is that my side of the House is opposing this idea, but I think it is a damn good idea so that puts me in a quandary. As one who travels a bit and drags stuff in and out of the country I think the present arrangement for duty free goods is absurd. He continued that if the Government is fair dinkum-they are my words: . . . why does it not include all products sold at airports-electrical goods, cameras et cetera? I do not know why the Government restricts this to only a few products. I do not doubt that as time goes by we will expand this principle to other areas. There is the authentic view of the National Party of Australia at work in the House of Representatives. As Senator Puplick acknowledged when defending his probity and integrity on this matter, he is not without a course record of various views on some of these issues. I do not allege anything in respect of that. I think he has changed his mind from time to time. Certainly he has changed his mind if the vehemence of his contribution to this debate is indicative of his present state of mind. However, that is bound to happen. The Government has made a decision in respect of inward duty free shopping. I indicated in a letter to Senator Chipp-it was read by Senator Sanders; it is very gratifying to note that they read my letters-that this measure would be confined to the three items in question. It will be. In those circumstances I rely very much on the arguments which were put at some length in the House of Representatives. Earlier in the debate on the Customs Tariff Amendment Bill (No. 2) Senator Chaney raised the issue of duty rates for machine tool parts and accessories. I do not want to dwell at length on that issue but I think I should just explain the background. In 1983 a simplification of the tariff led to a drop in the rate of duty from 26 per cent to 2 per cent for metal working machine tool parts and accessories. As a result local producers made submissions to the Industries Assistance Commission and gave evidence to it of some substantial drop in sales and production as a result of that reduction in duty. The IAC, in its 1984 report on metal working machine tools, recommended that parts and accessories for use as original equipment in the production of machine tools be bountiable and dutiable at minimum rates. It also recommended that other parts and accessories for replacement purposes be dutiable at 25 per cent. In other words the IAC restored the situation to what it was prior to 1983. The Government accepted these recommendations on assistance for parts and accessories and rejected the possibility of bounties for parts and accessories because the cost would have been too great. The IAC noted in its report that many parts and accessories are not manufactured locally. In that circumstance which is the point of the tariff concession system, importers should be able to apply for tariff concession orders which, if they are granted-they would be in circumstances where there is no local manufacturer-would allow imports to be made at the 2 per cent rate rather than the 25 per cent rate. That is the essence of what Senator Chaney was seeking to have put on the record. A number of matters have been raised in the debate but I do not wish to deal with anything other than the substance of what honourable senators have said. I commend the legislation to the Senate. Question resolved in the affirmative. Bills read a second time. The Bills. Clauses 4, 6, 7, 12, 17 and 18 of the Customs and Excise Legislation Amendment Bill (No. 2) 1985, and clause 13 and Schedule 8 of the Customs Tariff Amendment Bill (No. 2) 1985-by leave-taken together. Senator CHANEY(Western Australia-Leader of the Opposition)(5.40) —The Opposition proposes to oppose clauses 4, 6, 7, 12, 17 and 18 and to vote against those clauses in the Customs Excise Legislation Amendment Bill (No. 2), and to vote against clause 13 and schedule 8 of the Customs Tariff Amendment Bill (No. 2) 1985. The reason for that is that all of those clauses and that schedule relate to the Government's proposal to institute inward duty-free shopping. I do not wish, at the Committee stage, to go back over all the ground that has been canvassed in the second reading debate but I should like to touch on some of the matters which have already been raised. I was particularly pleased to hear the Minister for Industry, Technology and Commerce, Senator Button, in his defence of what is proposed, express his confidence in the Australian Customs Service. I do not in any way demur from that expression of confidence or disagree with it, but I draw the Minister's attention, the Senate's attention-that of the Australian Democrats in particular-to the views of the Australian Customs Service in which the Minister has so much confidence. The Customs Service made a submission to the Industries Assistance Commission. That submission is a public document. I should like to advise the Committee of one of the views expressed by the Customs Service with respect to this matter. I quote from the submission: An additional problem is that inward duty-free shopping staff would be located within the Customs area leading to an added risk of narcotics and message exchange. This would require additional customs surveillance workload and increased manpower. The security screen would have to extend to checking inward duty-free shopping staff each time they left the premises (for example, lunch, visits to toilets, leaving work for the day). Monitoring would be required of deliveries to and from the inward duty-free shopping and rubbish removal. There would be a requirement of police/character checks on inward duty-free shopping staff. Later in the same submission, the Customs Service said: In the circumstances of resource pressures resulting from a particular concession regime, there is some risk that the increased emphasis on veryifying passenger concessions usage could be detrimental to Customs effectiveness in the high priority areas of narcotics, quarantine and community protection. I do not seek to overemphasise or in any way to misrepresent the views that are put forward by Customs. They refer to `some risk'; they refer to the fact that it `could be detrimental to Customs effectiveness in the high priority areas of narcotics, quarantine and community protection'. That is a view which seems to be reflected and has been accepted as a consideration worthy of being put forward by the Industries Assistance Commission. The simple point which the Opposition makes is that we do not believe that in circumstances of doubt we should simply pass these provisions and hope for the best. I am totally unimpressed, and indeed I am somewhat taken aback, by the attitude which was evidenced by the speaker for the Australian Democrats. His rather contemptuous pushing off of the views which I put forward, on the basis that this was an aviation matter and not a Customs matter, I find very hard to understand. Frankly, I think that the obviously quite marginal advantages which accrue or may accrue to aviation if this change is made just do not weigh very heavily in the balance when held up against the possibility that there will be further weakening of barrier controls against the possible introduction of narcotics and other matters. So I express considerable surprise that the usually would-be idealist Australian Democrats should take the stance that was put forward by Senator Sanders, and I would express the hope that it does not represent the view of his Democrat colleagues. Again, I do not wish to flog the horse; I hope it is not a dead horse. I hope that honourable senators are alive to the arguments which have been put forward and will see it as a desirable matter that there should be careful consideration of the barrier control aspects of this legislation. I do not wish to expend much time on the other many arguments which are available as to the advantages and disadvantages, but perhaps I may quote from one other submission to the Industries Assistance Commission, that put in by the Department of the Treasury. In its penultimate paragraph, its says: The extension of taxation concessions is not considered an appropriate response to passenger in-flight behavioural problems or rising airline fuel costs. In regard to fuel savings, the argument is simply ludicrous when the value of fuel savings is set against the amount of Commonwealth revenue foregone. Further, the reduction in Commonwealth revenue collections must outweigh any increase in on-airport duty-free licence revenue. In any event, extra licence free revenue collected by the Department of Aviation would primarily benefit international airline operators and international air travellers by allowing airline rentals and airfares to be lower than otherwise. In effect, ordinary taxpayers would be subsidising overseas travel. I just wonder at the priorities of the government and at the priorities of the Australian Democrats. I commend to the Committee the proposition that we should vote against those clauses and should subsequently refer this matter to the Standing Committee on Industry and Trade so that that Committee can examine the proposed establishment of inward duty-free shops and its impact on Customs administration and barrier control. We have a duty to do that, for to do otherwise is to be careless. Senator SANDERS(Tasmania)(5.46) —Firstly, I still do not think that Senator Chaney understands the mechanisms of these Bills. These Bills will take in revenue from the concessionaires which will be used to offset against all air navigation charges. I do not think that Senator Chaney understands that; he still seems to imply that it is only offset for international costs. That will not be so. It will be offset against all air navigation charges. It is obvious that he has not studied this issue. Earlier, Senator Puplick raised the item of small business. It is difficult for me to see how any small business can be affected when the only three items involved are perfume, liquor and cigarettes. These are items which would have been bought in Singapore or some other place anyway. It is interesting to note, incidentally, that this is not a unique idea. It will not be used only in Australia. Singapore, a very major embarkation point for Australian flights, and Taiwan, Pakistan, India, Sri Lanka, and New Zealand may use it. New Zealand is about to implement this type of inward duty-free shopping. So, we shall not be alone. It is not something that somehow the Government has just cooked up as a hare-brained scheme. This has been studied. It is working elsewhere. It has been proven. The other item is tourism. Strong support for inward duty-free shopping is shown by the tourist industry, by representatives and commissions. They feel that Australia's present reputation as a shopping destination would be significantly enhanced by this proposal. The tourist industry feels that if we can make Australia a more attractive destination, through this and other means, more tourists will come here and spend more money in Australia, thus enhancing small business. Any increases in tourism resulting from these incentives will have a multiplier effect on our economy as a whole. We have heard once again about problems of Customs control. This is an overall problem in Australia, as in any other country where drugs flow across borders. For the life of me, I cannot see why this one issue can cause so much of a problem, so much of an increase in drugs. These duty-free shops are basically warehouses which are licensed and controlled by Customs. They are controlled in terms of the warehousing provisions contained in Part V of the Customs Act 1901. They will be required to be licensed as Customs warehouses. It is nothing unusual. The licensing of these premises will require compliance with certain eligibility criteria relating to the physical security of the premises, the safekeeping of the goods in the warehouse where there is a duty-free shop operator, the maintenance by the duty-free operator of proper records, being records sufficient to trace the movement of those goods out of the warehouse by sale to a passenger, and the need to be able to satisfactorily account to Customs for their warehouse goods. The Customs administration of the warehousing arrangements for the scheme of restricted duty free shopping is feasible. There can be no major problems which are insurmountable by the very capable people in the Customs Service. To amend this Bill further it is really unnecessary. I feel that we have canvassed the issues quite thoroughly. To carry the argument any further would simply be an improper use of the Committee's time, so I will sit down and make no further remarks. I hope that we can get on with the rest of the business. Senator PUPLICK(New South Wales)(5.50) —I will take only a moment to respond to a couple of the extraordinary remarks made by Senator Sanders. By way of interjection he dismissed the Treasury's Industries Assistance Commission claim as rubbish. The claim that the Treasury made before the IAC was that it would be `ludicrous' to believe that the savings alleged to occur as a result of inward duty free shopping would have any overall impact when we consider the total revenue forgone as a result of its introduction. For Senator Sanders to dismiss that Treasury statement as rubbish I think simply indicates that he has not read, studied or understood the Treasury's submission to the Industries Assistance Commission. Senator Sanders's second point related to the alleged enormous fuel saving. Let me take him back to the September 1979 Bureau of Transport Economics report entitled `Inwards Duty-Free Shopping at Australian International Air Terminals: An economic evaluation'. Under the heading `Fuel Savings' it is said, among other things: Allowing for these adjustments the estimate of total fuel cost saving ranges from $54,000 in 1980 to $163,000 in 1982. These savings are small and would be an insignificant part of the total operating costs of any international airline providing services into Australia. Senator Sanders —A penny saved is a penny earned. Senator PUPLICK —A penny saved is a penny earned, and a life lost as a result of increased drug smuggling is a life lost. Senator Sanders should stick to saving his grubby pennies and let the Opposition parties stick to trying to save young lives. Senator Sanders said for heavens sake, `this is going to make Australia a more attractive tourist destination'. He thinks that the ability to buy a bottle of liquor, 200 cigarettes and a small amount of perfume will make Australia a more attractive shopping destination. He thinks that people will sit on an aeroplane for hours and hours because it is more attractive to buy a bottle of liquor when they get to Sydney Airport. Those people will probably be coming from places where it is cheaper to buy in any case. Let Senator Sanders remember this: What has made Australian duty free shopping renowned throughout the world has been the phenomenal success of the off-airport duty free shops. Senator Chipp —Most of them are rip-off merchants. Senator PUPLICK —The very people who are the most likely to be affected by the introduction of inward duty free-- Senator Sanders —What quantities of booze do they sell at those shops? Senator PUPLICK —In some cases about a third of their total income is made up from that. Senator Chipp says that most of them are rip-off merchants. Senator Chipp —That is what I said, yes. Senator PUPLICK —He did indeed. Let me take the honourable senator to the latest Choice survey. Perhaps he will have some respect for the survey done in the November 1985 Choice magazine. The report on that survey in the Australian for 9-10 November 1985 said: An international survey of duty-free shopping has revealed that most Australian stores-except at Sydney Airport-compare favourably with European and Asian competitors. Mr Temporary Chairman, I wish through you to address remarks to Senator Chipp, if Senator Button will yield his ear to me for one moment. I wish to address this remark to Senator Chipp, through the Temporary Chairman. The article- Senator Archer —He is not interested. Senator PUPLICK —He is not in the least bit interested in listening. The Australian article, having said how Australian duty free shopping was the best in the world, said: `The only exception (was) Sydney Airport's duty-free which had noticeably higher alcohol and cigarette prices.' They are the very people who are now to be given the sole monopoly concession in Sydney to sell cigarettes and tobacco. The only people who charge internationally high prices, who are genuine rip-off merchants-the people who are operating the store at Sydney Airport-are the people to whom this legislation gives the monopoly concession. All of the others, according to the article headed `Duty-free shopping', in Choice of November 1985, are demonstrated by international comparison to be among the cheapest in the world. I think the lack of logic in Senator Chipp's point is totally revealed. I address a question to the Minister for Industry, Technology and Commerce (Senator Button). I ask him in his reply to indicate to the Committee what extra resources are to be made available to the Australian Customs Service for the surveillance of passengers in the inward duty-free shopping area. The last point I make is this: If Senator Chipp has any reputation in this chamber, it has been one of being very sensitive to the recommendations of the Bureau of Customs-now the Australian Customs Service-for what it believes to be in the interests of Australians in matters of narcotics control. Senator Chipp has a long-established reputation in this place for having paid the closest attention to the recommendations of the Customs Bureau. I appeal to him, therefore, not to go back on that reputation and to stick by the Customs Service in this matter. Consistently, in every inquiry, as shown in the report of the Bureau of Transport Economics, in interdepartmental committee reports, in the report of the Mahony Review of Customs Administration and Procedures and in the IAC report, Customs has pleaded with the Government not to introduce inward duty free shopping. I plead with Senator Chipp once again to give his support to the recommendations of the Australian Customs Service. Senator BUTTON(Victoria-Minister for Industry, Technology and Commerce)(5.58) —The answer to Senator Puplick's question is that a number of additional Customs officers were made available earlier this year for general surveillance duties. There has, of course, been no special allocation in respect of inward duty free shopping, as there is yet no legislation in respect of inward duty free shopping. I indicate that the Government does not accept the Opposition's argument for reasons given earlier. Question put: That the clauses and Schedule stand as printed: The Committee divided. (The Temporary Chairman-Senator G. N. Jones) Ayes . . . . . . . . . . . 37 Noes . . . . . . . . . . . 33 —— Majority . . . . . . . . . 4 —— Aulich, T. Jones, G. N.Black, J. R. McIntosh, G. D.Bolkus, N. McKiernan, J. P.Button, J. N. Macklin, M. J.Childs, B. K. Maguire, G. R.Chipp, D. L. Mason, C. V. J.Coates, J. Morris, J. Colston, M. A. Ray, RobertCook, P. F. S. Reynolds, M. Cooney, B. Richardson, G. F.Crowley, R. A. Robertson, E. A. (Teller)Devlin, R. Ryan, S. M.Elstob, R. C. Sanders, N. K.Evans, Gareth Sibraa, K. W.Foreman, D. J. Tate, M. C.Georges, G. Vigor, D. B.Gietzelt, A. T. Walsh, P. A.Giles, P. J. Zakharov, A. O.Grimes, D. J. Archer, B. R. Lewis, A. W. R. Baume, Michael MacGibbon, D. J. Baume, Peter Messner, A. J.Bjelke-Petersen, F. I. Missen, A. J. Brownhill, D. G. C. Parer, W. R. Carrick, Sir John Puplick, C. J. G.Chaney, F. M. Rae, PeterCollard, S. J. Reid, M. E.Crichton-Browne, N. A. Sheil, G.Durack, P. D. Short, J. R.Guilfoyle, Dame Margaret Teague, B. C.Haines, J. Townley, M.Hamer, D. J. Vanstone, A. E.Harradine, B. Walters, M. S.Hill, R. Watson, J. O. W.Jessop, D. S. Withers, R. G.Kilgariff, B. F. (Teller) Question so resolved in the affirmative. Remainder of Bills-by leave-taken as a whole. Senator CHANEY(Western Australia-Leader of the Opposition)(6.05) —I refer to Schedule 6 in Customs Tariff Amendment Bill (No. 2) 1985, which refers to metal working machine tools and the increase in duty from 2 per cent to 25 per cent. I thank the Minister for Industry, Technology and Commerce (Senator Button) for his response, which went so far as to outline the procedures which are available to importers to obtain commercial tariff concessions where the spare parts are not manufactured in Australia. I ask the Minister whether he is able to give a commitment that the Government will expedite these applications. There is concern in the industry about delay. I ask him to give that simple undertaking that that will be done. Senator BUTTON(Victoria-Minister for Industry, Technology and Commerce)(6.07) —I will certainly give that undertaking in respect of the parts covered by this legislation. The concern may go wider than that, but insofar as these Bills are concerned, I give that undertaking. Remainder of Bills agreed to. Bills reported without amendment or request; report adopted. Bills (on motion by Senator Button) read a third time. Senator CHANEY(Western Australia-Leader of the Opposition)(6.08) —by leave- I move: That the following matter be referred to the Standing Committee on Industry and Trade: The proposed establishment of inwards duty free shops, and its impact on Customs administration and barrier control. I do not wish to speak to this motion at length. I simply say to the Senate, for the benefit of the Australian Democrats, that this motion will not delay the legislation, the legislation having passed through the third reading. It would enable the Senate Standing Committee on Industry and Trade to look at the administration and to check the issues which are of concern to the Opposition and report back to the Senate. Senator Haines —Have you spoken to the Chairman of the Committee? Senator CHANEY —The Committee is aware that the matter has been raised. Senator Haines —How does the Committee feel about the idea? Senator CHANEY —I am sorry, all I know is that the Committee Chairman has been advised. In any event, there is a significant matter which the Australian Customs Service has raised as an issue. I think it would be reasonable for the Senate to look at it. It would mean that if there were resource problems, for example, it would be more likely that the Government would be under pressure to meet them. I think this would be a useful way of seeing that we do not have the sorts of problems with barrier control that have caused the Opposition to oppose parts of this legislation. I do not think there can be any doubt, given the attitude of the Customs Service, that there are potential problems. We would like to see that those problems are, at least, examined. Senator BUTTON(Victoria-Minister for Industry, Technology and Commerce)(6.09) —The Government deoes not support the view put by Senator Chaney. The substantive issues have been argued in the course of this cognate debate. It would be nice to refer everything a government does to a committee to make sure that the Government does things properly. I assure Senator Chaney that if there is an additional need for resources we will look after that. I would be very concerned that that was so. We do not accept the motion for those reasons. Question put: That the motion (Senator Chaney's) be agreed to. The Senate divided. (The Deputy President-Senator D. J. Hamer) Ayes . . . . . . . . . . . 33 Noes . . . . . . . . . . . 37 —— Majority . . . . . . . . . 4 —— Archer, B. R. Lewis, A. W. R.Baume, Michael MacGibbon, D. J.Baume, Peter Messner,A. J.Bjelke-Petersen, F. I. Missen, A. J.Brownhill, D. G. C. Parer, W. R.Carrick, Sir John Puplick, C. J. G.Chaney, F. M. Rae, PeterCollard, S. J. Reid, M. E. (Teller)Crichton-Browne, N. A. Sheil, G.Durack, P. D. Short, J. R.Guilfoyle, Dame Margaret Teague, B. C.Haines, J. Townley, M.Hamer, D. J. Vanstone, A. E.Harradine, B. Walters, M. S.Hill, R. Watson, J. O. W.Jessop, D. S. Withers, R. G.Kilgariff, B. F. Aulich, T. Jones, G. N.Black, J. R. McIntosh, G. D.Bolkus, N. McKiernan, J. P.Button, J. N. Macklin, M. J.Childs, B. K. Maguire, G. R.Chipp, D. L. Mason, C. V. J.Coates, J. Morris, J.Colston, M. A. Ray, RobertCook, P. F. S. Reynolds, M.Cooney, B. Richardson, G. F.Crowley, R. A. Robertson, E. A. (Teller)Devlin, R. Ryan, S. M.Elstob, R. C. Sanders, N. K.Evans, Gareth Sibraa, K. W.Foreman, D. J. Tate, M. C.Georges, G. Vigor, D. B.Gietzelt, A. T. Walsh, P. A.Giles, P. J. Zakharov, A. O.Grimes, D. J. McClelland, Douglas Knowles, S. C.Coleman, R. N. Boswell, R. L. D. Question so resolved in the negative. Consideration resumed from 2 December, on motion by Senator Gareth Evans: That the Bills be now read a second time. Question resolved in the affirmative. Bills read a second time, and passed through their remaining stages without amendment, requests or debate. Consideration of House of Representatives amendments. (1) Clause 9, page 3, line 27, omit paragraph (a). (2) Clause 10, page 4, lines 15 to 42, omit proposed sub-section 25 (7), substitute the following sub-section: `` `(7) A report prepared under sub-section (6) shall be in accordance with guidelines from time to time approved by the Prime Minister and presented to the Parliament.''. (3) Clause 10, page 4, add at the end of the clause the following proposed sub-section: `` `(9) In sub-clause (6), ``Department'' means a Department referred to in paragraph (a) of the definition of ``Department'' in sub-section 7 (1).'.''. Motion (by Senator Button) proposed: That the amendments be agreed to. Senator COLLARD(Queensland-Leader of the National Party of Australia)(6.19) —I acknowledge the fact that there has been consultation between the Government and the Opposition. I thank the Government for that and also Senator Walsh's staff. Senator Button has to put down the reasons in a form of words which both the Government and the Opposition have agreed to. I will not be opposing the legislation. Senator BUTTON(Victoria-Minister for Industry, Technology and Commerce)(6.19) —There have been discussions about this legislation. I give notice that it is intended to amend sub-section 25 (7) of the principal Act along the lines of ensuring that there is consultation with the Parliament on the contents of guidelines. An appropriate mechanism would be to require that the guidelines on annual reports should be approved by the Joint Committee of Public Accounts. The fulfilment of that undertaking will take place in the next available Statute Law (Miscellaneous Provisions) Amendment Bill. In the meantime, the Government undertakes, before introducing revised guidelines, to seek their approval by the Joint Committee of Public Accounts. Senator VIGOR(South Australia)(6.20) —I wish to point out that the Australian Democrats were involved in the tripartite negotiations. We moved the original amendment, which was in fact disallowed in the other House, to make certain that the annual reporting procedures were forced upon departments and statutory bodies and that standards and guidelines of some type were set in. As a result of the negotiations, we accept the Government's undertaking to put the amendment that Senator Button has told us about into the next Statute Law (Miscellaneous Provisions) Amendment Bill and the Australian Democrats will be supporting that amendment. Question resolved in the affirmative. Resolution reported; report adopted. Debate resumed from 26 November, on motion by Senator Grimes: That the Bill be now read a second time. The DEPUTY PRESIDENT —Is it the wish of the Senate that this Bill and the Subsidy (Grain Harvesters and Equipment) Bill 1985 be taken cognately? There being no objection, it is so ordered. Senator SHORT(Victoria)(6.22) —The Opposition does not oppose either of the two Bills we are now debating cognately, namely, the Bounty (Commercial Motor Vehicles) Amendment Bill (No. 2) 1985 and the Subsidy (Grain Harvesters and Equipment) Bill 1985. However, there are a few points I would like to make on each of the Bills on behalf of the Opposition. The Bounty (Commercial Motor Vehicles) Bill is part of a package of revised assistance arrangements for the commercial motor vehicle industry in Australia which was announced by the Government in August, the overall effect of which will be a modest reduction in the level of assistance afforded the local industry. The Bill before the Senate at the moment proposes the phasing out, over a three-year period commencing on 1 January 1986, of bounty assistance on certain components used in the assembly of general purpose heavy commercial motor vehicles with a gross weight of 2.72 tonnes or more. The tariff assistance to be provided, phasing up from the present nil to 25 per cent by 1 January 1989, will be balanced by a reduction in the bounty assistance as the existing bounty is phased down over the same period from its 20 per cent to nil. The Government has explained in the second reading speech of the Minister for Industry, Technology and Commerce (Senator Button) that the basic reason for this change is to effect a rationalisation in the industry, particularly so far as component manufacturers are concerned. This is a very fragmented industry. It has had a checkered history both in terms of the assistance accorded to it and in terms of its own activities. I think there is general agreement on all sides that it is a very important and worthwhile part of our total manufacturing base, but one which would benefit from measures taken to improve its overall efficiency by helping it to rationalise. Whilst not opposing the Government's proposal, I do not fully understand exactly how the switch from bounty to tariff is going to effect that rationalisation. In the debate in the other House the Minister for Science and Minister Assisting the Minister for Industry, Technology and Commerce (Mr Barry Jones), who handled the Bill there, tried to make the point, I think incorrectly, that putting on a tariff instead of bounty assistance would make the imported product 25 per cent more expensive than the locally-produced product and that that, therefore, would cause more local production. It seems to me that that is a technically incorrect argument, particularly given that the Government says that this level of assistance being afforded in this Bill, this time by way of a tariff, will be roughly equivalent to the level of assistance now being afforded by way of bounty. I would appreciate some clarification from the Minister on that point because prima facie it would also appear that taking away a bounty and imposing a tariff has the disadvantage of increasing costs to users and generally lifting the level of cost in Australia. In that sense, of course, there is an inconsistency in the Government's approaches to the two Bills we are presently debating because the other Bill, the Subsidy (Grain Harvesters and Equipment) Bill, moves in the direction of assistance of a tariff nature being replaced by a bounty. What we are debating cognately are two Bills which, in terms of the nature of the assistance to be afforded, are moving in quite opposite directions. Senator Macklin —Without going away from protection. Senator SHORT —Without going away from protection, but it is a different form of barrier assistance, of course. The reason for the grain subsidy Bill before us is nothing other than a very cynical political exercise on the part of the Government. Senator Button —Why is it cynical? Your leader here has been advocating today the same thing in respect of diesel rebates. What is cynical about that? Senator SHORT —The reason it is cynical is that only two years ago the Government introduced a 15 per cent tariff on imported grain harvesters and until earlier this year the Government's thinking on assistance to this industry had been entirely along the lines of tariff assistance. What produced the change in heart on the Government's part, a change I hasten to add which we do not oppose, was pressure by the Opposition and by the rural sector on the Government to do something about controlling the horrendous, massive and very widely based cost increases that the rural sector in this country has been facing as a result of a whole range of policies of this Government. As a result of that, the Government announced, following discussions with the National Farmers Federation, that it would mount an Industries Assistance Commission inquiry into how to change the existing tariff assistance into bounty assistance without affecting the overall level of assistance for the industry. Sitting suspended from 6.30 to 8 p.m. Senator SHORT —Before the suspension of the sitting for dinner we were discussing the Subsidy (Grain Harvesters and Equipment) Bill and the Bounty (Commercial Motor Vehicles) Amendment Bill (No. 2). In relation to the former Bill I was outlining the background to the reasons why the Government has made the proposals that are now before the House, proposals which, as I said, the Opposition supports. The basic reason for those proposals goes back to earlier this year when the Government, under pressure from the Opposition and the rural sector-the National Farmers Federation, the Australian Wheatgrowers Federation and others-at last got the message from them that the farm cost increases that had been occurring in Australia over the last couple of years were really crippling the domestic industry. For that reason the Government, with the support of the Opposition, sent a reference to the Industries Assistance Commission, to provide assistance-without changing the overall assistance available to the industry-to grain harvesters in the form of a bounty rather than the existing tariff level. The Bill reflects that. As I said, the Opposition supports the Bill. We are sorry that it is being debated in such haste. We are sorry that the IAC was required to investigate and report on the matter with such haste and we are sorry that the original proposal came from a political exercise rather than a considered view as to what was in the best interests of the industry in Australia, although the outcome is obviously and supportively, from our view, in the best interests of the user industries. As I said before the dinner break, there is a conflict and an inconsistency in the Government's approach to these two Bills. In one case we are moving from bounty assistance to tariff assistance. In the case of the other Bill we are moving from tariff assistance to bounty assistance. That is an inconsistency. I believe that inconsistency raises the whole question of the Government's approach towards the direction in which industry restructuring and industry development in Australia should be going. There are obviously many more factors involved in industry development than just the question of tariffs or bounties, important though they are. If we are serious about restructuring a developing industry in Australia we have to look at a much wider range of issues. We have to look at the whole question of the basic competitiveness of Australian industry. That can be affected in an artificial way by the question of whether we provide assistance in the form of bounties or whether we provide it in the form of tariffs. However, in many respects that is an artificial question. When we deal with industry assistance Bills we ought to be looking at what we need to do in Australia in terms of making this nation, and particularly our manufacturing sector, more competitive. Whether we are going to be able to compete in an increasingly world oriented market scene depends in the end on costs, efficiency, competitiveness and many other things. This is an important issue which involves an attitudinal approach towards industry and towards where we are going as a nation. Unless we are really serious about wanting to reduce our costs and to become more competitive, if we really want to have a manufacturing sector in this country-and this is certainly a basic aim of the Opposition and, I believe, of the Government as well-and unless we are really serious at a government, political, industry, union and management level about looking at and diagnosing what is wrong in this country in terms of where we are going in industry, we are never really going to solve the problems in front of us. As I have said, the Opposition does not oppose the two Bills before the Senate. I believe the Bills raise certain particular issues in terms of whether the Government is being consistent in its approach. However, both of the Bills trend in the right direction and for that reason, as I said earlier, the Opposition does not oppose them. I have raised various issues which I hope either the Minister for Finance (Senator Walsh), who is in the chamber at the moment, or, more particularly the Minister for Industry, Technology and Commerce (Senator Button) will deal with when summing up the debate. Senator MACKLIN(Queensland)(8.08) —The Committee is dealing cognately with the Bounty (Commercial Motor Vehicles) Amendment Bill (No. 2) 1985 and the Subsidy (Grain Harvesters and Equipment) Bill 1985. At present, assistance in respect of heavy commercial vehicles is provided by a mixture of bounty protection and tariff protection. The Bounty (Commercial Motor Vehicles) Amendment Bill (No. 2) does not seek to increase protection, but rather seeks to change the type of protection that is available. The Industries Assistance Commission report which was referred to by Senator Short, who has just concluded his speech, recommended that the bounty on parts be replaced with an increased tariff on completed vehicles. It also recommended that there be a tariff protection for various component parts. This would certainly result in less protection for the part producers and assemblers and increased prices for consumers. Hence, we believe that the approach the Government has taken has a lot to recommend it. We certainly do not want to see any increased protection within the economy and the Government, by making use of the device of a bounty rather than the protection mechanism is, we believe, heading in the right direction. The development of the support which is necessary for Australia's manufacturing industry has to be based on the grounds of competitiveness with world industry and not, as it were, as though it existed in a world of its own. It should exist in the competitive market-place. Of course, other approaches can be taken. Hopefully, in the new year the Government will look at taking further approaches with regard to the support of industry. My colleague Senator John Siddons's Employee Participation Bill, we believe, would be of help in regard to this further development of industry by bringing the employees and employers within industry closer together, rather than as is currently the case in an across the board union-employer organisation, which often does not have terribly much to do with what the person does in his day-to-day work place. I also indicate the support of the Australian Democrats for the second of the Bills, the Subsidy (Grain Harvesters and Equipment) Bill. But we wish to raise a particular problem with the Minister for Industry, Technology and Commerce, Senator Button. There are currently three manufacturers of grain harvesters in Australia. The largest of those manufacturers is a wholly-owned Australian company in South Australia. It currently employs, as I understand it, about 270 people and is indirectly responsible for about 1,250 jobs. The Government's Bill as it is currently structured plans to replace the present 15 per cent tariff on imported grain harvesters with a subsidy. That subsidy is broken down into two parts: A subsidy of 12 1/2 per cent of sale value if the value added by the manufacturer is not less than 40 per cent; and, in other cases, the subsidy is to be 25 per cent of the value added by the manufacturer. The South Australian producer, the largest producer in Australia, produces two types of harvester-the self-propelled harvester and the power take-off. Fifty per cent of its output is in the area of the self-propelled harvester. But the self-propelled harvester has a local value added, according to the manufacturer, of only 38 to 39 per cent, which, of course, is below the threshold for the maximum subsidy. The reason for the fact that the value added is below the threshold is that the work carried out by Australian subcontractors under this legislation is not considered for value added purposes. Of course, the subcontractors get the bounty as part suppliers. Hence, the company in South Australia has claimed that it will get no advantage from the Government's subsidisation of parts and has sought from the Government a variety of possible ways of dealing with its problem. Essentially, its solution boils down to this: The Government would extend the bounty to production for export, as it does for other industries. The Australian Democrats do not support that type of approach. We do not believe that the subsidisation of our exports in the long term is likely to do other than harm Australia as a whole. Already, of course, Australia is locked in fairly heavy competition in the international scene. If Australia argued with the European Economic Community and the American markets, that they ought to wind back their heavy subsidisation, it would hardly be useful for us to start aggressively to subsidise our products and expect them to take very much notice. It does not, I think, in the long run assist any country to engage in that activity. So we do not believe that is an avenue which is available. Another possible approach, of course, is to count sub-contracting work in the total Australian value added formula. Since the sub-contracting work is value added in terms of the bounty formula contained in this Bill, we would be looking at a double bounty and that would hardly seem to be an advisable way to travel. The only avenue which seems to be left is that contained within the Bill, and is within the discretion of the Government. I refer to clause 13 of the legislation, which allows the Government to set a new percentage for eligibility criteria. Because this is possible and because we believe in this case that we are dealing with only three manufacturers over the whole of Australia, we certainly seek from the Government its response to this problem. If we were dealing with hundreds of manufacturers, that would obviously not be a reasonable request to put to the Government. As I understand it, Senator Button is already very conversant with this problem, and I would be interested in hearing in his summing up the Government's view on how it will handle that problem. Senator Button is looking quizzical at the moment. I do not intend to go through the entire episode again; I merely refer Senator Button to the Horwood Bagshaw Ltd problem in South Australia. I must admit that I cannot see how one could criticise these Bills, as did the previous speaker, by suggesting that they are going in the opposite direction. I suggest that they are both going in the right direction, one possibly not as far as the other. Any movement away from the protection mechanisms that have been entrenched in the past and have been massively used, to more open forms of support, first of all to a subsidy operation and then to a bounty operation, needs to be welcomed. I think it is not really fair of the Opposition spokesperson in this debate to criticise the Government for moving in this way when it is the Opposition's policy to move in the same way. When it was in government, so little was done in these areas. I indicate that the Australian Democrats will support both of these pieces of legislation, and I will be interested in seeking from the Minister the attitude the Government is likely to take on clause 13 of the grain harvester legislation and whether or not the Government will be seeking to alter at any stage the percentage eligibility. Senator BUTTON(Victoria-Minister for Industry, Technology and Commerce)(8.18) —I thank honourable senators for their fulsome support of the Bounty (Commercial Motor Vehicles) Amendment Bill (No. 2) and the Subsidy (Grain Harvesters and Equipment) Bill. However, a couple of questions have arisen in the course of the debate to which I wish to refer. Senator Macklin raised a question in his comments on the grain harvester bounty legislation. It is perfectly true that the company in South Australia to which he referred rather circumspectly-I am not sure that he mentioned its name; it was Horwood Bagshaw Ltd-did raise some doubts about the larger harvester produced by them qualifying for the 12.5 per cent outward subsidy because the value added in the production of the machine was below the 40 per cent eligibility threshold. Since those doubts were raised, the management of Horwood Bagshaw has been to Canberra and has had lengthy discussions with officers in my Department. As a result, the company is reassessing its position. It certainly looks as though it would not be as disadvantageous as was expressed in its earlier representations. There are arrangements for ongoing discussions on that question. I do not think there is any point in my anticipating the details of those discussions at this stage. Senator Short raised the question of the switch from bounty to tariff in respect of certain components referred to in the Bounty (Commercial Motor Vehicles) Amendment Bill. Of course, he is quite correct in stating that there does not seem to be any difference in the level of assistance accorded currently to bountiable components through switching from a bounty to a tariff. Certainly the Government has not claimed any such reduction. The level of assistance, however, where there is a difference, is that accorded to the assembly operation, which is reduced by this change. Where assemblers are currently being paid bounty at the rate of 20 per cent for the use of those components, under the new arrangements these payments will phase out and assemblers using locally sourced components will be faced with a phased increase in the cost of these components of up to 20 per cent, while assemblers using imported components will face a phased increase in the cost of their components of up to 25 per cent. This is one of the measures we have taken to reduce the high level of assistance accorded the assembly sector, which is currently around 95 per cent in effective rate terms, down to an estimated 65 per cent. So there is a substantial reduction in assistance to the assembly operation. This applies, of course, only to those currently bountiable components on which phased tariffs are to be introduced. I must say to Senator Short, that in terms of the problem of this particular industry, we have had that debate before in the Senate. It is a very difficult industry with which to grapple, but I assure Senator Short that in terms of the assembly operations it represents a considerable reduction in assistance. Senator Short also sought to draw some inconsistency between the grain harvesters bounty and the phasing out of the bounty for commercial motor vehicles. Any apparent difference in approach arises from the difference in intent of the two quite separate measures. The grain harvesters bounty is aimed at reducing the cost to users. The Senate is aware of the circumstances in which it was announced, and in fact we have been chided for that in the course of debate here. The beneficiaries of that are the farm sector. The phasing out of the commercial motor vehicle bounty is, as I have already stated, to reduce the current high level of assistance accorded to the assembly sector of the commercial motor vehicle industry, such as it is. I think they were the two matters of substance with which I had to deal. I commend the Bill to the Senate. Question resolved in the affirmative. Bill read a second time. The Bill. Senator SHORT(Victoria)(8.23) —There are just two or three points I would like to raise in relation to specific clauses of the Bill. Before I do that, I reiterate that the Opposition does not criticise the direction in which the Government is taking the grain harvesters Bill. I did not express opposition at all to the bounty arrangements. I chided-to use Senator Button's word-the Government on the motivation for the move that has taken place, rather than the move itself. I am not saying that the Minister for Industry, Technology and Commerce (Senator Button) should not have imposed the bounty in relation to the grain harvesters; I am questioning the motivation for doing so. There are two or three brief comments that I would like to make in relation to specific clauses of the Bill. The first relates to the definition of the interpretation clause, clause 4. Senator Button —Which Bill is this? Senator SHORT —The Subsidy (Grain Harvesters and Equipment) Bill. I refer to the interpretation of `production service' which is at the top of page 3. Production service includes, under (d): a service declared by the regulations to be a production service for the purposes of this Act; I think I am correct in saying that that has relevance to the question of the treatment of subcontractors. The Industries Assistance Commission report on this subject at page 15, section 3.4.2 says that in calculating the bounty, it is desirable that provision be made to allow for the value of such services; that is, the services of subcontractors. As I understand it, the Bill before us at the moment does not take up that recommendation or expression of opinion by the IAC, but there is provision for it to be taken up through the interpretation clause-clause 4 of the Bill. I would like an assurance from the Minister that my interpretation is correct because I think it is an important point. If what we are about is the increasing of local Australian involvement in the production of both components and finished products within the industry, obviously the role of the subcontractor can be very important indeed. In fact, it may be critical for some of the major assembler and producer companies who may wish to increase the Australian content in their product but for whom it is not financially or economically viable or worth while to do so by setting up a new production facility, whereas they could benefit, and Australian industry as a whole could benefit, by the greater use of sub-contractors. To give an example of that, a case which comes readily to mind because I have had connection with it in the past in a representational sense is A. F. Gayson Pty Ltd at Ararat, which makes harvester cabins. They would be a subcontractor to a company like Horwood Bagshaw Ltd, but at the moment they do not appear, other than through clause 4, to be covered in the legislation. I just raise that and I would be grateful for any comment the Minister may have because what is proposed in this Bill does not seem to me to take on board what the IAC proposed and recommended in that respect. The other two clauses of the Bill I would like to refer to briefly are clauses 10 and 13. I am really seeking guidance on this. Clause 10 relates to the specification of subsidy and in clause 10 (3) there seems to me and to the Opposition that there is an inconsistency between the drafting of paragraphs (a) and (b). The clause does not appear to make sense unless one includes in (a) the word `or' before one comes to (b). The two paragraphs tend to be mutually exclusive. I understand that there has been some discussion with the Department about that but I am not satisfied that an adequate explanation has been given as to how paragraphs (a) and (b) of clause 10 (3) of the Bill can sit together if there is not the word `or' between the two. I would be grateful for comment on that. The only other comment I want to make is in relation to clause 13 of the Bill. I note that clause 13 (1) (a) states: The subsidy payable under section 10 in respect of a subsidised harvester to the completion manufacturer of the harvester is- (a) where the value added to the harvester by the completion manufacturer is not less than 40 per cent, or, if another percentage is pre- scribed . . . The clause continues. I would like an assurance from the Minister regarding the discussions that I think have been held outside this chamber in relation to one of the companies that is involved-involved in the sense of being affected very significantly by this Bill-that in fact, depending on the arithmetic involved in the calculation of value added, if this causes a problem in relation to the 40 per cent figure, which I cited, in clause 13 (1) (a), the following words `or if another percentage is prescribed' will be taken into consideration by the Government, or I guess by the Department, in looking at the actual payment arrangements. I would welcome some satisfaction or confirmation of those points. Senator BUTTON(Victoria-Minister for Industry, Technology and Commerce)(8.31) —I will deal with the last point first. Of course, the provisions in clause 13 (1) of the Bill will be taken into account if appropriate. The Department will endeavour to meet the problem. I do not wish to elevate the provisions of that clause as the only solution to the problem. I make it quite clear that that is not the only solution to the problem. With regard to clause 10, the provisions to which Senator Short referred are cumulative. As I understand it, there is no detriment to sub-contractors in those provisions being so cumulative. With regard to clause 4, Senator Short asked about the definition of `production services'. He referred particularly to sub-clause (d); that is, a `service declared by the regulations to be a production service for the purposes of this Act'. He asked whether that embraced the position of sub-contractors, if that is the right expression. The answer to that question is that it may well do. The sub-contractors of the kind that he mentioned, such as A. F. Gayson Pty Ltd, are in a position to obtain the bounty in any event in their own right by application under this legislation. But that provision possibly could be interpreted in the way he suggested. Senator SHORT(Victoria)(8.34) —I thank the Minister for his response. I will ponder on the latter part. I was not necessarily commenting on clause 10 (3) in relation to sub-contractors. It was just in terms of the straight logic of the drafting of the clause. It would appear that 10 (3) (a) is a different requirement from 10 (3) (b) and that, therefore, the word `or' ought to appear between (a) and (b). If the word `or' does not appear, (a) and (b) read together do not appear to make sense. That was my point. Senator BUTTON(Victoria-Minister for Industry, Technology and Commerce)(8.35) —As I understand it, this is a standard provision in most bounty legislation of this kind. The instruction I have is that they are considered to be cumulative. It is a matter of interpretation whether they can be seen to be in this category. Clause 10 (3) (a) requires all the processes to be carried out in registered premises; clause 10 (3) (b) requires that the last substantial process in the manufacture of the equipment be carried out in registered premises. All it means is that both of those requirements must be satisfied. It seems almost tautologous, but it is a standard requirement. Senator SHORT(Victoria)(8.36) —That is my point. Unless the word `or' is between the two clauses, clause 10 (3) (b) is tautologous in that it is completely unnecessary. Senator Button —If you put `or' in, see how it reads. You have a problem with (b). Senator SHORT —I think you have a problem with clause 10 (3) (b) whichever way one reads it. Bill agreed to. Bill reported without amendment; report adopted. Bill (on motion by Senator Button) read a third time. Senator COONEY(Victoria) —I seek leave to make a short statement in connection with a notice of motion standing in my name for the disallowance of part of an ordinance. Leave granted. Senator COONEY —The Senate Standing Committee on Regulations and Ordinances has been scrutinising the Crimes (Amendment) Ordinance (No. 3) 1985. The Ordinance has the effect that any person accused of a criminal offence involving money or property of less than $2,500 in value has no right to trial by a jury. Such a person would be tried summarily by a magistrate unless the magistrate otherwise ordered. The Committee wrote to the Attorney-General (Mr Lionel Bowen) raising this matter as an issue of concern. The right to trial by jury in indictable cases is central to our criminal justice system. In 1951 the right of an accused person to be tried by jury was removed in respect of certain indictable offences, the test being whether the property involved had a money value of below #100. In 1974 that value was raised to $500. This year there was a move to raise it to $2,500. I am pleased to report that the Attorney-General has given an undertaking to amend the Ordinance to provide that a person charged with a relevant criminal offence shall not be tried summarily unless the person consents to that course. I therefore withdraw Business of the Senate, notice of motion No. 1, as amended earlier today, standing in my name for this day of sitting for disallowance of part of the Crimes (Amendment) Ordinance (No. 3) 1985. In doing so I pay tribute to the Attorney-General for the undertaking he has given on this matter. The Committee viewed the right to trial by jury as a matter of vital significance to it under its principle. The Attorney-General, by his undertaking, has recognised the importance of the issue and he deserves our thanks and approbation for his decision. Senator Peter Baume —The honourable senator stated that he was withdrawing a notice of motion. Is this the last day on which disallowance is possible? Is there not a special procedure in the Senate? The DEPUTY PRESIDENT —Senator Cooney, if you wish to withdraw a notice of motion you must seek leave. You have not done so yet. Do you wish to do this? Senator COONEY —Yes, I seek leave. This is the last day on which I can move such a motion to withdraw the notice of motion. I seek leave, if that is the right procedure, to do so. The DEPUTY PRESIDENT —Is leave granted? There being no objection-- Senator Peter Baume —I have no objection, but as I recall it, if leave is granted and any other senator wishes to persist, that honourable senator will lose his right. Does the honourable senator know whether both sides of the House are happy with the withdrawal? Senator COONEY —Yes. This has been agreed to in the Committee. I thank the honourable senator for raising that matter. Notice of motion-by leave-withdrawn. Consideration resumed from 3 December, on motion by Senator Grimes: That the Bill be now read a second time. Question resolved in the affirmative. Bill read a second time, and passed through its remaining stages without amendment or debate. Senator COONEY(Victoria) —by leave-I table a report of the Standing Committee on Regulations and Ordinances concerning disallowance of the New South Wales Acts Application Ordinance 1985 by effluxion of time. Ordered that the report be printed. Senator COONEY —Mr Deputy President, I seek leave to make a very short statement on this matter. Leave granted. Senator COONEY —The New South Wales Acts Application Ordinance was disallowed by effluxion of time when the Senate rose on Thursday, 28 February 1985. The Committee has examined the Ordinance and notice of motion of disallowance was given on behalf of the Committee. The report sets out for the information of the Senate the course of the Committee's scrutiny of the Ordinance. Debate resumed from 14 November, on motion by Senator Grimes: That the Bills be now read a second time. Senator PETER BAUME(New South Wales)(8.44) —The Home and Community Care Bill and the Bill that is being debated with it set up a new framework for community care services in Australia. The main Bill establishes the framework for the home and community care program which was announced in August 1984 by the Government-that is some 15 months ago. The Opposition is not opposing either of these Bills, which if they are implemented with good will and fairness, can go a long way to achieving some important social goals. In this country we have, for some years, wrestled with the problems that many people who need long term residential care have not been able to obtain it and that many people who really need something other than long term residential care have been condemned to that kind of care because there is nothing else available for them. The purpose of the Bills before the Senate is to put in place a new arrangement which might allow the better realisation of a desirable balance of goals. The home and community care program is to be a joint Commonwealth-State program and, like most of these programs, will be funded under section 96 of the Constitution. That is always a matter of some note to those of us who are federalists, but in any event we have used section 96 for community care services in this country for some 30 years, and this is nothing new. The program is to assist State and local governments and non-government organisations which will be providing basic community support and maintenance services, particularly for those who are aged or disabled and who need long term care in the community. The Government has announced that the services provided under this legislation are to be targeted to aged or disabled people to minimise premature or unnecessary admission to long term residential care. One of the problems which may be raised in relation to the HACC program is that some who presently offer services which are not to be targeted may fear that they will be losers under the new program. I will come back to that in a moment. The Bill contains a Schedule with a model agreement and it is hoped that most of the States and the Territories will sign that agreement. It sets out the terms and conditions and the scope of the program. It is my understanding that two States so far have signed. Senator Grimes —Three and the Territory. Senator PETER BAUME —Three States and the Territory have signed, so there is already a degree of compliance between the parties. The Schedule also sets out the levels of funding and growth for the program. It is my understanding that the program provides for growth of $10m on an unmatched basis for those signing States; $25m in 1985-86 on a matching basis, a $3 to $1 basis; and $30m in 1986-87 on a different matching basis, $2 for $1. Further growth funds have been promised for later years. It is a quite complicated funding formula. The second, accompanying Bill amends the four existing Acts which have delivered community care over the last few years; that is, the Delivered Meals Subsidy Act 1970, the Home Nursing Subsidy Act 1956, the States Grants (Home Care) Act 1969, and the States Grants (Paramedical Services) Act 1969. I remind honourable senators that all of those Acts were enacted by Liberal governments. The present Government is not eliminating these Acts; it is trying to consolidate and extend them into the new program. The Opposition parties introduced the original programs and we are now keen to see the Government extend them in the way it proposes. The second Bill provides that those four Acts will cease to apply in those States which choose to join this new agreement, but those States which do not join the agreement can continue to offer services under the old Acts and continue to be funded at 1984-85 activity levels-I take it from the Minister for Community Services (Senator Grimes) that that is correct. So there could still be some money growth for the non-signing States, but no real growth in activity under the existing Acts. The Government has said that no new approvals will be given and no growth funds will be available to non-signing States. The reason why these changes were necessary is that the whole program area has represented an unsatisfactory interface between the long term residential care needs of the community, which are funded generally by the Commonwealth; the community care of the aged and the chronically disabled, which have tended to share funding; and the acute support and care functions, often providing for people who have been in the acute care hospitals, which are programs funded, or intended to be funded, generally by the States. It seems that some States have used funds from the existing four community care Acts to support mainly acute, post-acute or palliative care and to support families in crisis. There is no doubt that those people need care, but by taking this route the States have shifted costs from themselves to the Commonwealth and in the process have shifted from the community into residential care some people who would not otherwise be there. The shifting of costs from the States to the Commonwealth is a game as old as federation itself. To the extent that that has been happening and the program goals have not been met, we can do nothing but applaud the intention of the Government in trying to propose these new arrangements. It seems that the States have saved calls upon their own Treasury, that too little of the money has gone to the support of the aged or chronically disabled in the community and that the result has been that avoidable long term admissions to residential care have occurred. That is really not in anyone's interests. We have seen the States minimising their own costs and maximising the costs being borne by the Commonwealth. That is bad enough, but in the process the people for whom the program is intended have not been benefiting as they should have done. The new arrangements could result in growth funds flowing more towards the aged and disabled and the Opposition would be pleased if this happens. We would see the new arrangements restricting the capacity of States to use what one might call the `new' HACC money to augment their own acute support services. It would be my hope that the States would continue to offer full acute care services, but that they would start to do it from their own resources and would not look to the Commonwealth to fund what are essentially their acute care, post-acute care and palliative services, which are properly State functions. The Minister's office has made it clear to me that existing programs would be allowed to continue. So it is not a question of dispossessing what is already going on; but, insofar as the programs are going to expand, they would expand more in the direction for which the original States Grants Acts in 1969 and 1970 were put in place. One concern that has been expressed by a number of groups is that both the HACC program and the Handicapped Persons Assistance Act exclude psychiatric problems as qualifying people for new service provision. The Minister may care to clear up the concerns which people have got in this area. Further, whatever HACC does provide it is clear that there will still be large areas of unmet need which will be unsupported by anyone. For example, HACC has failed to pick up many of the new proposals contained in the recommendations set out clearly in `New Directions'. Those may be matters for the future. But it has long been a policy objective of the Federal coalition of the Liberal and National parties to promote measures to assist people to live independently rather than in institutions. To the extent that this legislation seeks to achieve that goal, it has the support of the coalition. If the Bill does work to achieve those objectives and to assist in the better operation of the original Acts, we will applaud it. It seems to me that the States will have two choices: The first choice is to carry on under the existing arrangements, under the existing four Acts, at the same activity funding level, but with no access to growth funds. The second choice is to sign up under the new arrangements, submit themselves to joint decision-making to a greater extent than they have, but to gain access to significant new growth funds to meet some of the outstanding and unmet needs, but to do so within new Commonwealth guidelines. That is the choice facing the States. To the credit of the Commonwealth, it has left the States with that choice and left them free to decide which road they wish to take. The Minister tells me that three States and one Territory have already signed. I hope the other States will choose to do that; but the choice will rest with the States. If that is the case, we would have no objection to the legislation. Obviously concern has been expressed and some of those who have been providing acute care, post-acute care or palliative care are fearful that they are, in some way, going to be under threat. For example, I was aware that a meeting was held on Friday, 29 November, at the Queen Elizabeth Rehabilitation Centre-I suppose that is in association with Royal Prince Alfred Hospital-and was preceded by a poster calling for community action to ventilate people's concerns. But that is not surprising because that is a post-acute care service. One of the problems which the Government will have is to sell what it is doing and to minimise the sense of threat which dedicated people have had as they offer services already available. Concerns have also been expressed by the Blue Cross Nursing Association in Brisbane. It is concerned that because it may not be offering a long term community support service of the kind we talked about earlier, its funding may be under threat. But if I have understood the program correctly, present activities will continue to be funded. The growth money will be directed towards the objectives which the Government has laid down for the support of people. Against that background, I thank the Minister for the access he has given me to advice from within his Department and I thank his advisers for the time they were able to spend on this matter. I think this proposal will build upon the original intention of Liberal and National governments to promote the long term support of people in the community. If the program can do that, it has our support and we wish it well. Senator HARRADINE(Tasmania)(8.56) —The Minister for Community Services, Senator Grimes, is wont to say that the speakers list on any Bill is in inverse proportion to its importance. Senator Puplick —Or its time in the session. Senator HARRADINE —I was just about to make that point. I do not think the Minister should regard the speakers list on this occasion as indicating that. We have all been given the very strong message that we have to get out tomorrow. The Government wants this measure passed; the Opposition wants this measure passed; I want the measure passed; and I am sure that those people on whose behalf the Bill has been presented and those who have been engaged in the work preceding the Bill want it passed as well. I will not be long in speaking on this measure. However, I want to indicate that it has two main objectives. The Minister's second reading speech states that the home and community care program objectives are: to promote the provision of a comprehensive and integrated range of home and community care designed to provide basic maintenance and support services (both directly and through their carers), to persons within the target population and thereby to assist them to retain their independence in the community and avoid their premature or unnecessary admission to long-term residential care; and to expand and develop home and community care services through the joint co-operation of the Commonwealth, the States, local governments and community organisations representing both service providers and users under a single cost-shared arrangement. Those two objectives are very worthy indeed. Anybody who has had anyone who has been critically ill or severely disabled in their home for some considerable time will realise immediately that those patients, those individual persons, prefer for the most part to remain at home. Nevertheless, it must be acknowledged- acknowledged it is by the Minister, the Opposition, myself and others-that a great deal of stress and strain is placed on the carers. I believe that the intention of this Bill is to co-ordinate the variety of programs that are running throughout Australia to ensure that those carers and patients are given the best deal possible in the circumstances. The Minister has adverted to the fact that a very substantial number of people are in the target group. He has indicated in his second reading speech that the 1980 Australian Bureau of Statistics survey on disability revealed that around 325,000 people over 65 years of age were severely or moderately handicapped and that over 70 per cent of this group live in the community. The interesting point is that that figure of 325,000 represents 42 per cent of the total moderately and severely handicapped population. There are a large number of others, of course, including the young. I admire greatly those families who nurture and bring up young disabled people. The Minister will recall that I have been in correspondence with him on their behalf in respect of respite care programs. It is necessary for these people from time to time to be able to get out of the home and have somewhere for the child to be looked after for a period. If this measure is going to improve that situation I applaud it and I applaud the work that has been done by the Minister and others on this development. I would like to raise a couple of matters besides that of respite care. Those matters deal with independence, transport and people in the bush. I wonder how far work has proceeded in examining the possibility of some sort of voucher arrangement or financial arrangement whereby carers can apply some of the amount which would otherwise be applied to the provision of transport to the provision of other services, particularly in areas where these services are not readily available. I am referring to country areas. Senator Peter Baume —Cash versus services. Senator HARRADINE —It is a cash versus services situation where services are not available. I imagine a fair bit of work has been done on that but I would be interested to know. If not now, then at some stage I would be obliged if the Minister could give me access to expert advisers in this area. The other matter dealt with by Senator Grimes was the no growth category of post-acute care, palliative care and services primarily to families in crisis, and services designed specifically for a particular disability group. It has been noted that services for these groups will be maintained at the existing level. However, as the Minister has indicated, this does not mean that people who suffer from a particular disability such as multiple sclerosis or a psychiatric disorder will be excluded from receiving services under the home and community care program. On the contrary, people requiring such basic support as will be provided through the home and community care program will, of course, be eligible, but the new program is not a vehicle for the provision of specialist services or for other services which have traditionally been the functions of other Commonwealth and State services. However, I wish to make the point that somewhere along the line it must be admitted that the demand for these services is indeed great and it is important to ensure that the money amounts being made available for these services are increased. If that means they have to be increased from the State level, that is where it will have to come from. But certainly I believe that the review that is promised ought to examine where this matter has gone. Indeed, before that review is undertaken a monitoring of the situation in respect of those programs should be undertaken. I wish to make this final remark: The community-indeed, we as human beings-owe a great debt of gratitude to those carers who recognise the inherent human rights to life of those persons whom they are caring for in their own homes, and in particular those who are doing so under enormous pressures and strains. I know many of them do it very happily, but others work under a cloud and under strain and do not readily recognise the great task that they are undertaking and the great merit that derives therefrom. My support is for a co-ordination of services to assist these people and the target groups. My concern is that there could be a great deal of bureaucratic control. I am also concerned about the amount of money that might flow. I know that the Minister said in his second reading speech that there will be a 20 per cent increase in money terms in 1987-88, as well as a 20 per cent increase in each successive year. I do not know whether that is going to be sufficient. In fact, I very much doubt whether it will be, because, due to techniques in medicine-the Minister would know this better than I-the rate of longevity will increase. A recent report from the Department of Immigration and Ethnic Affairs said that in the last 100 years the longevity rate had increased by 10 years, and that that will increase by another eight years in the next 36 years. So I believe the 20 per cent increase in money terms may very well be below the mark. I believe that both we and those who are responsible for the review should look at that. In closing, I congratulate those who have worked on this legislation. It seems to me to be worthy of support, and I hope it is successful. Senator GRIMES(Tasmania-Minister for Community Services)(9.07) —in reply-I thank both those honourable senators who spoke and those who did not speak for their support for this legislation. The legislation has been a long time coming. The planning and the negotiations in fact have been long and tedious, and in some cases have not yet finished. I certainly owe a very great debt of gratitude to the public servants in my Department of Community Services, to those in the Department of the Prime Minister and Cabinet, to those in the Department of Finance and to those in the State departments who have worked long and hard on what has sometimes been a very tedious and very difficult task. To take up Senator Harradine's point, I suppose if I had any aims or a dream in this area it would be that one day we would have in this country the provision of adequate services for people who need them for post-acute care, for palliative care, for people who have psychiatric as well as physical disorders, for disorders of the aged and other disabilities. They would be also that we have those services provided on a community basis to people either in the home or in a home-like atmosphere, wherever they can be delivered: Firstly, to ensure that they get the care that they need; secondly, to ease the lot of those individuals, but primarily those women in the community, who have borne the burden over the years of looking after relatives who are disabled, ill or aged in their homes; and, thirdly, to ensure that as few as possible of our citizens end up in large institution-type care, frequently of an impersonal nature, no matter how well they are cared for, no matter how hard the people caring for them work in those institutions, and no matter how well-intentioned they are. We are inhibited from developing such a utopia, I suppose, by basically two things. The first, obviously, is a lack of funds. The cost of producing such universal services is considerable. I do not think it is impossible but it is considerable. The cost of producing such services to run in parallel with the present predominance of institutional services that we have is very large. But we still need to do it so that we can eventually effect that transfer from the emphasis on institutions to the emphasis on home care. The second thing that bedevils us is history. The negotiations have been bedevilled a lot by history. We are a federation in which the States have had certain responsibilities, some of which were adverted to by Senator Peter Baume-and I will talk about them in a moment. The Federal Government, through the legislation we are replacing or co-ordinating here tonight, has been involved in the delivery of services. To a very small extent, compared with what happens in other countries, local government has been involved. I think our path would have been much easier if local government in this country had had a tradition of involvement in the sorts of services in this area as it does in some of the social democracies of Western Europe. A very large group of non-government and voluntary organisations provide the bulk of the care on the ground. I decided very early that to attempt to step from where we are now into that utopian situation would cause disaster. Such a move would also cause considerable problems for the Federal Budget. Senator Peter Baume was perfectly right when he said that it is in the inherent nature of our federation that whenever we try to do anything our colleagues in the States will do what they have done since Federation-they will attempt, without any ill will, to transfer the cost of their programs to the Federal Government. Senator Peter Baume —There is a fair amount of cynicism there. Senator GRIMES —Not cynicism-it happens and it is happening now. It was for this reason that we decided that the predominant services that we would provide under the home and community care program would be for aged and chronically disabled people. We decided that psychiatric services would be excluded for the moment unless they already came under the program or unless people with psychiatric disturbances needed to come under the general HACC provisions. We also decided that the services for families which some States had provided would similarly be excluded at present. But I would hope that in the long term-some time when Senator Peter Baume, Senator Harradine and I have gone from this place-that there will be an evolution of this program so that we can get to that utopian situation. Quite frankly, we were faced with a situation of great de-institutionalisation throughout the States in the psychiatric area. I agree with what happened. However, for us to attempt to pick up the community services to care for those people who are coming out of psychiatric institutions-- Senator Peter Baume —Doesn't it happen to shift costs to the Commonwealth? Senator GRIMES —It would have shifted costs to the Commonwealth. Senator Peter Baume —Doesn't it do so anyway? Senator GRIMES —No, it would have spread our services and facilities too widely. So we thought that we would walk before we ran, that we would take the first step that we have taken in the HACC program. As Senator Peter Baume said, the agreement has been signed by three States and the Northern Territory and I have no problem with my colleagues in the Australian Capital Territory. I am confident that two other States will sign pretty soon. One State may take a bit longer, if it is going to sign at all. But we also realise, and I realised in my dealings with the States in these service areas, that to attempt to hang around until one can get the agreement of every State is just impossible. In fact, the best way frequently to get the agreement of all the States is to get the agreement of a couple of States which are willing to have a go and demonstrate that it can be done and then the others will follow as a result of pressure from their electors. Incidentally, Senator Peter Baume mentioned the meeting at the Queen Elizabeth II Rehabilitation Centre in Sydney on 29 November. That was not in fact a meeting of people who wanted acute care incorporated in the legislation. It was a meeting of non-government organisations which had been involved in negotiations on the home and community care service and which were getting impatient with our State colleagues. The meeting was held to ginger the State into hurrying up its negotiations with the Federal Government. I understand it was a very lively and successful meeting. Of course, this program is a fairly modest one. Senator Harradine is right. It is no good our pretending that the money that is going in now, with the built in minimum increases of 20 per cent later on, will solve the problems we have. We have a very severe structural problem in this country. We have concentrated on two forms of care-nursing homes for the aged and disabled, and institutional-type nursing homes, and if one could not get into a nursing home or institution of that type, one stayed at home. We had hardly heard of respite care beds until the last few years. We are ensuring that respite care beds are provided in nursing homes and hostels for the aged and in the smaller institutions for the disabled in the community. They are vital if we are to keep people at home as much as possible. Although we have concentrated on these nursing homes and we have one of the highest proportions of nursing homes-we spend probably as much per capita as do most countries on nursing homes-we have neglected very badly the provision of home care and home services. We do not have a very good infrastructure to build on, and the infrastructure that is in place is unco-ordinated and incoherent. States are doing things, non-government organisations are doing things, and various Federal departments are doing things. Sometimes they cut across each other. Sometimes even within the one government, one department does not know what the other is doing. This is an attempt to get co-operation between the various levels of government and the non-government organisations and some overall co-ordination of the development of the programs so we can see our way clear in the future to develop community services of the type that I think our people deserve. In the long run it will sometimes be more economically efficient. In the long run, sometimes, in regard to some disabilities it will be more expensive but it will certainly be socially more efficient and we will have a better form of service than we have had in the past. Senator Peter Baume raised the matter, which I think I have dealt with, of psychiatric services and the disquiet felt by some people dealing with psychiatric patients. I pointed out that mental services of this type are essentially State responsibilities and have always been State responsibilities. For some reason the States have always guarded these responsibilities very closely. The Commonwealth is not now in the position to substitute for these services, but I emphasise that people with psychiatric disabilities, people with specific disabilities or members of specific disability groups, have access to HACC services if they are otherwise assessed as being in need of these home and community care services and these services are not being used as a substitute for State services. That is quite clear. I think the people in the area of mental illness understand this. They may be impatient, they may have hoped that we would step straight into this area, but I do not think we will do so for some time, until we establish things. Senator Harradine talked of a couple of specific programs which have been mentioned in the discussion on home and community care services and which we are developing with the States at the moment. We are presently looking with the States at different transport service programs, which is a new type of service in this country. These programs will be not only for people in remote areas, although it is obviously important for them; they are also of importance for people in urban areas who have great difficulty in our urban sprawl with our public transport systems. We are presently considering the use of taxi vouchers or transport voucher schemes. Any new schemes of this type will be monitored closely. I will certainly be happy for any of the officers in my Department who have been involved in this area to talk to Senator Harradine about them. In regard to the no-growth services, we agree with Senator Harradine that we need to assess where the present funds are going, who is getting those funds, for what purpose they are getting them, and in particular what the need is, before we start to determine where we will spend large sums of new funds in these areas. There is a huge area of unmet need with regard to not only disability but also post-acute care and all the areas that were mentioned by Senator Harradine and Senator Peter Baume. If we could solve that unmet need by throwing in large sums of money and expecting services to bloom out of the ground, we would do so; but we would fail for certain, and we know it. So by carefully monitoring it and planning where we are going, I think we can succeed in the long run. Senator Harradine brought up one more worry which I think is extremely important; that is, that if we get so obsessed with planning and with only taking steps forward where we can see quite clearly that we will not fail we are likely to have the problem of so much over control-so much excessive bureaucratic control-that people will get fed up and will not want to be involved in these services. For this reason, we have felt it terribly important to involve the non-government organisations and the local community organisations as much as possible in the planning. In the future I see as the ideal situation the local and non-government organisations, with a little assistance at Federal and State levels, being in a position to have a much greater part in the development, planning and administration of programs than they now have. In some ways, that would be a bit of a step into the unknown, but it is a step that I believe we have to take. We cannot go on, as we have in the past, with State governments, the Federal Government and non-government organisations going in all directions and not taking note of what each other is doing. We cannot go on, as we have in the past, plugging the gaps when we see them every now and again and not looking at some sort of coherent program to examine the needs of our population. I do not think we can go on, as we have done in the past, largely ignoring the potential which exists in the local government organisations in this country. Local government should be a very effective form of government for the delivery and development of services of this type. In the past, local government in this country has been largely concerned-with some exceptions in Victoria and probably Western Australia-with building subdivisions and drains and not with providing directly services for people. I believe that the only way we can change that is to create an atmosphere where the sorts of people who are interested in these services and in their development will feel encouraged to get into local government. We cannot expect local government to change before we give it the capacity to do so. I think we have to demonstrate to it what is possible, and people such as those I have mentioned will get into local government and change it. Senator Vigor —You have got to give them funds too. Senator GRIMES —Of course we have to give them funds, but this community is full of people who have the capacity, the desire and the capability to help less advantaged citizens. They have demonstrated that capacity time and again. They have demonstrated it daily, as Senator Harradine said. Sure, they frequently need funds but, equally, they frequently need advice and a little assistance on how best to go about things. Above all, in many cases, they need a break every now and again so that they do not suffer the burn out, the depression and the terrible strain and stress that they can develop. Of course they need funds but they also need the capacity to utilise those funds and to learn how best to help one another. We cannot solve this problem by my suddenly getting from the Government $1,000m or $2,000m and chucking it out into the commun- ity without knowing where it will go or how it will be spent. We can utilise the strengths and knowledge of people who are in the community, and, I hope, in the future we can utilise the latent capacities which exist in local government and, perhaps, we will get a system of services of community care of which we will all be proud. We will provide not only a system which is more economical but also services which are much better and more appropriate to the needs of the people. I see this very much as the start of a long evolutionary road. I thank honourable senators for their support and good wishes. I thank all those who have helped me in starting off on this road. I wish everyone who will travel down it a little further considerable success. Question resolved in the affirmative. Bills read a second time. The Bills. Senator PETER BAUME(New South Wales)(8.26) —It is not popular to speak at the Committee stage at the moment, but the Australian Council on the Ageing has raised a number of matters which I think deserve a response from the Minister for Community Services (Senator Grimes). All of the matters which it raised are contained in the Schedule to the Bill. The Bill consists mainly of the Schedule. The first matter concerns the use of the phrase `brain failure'. Maybe it is matter of style, but I am sure that when Senator Grimes and I did medicine at a very fine medical school in this country-I notice other graduates from the school in the gallery tonight-that was not the phrase that we would normally have used. Although people may have said that they wanted to use the phrase `brain failure', in a sense it would seem to presuppose that there was a failure from some previous condition which was rather better. What about those who have a disability which may be congenital; which may not be a condition of dementia, but a condition of relative amentia? Why use that phrase just because it meets the convenience of some people? In a medical sense, calling a spade a spade, it seems to beg a number of questions. I am not even sure that it will help us in the long term. The second matter raised by the Council on the Ageing is rather more technical. It relates to clauses 5 (1) (e) and (j) and clause 7 (1) (h) of the Schedule, in which reference is made in one place to `assessment or referral (or both)' and in another place reference is made to an integrated and co-ordinated approach between assessment and referral. The Council on the Ageing has made the point quite strongly that if the Minister's goals are to be achieved, assessment and referral services will need to be integrated. It seems to be suggested in the Schedule that people may offer one or the other. It is not quite clear that if one is offered the other necessarily will follow. If I have heard the Minister correctly, he has talked about the need for an assessment, referral and service provision. That question from the Council on the Ageing may be one to which the Minister will respond. The third matter to which the Council on the Ageing has made reference is in Part VII of the Schedule, which relates to the supply of information. I refer particularly to clauses 30 (1) and (6) which require the development of a home and community care information system with regard to the views of local government services providers and users, and the provision of the information to those bodies where appropriate. The Council on the Ageing has made the point that the processes of development of both the information system and the agreed standard definitions and collection methods have not been defined in the Schedule. That is not surprising; they are scarcely the sorts of things that would be defined in the Schedule. But the Schedule goes on to state that the Commonwealth Minister will specify the requirements. The Council on the Ageing supports the view of the national non-government organisation on HACC-that consultation between Government and service providers will be essential for the development of an effective information system with appropriate standardised definitions of services. It refers to several sections where that is made clear. Would the Minister be able to give assurances in that direction? They are the three matters. Why do we talk about brain failure? Can we get a definition on the question of the necessary relationship between assessment and referral for service and on the question of the information systems? Senator GRIMES(Tasmania-Minister for Community Services)(9.30) —I am not attracted to the term `brain failure' any more than Senator Peter Baume is. However, we ran into one of these ridiculous situations where, when trying to come up with an acceptable term, which is acceptable to everybody, about people who have cerebral degeneration from any cause, the States were reluctant to use the term `senile dementia'; `Alzheimer's' or anything else. I admit that `brain failure' is there while we seek expert advice and consultation on a better and more appropriate term. I do not like it but it is the only acceptable term we could get between the States. I notice that Senator Peter Baume did not suggest any other term tonight. I certainly hope that he will assist us in the future to get a better term. In fact, it is a jargon term in some countries. Senator Peter Baume —That is because of the taboo on using the proper name for things. Senator GRIMES —Sure. We are trying to placate and get some co-operation from other organisations, as Senator Peter Baume knows. We want assessment and referral to be an integral part of all home and community care services and we expect them to be so. I have not had a chance to look at the wording that the Australian Council on the Ageing apparently is concerned about. As far as we are concerned, assessment and referral are integral parts of all home and community care services. I am sorry if the present wording seems to concern ACOTA. We will have a look at that, but it is clear to us-- Senator Peter Baume —Could you look at 7 (1) (h)-assessment or referral or both? That is what worries me. Senator GRIMES —Clause 7 (1) (h) is a funding clause. It describes how we fund various services and it lists services to enable us to fund services of that type. It is not objective. We really want referral and assessment in all our services. Some services will be basically assessment and referral services and we must have the capacity to fund them. In respect of defining information systems, we need standard information systems as much as possible. We need to develop them so that they are usable and practical. To try to do so without consultation with the non-government groups and the groups which are going to use them would inevitably mean that we would fail to come up with a reasonable system. For that reason, yes, we will consult with the various groups in the development of these standard information systems. We hope and we know that we will get assistance from them. The difficulty is sometimes trying to ensure that one has consulted with the people who feel they need to be consulted and ensuring that one does not tread on too many toes in the States while trying to do so. Senator HARRADINE(Tasmania)(9.34) —I have one quick question of the Minister which has been stimulated by the question of Senator Peter Baume. It deals with clause 7 (1) and deals with this question of brain failure. I instance an aged couple-one person in his 80s and the other her late 70s-where one of them has Alzheimer's or brain failure. There is quite a bit of that in the community, as the Minister would know. I notice that clause 7 (1) talks about services provided in community respite care. I imagine that this would not preclude moneys being made available to existing institutions for the purposes of enabling, say, the wife to go in for three or four hours a day on maybe two or three days a week, which gives a respite to the husband. I imagine that that would not be precluded and that that would be regarded as community respite care. Senator GRIMES(Tasmania-Minister for Community Services)(9.35) —Basically, there are three forms of respite care. There is respite care in the carer's home. That is what we really mean by community respite care. There is respite care in day care centres, which can be for three or four hours a day, or more. Both of those can be funded under the home and community care service. Then there are the respite care beds that we provide in nursing homes and hostels. They certainly can still be funded, but they are funded under different legislation. Bills agreed to. Bills reported without amendment; report adopted. Bills (on motion by Senator Grimes) read a third time. Debate resumed from 2 December, on motion by Senator Gareth Evans: That the Bills be now read a second time. Senator DURACK(Western Australia)(9.37) —The Opposition will oppose the Australian Trade Commission Bill and the Australian Trade Commission (Transitional Provisions and Consequential Amendments) Bill because, in our view, they represent further unnecessary regulation without really tackling the major trade problems confronting Australia. The recent trade figures highlight the tragic state of the Australian economy. The October trade deficit of $1.6 billion is an all-time record for one month. This should be of grave concern. Yet the Government, in a traditional response, is only proposing to establish another quango without abolishing the existing trade bureaucracy. In addition, cumbersome export permit requirements remain. In the last week or so, in the threats that the Minister for Trade (Mr Dawkins) has made against the Gove Peninsula consortium, we have had dramatic examples of the extent to which this Government will go in enforcing export controls. We know that many Australian companies have missed out on trade they could have won if they had been able to move more quickly to secure export approval. In most cases, industry should not be required to seek prior approval. The Opposition has already stated that it would phase out such export controls. This would directly assist further development within Australia, based on a sharp increase in Australian exports. Deregulation of these trade controls on exports is a direct and positive move that the Government could and should be taking now. These Bills, which largely are of a cosmetic and window-dressing nature, do nothing to rectify our current trade problems. It is a typical bureaucratic response to a problem. What we require is instant and entrepreneurial responses which, of course, these Bills do not provide in any shape or form. While on the face of it these measures represent some rationalisation of the existing trade bureaucracy, there is no substantial change or new initiative in this exercise. Indeed, the new quango will have greater and expanded powers beyond those available to the three separate bodies which it will replace. In addition this power will be largely outside the scrutiny of this Parliament. It is quite unrealistic to expect improved efficiency in results from a new statutory authority, particularly as it will be staffed largely by the same public servants and viewed with the same experience and same attitudes to overseas trade. In the Opposition's view the development of overseas markets should essentially be a matter for industry. These Bills will not ensure that industry will win a share of any overseas markets. That can be achieved only if industry is free to seek out markets, is encouraged to do so and remains competitive. Unfortunately, high and increasing government regulation and taxes serve only to reduce this competitiveness. Any assistance that may be provided by way of these Bills will be overshadowed, if not lost, if that competitiveness is not improved. Merely facilitating and encouraging trade is insufficient if on the other hand industry is restricted by controls and government costs in developing and capturing new markets. As I have said, these Bills do nothing to rectify that fundamental problem with our overseas trade. They just rearrange the deck chairs on the Titanic. These Bills will permit the Minister to absolve himself and the Government from the activities of the Australian Trade Commission. Will this Commission be just another directionless quango, soaking up taxpayers' money without providing any substantial benefits? There is certainly a danger that this will be the case. We have growing numbers of examples of just this situation. The Australian Broadcasting Corporation, the Australian Bicentennial Authority, Trans Australia Airlines and the Australian Postal Commission are classic examples. In our view the Government should be getting out of these operations and not rearranging them and establishing new organisations, of which this Bill is a prime example. There has been little interest in the proposal from those who are supposed to be assisted by it, and no wonder. There is some scepticism about the usefulness of this body and concern that the Commission could in time, and with minimal amendment, carry on trading activity on its own authority in a similar way to the Commonwealth Banking Corporation. The Commission will be allowed to form companies and join partnerships or consortiums to further its aims, whatever these may turn out to be. Again this raises the spectre of overseas trade being a nationalised activity with the Government excluding and preventing the competitiveness of industry. Competitiveness, of course, is the only way we can improve our trading position. Some months ago, at the time of the May economic statement, which is now looking very tattered and torn, the coalition supported the overall thrust of the Government's attempts to contain expenditure within the export market development grant schemes. However, any benefits that may have come from the May economic statement, which is pretty tattered already as a result of the Government having reversed so many of its decisions, will be further depleted by these Bills. We are told that the new Commission will have a staff of about 1,400 and a budget of the order of $200m. Can we expect to get $200m extra trade as a result of the activities of this Commission? We are most sceptical about that. It is obvious that much, if not most, of this $200m will go on staff wages and staff entitlements. It will certainly not go effectively on improving Australia's export performance. It is really quite a disaster that the Government's response to this vital problem is simply to throw more taxpayers' money at a problem it could solve by getting out of this area and not further into it. The Opposition has demonstrated a practical commitment to export incentives and support for initiatives designed to improve that export performance. We certainly do not think that this reshuffling exercise will achieve that or any other purpose. Export industries look as though they are just going to be left to languish until we are returned to government with a forward and effective policy of encouraging the private sector to solve this problem. The piecemeal approach that is demonstrated by the Government and highlighted by these Bills will not improve it. Certainly, the Government does not appear to have any overall strategy to solve our overseas trade problem. It seems as though on this issue the Hawke Government, despite its rhetoric about dereg- ulation and encouragement of the private sector, has simply run out of steam, and its only response to this problem is to establish another quango, another statutory corporation, another bureaucracy. These Bills do not offer any positive approach or promise any effective returns. The Opposition will not support the proposition for a new trade commission, a new statutory authority, a new quango, and we will vote against the Bills. Senator COOK(Western Australia)(9.47) —I listened intently to the reply to the second reading speech by the shadow Minister, Senator Durack. Allowing for the hour, allowing for our program, and allowing for the desire for us all to complete our agenda by tomorrow, nonetheless we heard an unfortunate and, in many respects, a very vague and ideologically based reply to the second reading speech. What we got was a series of cliches and assertions, unsupported by any argument that resorted to facts or statistics or evidence, that this was a measure not soundly based. I listened intently to what Senator Durack said to find at least one pearl of conviction from the Opposition as to what should be done specifically. All I heard was that the Government ought to make an instant entrepreneurial response-and of course that was never specified. It is unfortunate that the debate should be cast in these terms, because there is at this time no greater need than the need for a bipartisan policy to lift Australia's trading performance. It is a matter to which all parties that have a chance of governing Australia ought to be committed. Whilst these Bills are important at the sharp end of promoting trade abroad, ultimately the ability to compete successfully overseas requires the impetus of the restructuring of the Australian domestic economy that is going on under the leadership of Senator Button, identified with the steel plan, the car plan and the rest of the initiatives this Government has taken. Senator Vigor —You are getting that support from the Australian Democrats. Senator COOK —That is right, and that is welcome support. It is support that addresses the need for us to rise above divisive domestic politics to address the national requirements of this country to promote our affairs overseas. These Bills are an honest attempt by the Government to come to grips with an aspect of our trading performance. The legislation will create a new statutory authority which will replace the Export Finance and Insurance Corporation, the Australian Overseas Projects Corporation, the Trade Commissioner Service, and the marketing and promotion areas of the Department of Trade. The Australian Trade Commission, which those Bills will create, will have the powers of all the authorities to which I referred a moment ago, plus additional powers. We believe that it will improve the efficiency of public bodies and, in this case, increase the promotion and encouragement of our exports. This Government has concentrated on being honest and candid about Australia's export performance. There is no way of addressing the difficulties that we face other than in being open in exposing the problems and seeking a widespread consensus about a strategy to address those problems. The Minister for Trade, Mr Dawkins, has made it clear in statements that he has put down in the House of Representatives that over the last 30 years Australia has slipped from being ranked eighth in the world as an exporting nation to twenty-third and that our current account deficit has slipped from an average of 2.5 per cent of gross domestic product in the 1960s and 1970s to an average of 4.5 per cent of GDP in the 1980s. While that is a deterioration, it is not as desperate a deterioration as has often been painted. We have recognised openly that our poor performance is in the main due to two factors. The first is the composition of our exports, in that at least 75 per cent of our exports are agricultural and mineral commodities and the fact that the world demand for these commodities has grown more slowly than the demand for manufactured goods. Indeed, those world economies that are doing best are those which have an increasing export trade in manufactured items. We have had a declining export trade in manufactured goods. To admit that is not to canvass a criticism of this Government. It is not a criticism of this Government; it is a recognition of the way in which that component of our trade performance was deteriorating over several years. Secondly, our manufacturing and service industries have had an inward looking attitude and have not moved as aggressively as we would have liked to manufacture and perform services for the trade area, for the world economy. The tendency has been to look at what the Australian domestic economy can absorb, to put items on the market for that economy, and then to sell any excess overseas, rather than to look at a trading opportunity for what Australia can contribute. The other sad thing that has to be said is that this country ranks second to virtually none in the world in terms of its technical capability, its innovative ability and its ability to come up with design and manufacture; but where we seem to lag the most is in promotion and in the entrepreneurial flair to get our goods into the international field and aggressively sell them overseas. This Bill is about creating a commission which will help do that. It is designed to meet those challenges. It is designed to be a one-stop trade shop providing exporters with a full range of advice and packages of the government resources that are necessary. It is designed to have a flexibility and an independence of management to respond to the changes as they occur in the international market. It is designed to be a source of advice to government and to have the ability to charge for some services, which in turn will help us and the Commission to identify those services which will be of most benefit to exporters. It is designed to achieve those results. The Opposition's arguments seem to me to have all been cast at the level of nit-picking. I honestly and sincerely invite the Opposition to make a genuine attempt to formulate with this Government a bipartisan policy and not fall back on the easy option of merely trying to criticise the honest initiatives that this Government has tried to take. For example, one of the themes of Opposition addresses in this debate has been that this legislation will somehow nationalise Australia's trade. Of course, that is a ridiculous proposition, as will be seen by anyone who reads the Bill comprehensively and objectively in an effort to understand what it seeks to achieve. A lot of thought and work has gone into restructuring the services we offer to traders in this country, and the Trade Commission reflects that restructuring and thought. It is a rationalisation of all those services to bring them together under a comprehensive banner. The ideological assertion that this seems to be some form of nationalisation is not the point of this Bill at all. This Bill proposes to bring together existing services, which have existed and have been sanctioned by previous governments over many years, to blend with the needs of the commercial sector of trade overseas so that we have a statutory authority which combines departmental advice and assistance with the need of the private sector in our foreign markets. It is a Bill which, rather than nationalise, seeks to rationalise those services and to achieve that balance of entrepreneurial flair with government services that are necessary. One of the other things the Opposition has said in this debate, and to which Senator Durack referred again tonight, is the tired, worn out, clapped out cliche of rearranging the deck chairs on the Titanic as if that, by repetition, somehow gains truth and authenticity. This is not an effort to do that. It is not a cosmetic exercise. The morale of the Department of Trade, which the Opposition claims is low, is in fact best served by having an authority such as this which will provide a purpose and a direction for those talented officers in the Department and those who will be attracted to the authority by virtue of its existence in order that they will have a real job to do in working more closely, by virtue of this authority, with the private sector to give them a greater responsibility than they now have. That is what this Bill seeks to achieve. There is no better way of improving what has been the flagging morale of the Department of Trade than to give it an authority and an opportunity, through that authority, to use the innovation, entrepreneurial skill and knowledge of foreign markets and Australian domestic performance to go overseas and promote Australian trade more effectively. The other criticisms seem to me to be criticisms that can be best described only as dog in the manger objections. One of the criticisms which I think ought to be put to rest finally in tonight's debate is the criticism which was a theme not so much of Senator Durack's debate tonight but rather of some of the speeches in the House of Representatives-that somehow or other the business community does not support this measure. One needs to look only at the Interim Board for the Australian Trade Commission to see that that Board reflects some of the leading lights in the Australian business community. I believe that the criticism that business does not support the Commission is really, if one looks at the Interim Board, a criticism of those who are on that Board and providing the leadership for the authority. If one runs down the list from the Chairman, Mr Asimus, to all the other members of the Board-Mr Ferris, Mr Gosper, Nicholas Whitlam and Mr Cottrell-it is clear that we have a board of immense experience in several areas of trade and industry in this country. To assert somehow, therefore, that it as a board does not reflect the confidence of the business community or that it has an inability to do the job which this Bill will give it to do were it to become the full Board in the event of the passage of this Bill is, I think, a sour and unfortunate criticism. I think many other things could be said about the legislation, but because of the hour and the form response from the Opposition it is not necessary to go into all of that detail. I commend the Bill to the Senate. Senator VIGOR(South Australia)(9.59) —The Australian Democrats will be supporting the Australian Trade Commission Bill and the Australian Trade Commission (Transitional Provisions and Consequential Amendment Bill. The Australian Trade Commission is being established to improve the efficiency both of the Department of Trade in its support of the Government and of the services offered by the Government to promote Australian trade overseas. I applaud the Government's initiative in this restructuring of the Department which hopefully-I emphasise hopefully-will mark a new era in efficient and cost-effective services to exporters. Communication between public servants and business people is always a problem. Public servants are loath to make a decision until all relevant facts have been checked. Businessmen depend on quick reactions to current market conditions. This problem was brought up by Senator Durack as one of the major problems that we face when government tries to work with businessmen in promoting our trade. I hope that the Trade Commission will solve some of those problems. Senator Durack —Why should it? Senator VIGOR —It should because the businessmen being appointed to the Trade Commission will direct its actions independently from government. It is to be hoped that the Australian Trade Commission will have sufficient independence from the Department of Trade so that we will not have a repetition of the Australian Bicentennial Authority's clash with the Department of the Prime Minister and Cabinet. I envisage a difficult period for the Commission at the outset as I understand that most of its staff will be public servants transferred from the present Department of Trade. These public servants will actually have to learn some of the methods of business if we are going to be effective and competitive in foreign markets. While I acknowledge their great experience in trade matters, I question the advisability of that personnel decision. I would much prefer to see the Commission staffed by people directly from industry. I am pleased to hear, however, that the top appointments to the Commission are from the business sector. I congratulate Dr Brian Scott, Chairman of Management Frontiers Pty Ltd and formerly Chairman of W. D. Scott and Co. Pty Ltd, on his appointment as Chairman of the Interim Board, together with the other outstanding members of the Board. I also commend Mr Exell for the tremendous work which he has put into this project. I have been quite impressed with it. What Australia needs at this time is a courageous and dynamic approach to trade promotion and a dynamic approach to the protection of Australian industry. The major problem that we have currently is that in foreign trade we are fairly stick in the mud and we are sliding downhill. I question the capacity of people trained in the Public Service to adjust quickly enough to their new role in the Australian Trade Commission, and we will be watching this very closely. As most people are aware, Australia's trade position is now critical, and that has been canvassed by both the previous speakers. Our trade deficit is increasing exponentially. Our overseas markets are being eroded by our `closest allies' who are flagrantly breaching the General Agreement on Tariffs and Trade on trade practices and protectionism. We are refugees, in fact, from an economic war between the United States of America, Japan and the European Economic Community. The EEC and the United States of America are subsidising more and more of their commodity exports, thus reducing Australia's share of traditional markets for our minerals and primary produce. Japan and the United States of America are engaged in an economic war which crushes Australian manufacturing industry in the middle. Australia needs to look towards a common market arrangement with its nearest neighbours to provide a buffer against such powerful economic forces. The major area of deficit in Australia's trade is that of the invisibles. Interest on our exploding foreign debt, our shipping costs and our costs of insurance are factors which contribute to this major deficit. I welcome the incorporation of the Export Finance and Insurance Corporation into the Australian Trade Commission. I hope that the Australian Government will undertake more of this type of financing in the national interest. I hope also that the Government will expand EFIC and its insurance capacity into general average and cargo insurances. I have had a number of discussions with the Department of Trade and the Minister for Trade, Mr Dawkins, and, because of time constraints, I seek leave to have incorporated in Hansard a letter from the Minister and the section of the Minister's second reading speech which came out of those very fruitful and constructive discussions. Leave granted. The documents read as follows- Office of the Minister for Trade and Minister Assisting the Prime Minister for Youth Affairs Parliament House Canberra ACT 2600 29 Nov. 1985 Senator D. Vigor Senator for South Australia Parliament House CANBERRA ACT 2600 Dear Senator Vigor Further to our very helpful discussions on Wednesday, I have included some additional paragraphs in the Senate Second Reading Speech to cover the points that you raised. These have been highlighted in the attached copy. On the matter of an export market development scheme for small new exporters and exporters of high technology products, it will be for the Trade Commission to come up with early proposals so that we can get something off the ground in 1986/87. I have asked the Interim Board to include it on their agenda for their final meeting on 17 December. As to meeting the new Board of the Commission, I would suggest one of the early meetings would be appropriate, probably late January or early February. I have asked officers of the Interim Commission to keep in contact with your office on this matter. Yours sincerely J. S. Dawkins SECTION OF SECOND READING SPEECH In this context the Minister for Trade will be requesting the Australian Trade Commission to develop proposals for export market development schemes tailored specifically to assisting small new exporters and exporters of high technology products. The Government will consider sympathetically schemes which are cost effective and offer real assistance. Whilst it will not be possible to implement any schemes in this financial year, depending upon the advice I receive from the Commission. It may be possible to have new arrangements in place in the 1986-87 financial year. . . . The Government is conscious of the low level of export orientation of Australia's service industries, particularly in the light of the large invisibles deficit in the balance of payments. In this respect, it is the Government's intention to develop services as an important export earner and significant steps have already been taken in areas such as tourism and education. The Commission will continue to develop marketing strategies aimed at improving the performance of the services sector in the broadest sense. Apart from reinforcing the activity which assists the export of professional consulting and contracting services, particular attention will be given to finance, insurance, entertainment and information industries. These initiatives will have a positive impact on our invisibles account. The budgeted revenue from the sale of the Commission's services has been set at $2.5m for the period ending 30 June 1986. Monies so recovered will be credited to the Commission's account. Future options for cost recovery are being assessed. Without previous experience in this area it is difficult to forecast what these levels will be, and the extent to which cost recovery will be an effective market test of the quality of the Commission's services to exporters. The Government is not seeking, through cost recovery, to reduce its commitment to the exporting community. Senator VIGOR —I thank the Senate. I note that the Minister had incorporated in his second reading speech my suggestions to improve Australia's invisibles trade and has promised to improve Australia's export services to achieve this. However, I note cynically the Government's failure to protect our tourist industry by today disallowing entertainment as an income tax deduction. Apart from the extra cost in marketing our export, the detrimental effect on our tourist industry seems suicidal. I appreciate also the Minister's support for our proposals for an export market development scheme tailored specifically to assist small new exporters and exporters of high technology products. However, I am most unhappy to hear that nothing will be done in this regard until the 1986-87 financial year. This shows the types of delays and lags that exist within the Public Service system. Given our current trading situation, action is needed now. It is needed immediately because we have to turn the corner. Another area of concern to the Australian Democrats and to many exporters is the impact of cost recovery measures on exporters. I welcome the Minister's incorporation into his second reading speech of assurances that the recoveries will be no more than $2.5m for the rest of this financial year. However, while applauding the concept of introducing full program budgeting in the Australian Trade Commission, I warn that Australian exporters are probably the most undersubsidised in the world and cannot efficiently or effectively absorb any further costs in this area, apart, that is, from those corporations indulging in transfer pricing and other tax rorts at the expense of all Australian businesses and all Australians. This practice needs to be stopped. I hope that a tightening up of Australia's trade situation will include the provision of controls over such pernicious practices. Transfer pricing has been raised as a problem in every annual report of the Australian Commissioner for Taxation since 1982. Amendments were introduced to the Income Tax Assessment Act in an attempt to control transfer pricing, and these were to take effect immediately in May 1982. In the 1982-83 annual report of the Australian Taxation Office mention was made of the growth in the international economic activity and the increased use of tax havens to shift profits artificially. Mention was made also of the fact that Australia was arranging to exchange information with overseas taxation authorities. We still have not seen the results of this. The latest report states that more than 90 cases of transfer pricing practices were examined last year and an extra $80m tax was collected. But that is just the tip of the iceberg. Mr Risstrom estimates that total tax evasion in this area is of the order of $2 billion to $3 billion. The audit process is highly complex and requires increased computer resources. It may be possible to stop these types of rorts if there is co-operation between the Department of Trade, the new Trade Commission and the Taxation Office. I take, for example, the Alusuisse case. A couple of days after I discussed these matters with Mr Dawkins, he attacked Austraswiss and Gove Aluminium Ltd. I seek leave to incorporate in Hansard an article from the Australian Financial Review of Friday, 29 November, which describes Mr Dawkins's attitude towards these types of processes. Leave granted. The article read as follows- Dawkins attacks Austraswiss, and GAL for low export prices By David Shires The Federal Minister for Trade, Mr Dawkins, in Parliament yesterday launched a second attack on the companies involved in the Gove bauxite and alumina project for negotiating export prices below those considered by the Federal Government to be a fair market price. The two companies, Alusuisse subsidiary Austraswiss and the majority CSR-owned Gove Aluminium Ltd (GAL), attracted the minister's wrath in the House on Tuesday on the basis of low prices negotiated with Austraswiss's Swiss parent Alusuisse, which contracted in 1968 to buy all alumina produced by the Gove project until 1992. The minister outlined his position on the matter to the companies last Thursday, threatening to bring export controls into play if they did not negotiate a better price with the Swiss-based buyer. ``There have been some responses from the companies involved, but neither of them have attempted to address the central issues,'' he said in the House yesterday. ``In the case of Austraswiss, we have the need for the company to obtain a freely negotiated fair market price for its alumina as was negotiated for in the agreement that it signed at the time when the project was established. ``Secondly, in the case of Gove Aluminium Ltd, the fact is that the company wishes now to have approval for export prices for bauxite below any prices which have been obtained at any time since 1978.'' He would not reveal the nature of the prices concerned, describing them as confidential within the Government. But the minister lashed Austraswiss in particular for its response to his attack earlier in the week, describing a claim by the company denying it had sought information under the Freedom of Information Act relating to other companies as ``frankly false.'' ``It has sought all reports, all memoranda and all documents relating to the international transactions between Australia and other countries in relation to alumina and bauxite,'' he said. ``The Government, of course, has resisted the release of the information relating to the other companies in this trade.'' Mr Dawkins denied the Government was attempting to renege on its contractual obligations, adding that as far as he was concerned the contract was not even at issue. He described a press statement released by Austraswiss as ``very misleading'' and avoiding the central issue. He said while GAL had responded, it had not provided the information sought. Mr Dawkins also assured the people of Nhulunbuy manning the Gove project that the Government had no intention of seeing the issue close the operation. Austraswiss did not respond to the minister's statement last night, but it is believed a response will be made this morning. The major problem lies in the ``cost-plus'' basis of the original contract signed in 1968-a time when there was very little international trade in international bauxite making the determination of price difficult. While Mr Dawkins may be right in accusing the companies of selling well below current market prices, it is worth noting that the only comprehensive paper on the subject produced earlier this year by a former Trade Minister staffer, Mr Greg Crough, acknowledges that Alusuisse may have lost considerable amounts of money in the early years of the deal. According to Mr Crough, in 1975 the total group of Alusuisse ran at a loss, one reason was that the company had 1 million tonnes of Gove alumina for which it had paid $30 to $40 above the then market price. In fact, he said, the price paid by Alusuisse had exceeded the market price from 1972 to 1977. ``Subsequently, the so-called market price exceeded the formula price and at that stage some people started to criticise the formula and said it was unfair on Australia, but I suggest that the formula, if it was unfair on Australia in 1979, was grossly unfair on Alusuisse in 1972 to 1976,'' he said. Mr Crough echoed the sentiments expressed earlier this week by the managing director of Austraswiss, Mr Andrew Parker, that Australia would have been in a very difficult situation if in 1976 Alusuisse had wanted to renegotiate the contract. ``We would have been in a very difficult position in our financing because if we had to accept the market price, we would not have covered costs.'' ``Were the export control mechanisms to be significantly weakened, the ability of the Government to ensure that the country's resources are sold at fair and reasonable prices would undoubtedly be undermined, which should be a matter of concern to all Australians.'' Senator VIGOR —I thank the Senate. My colleague Senator Mason asked a question of the Minister for Trade on 16 October on this matter and it seems that it has now been taken up. The Department of Trade estimates that the price of Alusuisse's exports in 1984 was $34m, under the lowest range of fair and reasonable export contracts. As much as $550m might have been shaved by that one company from export values since 1972 by use of various transfer pricing techniques. I believe that the Taxation Office has failed in this area. Maybe some statutory specification and control within the ambit of the Trade Commission might be able to give more information on this and indicate a better way of handling this problem. I commend the Bills to the Senate. Senator BUTTON(Victoria-Minister for Industry, Technology and Commerce)(10.10) —I want to address briefly a few points that were made by Senator Durack. I think his arguments can be summarised in this way: The Government's legislation does not deal with the real issue and industry should be encouraged to do things itself and be more competitive. The honourable senator more or less encapsulated his view in an interjection he made when Senator Cook was speaking. He said that governments should get out of industry's hair. I think that is a fair enough summary of the main thrust of his comments. Senator Durack also said that the Government was setting up another quango, that the cost would be $200m and, that an additional bureaucracy would be created and so on. I just want to deal very briefly with some of those points. The difference between this Government and the Government in which Senator Durack was a Minister in respect of trade is that the honourable senator's Government set up three quangos to deal with trade in addition to a very large Trade Department and, of course, the Trade Commissioner Service. This legislation will get rid of three quangos and establish a single statutory authority which, in addition to the functions of those three bodies, also incorporates the functions of the Trade Commissioner Service. In fact, the Commission will be governed by a single board of directors which, as other speakers have pointed out, will be substantially made up of people from outside the Public Service. Senator Durack said by way of interjection when the names of those directors were read out that the board of the Australian Trade Commission would be like that of the Australian Industry Development Corporation. He went on to say that the AIDC had not been a very successful body. I think he ought to read the reports of the AIDC. It was not a very successful body in the early period of the Government of which the honourable senator was a member. However, its performance has been extraordinary. Senator Sanders —Who are you talking to? We didn't say anything. Are you talking to them? Senator BUTTON —I am talking to Liberal and National Party senators. This is the sort of comment that has been made. I do not know what is meant by the suggestion that the Australian Trade Commission will cost $200m. A total of $117m will be used for export market development grants. Is Senator Durack saying that that system should be got rid of? If so, he should say so outside this place. Similarly, $30m will be devoted to the Export Finance and Insurance Corporation. Is he saying that the EFIC facility should be got rid of? If he believes that he should say so outside this place. He should say that to industry. However, he was fairly silent on those points. There is also a cost in respect of the Trade Commissioner Service. That cost already exists. So there is no additional cost as a result of the establishment of the Commission. Senator Durack should know that the change will result in a division in the traditional personnel and functions of the Department of Trade. I have dealt with essentially the main points that arose from what Senator Durack said. I found his remarks negative and churlish, which I think is extraordinary for a man of his normally generous disposition. However, I guess that is due to the fact that we are now at the end of the year and we have been sitting a lot of late nights. I commend the Bills to the Senate. Question put: That the Bills be now read a second time. The Senate divided. (The Deputy President-Senator D. J. Hamer) Ayes . . . . . . . . . . . 36 Noes . . . . . . . . . . . 31 —— Majority . . . . . . . . . 5 —— Aulich, T. Grimes, D. J.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. Morris, J.Colston, M. A. Ray, RobertCook, P. F. S. Reynolds, M.Cooney, B. Richardson, G. F.Crowley, R. A. Robertson, E. A.Devlin, R. Ryan, S. M.Elstob, R. C. Sanders, N. K.Evans, Gareth Sibraa, K. W.Foreman, D. J. Tate, M. C.Georges, G. Vigor, D. B.Gietzelt, A. T. Walsh, P. A.Giles, P. J. Zakharov, A. O. Archer, B. R. MacGibbon, D. J.Baume, Michael Messner, A. J.Baume, Peter Missen, A. J.Bjelke-Petersen, F. I. Parer, W. R.Brownhill, D. G. C. Puplick, C. J. G.Carrick, Sir John Rae, PeterCollard, S. J. Reid, M. E. (Teller)Crichton-Browne, N. A. Sheil, G.Durack, P. D. Short, J. R.Guilfoyle, Dame Margaret Teague, B. C.Hamer, D. J. Townley, M.Hill, R. Vanstone, A. E.Jessop, D. S. Walters, M. S.Kilgariff, B. F. Watson, J. O. W.Knowles, S. C. Withers, R. G.Lewis, A. W. R. Coleman, R. N. Boswell, R. L. D.McClelland, Douglas Chaney, F. M. Question so resolved in the affirmative. Bills read a second time. The Bills. Senator PETER RAE(Tasmania)(10.21) —The purpose of the Australian Trade Commission Bill is to establish another quango which does not comply with the requirements for a statutory authority set out in the policy issued by the present Prime Minister (Mr Hawke) and the former Attorney-General, Senator Gareth Evans, in their paper on Labor and the quality of government. The Bill does not comply with all the essential features of a statutory authority which the Standing Committee on Finance and Government Operations set out. It listed in considerable detail many of the safeguards that are desirable and necessary in establishing a statutory authority. This stage of the proceedings is neither the time nor the place to debate this question in detail. It is a matter of great regret to me that the time and circumstances are not such that we can apply our diligence suitably in the consideration of what ought to be the proper requirements for the creation of a responsible, operational, functional statutory authority. I simply express my regret that the circumstances at the end of this session are such that it is not possible to do so. I would have liked this matter to be considered in some detail in Committee. I would have liked it even to be referred for consideration to the Standing Committee on Finance and Government Operations. I hope that when the Senate creates its next statutory authority it will consider what the requirements ought to be and that it will make sure that it does not do what it has done over the years; that is, create monsters and creatures which are not properly accountable. It has created bodies which it has subsequently criticised through its committee system when those bodies are investigated and it is found that the Parliament has been recreant in its duty in creating such bodies by not ensuring that they would be proper, operational and functional. I simply rise to express my regret that the circumstances are such that we will not be able to follow that procedure in relation to this body. Bills agreed to. Bills reported without amendment; report adopted. Bills (on motion by Senator Button) read a third time. Debate resumed from 4 December, on motion by Senator Grimes: That the Bills be now read a second time. Senator GARETH EVANS(Victoria-Minister for Resources and Energy) —I propose that these two Bills be debated cognately with the Customs Tariff (Stand-by Duty) Bill 1985, which I understood was the case. Senator Durack —No, I am not ready to debate that; it is a separate item. The DEPUTY PRESIDENT —Order! Is it the wish of the Senate that those Bills be debated cognately? Senator Durack —No. I am prepared to debate the two Bills cognately, but not a third Bill which Senator Evans rings in at the last minute. Senator GARETH EVANS —It was an Opposition suggestion, which we are trying to accommodate. The DEPUTY PRESIDENT —Order! By motion of the Senate, the first two Bills are being taken through all their stages together. Senator Durack can speak to those Bills. I call Senator Durack. Senator DURACK(Western Australia)(10.26) —What has happened now was also typified by the fact that we were to have the report of the Royal Commission into British Nuclear Tests in Australia between 1952 and 1963 presented at 3 o'clock this afternoon, and suddenly about half an hour before we started this morning we were told that Senator Evans would present it at 10 o'clock. So I will not end the day pandering to Senator Evans's whims, which his own Whip does not even know about. We have had too much from the Minister for Resources and Energy (Senator Gareth Evans) for too long. Apart from that, the Customs Tariff (Stand-by Duty) Bill has nothing whatever to do with this particular proposal. The Petroleum Revenue Bill and the Excise Tariff Amendment Bill are a somewhat extraordinary exercise by this Government and again are a very good example of how it simply cannot get its act together. The Government has a particular pet theory of taxing the oil industry in this country, in addition to its other new and increased taxes which it has been imposing upon it. We have heard a great deal about Ricardo's theories of economic rent and whatever, about which Senator Walsh has been telling us for so long and has failed dismally to explain to us. One example of this interesting theory of Senator Walsh, which I think he got from some Australian National University economist who has had some further preference from the Government as a result of his assistance and advice to it, has been to propose the introduction of a new taxing regime for the mining industry, known as resource rent tax, which is to replace existing royalty arrangements and other special imposts on the mining industry, but in fact is an additional burden or an excess profits tax because the ordinary company tax regime will still apply. We have heard a great deal about this particular theory from the Government. Senator Walsh-the predecessor of Senator Evans, who is the Minister for Resources and Energy now responsible for this legislation-announced that there would be a resource rent tax along fairly general lines, which it had been negotiating with industry to apply from 1 July 1984. We have heard a good deal about taxation reform from this Government. We have heard that a lot of its other tax reform proposals were to take effect from 19 September. We have not seen the relevant legislation and will not see it until next year. What nobody seems to understand completely is that this resource rent tax legislation, which is to take effect from 1 July 1984, on 5 December 1985-today-still has not been introduced in any shape or form into this Parliament. The Government has recently passed a new regime for granting off-shore exploration permits, known as cash bonus bidding. We have had elaborate advertisements by the Department of Resources and Energy calling for bids on this new cash bonus bidding proposal for prospective off-shore areas of Australia. Probably, if the advertisements had been placed by private promoters, the companies concerned would have been in breach of prospectus arrangements because of the puffing that is included in them. Debate interrupted. The DEPUTY PRESIDENT —Order! It being 10.30 p.m., under sessional order I put the question: That the Senate do now adjourn. Senator GILES(Western Australia)(10.30) —Tonight I pay tribute to a great Aboriginal activist, Gloria Brennan, who died in Perth on 1 November at the age of 38 years. In the words of those who spoke at the memorial service held in Canberra on 11 November, Gloria was a leader of her people, an ear to listen to their problems and aspirations, a resource for those in search of knowledge and advice and a fighter for Aboriginal rights, especially those of Aboriginal women. Gloria's formidable intellect was recognised when she was a child at school in the eastern goldfields in Western Australia where efforts to repress her ebullient nature were fortunately without success. She became the first Aboriginal to graduate from the University of Western Australia. It was there that I met her first while she was working for a degree in anthropology, later majoring in linguistics and graduating in 1978. She was amongst the most active people on campus, participating closely in the affairs of the Guild of Undergraduates, singing in the Capella Choir and taking a prominent role in the protest against Australia's involvement in the Vietnam war. Her first public position was as a member of the legal team researching allegations of brutality against Aborigines at Laverton, an inquiry which led to the so-called Skull Creek Royal Commission of 1974-75. She joined the Department of Aboriginal Affairs in 1975, working first in Perth and later in Canberra and subsequently became a valued member of the Equal Employment Opportunity Bureau of the Public Service Board. On a number of occasions she represented Australian Aborigines at international conferences and she travelled widely carrying the message of her people to other indigenous groups. She played a leading role in establishing Aboriginal medical and legal services in Perth, exercising to great effect her capacity for drawing together disparate tribal groups and differing generations, gaining their respect and confidence. Similarly, her skills were repeatedly called upon to bridge the gaps in the understanding between indigenous and white Australians. Western Australians who worked with Gloria on any of the countless activities with which she was involved have reason to be grateful for her patience and tolerance as she educated and guided us along the path of more enlightened attitudes, policies and practices towards the original Australians. It was of immense importance to Gloria that Aborigines be allowed and encouraged to determine their own destinies and I recall her insistence not only on the right of Aborigines to vote but also their responsibility to do so and, of course, the concomitant obligation of Australian society to ensure that they were given every opportunity to make informed decisions. Gloria, during the last months of her life and knowing that she had not long to live, was occupied whenever possible with writing speeches and attending committee meetings and was engrossed in planning legislative and social initiatives on behalf of her people. She was appointed by the Premier of Western Australia in 1984 to the State Women's Advisory Council, bringing to another forum the wit, wisdom and diplomacy which characterised all her endeavours. One of her last public appearances was to speak to the Australian Pacific Women's Peace Conference on 28 June this year. She described the position of Australian Aboriginals thus: We live in Third World conditions . . . The health and well-being of Aboriginal Australians depends now, as always, on a close material and deep spiritual relationship with our land; and on cultural integrity, and the material wherewithall which would enable us to live in dignity, independently and self-reliantly. Since European settlement began almost 200 years ago, each of these requirements have been rudely disturbed-initially by a policy of murder and conquest aided by the exposure of Aboriginals to infectious diseases to which we had had no previous contact; progressively by moving us from our traditional lands; by institutionalising and paupererising us; and by degrading and forbidding us our culture. These policies succeeded in reducing our population by 1950 to less than half the number in Australia on original European settlement. Since then, however, there has been a significant rebirth of Aboriginal Australia on all fronts, aided by significant international pressures, the more liberal attitudes of some sections of the other Australian community; and more particularly, by the efforts of Aborigines ourselves. In theory at least, the policies of assimilation and cultural genocide have been swept away, and the official policy of the Federal Government is to permit Aboriginal self management; self determination. Limited land rights have been granted in some areas; and in most areas the legal machinery that created official discrimination has been dismantled. There have been, however, some problems in making a reality of these new policies. The greatest perhaps is that most of the programmes affecting Aboriginals are under the control of State governments-all in different degrees hostile to the new policies. . . . Much of the legal discrimination still occurs, and Aboriginals are still at a substantial disadvantage at dealing with other Australians. She continued: What do we want? Aboriginals recognise that to regain health, they have to regain control over their lives. This involves Aboriginal sovereignty over our own budgets and our own affairs; the development of land rights and compensation policies; and the removal of discriminatory practises. That excerpt from her speech is typical of Gloria's approach-without bitterness or rancour, giving credit where it was due, but clearly and objectively stating her case. Gloria's life was tragically short, but wonderfully productive. To the extent that her people have regained control over at least some aspects of their lives, much of the credit is due to Gloria and those like her who learnt to use the brash new systems to protect and to revive their ancient rites and dignity. With her family, we mourn her death, but we rejoice in her life and her achievements. Senator CHANEY(Western Australia-Leader of the Opposition)(10.37) —Briefly, I support the remarks made by Senator Giles about Gloria Brennan. Gloria was a friend of mine going back to the early 1970s when she, with Kate George, the wife of John Dawkins, was heavily involved in the Aboriginal legal service which at that stage was not, as I recall, a government funded body but a body which was made up of people who were interested in providing legal services to Aboriginals-mainly Aboriginal defendants. It was a very good time and we enjoyed the work that we did together. I have enjoyed my contact with Gloria from that time on. I suppose, like many of her friends, I have a very vivid recollection of the last year or so when she was extremely ill. My last memory of her was, I think, at the Aboriginal ball at the university when she was in great form and very much the Gloria of old. The thing that I would take from Gloria's life, which I think is worth putting on the public record, is that in her activities she often succeeded in bringing together quite disparate people who had a common interest in the advancement of Aboriginal people. I think it is notable that the group with which she was involved in that early 1970s period when I met her included Sir Ronald Wilson, who was the then State Solicitor-General. I cannot remember whether there was a Liberal government or a Labor government at the time, but that does not matter. I recall the involvement of Mr John Toohey, who was subsequently appointed the Aboriginal Land Commissioner and is now a judge of the Federal Court. He was appointed by us but he has just been appointed by the present Government to the constitutional committee that has been set up by the Attorney-General (Mr Lionel Bowen). I recall Aboriginal people such as Vic Forrest, Ken Colbung, Ivan Yarran and Bob French who was then, I think, a law student and is now a barrister in Western Australia. The common interest in that group crossed political and many other lines. Gloria's contribution was of the quality that has been described by Senator Giles and is a contribution which I will always remember. Gloria came from the eastern goldfields. It was a matter of great pleasure to her that her parents-her father in particular-were recognised when Aboriginal Hostels Ltd established a fringe dwellers camp at Parkstone, just out of Kalgoorlie, which is a very valuable facility and provides continuing assistance for the many desert people who come into Kalgoorlie. I like to think of that as one of the many monuments which reflect the contribution made by Gloria Brennan, by those who are related to her and by her many friends. It is a particular tragedy that Gloria died at such an early age. She was a notable person, a great contributor and a woman of great spirit. She never left me in any doubt that she did not share my politics but we certainly shared many interests and some very good times together. I have very great pleasure-although some sadness of course-in supporting the remarks of Senator Giles. My political approach may be different but I hope that many thousands more Gloria Brennans come from the Aboriginal community. The emergence of people of her quality, determination and spirit is essential if Aboriginal people are to have the place in Australia that they deserve. Senator MICHAEL BAUME(New South Wales)(10.41) —Tonight will probably be the last opportunity many of us will get to address the Senate-I suppose some will say: `Thank heavens for that!'-before the Christmas recess. I would like to take this opportunity of saying a few things briefly. Firstly, this is an exciting and stimulating chamber. One certainly has opportunities of becoming much more involved in the operations of government, examining those operations, asking questions about them and discovering the extent to which those questions can remain unanswered. Nonetheless I must say that it is a chamber I have found immensely stimulating. However, I will briefly raise three items. Senator Gareth Evans —You will get over it. Senator MICHAEL BAUME —I do not have to stimulate myself. Senator Short —I hope you do not get over it. Senator MICHAEL BAUME —I thank the honourable senator. I do not have to stimulate myself; I am stimulated by the environment here and the many issues that we have the opportunity to take up. Before this session finishes, I would like to mention in passing that one of the disappointments I have had has been the failure of any government response to the matters that Senator Reid and I raised over Bowen Island, where the Government involved itself in immense expense from 1 January this year to provide an inadequate service protecting the fairy penguins that are on that island by throwing out the leaseholders and providing some kind of alternative supervision. Heaven knows what it is but it is certainly inadequate, judging from the management action plan that I have now got hold of from the office of the Minister for Territories (Mr Scholes). It is totally inadequate, totally unsatisfactory and involves a set of proposals which, had they been serious, should have been in operation for many years. Ninety per cent of that island is under the control of the Department of Territories. Yet all of a sudden, when it gets rid of the leaseholder, who has looked after the island so well for 30 years without any public criticism-there is certainly no substantiated criticism from the Department-we now find a management plan which is ludicrous. It talks about developing longer term programs for managing more widespread and persistent species-kikuyu in particular-to monitor rabbit control programs, control rats and other feral animal species. If the Department has not been doing this all the time it damn well should have been. To use the need for a coherent management plan as part of its devious desires to get rid of the people who have been looking after the island for so long at no expense to the Commonwealth indicates a level of arrogance and incompetence within the Department which is absolutely appalling. I will not keep the Senate long. It is a shame that the people who have done so much to keep the island in good shape will be deprived of its pleasure. I am reminded of one matter. It is extraordinary that in a sanctimonious way the Department now says that it is going to initiate the control and removal of foreign plant species. The lessees have been complaining to the Department for years about the bamboo stands that have grown on the island; the lessees are not allowed to take any action on this matter. But now that at last the Department is throwing out the lessees, it says that it is a matter of such major importance that it has to throw out the lessees to do it. What utter bunkum! I come to the second matter I wish to raise. I hope that the Government will take some note of the very many petitions I have been submitting to the Senate on the Government's plans to force WIN4, the local television station in Wollongong which extends to the Victorian border, from VHF to UHF. This is a disaster for many people in the region, particularly those who cannot afford the conversion necessary, involving $110 or so for an aerial, and it is an even more expensive conversion for those who do not have UHF receivers. I have received from WIN4 the detail of a survey done by the Illawarra Regional Information Service into the attitude towards UHF transmission. The findings are summarised as follows. Only 3.4 per cent of households in the region have installed UHF aerials, 2.6 per cent since the introduction of the local SBS Program. About 82.5 per cent currently have unacceptable or no reception of Channel 59/44-that is, UHF. Some 43.7 per cent of households will not install UHF receiving equipment, regardless; the majority of these do not presently receive or have the capacity to receive Channel 59/44. Further, 52.3 per cent of households able to receive SBS on 59/44 said that their reception was not as good as Channel 5A/2. The television station comments in this way. It is now evident that the public at large is not enthusiastic towards UHF and is thoroughly confused as to its implementation. Although we recognise that these results may be affected by the special programming nature of the SBS-- which is the only UHF programmer in the region-- it is clear that the public response to UHF is not positive; indeed if the Illawarra went totally UHF with five channels at Knights Hill and another 5 at Brokers Nose mayhem would reign supreme and the viewer would continue watching the readily available, easily identifiable, Sydney VHF transmissions. I conclude that the Illawarra must in the main be served by VHF transmissions. To do otherwise, especially a total UHF solution, will result in considerable loss of audience with consequential loss of viability. That is to WIN4. The Illawarra would lose its local station. As you are aware commercial television derives its revenue from the sale of airtime and rates are set dependent on audience numbers. The results of the IRIS research simply mean that if WIN is forced onto UHF, revenue will drop by over $4m per year. The UHF option requires most of the 111,700 television households in our viewing area to instal a UHF antenna and 20 per cent of them to instal a down converter. The approximate cost, installed for a down converter is $150 and antenna, $110. The total cost for our community to continue viewing their local station: $15.3m. I am hopeful that the Government will take notice not only of the many petitions-over 1 000-I have presented in the last couple of days, but also of the very many letters that are now being sent to the Government on this matter. I raise one other matter briefly. I have a very good friend, Mr Ron Saw, with whom I used to work. He is a journalist on the Bulletin and has asked me to draw the attention of the Senate to a problem he suffered. He in fact suffered a stroke. He has advised me of some information of which I think the Senate should be aware. This information is that on the basis of studies by health authorities in Australia, some 31,000 people can be expected to suffer a stroke each year in Australia. Of these, approximately one-quarter-nearly 8,000 people-will become stroke victims before the age of 65-that is, during their working lives-and half of the victims will be aged between 65 and 75. Of those people who suffer a stroke, approximately one-third will die within three months of the attack, but this leaves two-thirds with a residual handicap that they and their families must learn to cope with. At any time there are about 180,000 stroke victims in Australia. Of these, some 1,600 will be in acute care hospitals, 16,400 will be in long term care institutions, and 160,000 will be at home but will be requiring help from either day care centres or day hospitals, rehabilitation help or home support. I have a letter from Mr P. G. Newton, a Director of the Australian Brain Foundation, whom my friend Ron Saw asked to contact me, which states: Extending the United States research figures to Australia, stroke and its effects is estimated to cost the Australian community from $1 billion-$2 billion a year. More significantly, a reduction in the incidence and prevalence of stroke in Australia to the American levels would save several thousand deaths per year and significantly reduce the residual level of suffering in the community. The following is the part that I want to stress: The Australian Brain Foundation has received from the Federal Government, a grant of $68,000 for the 1985-86 year to assist the Foundation with its stroke program. The booklet, `Understanding Stroke', was produced with the help of this fund. In addition, the Australian Brain Foundation is endeavouring to raise funds to help launch programs in the following areas: Education Prevention Care and Diagnostic Procedures Aftercare-in hospitals and at home Rehabilitation. Apart from the grant noted above, the only funds available come from private donations and these so far are quite inadequate . . . As stroke is the third major killer after heart attack and cancer, I think-the Senate would no doubt agree-it should receive greater attention. I simply draw to the attention of the Senate the fact that, as Ron Saw has pointed out to me, many other health problems receive great media attention and cause great excitment, yet stroke is one of those that seem to slip by. Most families in Australia have a member who has suffered a stroke. My mother suffered a stroke at one stage. I think all of us certainly should have some concern about this difficult health problem. It is not difficult so much because it kills so many people but because it immobilises so many people, who then become problems to themselves and to their families. I make the point which Ron Saw made in an article, that death at the rate that I have just discussed makes the acquired immune deficiency syndrome seem to be no more than a passing epidemic of piles. Ron Saw obviously feels strongly about this matter. He has triumphed over this problem and no doubt feels angered by the enormous media attention to AIDS, which perhaps is excessive in relation to the lack of attention that stroke is getting. I hope that the Australian Brain Foundation is fortunate in its future activities and can attract wider public support and sympathetic support from the Senate. Mr Acting Deputy President, although it is a day premature, in case I do not get the opportunity later I wish all honourable senators, you and, of course, the Clerks a very happy Christmas. Senator TATE(Tasmania)(10.55) —I want to refute some allegations made by Senator Kilgariff which are of a quite serious nature. He made them during the opportunity that is provided during the luncheon period to make speeches of a non-contentious character, as they are normally called. He launched what I regard as a very ill-founded attack on the Catholic bishops of Australia in relation to the recently published document Work for a Just Peace subtitled `Reflection on Peacemaking in an Armed World'. On the back page, the document states: Work for a Just Peace has been prepared by the Catholic Commission for Justice and Peace as a contribution to dialogue in the International Year of Peace. It goes on to state: Work for a Just Peace has been approved for discussion and reflection by a more than two-thirds majority vote of the Catholic Bishops of Australia. I emphasise, of course, that it is a document circulated for discussion and reflection. It is certainly not a doctrinaire document and does not purport in any way to be binding. Before I make my comments I must reveal my interest, in case somebody tries to show later that I was overly partisan in my remarks. But I hope that they are objective. It is a fact that I was an early member of the Catholic Commission for Justice and Peace when I was appointed by the Archbishop of Hobart before entering the political arena. Senator Kilgariff's speech, which can be found in the Hansard record of proceedings, sometimes under the guise of inquiry and so on, nevertheless made some very serious allegations and innuendos. He suggested misappropriation of funds in order to sustain the activities of the Catholic Commission for Justice and Peace and deceit as to the support of the bishops conference in relation to the publication of the document. They are very grave allegations. It is worth noting, as I wish Senator Kilgariff had done, that his allegations-in fact, the very tenor and sometimes the very language of his allegations-bear a very remarkable similarity to a television program which I saw on Sunday when Mr Bob Santamaria made very similar comments and attacks. I find great similarities in the actual language of articles published this week in the Australian. Whilst Senator Kilgariff noted that media reports have aroused his concern, I think it might have been helpful if he had indicated for readers of the Hansard where they might find those media reports and under whose pen they were written. The key paragraph with which I want to concern myself relates to the twofold allegations that I have mentioned. I will not go into the terms of the actual document, although I could. The fact is that the document, as I have said, is distributed for `Reflection on Peacemaking in an Armed World'. The fact is that I do not agree with all the conclusions either, nor is that surprising. For example, I have made it very clear in speeches I have made that I believe the Catholic doctrines of a just war theory would support the ANZUS Treaty and surveillance and monitoring facilities such as those at Pine Gap and Nurrungar if, indeed, that is what they are carrying out, as we are told they are. I believe that they are playing an important part in providing a system of deterrents. I have grave doubts when that theory is applied to the question of North West Cape, which serves a quite different purpose. These are matters of legitimate disagreement and I do not intend to go into those today. But I completely refute the statement made by Senator Kilgariff in relation to the substance of that document. On page 5 of the speech as circulated-of course, I do not know where it will appear in the Hansard-He said: Given the content of the publication I find this-- he is referring to the question of support from the bishops-- quite surprising. The report of the Commission clearly supports the unilateral approach--- That is quite untrue and quite incorrect. It is a gross travesty of the approach of the document. For example, looking at page 27 of the document, general principles are outlined. To save time, I seek leave to incorporate in Hansard about a dozen principles which are set out. Leave granted. The document read as follows- TO RE-APPRAISE WAR The view of the Catholic Church on all the specifics of modern warfare is still developing and at times unclear. The elements of a general position can be described with certainty, however. Peace cannot be limited to mere absence of war. Nations have the right to defend themselves and others against injustice of the utmost gravity, although such defence need not be based on violence. Violence can only be accepted as a last resort, if at all. Nuclear deterrence is accorded only conditional and provisional moral acceptance as a means towards total disarmament. Any act of war aimed indiscriminately at the destruction of entire cities and large populations is a crime against God and humanity. No use of nuclear weapons is acceptable. Disarmament must be mutual, balanced, gradual and verifiable. Within this, there is room and need for independent initiatives to build mutual trust. The just war conditions of discrimination and proportionality are very difficult, if not impossible, to satisfy in modern warfare. Pacifism is a valid Christian option. Conscientious objection to all war and to particular wars and acts of war must be recognised and protected by governments. Senator TATE —I thank the Senate. I wish to highlight two points which state: Disarmament must be mutual, balanced gradual and verifiable. Within this, there is room and need for independent initiatives to build mutual trust. On page 33, after several pages of discussion, talking about the ANZUS alliance, which I know is a matter of great concern to Senator Kilgariff, he said: The Catholic Commission for Justice and Peace considers that the time has come for Australians to reappraise their relationship with the United States in the hope that this will lead to further Australian initiatives to promote gradual, mutual, balanced, verifiable disarmament. Through the alliance, Australia is part of defence strategies which may involve us in violence against others. There is therefore a moral obligation to ensure that the strategies and their consequences are just. I think that this gives some of the true flavour of the document, which is certainly not unilateralist although it does speak of the need for independent initiatives and unilateral steps along the way to building trust towards mutual, verifiable disarmament. But it is to the main allegations that I wish to address my comments. The key paragraph in Senator Kilgariff's speech is to be found at page 6. I need to read it. He said: The other matter which must be mentioned in relation to this document is that there seems to be some doubt as to just how many Catholic bishops have approved the document for discussion. There have been reports indicating that less than one-half of the 44 Catholic bishops responded to the Commission's inquiries on the paper. Twenty voted for the paper and one voted against it. The remaining 23 who did not respond at all were taken to have given their approval. If this is the case, it seems to me that the Commission is guilty of gross misrepresentation, and the Catholic bishops should move immediately to clarify the situation. To return to that major paragraph, he said that `there have been reports indicating'. There are no second guesses as to where those reports might emanate from. As I say, there is a striking similarity between the very language of Mr Bob Santamaria in his television performance on Sunday, which I happened to view, and the newspaper articles which followed during the week. The ambiguities inherent in this paragraph are really the work of a master propagandist. He said: The remaining 23 who did not respond at all were taken to have given their agreement. There is a very clear inference there that the Commission grossly misrepresented the actual voting pattern to concoct artificially a two-thirds majority to give this reflection document a semblance of episcopal blessing. That is completely out of accord with the truth. The bishops themselves in the episcopal conference earlier in the year decided on a voting procedure. The agreement recorded by their conference resolution was that a reply as to whether the document should be circulated for reflection could be given in writing by a stated date saying yes or no to the distribution. If there were no written reply, that non-written reply would be regarded as assent, as a positive affirmative vote. That was the voting procedure that was established. In other words, the bishops devised this method of voting. They received the draft, I think, on about 15 June. The deadline for their reply was 21 July; that is, they had over a month to assess whether it should be circulated as a reflection document by the CCJP. The voting procedure, having been agreed upon by the bishops themselves, was then put into operation and, if Senator Kilgariff and Mr Bob Santamaria are correct in their numbers-I will come to how they might be correct in a moment-43 bishops assented to this document being circulated and one did not. Twenty of those 43 bishops took the trouble to submit their assent in writing. It is quite false and misleading to say, in Senator Kilgariff's words, that the others were `merely taken to have given their assent'. By resolution of the conference they did give their consent, though not by submission in writing. Really I think the honourable senator, for whom I have a great deal of affection, has been misled by Mr Bob Santamaria's article in which he portrays the 20 bishops not merely as having not submitted written responses but as having abstained-the word used in Mr Santamaria's article. They never did abstain from voting; they merely did not submit a written answer. That was provided for in the voting procedure devised by the episcopal conference. So there are no assumptions or contrived results or gross misrepresentation by the CCJP as to the two-thirds majority. In fact, it would be very peculiar if the CCJP could misrepresent the episcopal conference's vote. After all, the President of the CCJP is Bishop Warren. There are two other bishops on the CCJP. All of the ordinary members of the CCJP are appointed by bishops. The four co-opted members are appointed by the Committee on Development and Peace of the Bishops Conference. So it is very unlikely that there would be gross misrepresentation by the Commission, on the back of its document of the two-thirds majority vote of the Conference. As I say, it needs to be asked how this could be queried anyway, because the CCJP, as I understand it, was never entitled to know the actual voting numbers within a episcopal conference. It was never sought and it was never given it. I am sure the episcopal conference never envisaged that the actual votes would ever be revealed. So Mr Bob Santamaria's informant bishop, whom he quotes in his article in the Australian and on which Senator Kilgariff must rely, because he takes the same voting numbers, regrettably is an example of a bishop-if it not be a fiction of Mr Santamaria's imagination-who has leaked details of the voting within the episcopal conference. Senator Bolkus —We should have him in Caucus. Senator TATE —As Senator Bolkus comments this is something that is obviously not confined to secular caucuses but extends to those of more sacred character also. Not only has he leaked, but he has mischievously leaked, a completely wrong and false impression of the significance of the way in which the vote was conducted. That is a very regrettable reflection on the bishop concerned. Senator Sheil —Do you know the figures? Senator TATE —I do not, and I do not claim or assert that those figures are correct. I am merely saying that if what Mr Santamaria and Senator Kilgariff claim are the figures, they come to a quite different conclusions when analysed in the light of the episcopal conference resolutions. The second charge I can deal with more briefly, and that is to be found on pages 7 and 8 of Senator Kilgariff's prepared speech, where, amongst other things, he says: But to find a quarter of a million dollars of the money given, to Project Compassion, for example, is used to fund the Commission for Justice and Peace has given many Catholics, both lay people and priests, great cause for concern. The Administration of the church must realise that we are not living in the Middle Ages. We are living in an age of public and financial accountability. . . The refutation of that is quite straightforward. One would have expected any decent person raising that sort of allegation at least to take the step, perhaps, of getting the annual report of the CCJP, where one would find that it clearly stated that the source of funding for the CCJP is the Bishops Conference itself. Senator Sheil —So what? Senator TATE —The Catholic Commission for Justice and Peace does not have, as is insinuated by Senator Sheil's question `So what?', some cosy, behind the scenes deal with the Australian Catholic Relief whereby, by some behind the scenes fiddling of the books, it somehow gets a transfer of a quarter of a million dollars that no one knows about, that is somehow hidden from the public gaze in some mediaeval abscuring of the accounts rather than by public accountability. The fact is that the Bishops Conference itself takes responsibility for the finances of the CCJP, as one might expect from the close organic link I outlined earlier. Senator Kilgariff —Was there a transfer of funds? Senator TATE —From where to where? Senator Kilgariff —From where I said to where I said. Senator TATE —The transfer of funds is from Project Compassion to the Catholic Bishops Conference. That Conference then decides to which works that will be devoted, and amongst the matters to which they devote the funds is the Catholic Commission for Justice and Peace. That has always over the years been acknowledged and known, published and publicised within the Catholic media. Indeed, I think it is contained in a good deal of the material circulated by the Project Compassion people when they mount their Lenten appeal. Certainly the Australian Catholic Relief organisation has audited accounts and makes the whole process very clear. Indeed, the CCJP has audited accounts which it submits to the episcopal conference, and they are available too. So fundamentally Senator Kilgariff's attack on the bishops as being medieval and not engaging in public accountability for these matters is quite unjust and unfounded, and it attributes to them a dishonest manipulation of gullible Catholics contributing to the Project Compassion funds which, as I say, flies in the face of the reality that Catholics who have been interested in these matters over many years know the relationship between Project Compassion, the bishops and the Catholic Commission. As I say, I do not intend to go into the substance of the document. That would be for another debate. But I felt it important that on the same day that these allegations were raised about gross misrepresentation of the support of two-thirds of the episcopal conference for the circulation of this reflection document, and against the allegation that the bishops were engaged in some sort of medieval hoodwinking of the Catholic people, the facts should be laid before the Senate for consideration by those who wish to take up Senator Kilgariff's speech. Senator KILGARIFF(Northern Territory)(11.10) —Is Senator Tate coming back to the chamber or not? I was merely going to say-- Senator Tate —Mr Deputy President, that will go in the Hansard as though I walked out on Senator Kilgariff. Senator KILGARIFF —The honourable senator did. Senator Tate —I had no notion from the list circulated that the honourable senator was next on the list. In fact, my list says Senator Vigor, Senator Vanstone and Senator Evans. Although the honourable senator's name appears at the bottom of the list, it is struck out. The DEPUTY PRESIDENT —Order! Senator Tate —I came back as soon as I realised that the honourable senator was on his feet. The DEPUTY PRESIDENT —Order! This is not a point of order. Senator Tate —That is a completely unjust allegation. Senator KILGARIFF —If it is an unjust allegation, I take back what I said. Senator Tate told me tonight that he would be raising certain things during the adjournment debate. I remained in the chamber to hear what he had to say. As the honourable senator raised certain matters in his speech, I exercised my right to reply immediately. But that is by the way. I have a high regard for Senator Tate and the various matters he raises in the Senate-issues such as the Philippines. At midday today I said certain things in the Senate. All I want to say now is that whatever Senator Tate said tonight does not alter the facts of the matter whatsoever. Senator Tate and I have certain affiliations with the church. Letters in the Press, such as in the Australian, and articles in so many papers throughout Australia from people within the church have indicated concern at the present situation. I think Senator Tate would probably acknowledge that there is concern. As a member of the church to which Senator Tate belongs I felt because the matter has been aired so strongly in the media, that I too should express my strong feelings and the feelings that have been voiced to me by members and clergy of the church. This is the first time that I have heard Senator Tate or, for that matter, anyone within the Catholic Church challenge Santamaria, who is a person of very high principles and very strong character. He has said many things recently-in fact, he says so many things week by week and month by month. It is not too often that what is said by Santamaria is refuted whether by the left wing of the Australian Labor Party or whatever. I suppose that members of the left wing know that if they challenge him they will come off second best. But that is by the way. I acknowledge that to some degree I have used what B. A. Santamaria has said. But why is it that I am being challenged because I have publicly indicated my strong feelings? Why have not Senator Tate and the people within the church challenged Santamaria before? All I am saying to Senator Tate tonight is that I think he is splitting hairs. I think what Senator Tate has done is to confirm what I have said. I said that the thing that concerned me and so many people was that this was a Lenten appeal when people around Australia were requested to give to the poor, the destitute, the refugees-all those people to whom I referred in my speech today. I do not have the figure, but it has been indicated that $2.4m was raised. Why is it, when such funds are raised to bring relief to those people, that funds have to be transferred, as they have been-I understand Senator Tate has said that they were transferred by authority-for some other use? I have nothing further to say tonight, Mr Deputy President, but I assure you that if this issue becomes dominant in the next week or two-- Senator Tate —You brought it up; I didn't. Senator KILGARIFF —I have not brought it up. I am merely indicating to Senator Tate and to others that through the Australian media the people of the land are questioning and showing disapproval of things that are happening. Those people have the right to express their opinion. I am merely picking up their opinion and expressing it in the Senate today. I believe I have that right. If it is the honourable senator's wish, I will have more to say about it. I am saying that I want nothing more than a reply from those people who administer the funds as to why $250,000 was shifted from the appeal for the destitute for the operational expenses, as I understand it, of a certain organisation. The honourable senator has said that I have used a particular person's name, and that was the name of B. A. Santamaria. To some degree I used his article in the Australian of 3 November, and I have a copy of the article here. It has been made public; everyone has seen it. In order to support what I have said, I ask that this article be incorporated in Hansard. Leave not granted. Senator KILGARIFF —I now have 22 minutes left in which to read it. What a drip the Minister is. Senator Bolkus —That is unparliamentary language. It should be withdrawn. Senator KILGARIFF —For God's sake, what a stupid thing to have done. Mr Deputy President, the Senate can settle it while I read this article. The article appeared in the Australian on 3 November 1985 and is headed: `Deceit as practised in the name of peace'. The sub-heading is: `Politics: a personal view by B. A. Santamaria'. In the centre of the page a heading reads: `Essentially fraudulent claims raise a question of elementary honesty'. Senator Sheil —Mr Deputy President, I ask that the request for the article to be incorporated be resubmitted. The DEPUTY PRESIDENT —Is leave granted? Leave granted. The article read as follows- DECEIT AS PRACTISED IN THE NAME OF PEACE Politics: a personal view by B. A. Santamaria Essentially fraudulent claims raise a question of elementary honesty In a kind of way, history was made in Australia during the past month. The American embassy in Canberra took the hitherto unprecedented step of writing a strong six-page letter protesting against a document on nuclear issues recently prepared and published by the Catholic Commission for Justice and Peace (CCJP). When the latter body replied, the American embassy did not let the matter drop, but restated its position, developing its arguments further. The CCJP is obviously pleased that it has been taken so seriously by the United States. Whether the Catholic bishops who appoint its members and finance its activities to the extent of a quarter of a million dollars annually should congratulate themselves equally is another question. The Catholic Commission's document, ``Work for a just peace: reflections on peacemaking in an armed world'', simply falls into the category of the familiar attacks made by the extreme Left in Australia on the general Western policy of preparedness to meet a possible military attack by the Soviets. The CCJP covers itself by using a few mildly critical words against the Soviet Union. The impact of its whole statement, however, as of all the CCJP's statements on these questions over the past decade, is anti-Western and particularly anti-American. On the present state of the nuclear question, it attacks President Reagan's policy of building an anti-missile defensive screen. It alleges that President Reagan's SDI (Strategic Defence Initiative) program is not aimed at defence but at offence. If SDI is not permissible, the only alternative is to continue the present policy of deterrence. Yet the statement itself clearly implies that deterrence itself is intrinsically immoral. If both SDI and nuclear deterrence are excluded, what logically follows is that there is no acceptable policy other than unilateral disarmament, regardless of what the Soviet does: neither the Pope, nor the American bishops, let alone the French, the German or the Italian bishops who have all made statements on this question, have adopted such a position. It has been adopted only by the Australian body. As far as Australia is concerned, the statement supports the New Zealand position in fragmenting the ANZUS alliance, and demands that Australia should tell the US to take its installation at North-West Cape away unconditionally, as well as the installations at Pine Gap and Nurrungar, unless the Americans hand their control over to an international authority, which, of course, they cannot possibly do. It is thus demanding that Australia leave ANZUS as well and follow the same kind of neutralist course as New Zealand. That is what the document means in theory and practice, despite all the hair-splitting. The document, of course, would not have excited any notice unless it seemed to have the authority of the Catholic bishops behind it. The lay members of the commission are completely unknown to the Catholic public who have never had any say in their appointment, although the Catholic public contributes the money which maintains them. It is fair to say that not one Catholic in 50,000 would even have heard their names. The document derives its authority from a single statement that it ``has been approved for discussion and reflection by a more than two-thirds majority vote of the Catholic bishops of Australia''. On the authority of that ``more than two-thirds of a majority vote'', its contents have passed into the Catholic schools system, where it is presumably learnt by children on the basis of that authority. Any criticisms are immediately attacked as coming only from ``extremists''. In substance, that claim of approval by more than two-thirds of the bishops is fraudulent. When I put the question of whether two-thirds of the bishops had actually approved the statement to one bishop, he replied: ``Contrary to the persistent claims by the CCJP and its supporters that two-thirds of the Australian bishops approved the 1985 statement of the CCJP. `Work for a just peace', I affirm that this is not so, and I categorically deny that two-thirds of the Australian bishops gave a positive approval to such a statement.'' What happened was this. There are 44 Australian Catholic bishops. Twenty-which is less than half (let alone two-thirds)-voted for it, which is bad enough. One voted against it. Twenty-three did not vote at all. For a variety of reasons, they abstained. But since the supporters of the statement in the episcopal conference last May had pushed through a resolution that any bishop who had not replied, indicating his view of the statement, by July 30, should be recorded as a positive vote, the claim was made that the statement was approved overwhelmingly. In the less august world of trade unionism, such a procedure would call for a court-controlled ballot. Since the CCJP has knowingly involved the vast mass ofCatholics who maintain it, in an attack on Australia's relationships with the US, since children in Catholic schools are to be brainwashed with this policy on the fraudulent claim that it is supported by more than two-thirds of the bishops, it becomes inevitable that a further issue must be raised. The people who, each Lent, contribute more than $2 million to Project Compassion, the Catholic Lenten collection for overseas relief, do so in the belief they are helping the poor. I have heard that claim made from several pulpits. A quarter of a million dollars of that money goes to maintain the CCJP, an expenditure which has no relationship whatsoever with helping the poor. Other quite dubious expenditures are made: for instance in relation to certain projects run by the Cambodian Government. Surely there is a question of elementary honesty in this, as there is in making esentially fraudulent claims as to the number of bishops who voted for the statement, as distinict from abstaining. Two years ago, when a group of Catholic parents protested to Cardinal Gagnon, now president of the Pontifical Council for the Family, at the widespread disobedience in Catholic schools to the norms established by Pope John Paul II in the matter of sex instruction, the cardinal referred to the obligation of the ordinary faithful to ensure obedience. It is a desperate situation. But when-despite repeated, fruitless representations-the authority of the bishops is finally used to attack the security of Australia, desperate ills call for desperate remedies. Senator KILGARIFF —Thank you, Mr Deputy President. Senator Gareth Evans —You were having so much difficulty in reading it that it was embarrassing to us all. Senator KILGARIFF —I am afraid that Senator Evans does not really assist the situation. Senator VIGOR(South Australia)(11.20) —I rise to canvass several problems concerning Australian National and the country railway services of South Australia. I want to talk especially about the future of the vital country services within my home State. I also want to talk about those services currently under threat from Australian National's myopic policy of concentrating almost solely on the long haul bulk freight market. I believe that this is almost Lord Beeching revisited, and it is a very short-sighted policy. It is very important for South Australia to maintain its country freight and passenger services, not only in wagon load traffic but also in LCL traffic-less than car load traffic-which must be further fostered and promoted if the railways are to operate effectively. Rail is a competitive force in country transport, and closures have added and will continue to add significantly to the transport costs of country people. For example, the railway unions have calculated that when the Balhannah to Mount Pleasant line through the Adelaide Hills was closed, freight costs in that area increased by 250 per cent. Rail is a good form of transport. It creates less damage to the environment than does road transport, and it is considerably more energy efficient. Heavy road transport will travel over country roads a lot more often if we happen to close country lines, and this would be to the enormous detriment of the roads which are not particularly well designed to carry this very heavy traffic. The increasing wear and tear on the country roads, which are already in quite a poor state, is a real liability to country and rural councils. Any pronounced increase in heavy road traffic would require a massive injection of funds from the Federal Government, which currently it does not appear to be willing to give. The situation would be even worse if Australian National were to continue to close grain lines, particulary those rail lines which serve co-operative bulk handling silos. Recently, one of my constituents drew my attention to the fact that Australian National was running down services on one such line-the Monarto to Cambrai line-perhaps in an attempt to close it. Farmers served by the silos at Cambrai and Apamurra still believe that the line will be closed and that road transport will be used by Australian National to fulfil its obligations to co-operative bulk handling. The line between Monarto and Cambrai was temporarily closed this year because of safety problems with one of the bridges and also the poor standard of sleepers. During this time road transport was used to clear the silos. Road transport took approximately 5,000 tonnes of grain from Cambrai and Apamurra to local mills and to Port Adelaide. This had a considerable effect on the roads. The trucks which travelled through the winding hill roads have had an enormous effect on them, and the road from Mannum has deteriorated considerably. It is riddled with potholes along its sides. The road between Apamurra and the main Mannum road, where the semi-traliers turn on to the main road, was completely torn up. It is now in an appalling state, and the Mannum District Council will have to repair it at great cost. On this occasion, Australian National seems to have seen some sense and it has started to upgrade the line so that trains are now being safely run on it for those people who are going to the grain silos. During the harvest season two trains of 15 cars long depart from Apamurra filled with grain. The situation is similar on the Tailem Bend to Peebinga line; it is also being run down. During last year's harvest three trains a week were running on this line. Catastrophic damage to local roads will result from the line being closed down. Country rail freight can and must be retained in South Australia. There is a strong economic need for this, if one looks beyond a narrow cost analysis accounting which the railway is following and using. It must also retain country rail passenger services. Rail can be made profitable through imaginative and enthusiastic promotion. Australian National's interest in any passenger service can only be described at best as lack-lustre and unenthusiastic and at worst as just plain destructive. The situation in New South Wales, however, is very different. In that State television advertising aggressively promotes the country services. The standard of services has improved and through better catering and staff training, according to the New South Wales State Rail Authority annual report of 1984-85, it has had major increases in passenger use of the service. In the Australian National Railways Commission annual report of 1984-85, AN announced that it has started promoting interstate passenger travel by improving interstate on-train services. I believe this is a very good thing. It has announced also plans to improve passenger facilities on the famous Indian Pacific and Trans-Australia trains and to promote these services extensively through television advertising. However, unlike these interstate services, country passenger rail services have not been properly promoted. In fact, they have sometimes received very bad publicity. No wonder the number of passengers has declined. After AN announced that it was closing the Peterborough service, there was a 49.5 per cent reduction in the number of passengers on that service. A typical example of AN's attitude to a country rail passenger service is the case of the Victor Harbor line. I will come to that in a moment. I first want to express concern about what is happening to the Mount Gambier service. A survey was taken in Mount Gambier to determine how many people wanted to retain the service. AN then changed the time-table to make the departure and arrival times more inconvenient. Numerous rumours were started about the service closing and it seems that AN may be moving towards that end. The pattern, unfortunately, is very much the same as what happened on the Victor Harbor line. In January 1984 Australian National announced that it would improve the Victor Harbor rail service. Following this, criticisms were made that the time-table was appalling and the services were almost useless to local tourism. The Friday service left Adelaide railway station at 6.41 a.m. and returned to Adelaide as soon as it arrived at Victor Harbor. The second Friday service left Adelaide at 5.45 p.m., arriving at Victor Harbor at 8.45 p.m. It then left Victor Harbor at 9.10 p.m., arriving back in Adelaide just after midnight when all public transport had stopped. As is widely known, Australian National announced its decision-- Senator Bolkus —I wish your mother had bought you a model train. Senator VIGOR —If Senator Bolkus does not think that rail services are important-- Senator Gareth Evans —No, none of us does. Shut up! Senator VIGOR —I think Senator Evans is showing the Government's attitude towards rail. No wonder Australian National has problems. Senator Bolkus —Mr Deputy President, I raise a point of order. It is quite apparent that Senator Evans does not think Senator Vigor is important; he thinks that train services are. The DEPUTY PRESIDENT —Order! That is not a point of order. I call Senator Vigor. Senator VIGOR —I consider this matter to be extremely important to my constituents. Promises were made by the Whitlam Labor Government, when it bought the rail system from the South Australian Dunstan Labor Government, that country rail lines would not be closed down, but in fact a large number of them have been. If this Government has the same attitude, we have real problems. In fact, Australian National announced its decision to close the service to Victor Harbor on 30 April 1984, four months after the supposed improvement to the service was meant to start. On appeal, the arbitrator found in favour of Australian National but was very critical of its behaviour. Page 6 of Mr Pascoe's determination reads: In several of the written and oral submissions the view was expressed that patronage could have been improved if AN had given more attention to publicity and promotion. There seems little doubt that the promotion of the Victor Harbor Rail Service has received only intermittent attention from management. It is my view that at present fare levels annual patronage might be increased by better promotion. Thankfully, there are people in our community with more flair and imagination than Australian National. They have demonstrated the potential of the Victor Harbor line with the success of 12 Steamranger tours during August, September and October 1984. During this period 9,000 passengers were carried and 4,500 passengers were turned away. Following considerable pressure, the State Government has supported the tourist line proposal. In October the South Australian Government approved the use of the line as a tourist line. The Australian Democrats supported this political action. Steamranger Tours will now run 62 return trips a year. The South Australian Government will fund the upgrading and restoration of the track. I congratulate the South Australian Government and the Federal Government for reaching this decision to return to South Australia its most scenic railway line and for making this railway line available for the enjoyment of the people of South Australia and its valued tourist industry. The service is scheduled to commence in May next year, following the handing back of the railway line to South Australia last Tuesday. Rail travel can survive, can compete and can flourish if we are committed, aggressive and imaginative in our marketing of the service. I strongly believe that it is important that the Government reconsider its position on the Darwin to Alice Springs railway line in exactly the same light. I am disappointed that the Hawke Government so quickly abandoned all thought of bringing together northern Australia with the rest of Australia once Mr John Reeves was rejected by the voters of the Northern Territory. Darwin is the nearest port to our Asian trading partners. With the current deficit and trading problems, it would be very useful for us to have this type of service in that area. With the right sort of enterprise we could forge major new markets and I believe that it is extremely important that the Government consider this matter as soon as possible for the sake of people in my State, for the sake of defence and also-- Senator Gareth Evans —Who do you think is going to take any notice of this? Who do you think is ever going to read what you are rabbiting on about tonight at half past eleven? Why do you bother? Senator VIGOR —Because it is an important matter for my constituents. I would like to finish off by saying that if we look after our trunk rail lines, improve our feeder lines and the interchange between road and rail, we can get an imaginative transport system within Australia. I thank the Minister for his patience! Senator VANSTONE(South Australia)(11.34) —I do realise that it is half past eleven and that there are Christmas parties on in various rooms in this building. I appreciate from the comments that the Minister for Resources and Energy (Senator Gareth Evans) has made that he does not want to be here for much longer. I can inform him that I am of a similar opinion. Nonetheless, I believe that it is my right to say what I want to say. I undertake to be brief and to the extent that it can be made interesting, I will. If the Minister is forced to fall back asleep, I am sorry, but he will just have to accept that I am doing my best. I raise the matter of the Government seeking to bypass Parliament by releasing policies to the media first and then coming into the Parliament. I fully accept that this is a practice that has been undertaken not only by this Government but also by other governments. I am expressing my view-not the view of my Party or anyone else. One very good example of this is the Foreign Minister (Mr Hayden) releasing to the media the code of conduct for Australian companies with interests in South Africa. This might be a matter in which Senator Evans has some interest. I have some interest in this matter. I wrote to the Foreign Minister and asked for a draft copy of the code of conduct to be offered to me on similar terms to those under which it was offered to Senator Missen by Senator Evans. The Foreign Minister wrote back and said that I could not have it on the same terms; I could not have it at all. The code of conduct was released to the media first without Parliament having had the opportunity to debate it first. Senator Evans, who is at the table, might think that that is acceptable. Ministers in other governments might think that it is acceptable. I do not think that it is acceptable. I think it is extraordinary that the Foreign Minister chooses to give one senator a different answer from the answer which the senator representing him in the Senate chooses to give. That is just one example. Another example is that the other day significant changes to government in the Australian Capital Territory were announced, not to Parliament but in a stage managed Press conference. I noticed that Senator Reid drew attention to this matter and expressed regret that it had been done in that way. Senator Bolkus —How else do you expect people to find out? Senator VANSTONE —One could go on-one is tempted to go on by the interjections from the other side of the chamber-with the long list of examples. Nonetheless, as I said, I have undertaken to be brief and I will leave the examples at those two. I have indicated that I do not believe that it is only this Government; previous governments also have undertaken this practice. I also think that the media cannot avoid criticism for the way in which Parliament is conducted and for the invitation that they offer to members of parliament to be lured into their net. The net about which I speak is one that invites senators and members to engage in side-shows, if you like, as though senators and members were here to amuse members of the Press Gallery. It is not my belief that that is the function of senators and members; nonetheless in some cases that seems to be what the media want. I draw the attention of the Senate to an article in the Canberra Times on Tuesday of this week, written by Debbie Cameron, with the headline `Senate is not a sideshow'. She said: The Senate was sitting yesterday without the distraction of the thespian House of Representatives and the public galleries were fuller than usual. What a cruel surprise for the busloads of pensioners and school children shuttled to Parliament House expecting to see a lacerating diatribe from the Treasurer, Mr Keating, or a fumbling impersonation of Max Gillies from the Prime Minister. What did they get? The Senate. It fails miserably as a sideshow. No clowns, no whizzing moments of terror, no giddy laughter and no sparkling spruikers. I simply make the point to Ms Cameron, and I suppose to Ian Warden who wrote an article which has a headline `Knitting in the land of nod', complaining about how boring it was to be covering the Senate, that the function of the Senate is not to be of interest to the Press Gallery, nor should it be. The job of members of the Press Gallery, in my view, is to report to the electors in this country what happens in both Houses of Parliament. If they think that it is boring, I do not mind their saying that it is boring. I do mind the expectation that this chamber and the other place be turned into some sort of side-show. I am tempted to use, and I will use, one other example. I think that it is the most glaring example of the year of the release of a policy to the media before releasing it to Parliament; that was this Government's so-called Priority One: Young Australia policy. We have seen advertisements, similar to the one I found in the newspaper today, with a big picture of the Prime Minister, Mr Hawke-I can understand why the Age refers to him as `Old Silver'-advertising himself yet again and advertising a policy that has not been properly thought out and debated in Parliament. I can understand why it was not debated in the Parliament before it was released, or at least canvassed in Parliament before it was released; the details were not even properly worked out. One can find that out by ringing any Commonwealth Employment Service office around the country and asking what it has in Priority One for young Australians. Any CES office will tell one that it does not have a damned thing; it has just been worked out. It has just been worked out. Old Silver, as Michelle Grattan refers to the Prime Minister, chose to release this policy prematurely to give himself a bit of advertising to create the impression that this Government is doing something about young Australians. That is yet another example of this Government-along with other governments-bypassing the role of Parliament to scrutinise policy. Senator BOLKUS(South Australia)(11.40) —I must admit I am quite stunned by the contribution of Senator Vanstone but I will not comment any more on it. I want to speak very briefly about a superannuation case that has been presented to me. I do so in the context of the debate that is going on at the moment about who is competent and responsible enough to handle superannuation funds. It has been contended in this place and also publicly that the trade union movement is not competent to do this. The point I wish to make tonight in highlighting a particular instance of a constituent, not of mine but someone in Victoria, is that the trade union movement may be a more responsible body to handle superannuation funds than those who have been charged with the specific responsibility to date. I raise the problem relating to the late Ian Macquarie, who died recently leaving three children all under the age of 14. He died after many years of work with his company. He stuck with his company after a takeover and worked for it assiduously and consistently. On the termination of his employment his superannuation payout was calculated. His family received $104,000. The problem is that there is a disputed amount of $8,000. One might think that $100,000 is enough and $8,000 should be seen as petty cash and not be argued about. But to a mother of three children left to guard and look after her children and bring them up it is obvious that $8,000 is, and will be, important to her. What is disputed in this case is the date of termination of employment. Ian Macquarie was entitled to four times his eligible salary at the date of total and permanent disability. Under the superannuation agreement and trust deed that was operating in his case, the trustees of the deed deemed his date of ceasing active employment as 16 January 1984. On 20 September 1984 they wrote a letter to that effect. However, after that date Ian Macquarie went to work, was tested for employability, and continued working. The main reason why the trustees saw 16 January 1984 as the date of termination of employment was that Macquarie soon after that date signed a declaration stating that he felt that he was unable to work as from 16 January 1984. It should be noted that he signed the declaration at a time when he was totally distressed. He had just been advised that he was dying of cancer and as a consequence his mental stability was diminished. However, having signed such a form, he was allowed to go back to work. As has been acknowledged in correspondence from the FSE scientific superannuation plan, he was able to go back to work and in fact worked until 25 May 1984. Ian Macquarie declared that he was unable to work on 16 January 1984. He did not declare that he was totally and permanently disabled on that date. By his employer's later actions it is quite apparent that they felt there was some chance he was able to to work after 16 January. In correspondence of 20 September 1984 the FSE stated that Mr Macquarie's employer subsequently terminated his employment on 25 May 1984. This date is important because the difference of those four months means that an amount of $8,000 has been denied to the widow and children of Ian Macquarie. So, let me restate: Ian Macquarie was allowed to go back to work. He was tested by the company over a period, and then his employment was terminated. There was obviously some doubt, for four months, as to whether Macquarie could go back to work. There was obviously some doubt as to whether he was totally and permanently-I stress the word `permanently'-disabled for employment. That point was obviously known to the company and to the trustees of the superannuation fund. It also should be noted that in correspondence to Senator Cooney dated 11 September 1985, it was recognised by the trustees that the date of disability was the date active work ceased. Let me restate that Ian Macquarie worked to 25 May 1984. Let me also state that in a report dated 1 March 1985, Macquarie's doctor declared that Macquarie was fit to return to work in April 1984. What we have here is a situation in which the trustees-in this instance people who are directly, and probably with vested interests, involved in the operation of the company and the trust-have declared that Macquarie's eligible salary for the purpose of calculating superannuation was that accrued at 16 January 1984. Despite the fact that Macquarie went back to work, and despite all the other considerations I have mentioned, they denied that he was employable up to May 1984. As a consequence, his widow has been deprived of $8,000. This decision by the trustees of the fund is a wrong one. In fact they have miscarried their duties, in my assessment of the situation and also on my reading of the fund. They have, in fact, relied on the technicality of the signature when, under the responsibilities of trustees, they should act both honestly and reasonably. In doing so, they would have recognised that Macquarie had returned to work, that his employer took him back on a trial basis, and that the declaration made by Macquarie, an error of fact, could not have been relied on by them as being fundamental in their decision making. They should also have recognised that his period of re-employment should have dissolved the effect of that declaration, signed by him, stating that he was not fit for work on 16 January. What we have are trustees acting not honestly and reasonably but technically and outside the spirit of the trust and of operating legislation. As a consequence, we have them operating in the interests not of the beneficiary but soley in the interests of the companies involved in the trust. As a consequence, we have employers' representatives not acting fairly in the interests of the employee. Let us look at that in the context of the debate we have had today and in recent days in terms of superannuation trusts. I do not believe that the workers of this country ought to be at the whim of capricious trustees of trusts such as this one. I believe that Ian Macquarie's widow and children are entitled to the money. I believe that for the trustees to act behind a technicality is neither honest nor reasonable, and is a breach of their trust. I believe that the trustees have an obligation to review their decision once again. In closing, let me say that I have tried today to contact Mr Townsend, a person who is a trustee of the fund, but without success. I will be contacting him in the next few days to alert him of my speech tonight and ask him to reconsider this decision made by the trustees. It is quite unfortunate that this position has been taken and has been adhered to by the trustees, but I hope that in the spirit of reasonableness they will review their decisions. Senator PETER RAE(Tasmania)(11.50) —I wish to speak very briefly in relation to the Australian Film Commission's annual report for 1985, which, notwithstanding the fact that my esteemed friend, as I would like to call him, Phillip Adams, is its part time Chairman, has done something which I regard as a matter which ought to be brought to the attention of the Senate and questioned. I have taken a considerable interest over a large number of years in the question of accountability and the nature of reporting to the Parliament. The Commission has presented a report by way of video. I produce in the chamber a videotape which it has supplied, as I understand it, to all members of the Parliament as a report. I am curious, for several reasons, as to why the Commission should have done this. First, I am curious as to why it should regard the videotape as being a report which I could interpret. I do not happen to be one of those who possess a videotape player in their homes. In my experience, those who apply for legal aid tend to have one, but I know that a large number of other people do not have one. That might be regarded as a supercilious remark and, if so, I withdraw it. All I mean is that it is not something which is available in the home of every member of this chamber or of every member of this Parliament. The idea that a report should be made to the Parliament and to the people of Australia by way of a video presentation seems to me to indicate a quite obnoxious assumption that people have the necessary facilities. These facilities are obvoiusly appropriate and relevant to the Australian Film Commission but they are not available to a large percentage of Australians, and to them this form of report is inopportune. I was curious also about the cost of that form of report. We are used to having reports printed in colour and sometimes in exotic colour. Certainly the Australian Film Commission, as one might expect, has indulged in exotic colour in the presentation of its fiscal printed report. I have no objection to that, but I wonder what the cost of the video presentation is. I asked some people who may have some idea about the cost. They told me that the cost of a similar video which was produced as a training video for people employed to perform commercial roles was between $35,000 and $38,000. I do not know what the cost of this video was but apparently it has been distributed to every member of the Parliament and to goodness knows how many other people as an annual report. Senator Puplick —It is actually a 10-year report. Senator PETER RAE —The interjection is that it is actually a 10-year report. I divide the cost by 10 and still ask whether it is warranted as a method of presenting a report when, apart from anything else, I personally, unless I queue up in the Senate party room and manage to get the use of the video machine there or go to one of my local television stations or something or other, will not be able to watch it. It does not mean a damn thing to me unless I do something like that. Quite frankly, it does not seem to me to be a way of reporting to the Parliament or to the people. After all, the report to the Parliament is a report to the people. I do not know how one translates what one has visually and auditiously accepted into a transmissible form. As I have said, notwithstanding my respect for the part time Chairman of the Commission, Phillip Adams-I quickly add that I have a very great respect for Phillip Adams-- Senator Gareth Evans —I don't think it is going to be reciprocated after tonight. Senator PETER RAE —I thank Senator Evans. I was going to go on to ask him whether he would apply somewhat less extravagant means of reporting in the future. It is interesting that Senator Evans should have interjected. I was going to mention one other matter in the adjournment debate. Earlier today I had occasion to take exception to the fact that I had been misrepresented in relation to certain comments I made about the Commonwealth Serum Laboratories Commission. I note that we still have an outstanding problem in relation to CSL which neither Senator Evans nor I have concluded. It just so happen that I have the information with me. I will refer to it briefly. It is an article in the Bulletin entitled: `How bureaucratic venom threatens your life'. The article states: Last week a new anti-venom saved the life of a boy bitten by a funnel-web spider. Yet a bureaucratic war in the Commonwealth Serum Laboratories means that only a few doeses are left to save spider victims-and that research has virtually ground to a halt. I simply raise this question: When will we resolve how we deal with problems such as that? When will we resolve the problem about which I know-I say this, in no way provocatively-Senator Evans and I are genuinely concerned? Earlier today I spoke about certain aspects of the Commonwealth Serum Laboratories. I speak now about another one, and that is: How will we resolve the problems that arise in relation to the difference between commerciality and the need for research development, as exemplified in that instance? I have raised two matters tonight. I will summarise them. Firstly, I have asked the Australian Film Commission to justify the cost of the video presentation of its annual report which I believe to be extravagant in the extreme and unrealistic in that it certainly will not get through to me and it is not likely to get through to a large number of other people. I have asked the Commission kindly to inform me whether I can return it so that it can be used for some other purpose. I have raised again the question of the Commonwealth Serum Laboratories and the problem of the reconciliation between research and administration. Friday, 6 December 1985 Senator GARETH EVANS(Victoria-Minister for Resources and Energy)(12.01 a.m.) —We have had nine speakers so far tonight on the adjournment, an unhappy experience at the best of times made even more so by the existence of numerous end of session parties around the building tonight. I want to say, though, that at least some of those speakers made positive and substantial contributions. I refer in particular to the condolences very effectively expressed tonight by Senator Giles and Senator Chaney for the late Gloria Brennan who was known to many in this place and indeed to many people in political life and active public life around the country as a great activist in the Aboriginal cause. I share the sentiments expressed by the other senators. We will mourn her passing. I noted but do not share the views expressed by Senator Michael Baume about the Senate in his contribution tonight. It was a sort of end of term report from the new boy after his first period in this place. I think the best answer to him came in a series of quotations in Senator Vanstone's speech about which she was expressing outrage but which seemed to me to capture quite precisely the essence of this institution. It is all there on the record, and I refer Senator Baume to Senator Vanstone's contribution in that respect. As far as Senator Tate and Senator Kilgariff were concerned, we were treated to a sort of internecine war between two rival factions within the Catholic Church, an exchange reminiscent of nothing so much as the squabble between the Guelphs and the Ghibellines in sixteenth century Florence. Many other heresies no doubt will be perpetrated and allegations of heresies made, but mercifully we might be spared them in future in this place. The story of the Catholic Commission on Peace and Justice has all the hallmarks of an ongoing saga. I only hope that I will not be on duty during the adjournment debate the next time it gets an airing. I am afraid that Senator Vigor's contribution on the perils of travel, personnel and freight on the Australian National Railways left us all rather agog with indifference. It was a speech, I am afraid to say, of quite excruciating tedium, although no doubt of some significance to someone. No doubt it can be referred to the appropriate source. At this time of night really I think it is a bit difficult to treat us to that kind of thing, although I understand the conviction with which the honourable senator espouses these causes. Senator Bolkus advanced a superannuation matter, the substance of which speaks for itself, and no doubt it will be taken up in the appropriate places. Senator Rae raised two particular matters. One was about the Commonwealth Serum Laboratories Commission, the substance of which I cannot help but agree with him about based on my experience of fighting the battles on behalf of the spider venom man, Dr Struan Sutherland in the past. The CSL is an extraordinary institution and questions of accountability of administration continually there arise. I have much less sympathy, however, with Senator Rae's other contribution tonight, telling us how obnoxious he found the rather adventurous exercise by the Australian Film Commission in presenting its tenth anniversary report to the Parliament not in the form of a printed document, which no one is likely to read any more than these documents are ever read, but in the form of a video. I think Senator Rae, in attacking that presentation, displayed a quite remarkable and quite conspicuous lack of imagination which I hope is not going to be characteristic of his contributions in the future in the Tasmanian Parliament, should he succeed in making the transition there, although if he does continue to perform in that way he will be much more at home than was the case when expressing those qualities in this place. I think it is unfortunate to make the assumption that Senator Rae seems constantly to make that people actually read the annual reports about which he is so obsessed. I think the prospect of anyone taking some notice of an annual report in the form in which it circulated to us as a video is something we ought to greet with positive enthusiasm rather than with the distaste with which it was greeted tonight. Senator Peter Rae —Does it not make of it a horrible waster of money if people do not take any notice? Senator GARETH EVANS —Maybe so, but if one added up the cost of the production, publication, printing and circulation of all the annual reports of all the statutory authorities that are circulated to all the people they go out to, it would, I suspect, be a quite gigantic impost on the public purse, and one might well ask for a cost benefit analysis of that too. It is quite extraordinary. I simply make the point that if annual reports are to be given at all, some credit ought to be given to an imaginative presentation rather than the kind of po faced dispatch with which this particular piece of adventure was greeted by the honourable senator tonight. Finally, Senator Vanstone, in the course of her speech tonight about the awfulness of policy matters being announced publicly rather than first to this Parliament-a practice, of course, which all governments have followed from time immemorial and will go on following-specifically mentioned the Government's announcement of its revised code of conduct for Australian businessmen operating in the Republic of South Africa. Last Tuesday I responded to a speech by Senator Missen on that subject, in which he was very critical of the revised code, arguing that it was significantly weakened compared to its predecessor. After rebutting the general theme of Senator Missen's speech, I did give notice that I would take an appropriate opportunity this week, if the time permitted, to give a more substantial and detailed reply to some of his specific criticisms. Although it is unusual for a Minister to speak in the adjournment debate, I take the course of putting this speech down now in deference to the time constraints that are upon us in this session. In further deference to the time constraints that are on us tonight, I think it might be appropriate if, rather than reading that speech, I were to seek leave to have it incorporated in Hansard. Leave granted. The speech read as follows- REPLY TO SENATOR MISSEN'S COMMENTS ON THE AUSTRALIAN CODE OF CONDUCT FOR AUSTRALIAN COMPANIES WITH INTERESTS IN THE REPUBLIC OF SOUTH AFRICA Senator Missen originally spoke on the adjournment of 9 October 1985, drawing upon an article by Alan Fewster in the Australian of the same day which he tabled. Mr Fewster's article listed a number of changes to the text of the Code of Conduct between the original tabled by Mr Hayden on 18 April 1985 as the basis for consultation with Australian businesses operating in South Africa and the final version which was subsequently tabled by the Minister for Foreign Affairs on 29 November 1985. While a number of the specific deletions or changes reported by Mr Fewster were included in the final version tabled by the Minister for Foreign Affairs, as I said in my response to Senator Missen in the Senate on 9 October 1985, there was `no justification for the terms of the Australian story with its heading ``Government Bows on Code for South Africa'' '. As I told the Senate on 9 October 1985, Mr Fewster's article was ``misleading'' and in a moment I shall explain in detail why this is the case, and rebut in detail the misrepresentations which Senator Missen has built upon Mr Fewster's article. Last Tuesday Senator Missen went beyond merely saying `I told you so', to assert that what I said to the Senate on 9 October `has turned out to be entirely untrue'. Indeed, Senator Missen went on to say `I will give chapter and verse to show that it has indeed been watered down, as the article said'. Senator Missen then proceeded on a series of mischievous misrepresentations going rather beyond the terms of Mr Fewster's original article. Nevertheless, both Mr Fewster and Senator Missen use essentially the same technique in order to achieve their misrepresentation. Namely, they report deletions and changes between the original and final versions of the text (with relatively few errors), but give a totally misleading impression by not acknowledging the way in which the matters concerned are still dealt with in the final version of the Code of Conduct. The Code of Conduct itself begins at page 5 of the text tabled by Mr Hayden in the House of Representatives on 29 November. At line 2 of section 2 of the Code of Conduct the expression `should abolish the practice of segregation, which is a particularly offensive form of racial discrimination' is deleted and replaced with `should integrate'. On 3 December Senator Missen claimed `I do not know what it means'. He might have taken a clue from the heading of section 2 which is desegregation at places of work. Quite obviously this is a drafting change which expresses the original meaning more succinctly and in terms of a positive course of action. The three minor verbal changes to section 3 on employment and industrial relations practices and section 4 on remuneration are so minor that neither Senator Missen nor Mr Fewster saw fit to comment upon them. Their misrepresentations resumed at section 5, on training and management. Both Mr Fewster and Senator Missen comment on the fact that the second sentence of the first paragraph under section 5 was deleted. This sentence read `To implement this provision fully, the educational disadvantages of non-white employees may need to be compensated for.' This sentence was removed because it contradicted the immediately preceding sentences, which in both versions of the Code of Conduct reads `Companies should appoint and promote personnel solely on the basis of their qualifications and ability.' Both Senator Missen and Mr Fewster also note the removal from the next paragraph of section 5 of the expression `facilitate and accelerate' used in relation to the movement of non-whites into more senior positions. What they do not acknowledge is that the final version of the code requires companies to implement training and development programs `to facilitate equality of employment opportunities at all levels of the company' and to `encourage the movement of non-whites into semi-skilled, skilled, supervisory, managerial and executive positions. Non-white employees with potential for further advancement should be identified and supported to undertake outside training courses or expanded internal training programs.' On 3 December, Senator Missen noted two deletions from section 6 of the Code which deals with labour restrictions. He noted the deletion of a reference to `aid relating to legal matters' and another deletion of a sentence which he describes as `a truism'. However, again, Senator Missen conveys a completely misleading impression by neglecting to quote the next sentence after the deleted `truism' sentence which says `Companies should assist non-white employees and their families with advice and aid relating to legal matters to avoid infringing freedom of movement and to alleviate the deleterious effects of the migrant labour system.' Furthermore, as I pointed out in my response to Senator Missen last Tuesday, Section 6 of the Code has been substantially strengthened by requiring Australian companies not merely to provide advice on legal restrictions on labour but to `support changes to' racially discriminatory legislation in South Africa. The misrepresentations by Senator Missen and Mr Fewster were perhaps most substantial in relation to section 7 of the Code of Conduct dealing with quality of life. Mr Fewster claimed that the reference to `retrenchment benefits' from the earlier draft had been deleted, which it had, but he did not acknowledge that it was replaced with a reference to `contributory unemployment insurance', which is a specific mechanism for providing appropriate income maintenance. Senator Missen went rather beyond this misrepresentation in claiming that clause (b) under section 7 of the Code of Conduct-`has all been absolutely deleted'. True, but Senator Missen did not mention that it had been replaced with a more succinct reference to all of the matters dealt with in the deleted clause (except subsidised meals). Furthermore, as I pointed out on Tuesday, that section of the final version of the Code has been strengthened by calling on companies to `set aside funds for' the measures listed. Finally, under section 8 of the revised Code, monitoring has been substantially strengthened by the incorporation of a provision for an `independent and impartial administrator', as I noted in my responses to Senator Missen on both 9 October and 3 December. That clearly identifies the nature of the misrepresentations which Senator Missen and Mr Fewster indulged in in their comments on the Code of Conduct. But they also passed over the unchanged definition of the objectives of the Code because reference to them would have been inconsistent with the thrust of their claim that the Government has watered down the Code. The intention of the Code is to go beyond the `Willesee Code' of 1974 and to provide `practical guidelines' to Australian businesses, consistent with the European community, Canadian and US Codes, within which Australian firms can voluntarily `work to eliminate discrimination on racial grounds in their South African operations', and so `help to alleviate the deprivation and hardships suffered by non-white workers' under the apartheid system. The preamble to the Code describes some of the legal constraints which the apartheid system imposes on non-whites in South Africa and spells out Australia's opposition to that system, a posture which is consistent with our obligations under the ILO Conventions, Australia's policy on human rights and the approach of the international community to apartheid. It recognises that trade with the Republic of South Africa will continue unless the United Nations Security Council imposes comprehensive economic sanctions on South Africa, but calls upon Australian business not to exploit the special labour conditions created by the apartheid system. Finally, there is no need to answer Senator Missen's tendentious points about publicising the Code, because they are answered in the two sentences which he quotes from Mr Hayden in making his points. It is sufficient to say that now that the Code has been finalised, `in consultation with relevant Australian interest groups', as Mr Hayden said, `the Code will be widely publicised and (he) shall issue both general and individual invitations to Australian companies to adhere to it.' There is every reason to expect that Australian business will cooperate in the implementation of the Code of Conduct, because the final version has been developed in consultation with Australian industry. The cooperative attitude of Australian industry is acknowledged in a change which was incorporated in the second paragraph of the preamble to the Code of Conduct which states that `there is no evidence that Australian companies operating in South Africa do not act as good corporate citizens.' Question resolved in the affirmative. Senate adjourned at 12.07 a.m. (Friday) The following papers were tabled: Christmas Island Act-Ordinance 1985-No. 10-Phosphate Mining Corporation of Christmas Island Provident Fund. Defence Force Retirement and Death Benefits Act-Regulations-Statutory Rules 1985 No. 324. International Organisations (Privileges and Immunities) Act-Regulations-Statutory Rules 1985 No. 327. Navigation Act-Marine Orders 1985- No. 5-Part 9 (Health-Medical Fitness). No. 6-Part 3 (Marine Qualifications-Issue and Procedure). Part 5 (Marine Qualifications-Engineer Officers); Part 6 (Marine Qualifications-Radio); Part 7 (Marine Qualifications-Ratings). No. 7-Part 4 (Marine Qualifications-Masters and Deck Officers). Public Service Act-Determination 1985 Nos 94, 95. Superannuation Act-Regulations-Statutory Rules 1985 No. 326. The following answers to questions were circulated: (Question No. 153) Senator Bolkus asked the Minister representing the Attorney-General, upon notice, on 28 March 1985: (1) Does the Attorney-General recognise the difficulties frequently encountered by homosexuals when trying to obtain normal community services, in having their relationships with their partners recognised for immigration purposes. (2) Does the Attorney-General intend to legislate to protect the rights of these people. Senator Gareth Evans —The Attorney-General has provided the following answer to the honourable senator's question: (1) The question of the recognition for immigration purposes of relationships of homosexuals with their partners is a matter for the Minister for Immigration and Ethnic Affairs to consider. The honourable member is referred to the answer given by the Minister for Immigration and Ethnic Affairs to question No. 1335 (Hansard 10 September 1985, page 585) in relation to the recognition of homosexual relationships for migration or residence status purposes. Many `normal community services' are matters which fall within the area of responsibility of State Governments. The Anti-Discrimination Act of the State of New South Wales contains provisions dealing with discrimination on the ground of homosexuality. It is the policy of the Attorney-General to encourage the State Governments to take appropriate action to protect basic human rights in areas of State concern. In areas of Commonwealth concern persons who consider they have been discriminated against on the grounds of sexual preference are entitled to complain to the Human Rights Commission, and in the case of employment under the Public Service Act, to the Merit Protection and Review Agency. Further, under the Australian Bill of Rights Bill the Human Rights and Equal Opportunity Commission would be empowered, with the consent of the Attorney-General, to investigate complaints about discrimination in areas of State concern on the ground of sexual preference. (2) The Government has introduced the Australian Bill of Rights Bill 1985 to implement the provisions of the International Covenant on Civil and Political Rights in relation to areas of Commonwealth concern. (Question No. 394) Senator Missen asked the Minister representing the Attorney-General, upon notice, on 20 August 1985: (1) Is the Attorney-General aware that the Queensland Government's Fraser Island Public Access Act (the Act), scheduled to come into operation on 1 July 1985, contains many alarming provisions including powers for any visitor in the recreation area to be fined or conscripted by any `authorized officer' without any rights of appeal or any explanation, and that the refusal of visitors to comply could lead to very heavy financial penalties and/or banishment from Fraser Island. (2) Has the Government received complaints from user groups about the terms of the Act. (3) Will the Human Rights Commission, as a matter of urgency, investigate the legislation and its implications for basic human rights. Senator Gareth Evans —The Attorney-General has provided the following answer to the honourable senator's question: (1) to (3) The Attorney-General is aware of the Act referred to in the honourable senator's question but is not aware of the Government as such having received any complaints about it. I am informed that the Human Rights Commission received a number of complaints but concluded that the Act was not inconsistent with Australia's obligations under the International Covenant on Civil and Political Rights. In the view of the Commission, the only question of human rights of any significance arising from the passing of this Act related to freedom of movement under Article 12 of the International Covenant. However the Commission concluded that, given the environmental fragility of Fraser Island, it would seem reasonable that some system of control should be placed over the movement of vehicles and people on the island in order to avoid harm to the environment. (Question No. 539) Senator Watson asked the Minister representing the Attorney-General, upon notice, on 13 September 1985: (1) To what extent can an Australian citizen on a very low income expect legal aid to contest a case for breach of contract in the court of a neighbouring country (e.g. Papua New Guinea). (2) If such a person is eligible for legal aid, can he or she expect to have the costs of security met by legal aid in order to have their case heard in the court of a foreign country. (3) Would the Attorney-General agree that 10 years is sufficient time for Australian solicitors to pursue a case of breach of contract in a neighbouring country particularly in view of the fact that the claimant has reasonable prospects of success. Senator Gareth Evans —The Attorney- General has provided the following answer to the honourable senator's question: (1) As the Australian Legal Aid Office and the Legal Aid Commissions in Australia normally do not grant aid for matters to be tried before a court in another country, it is suggested that any Australian citizen requiring assistance in such a matter be advised to contact the legal aid agency in the country concerned. (2) Refer to answer (1) above. (3) As insufficient details have been provided of the matter to which the honourable senator is referring no comment can be made. (Question No. 564) Senator Mason asked the Minister representing the Minister for Health, upon notice, on 19 September 1985: Did the 1976 Royal Commission on Australian Government Administration recommend an inquiry into the case of Mr. W. F. Toomer, former Senior Quarantine Inspector with the Western Australia Department of Health; if so, did such an inquiry take place and, what were the results of that inquiry; if not, will the Government set up such an inquiry. Senator Grimes —The Minister for Health has provided the following answer to the honourable senator's question: The 1976 Royal Commission on Australian Government Administration did recommend an inquiry into the case of Mr Toomer. The inquiry, conducted by Messrs R. J. Perriman and G. P. Temme, officers of the Department of Veterans' Affairs and Defence respectively, traversed a wide range of matters and produced a detailed report which was tabled in Parliament on 8 November 1977. The main recommendation of the report was that the proposed transfer of Mr Toomer from Western Australia to Victoria should proceed. The Public Service Board, after considering the report and consulting my Department, decided that this recommendation should be implemented, and Mr Toomer took up duty in Melbourne in January 1978. (Question No. 601) Senator Bolkus asked the Minister representing the Minister for Employment and Industrial Relations, upon notice, on 8 October 1985: (1) Are some organisations charging for the preparation of applications under the Community Employment Program (CEP), and that in some instances the charge levied maybe a percentage of the final fund allocated by the Government for such applications. (2) Will the Minister investigate whether Trojan Owen and Associates deduct such payments in view of the fact that this organisation has been involved with approved CEP projects in both South Australia and Victoria. (See answer to question on notice No. 210, Hansard, 28 May 1985, p. 2666). Senator Walsh —The Minister for Employment and Industrial Relations has provided the following answer to the honourable senator's question: (1) Some consultants who prepare applications for CEP funding on behalf of intending sponsors charge a fee for this service. Such charges are ineligible for CEP funding and must be met by the sponsor. After a project has been approved, the sponsor may engage the consultant to manage a project and a charge is made on the basis of a fee for service. Such fees are met from the sponsor contribution to the project. (2) Trojan Owen and Associates do not charge a fee for the preparation of project applications. Where that body is engaged to manage a project on behalf of the sponsor, a fixed fee is charged for the service. As mentioned in the answer to Question (1), these fees are met from the sponsor contribution to the project. (Question No. 630) Senator Foreman asked the Minister for Education, upon notice, on 16 October 1985: (1) What level of fees are charged for tertiary tuition for overseas students in the United Kingdom, Canada, United States, New Zealand, Japan and other comparable countries. (2) Do the charges referred to in (1) vary greatly with the courses undertaken. (3) Are charges different for study at postgraduate level rather than undergraduate. (4) How many overseas students are currently enrolled in tertiary education in Australia. (5) What numbers of these students receive fully subsidised tertiary education in Australia. (6) What percentage of the full cost of tuition does the present charge represent. (7) How do Australian education institutions compare with those of comparable countries in terms of accessibility to overseas students. (8) Do quotas currently exist in courses for overseas students. (9) Is this the practice in other comparable countries. Senator Ryan —The answer to the honourable senator's question is as follows: (1) Fees charged for tertiary tuition for overseas students in a number of countries are set out below: Country Fee range per annum (1984-85) $ United Kingdom... ... 4,737-11,521 United States of America... Public institutions... 1,490-7,450 Private institutions... 7,450-12,400 Canada... ... 1,174-6,114 Japan... Public institutions... 1,845 (average) Private institutions... 3,314-23,787 New Zealand... ... 589 All figures are in Australian dollars and are based on exchange rates at 3.1.85. (2) In all the countries listed above, with the exception of New Zealand, the level of fees varies according to discipline, arts and humanities being in the lower ranges and science, engineering, veterinary and medical courses being more expensive. (3) Of the countries listed in (1) above only Canada's fees distinguish between undergraduate and postgraduate courses. All the other countries charge the same level of fees irrespective of the level of the course undertaken. (4) At 30 June 1984, the last year for which the Department of Education has complete statistics there were 14,255 overseas students in full time tertiary education in Australia. (5) Of the 14,255 overseas students, 1,208 were students in full time tertiary study and fully subsidised by the Australian Development Assistance Bureau. (6) The Overseas Students Charge currently represents 25% of the average full cost of courses. (7) The following table shows overseas students as a percentage of the total tertiary student population: Country Overseas students as a % of total students UK (1982-83)... 5 Germany (1981)... 5.8 Canada (1983)... 5.3 USA (1983)... 2.7 France (1981-82)... 13 Australia 1984... 4 (8) There have been overall quotas on the number of overseas students entering Australia for some years. In 1986 there will also be quotas limiting student enrolment to 10% in each tertiary institution and 20% in each course. In addition to the quotas set by the Government some tertiary institutions set their own quotas on the number of overseas students accepted each year. (9) Of the major western nations who are host countries for foreign students only West Germany imposes quotas to regulate the number of overseas students entering the country. No other country operates a quota system at the course level.