Wednesday, 12 February 1986 The PRESIDENT (Senator the Hon. Douglas McClelland) took the chair at 10 a.m., and read prayers. The Clerk —Petitions have been lodged for presentation as follows: 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 the 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 Brownhill (from 268 citizens), Michael Baume (from 32 citizens), Peter Baume (from 387 citizens) and Sir John Carrick (from 115 citizens). To the Honourable the President and members of the Senate in Parliament assembled. The petitions of the undersigned respectfully showeth: Introduction of any additional capital gains taxes, wealth taxes or death duties is opposed on the grounds that: they adversely affect the small and medium size businesses in Australia, destroying incentive and discouraging investment in this important area of the economy; the Australian economy, and employment in particular, is heavily reliant on growth in small businesses; any capital gains that might result when owners of small businesses finally sell the business are not ``windfall gains'' but the result of many hard years of work and sacrifice, with very little being taken out of the business by way of salaries so that the maximum amount of money can be ploughed back into the business to create growth and jobs; Your petitioners request that the Senate, in Parliament assembled, will protect the rights of private enterprise and reject any inequitable additional taxes. And your petitioners as in duty bound will ever pray. by Senator Brownhill (from 14 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 Zakharov (from 22 citizens). To the Honourable the President and members of the Senate in Parliament assembled. The petition of the undersigned shows: That the proposed introduction of compulsory identification (ID) cards should be reconsidered and rejected because the system: (a) is not a cost-effective method of reducing tax evasion and social security fraud and, to the contrary, in the form proposed will facilitate such evasion and fraud; (b) will constitute an unwarranted infringement of individual privacy by the aggregation of a wide variety of personal information of a private nature; (c) will cause a further large and costly growth in the bureaucracy and burden on the taxpayer; and (d) cannot be guaranteed against misuse for purposes other than for which their introduction is stated to be intended and in fact provide the opportunity for blackmail and other forms of misuse. And your petitioners humbly pray that the problems which identification cards are intended to reduce should be attacked by other, more effective and less obnoxious methods. And your petitioners as in duty bound will ever pray. by Senator Townley (from 17 citizens). To the Honourable the President and members of the Senate in the 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 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 Senators Crowley (from 147 citizens), Foreman (from 212 citizens), Maguire (from 304 citizens), Parer (from 161 citizens) and Vigor (from 138 citizens). To the Honourable the President and members of the Senate in the Parliament assembled- The petition of certain undersigned citizens of Australia shows that the proposed private member's Bill introduced by Senator Harradine - an act to prohibit experiments involving the use of human embryos created by in vitro fertilisation - disadvantages infertile members of the community seeking treatment through the current medical procedure known as in vitro fertilisation because the inadequate definition of terminology relating to the proposals in the said Bill will prevent any further development and improvement in the relevant medical research anywhere in Australia and, hence, lead to the cessation of the freeze/thaw technique currently associated with the preservation of excess embryos created and intended specifically for the purpose of later implantation into the uterus of an infertile woman seeking treatment. We strongly believe that research should be allowed to continue under the strict guidelines already laid down by the National Health and Medical Research Council and Victoria's ``Infertility (Medical Procedures) Act 1984''. Since the proposed Bill infringes on the personal rights and liberties of infertile couples to have children, your petitioners as in duty bound therefore humbly pray that the Senate will view with sympathy our opposition to the afore-mentioned Bill and NOT support its passage through the Senate. by Senator Peter Baume (from 89 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 tax proposals as outlined in the Government's ``White Paper'' and the Government's preferred option on proposed new and widened tax proposals as so outlined, namely: Capital Gains tax Hidden Death tax described as ``Capital Gains tax after death'' Gift tax Increased Company tax Employer taxes on employees' employment benefits. All such taxes will discriminate against and inhibit progress, growth and employment throughout the nation. They will attack hardworking people who have built up their assets; they will discourage thrift; they will inhibit development; they will treat unfairly all who plan for the future; they will cause trouble and expense in arriving at the value of their assets; they will discourage industry and punish achievement. We ask that the tax proposals be rejected. by Senator Sheil (from 35 citizens). To the Honourable the President and members of the Senate in Parliament assembled. The petition of certain citizens of South Australia respectfully showeth: That the Australian flag symbolises the continuity between Australia's past, its present and its future; That the presence of the Union Jack on the flag represents not a subservience to Britain, but a reminder of our inheritance of the fruits of hundreds of years of struggle for individual liberty against the forces of tyranny and oppression; Nonetheless recognises the rights of Australians should they so wish to change the design of their flag. Your petitioners humbly pray that no change be made to the Australian flag except with the consent of the people in a referendum. And your petitioners, as in duty bound, will ever pray. by Senator Bjelke-Petersen (from 980 citizens). To the Honourable the President and members of the Senate in Parliament assembled: The humble petition of the undersigned citizens of Australia respectfully showeth: That we the undersigned, having great concern because of the spread of moral pollution in our nation call upon the Government to introduce immediate legislation: 1. To provide strict controls over importation, production, sale, hire or mailing of video-cassettes with the open sale of only G, PG, and M rated video-cassettes; and the total prohibition of the sale of R rated video-cassettes so that R rated films can only be viewed in an adult theatre by persons over 18 years. We totally reject the concept of ``X'' rated video-cassettes which would allow the legal sale of hard-core pornographic films for screening in the homes of our nation, which endanger our children. 2. To dramatically improve the Federal Attorney-General's Guidelines for Classification of Video tapes/discs which restrict the importation, production, sale or hire, screening in private homes and mailing by Australia Post so as to include the total prohibition of any pornographic, obscene or blasphemous video cassette, or film containing child pornography, bestiality, sodomy, group sex, violent sex acts with women, such as rape and pack rape, sadism and torture, etc. Your petitioners therefore humbly pray that your Honourable House will protect our society, especially women and children from moral pollution and its harmful effects. And your petitioners as is duty bound, will ever pray. by Senators Michael Baume (from 33 citizens), Peter Baume (from 20 citizens) and Brownhill (from 51 citizens). To the Honourable the President and members of the Senate in Parliament assembled. The petition of certain citizens of South 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 2,679 citizens). To the Honourable the President and members of the Senate in Parliament. The Petition of the undersigned shows that because it will cause serious harm to the community, the Parliament will not legalise the possession, sale, hire, or supply of any publication or video tape, video disc, slide or any other recording from which a visual image can be produced, which displays degradation of any person, particularly women and children, or animals; scenes of explicit sexual relations showing genitalia detail; acts of violence and sex; sexual perversion such as sodomy, mutilation, child pornography, urolagnia, coprophilia, necrophilia, bestiality; or the use and effect of illicit drug taking; explicit fellatio and cunnilingus; explicit nudity including touching genitalia, erect penis. Your petitioners pray the Senate, in Parliament assembled that you will give this matter earnest consideration and your petitioners as in duty bound, will ever pray. by Senators Bjelke-Petersen (from 77 citizens) and Robertson (from 121 citizens). To the Honourable the President and members of the Senate in Parliament assembled. The humble petition of the undersigned citizens of Australia respectfully showeth their desire to stop the commercial exploitation of the kangaroo. Your petitioners therefore humbly pray that your Honourable House re-apply the ban on the export of kangaroo products. And your petitioners as in duty bound will ever pray. by Senator Peter Baume (from 124 citizens). To the Honourable the President and members of the Senate in Parliament assembled. The petition of the undersigned citizens of Australia respectfully showeth: That the Australian Bill of Rights Bill is a harmful, dangerous and divisive proposal, the provisions of which are authoritarian and anti-democratic. Your petitioners therefore pray: That the Senate rejects this Bill. And your petitioners as in duty bound will ever pray. by Senator Foreman (from 23 citizens). To the Honourable the President and members of the Senate in Parliament assembled. The petition of the undersigned shows: That the Bill of Rights and the Human Rights and Equal Opportunity Bill: 1. Offer nothing more than is already available under Common Law, 2. Deny some Human Rights and do not include others, 3. Give dangerously wide powers to an unelected body, and 4. Could cause far more damage than they could possibly cure. Your petitioners request that the Senate should: Completely reject both the Bill of Rights and the Human Rights and Equal Opportunity Bill. And your petitioners as in duty bound will ever pray. by Senator Chipp (from 45 citizens). To the Honourable the President and the members of the Senate in the Parliament assembled. The petition of the undersigned respectfully showeth: That certain Trade Unions are currently forcing employers and employees to join union-controlled Superannuation schemes through industrial blackmail, thereby extending the Unions' economic power and at the same time infringing individual rights. Your petitioners therefore humbly pray that the Government: (i) Guarantee that Occupational Superannuation is a matter of individual choice (ii) Declare illegal industrial standover tactics which force people to join superannuation schemes controlled by, or sponsored by trade unions. (iii) Protect those companies and their employees who establish their own superannuation arrangements at the enterprise level. (iv) Ensure that union or industry-based schemes are not disguised pay rises by providing that employees must also make contributions. (v) Provide that control of the funds of such schemes is vested in the elected representative of the contributors to those schemes (vi) Oppose any backdoor attempts at achieving compulsory unionism. And your petitioners as in duty bound will ever pray. by Senator Parer (from 313 citizens). To the Honourable the President and members of the Senate in Parliament assembled. The Australian Bill of Rights The Petition of the undersigned citizens of Australia respectfully request and pray that: The Bill of Rights provides for a change in the Australian Constitution that we do not agree with, nor support in whole or in part and we respectfully ask that a public referendum be held to hear the views of the citizens of this country. And your petitioners as in duty bound will ever pray. by Senator Robertson (from 123 citizens). Senator REID(Australian Capital Territory) —by leave-I present the following petition, which is not in conformity with Standing Orders, from 490 citizens requesting that there be no development in the north Lanyon area of the Australian Capital Territory: We the undersigned object to any development proceeding in the north Lanyon area. Petitions received. Senator COLLARD(Queensland-Leader of the National Party of Australia) —I give notice that, on the next day of sitting, I shall move: That the Senate, noting that- (a) the Hawke Government has consistently demonstrated its lack of concern for the rural sector since its election to power in 1983; (b) through the Government's unwillingness to formulate policies to assist rural producers, the average family farm income estimate for the 1985-86 financial year is below the poverty line and also well below the unemployment payment available to a couple with two children; and (c) the Hawke Government imposts such as the tax package including the capital gains tax and the quarantining of farm losses have precipitated this decline in the standard of living for rural producers, although our farmers are considered some of the most efficient in the world. calls on the Federal Government to grant relief to Australia's rural producers by: (i) revising Government policies which are causing record high interest rates, (ii) providing an immediate injection of an additional $100m for rural adjustment funding; and (iii removing Government controls that artificially inflate farm input costs, for example, fuel. Senator PETER BAUME(New South Wales) —I give notice that, on the next day of sitting, I shall move: That the Senate- (a) notes that the disabled volunteers participating in the National Attendant Care Pilot Program (NACPP) receive their last carer's payment on Friday 14 February 1986; (b) notes that the Minister for Community Services (Senator Grimes) has been aware for many months that the NACPP would conclude in February, 1986; (c) condemns the Minister for Community Services for failing to decide and announce in good time whether payments for volunteers would end or continue after February leaving the severely disabled scheme participants completely uncertain of their position; and (d) calls on the Minister for Community Services to announce immediately that the pilot program will be extended until a decision is made on the introduction of a National Attendant Care Program. Senator CHANEY(Western Australia-Leader of the Opposition) —I give notice that, on the next day of sitting, I shall move: That the Senate calls on the Hawke Labor Government immediately to refer the coastal shipping industry to the Industries Assistance Commission for inquiry and report. Senator TOWNLEY(Tasmania) —I give notice that, on the next day of sitting, I shall move: That the Senate- (a) aware that it will be poorer by the absence of Peter Rae, who until a short time ago was a Senator from Tasmania held in very high regard by most members of this Chamber; and (b) conscious of the excellent vote that ex-Senator Rae received in the Tasmanian State elections on 8 February 1986, which was second only to that of the Premier of Tasmania, congratulates Mr Rae and wishes him good fortune in his political career. Senator MICHAEL BAUME(New South Wales) —I give give that, on the next day of sitting, I shall move: That the Senate- (a) notes with concern that the Federal Government's own Economic Planning and Advisory Council (EPAC) has warned the Government that the economic recovery is not sustainable without an appropriate level of business investment (which is not taking place), with much of the recent economic growth coming from fuller use of existing capacity rather than from new investment; (b) notes EPAC's view that the stronger levels of business investment essential not only to sustain the economy but also to reduce unemployment, will not take place unless interest rates, inflation and Government spending are lower, there is full discounting in the event of further devaluation and there is increased confidence in the future of the exchange rate; (c) considers that the Government should accept EPAC's warning and reverse those economic policies that have created record interest rates, rising inflation, record levels of government spending, only partial wage discounting and a destabilised Australian dollar; and (d) calls on the Government urgently to introduce a mini-budget to include corrective fiscal and labour market policies that would reduce its over-reliance on monetary policy and excessively high interest rates that are unnecessarily hurting all Australians. Senator CHANEY(Western Australia-Leader of the Opposition) —I give notice that, on the next day of sitting, I shall move: That the Senate condemns the Hawke Labor Government for its inept handling of the dumping duties levied on certain imported fertilisers, including its blatant attempt to buy votes during the Western Australian election by providing a subsidy to offset the impact of the dumping duties for Western Australian farmers only. Senator CHANEY(Western Australia-Leader of the Opposition) —I give notice that, on the next day of sitting, I shall move: That the Senate- (a) the Hawke Labor Government's proposed fringe benefits tax on motor vehicles; and (b) its failure to assess the impact of the tax on the car industry before announcing its introduction. Senator REID(Australian Capital Territory) —I give notice that, on the next day of sitting, I shall move: That the Senate condemns the Federal Government for- (a) not taking action to remove the illegal structure from Commonwealth land which adjoins the South African Embassy; (b) not adhearing to the Vienna Convention which as signatories we are obliged to do; and (c) not taking action against the tresspassers who erected the illegal structure. 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. National Training Council-Report 1982-84 2. Department of Foreign Affairs-Annual Report 1984-85 3. Australian Meat and Live-stock Industry Policy Council-Annual Report 1984-85-Pursuant to Section 22 of the Australian Meat and Live-stock Industry Policy Council Act 1984 4. Australian Dairy Corporation-Annual Report 1984-85-Pursuant to Section 29 of the Dairy Produce Act 1924 5. Australian Wool Corporation-Annual Report 1984-85-Pursuant to Section 90 of the Wool Industry Act 1972 6. Oilseeds Research Committee-Annual Report 1984-85-Pursuant to Section 28 of the Oilseeds Levy Collection and Research Act 1977 7. Australian Meat Research Committee-Annual Report 1984-85-Pursuant to Section 17 of the Meat Research Act 1960 8. The Australian Wine Research Institute-Annual Report 1984-85 9. Housing Loans Insurance Corporation-Annual Report 1984-85-Pursuant to Section 39 of the Housing Loans Insurance Act 1965 10. Australian Institute of Multicultural Affairs-Annual Report 1984-85-Pursuant to Section 49 of the Australian Institute of Multicultural Affairs Act 1979 11. Department of Immigration and Ethnic Affairs-Annual Report 1984-85-Also included is a report on the operation of the Adult Migrant Education Program which is required under the Immigration (Education) Act of 1971 12. Commonwealth Serum Laboratories Commission-Annual Report 1984-85-Pursuant to Section 44 of the Commonwealth Serum Laboratories Act 1961 13. Health Insurance Commission-Annual Report 1984-85-Pursuant to Section 42 of the Health Insurance Commission Act 1973 14. Department of Health-Annual Report 1984-85 Motion (by Senator Grimes for Senator Button) agreed to: That leave be given to introduce a Bill for an Act to enact certain transitional provisions and make certain amendments in consequence of the enactment of the Customs Administration Act 1985 and for related purposes. Bill presented by Senator Grimes, and read a first time. Standing Orders suspended. Senator GRIMES(Tasmania-Minister for Community Services)(10.10) —I move: That the Bill be now read a second time. I seek leave to have the second reading speech incorporated in Hansard. Leave granted. The speech read as follows- This Bill proposes to amend a number of laws administered by the Australian Customs Service to transfer a range of ministerial powers to the Comptroller-General of Customs. In the autumn sittings last year a package of measures passed this place which amongst other things, created an independent Australian customs service and invested the general administration of the legislation to be administered by that service in the Comptroller-General of Customs. The new measures which were proclaimed to operate from 10 June 1985, also transferred a wide range of delegated ministerial powers to the Comptroller-General of Customs. Many of those powers have in turn been delegated to officers by the Comptroller-General of Customs under the general power of delegation in section 14 of the Customs Administration Act 1985. After the transfer of the delegated powers about 25 per cent of the total ministerial powers still remained to be exercised personally by the Minister for Industry, Technology and Commerce. At the time of the introduction of the previous legislation package into this place mention was made of a review being undertaken to determine whether any of those powers ought to be transferred to the Comptroller-General of Customs. That review which was conducted by the Australian Customs Service and the Department of Industry, Technology and Commerce with the advice of the Attorney-General's Department was finalised late last year. This Bill now proposes to implement the recommendations of that review, and effectively completes the transfer to the Comptroller-General of the ministerial powers involved in the day-to-day administration of the Australian Customs Service which the earlier Customs Administration (Transitional Provision and Consequential Amendments) Act 1985 commenced. A brief description of each of the powers proposed for transfer is contained in the Schedule to clause 3 of the explanatory memorandum which has been circulated. The Government believes that because the Comptroller-General of Customs has the general administration of all laws of customs or excise it is appropriate for that officer to be invested with all of the administrative powers involved in the day-to-day running of the service. One of the benefits in establishing an independent Australian Customs Service was to relieve the Minister and Secretary of the Department of Industry, Technology and Commerce of the routine of customs administration with greater opportunity, in consequence, for both to concentrate on the major and complex issues facing industry in this country. That benefit would of course be somewhat negated if the daily administrative powers had to be personally exercised by the Minister. I might mention that about 10 per cent of the powers in Customs laws will remain with the Minister. These are powers which have major policy implications and which are considered more appropriate for retention by the Minister. Such powers involve for example the extension or variation of bounty assistance arrangements, the proposing of Customs tariff alterations and the formulation of schemes for the calling and dealing with tenders for the right to import goods. Numerous powers in the Customs Tariff (Anti-Dumping) Act relating to the imposition of dumping and countervailing duties and the formulation of schemes for the purposes of the States Grants (Petroleum Products) Act also fall into this category. Finally, in one instance the Bill proposes to re-invest a power in the Minister. That is the power in Section 25 of the Customs Tariff Act to determine whether certain goods might be substituted for other goods for the purposes of avoiding the Customs duty normally payable. Although this power was previously transferred along with all other delegated powers the Government considers that it is a power in the major policy category which should be retained by the Minister. Financial Impact Statement The measures contained in this Bill have no direct financial implications. I commend the Bill to the Senate. Debate (on motion by Senator Reid) adjourned. Debate resumed from 29 November 1985, on motion by Senator Grimes: That the Bill be now read a second time. Senator PETER BAUME(New South Wales)(10.12) —The Federal Government has got its whole approach to tertiary education wrong. What is happening in Australia is that tertiary education opportunity is limited. In my State of New South Wales, for example, 30,000 young Australians will be turned away this year, and in other States a very large number, tens of thousands, will be turned away from universities and colleges of advanced education in this year, 1986. If we add to that the number of people unable to get access to technical and further education, we find that the number of young Australians seeking to do nothing more than improve themselves, to add to their skills, to add to the pool of skills which the nation has, may well be approaching a quarter of a million. That is the result of a set of policies which seeks to govern tertiary education from the centre, which seeks to determine, through a tertiary education commission, how many places there will be and which institutions will offer which places. The Government has clearly determined to centralise and to take to the centre every aspect of the control of tertiary education. The Opposition predicts now that that approach will further limit and restrict the opportunities which young Australians have to improve themselves and to educate themselves further. I remind the Senate that at the end of 1982, when I was the Minister for Education, I began a program to encourage young people to remain at school. The Labor Government, when it took office, picked up and extended that program, and it was very successful. The increased retention in years 11 and 12 as a result of that program and other factors has been very considerable. But that has meant that increasing numbers of young Australians are finishing secondary school and qualifying for places in tertiary education-in technical colleges, colleges of advanced education and universities. The places simply are not there and they never will be there under the present system because the Government simply cannot find a Treasury with a deep enough pocket to fund what it wants in tertiary education. The result is blighted opportunity and restricted access. Those are two of of the characteristics of higher education under Labor- restricted access and blighted opportunity. The Commonwealth Tertiary Education Amendment Bill 1985 before us now seeks to put into effect administrative arrangements which are inconsistent with that approach. Every decision about taking some more students, say in the Warrnambool College of Advanced Education - a fine campus; I do not know whether you have been there, Mr President - will be authorised primarily from an office in Belconnen. The officers who work in Belconnen are good officers. However, it is simply wrong and it is not the system of decision-making that should be guiding higher education provisions in Australia. In the western region of my city of Sydney, which has a population greater than that of the conurbation of Adelaide, there is nothing like the two universities or the series of colleges of advanced education which the Adelaide population has to service its young. I am not criticising the provision in Adelaide; I am saying that western Sydney is entitled to some kind of pro rata equivalent provision. It is an area where the lines of travel are difficult and where access is difficult and we simply do not have the provision in my city. The Government will say that budgetary considerations do not permit it to offer young people the chance to educate themselves, do not offer middle-aged people the chance to retrain, do not offer anyone who wants it the chance to add to their skills, increase their knowledge and add to the skills of the nation. I digress briefly to say that questions of productivity are central to this nation's chance of survival-whether as a nation we can produce sufficient to make us competitive so that we can generate the wealth which we can then spend on further education. The effects of the policies which we see here from this Government are to limit access, to limit opportunity and to turn people away in increasing numbers from the gates of our institutions. The Tertiary Education Commission was established really in the mid-1970s. I pay tribute to my colleague Senator Sir John Carrick who, as Minister for Education, devised and put into place the structure for the Tertiary Education Commission, and for the councils which supported it, which was necessary at that time to advance each of the sectors through the difficult period of the mid-1970s. We did so at a time when participation rates through schools were not as high as they are now, when the number of people seeking entry was not as high as it is now but when tertiary education generally faced very real difficulties. The model which Sir John Carrick introduced for the structure of higher education, the model which is now being put aside by the Labor Government, involved the deliberate creation of tension, creative tension, between the different sectors so that they would compete openly and the Government would receive the advice from each sector on which it could make its decisions on the allocation of resources and on the determination of priorities. Senator Sir John Carrick put in place not only a Tertiary Education Commission but also a Universities Council, and Advanced Education Council and Technical and Further Education Council, each of which had a number of part time commissioners or councillors who contributed their skills from within the sector to the deliberations which then went on to the higher body and, through it, to the Government. This meant that there was a very considerable yeasting and input from the practitioners in the different levels of higher education to the deliberations of government through the Tertiary Education Commission. In my time as Minister I met each of these groups. I had the pleasure of appointing people and discussing the work of each of the councils. I came to realise the enormous body of expertise which went into the councils through the part time people who served on these bodies and who contributed their advice to educational administration in Australia. All that will be lost. Mr Hugh Hudson, the Chairman of the Tertiary Education Commission and a very distinguished former Labor Deputy Premier of South Australia, will have a much smaller commission and power will be much more in the hands of full time commissioners. In fact, Mr Hudson will be in a much more powerful position as a result of the alteration in this Bill than has been any chairman of the Commission before him. It is true that this change will obviously reduce the number of people involved in giving advice. Most of the part time people who gave practical advice within the sectors will be dispensed with. They are no longer need or wanted. The Government thinks that this will be good. I will not argue. If that is the perception of the government of the day about what will be best for higher education or tertiary education generally, that is a judgment about whether there should be consultation at all. The Tertiary Education Commission, as it is now structured, makes adequate provision for consultation across the sectors. When it is restructured it will save the involvement of more people and do so at the cost of the kind of consultation which has taken place. Indeed, it will save some money in the process. The Government puts this forward as a prime justification. I accept that this change will save money. Whether that sum is $100,000 or more does not matter. Our concern in the end is not really whether the Labor Government in administering education during its period of stewardship determines to emasculate or destroy the structure which Senator Sir John Carrick put in place. We will not oppose the Bill but I give notice that we have a different approach to the offering and administration of higher education. We believe that many more of the decisions in relation to their own activities should be taken at the institution level within the universities and the colleges, that they should be responsible for many of the things that they do and that this can happen best with a less centralised, rather than more centralised, system of administration. The Government chooses to go down a centralist road to accrete power to the centre. We believe that that is consistent with its whole centralist approach to government but in the end will not be good for education. I understand that a number of amendments from the Australian Democrats have been circulated in the chamber. The amendments were made available but as yet the Australian Democrats have had no discussion with us and have in no way indicated what their amendments are about and what merit they may have. If the Democrats would do us the courtesy of explaining what they are about, we will examine those amendments on their merit as they come through. In the meantime I indicate that the Opposition will not oppose this legislation at the second reading stage but we believe it is part of a program of administration of higher education put down by a government which is on the wrong track in meeting the needs of many Australians to improve and upgrade their skills and in meeting the needs of the education sector to provide adequately for tomorrow's Australia. Senator MACKLIN(Queensland)(10.25) —The Commonwealth Tertiary Education Commission Amendment Bill 1985 amends the Commonwealth Tertiary Education Commission Act in line with recommendations made in the report on the structure of the Tertiary Education Commission, the so-called Hudson report. Over the years the development of policy and funding priorities for tertiary education in Australia has been a very complicated one, becoming increasingly contentious. Unfortunately, it is also not particularly efficient, as I hope to show by reference to some specific items. On page 9 of the Hudson report there is reference to the rather farcical situation of the Commission preparing its report before the councils whose advice the Commission is bound to consider have finished their reports. It is an extraordinary and inefficient situation when the peak body puts down its report prior to the reporting of those bodies which are meant to advise it. Hence, there is fairly obviously a need for an overhaul of the system. However, let that comment not be taken as meaning that the Australian Democrats agree with all the criticisms contained in the Hudson report. I refer to one example that seems to me to illustrate our concern with many of those recommendations. It is that the councils recommended an increase in funding of $355m for the 1985-87 triennium and the Government provided only $65m. The Hudson report cites this disparity as evidence of the irresponsibility of the councils. Senator Peter Baume —They would fail Logic I on that. Senator MACKLIN —Quite frankly, I find this an extraordinary proposition. The importance of having independent commissions and of having advisory councils is precisely that they will advise government on how they see the matter. In their expert professional opinion, they put forward what they believe should be the case. It is not for them to make the policy decision; that is for government. But one does not appoint a commission and then expect it to guess what government wishes to do. I have expressed this viewpoint time and again, not only under this Government but also under the previous Liberal-National Party Government. The Commonwealth Schools Commission and the Tertiary Education Commission are expected to provide professional expert advice-not to be a commission of yes men and women, but to put forward a strong, reasoned argument of what are the needs of the sector. The Government, in its budgetary considerations, taking into account advice from the commissions and from all the other expert advisory bodies, has to make tough decisions. It should bear and does bear the odium or the applause arising from those decisions. But it seems to me very odd-almost, as it were, killing the messenger who brought news-to blame the people who put up what is needed. I wish to illustrate that with some examples of where I think the previous work that has been done to date in many of the recommendations is very useful, not only for the Government but also for the debate in the community at large. I am the first to admit that it is most definitely inconvenient advice, and I suppose all governments are concerned when they receive inconvenient advice. But I would have thought that governments would welcome being given the kind of strong, rigorous advice rather than the weak-kneed, `what is it that the Minister wants' type of advice. Rather than have that served up I would have thought that Ministers would like to know precisely what is going on so that they can make their decisions based on facts and not on material that they come to understand is being given to them because it is perceived to be what they are asking for. The amendments we propose to move meet that very philosophical point of trying to make sure that the advice can be offered-if it must be offered-and it is up to the Government then to make the decisions down the track. If we look at that $355m that the councils recommended and the $65m that the Government finally provided, it does not seem to me that it is a criticism-if it was meant to be a criticism-that could be levelled only at the councils because after all the Commission, in its wisdom, recommended an increase of $158m, which is still three times what the Government actually provided. Everybody managed to get it wrong. So if Mr Hudson's committee is willing to criticise others, it should also accept that same type of criticism. But I think it is ill-founded, misdirected criticism. The fact of the matter is that tertiary education is still massively under-funded. That is what the councils have been pointing out; that is what the committee has pointed out. I imagine that the Government itself also believes that tertiary education is still massively under-funded. Its excuse is that it cannot find any more money in a budgetary context. That is fine, but let us not go around criticising various expert bodies just because they point to the obvious facts-they are obvious facts-of the situation in Australia today. When the councils put in those reports they were merely doing their job and I think that they are to be applauded, not criticised. We know from the figures for the 10 years after 1975 that funds for capital developments for tertiary institutions have been drying up. They were drying up under the seven years of the Fraser Government, and that has continued. The Tertiary Education Commission's report for the 1985-87 triennium, volume 2 part 1, on page 39, points to a number of examples. They are matters that I have raised previously and, as I have suggested before, they will probably not be rectified until we have a major catastrophe. For example, paragraph 3.48 says in part: In particular, it has not been possible to provide all the additional space necessary to cater for increased enrolments. This has resulted in serious overcrowding at some institutions, especially those in outer metropolitan and regional areas . . . While the Commission considered that priority should be given to providing for enrolment growth during the 1985-87 triennium, it also recommended that substantial funds be provided for essential projects to rectify existing building deficiencies. These deficiencies are the result of serious overcrowding . . . I have already mentioned that, but of even more concern is the following statement: . . . buildings in the older universities, institutes of technology and consolidated colleges which, because of their age, are completely unsuitable for present needs and in a number of cases, are now serious fire and safety hazards. That is the fact. I am quite sure that other members of the Senate who visit tertiary institutions, as I do, can see that a number of serious fire hazards exist. I am particularly concerned about the buildings in which large numbers of students gather for major lectures. Of particular concern to me are the old-style, very steeply raked lecture theatres in the older universities and some of the colleges of advance education. I know of some lecture theatres in Australia whose only fire exit is the main door at the front, past which gas is piped and which leads into a very narrow corridor able to carry only a very small number of people. Often in newspapers and in reports from overseas we learn of major catastrophes occurring in old buildings because of their inadequate facilities. I expect that such facilities will remain in Australia until a major catastrophe occurs and, probably, large numbers of students are burnt to death. Certainly at that point there will be a lot of concern and people will ask why we have not done something. Unfortunately, then it will be too late. Such facilities currently exist in Australia. I believe that there is an urgent need to upgrade many of those old-style lecture theatres to provide them with a safety outlet. I have raised this matter previously on a number of occasions. In fact, I remember three distinct occasions on which I have raised this matter over the years. I was interested to see that the most recent report for the Commission pointed to the problem as a serious deficiency. We must do something about it. I do not want to be saying `I told you so'. It seems to me to be an area of top priority. It has been pointed to by the Commission and should be seen to. There is a good argument for having people point out the inconvenient facts. It is important that they do so and that they continue to do so. We should continue having bodies in Australia that can point these problems out and can put pressure on government so that government finally has to respond. The report of the Universities Council, one of those supposedly `overkill'-and I quote from the Hudson report-or `counterproductive' reports, points out in paragraph 9.7 on page 107 the following: Capital grants made available over recent years at less than $20m a year represent only 0.5 per cent of the total replacement value of buildings within the sector-- I emphasise `0.5 per cent'- estimated at some $3,000m. Thus the current level of capital grants implies an average life-span for university buildings of about 200 years. That is fine. We know that many old buildings exist in overseas universities. However, I suggest that anybody who has visited those buildings would know that they are no longer used for the purposes which we use them, that is, for packing in students. This is clearly absurd. The tax Act does not provide for that incredibly long life-span arrangement. But that is the current funding which is available. Again, that is inconvenient advice for sure. Nevertheless, it is true. Capital grants happen to be only 0.5 per cent of the total replacement value of the buildings which implies an average life-span of 200 years. There is nothing wrong in the Council's pointing that out. I am grateful that it has done so. Unfortunately, I am not sure whether it will be able to do so in future. The differences that we find between what the Government does and what is recommended are the result of political decisions, as they should be in a democratic country. I am happy to go on knowing what should occur even though it does not, because at least we know the size of the problems which face us in each area. I would have thought any government would want that type of information. Paragraph 2.5 on page 9 of the Hudson report states: The Councils have been used for the wrong purposes. The greatest contribution the part-time members can make is in the area of planning and development of policy rather than on matters of detailed administration and funding which are frequently put before them. I could not agree more. I believe that is perfectly true. It points to a problem we have had in the past that, in many reports, there has been an over-emphasis on a great deal of detail and of administrivia. I would much prefer it if they had pointed to those general policy items such as those to which I have just referred, as they are general policy positions. I want to point to the last set of amendments, (4), (5) and (6). Often in making a policy statement it is necessary to refer to some of the funding operations, but the Bill as currently stated says in clause 20: A report furnished under sub-section (2) shall not contain recommendations in respect of grants to be made to particular States or particular institutions. That is fine in that technical detailed sense, but I do not think I would want to support the idea that the reports need to go on making those fine judgments, because in many ways it is pointless to make fine judgments about $355m when in fact the Government comes up with only $65m. But I would still want as my amendment suggests to provide: except where the Council considers such recommendations to be necessary for the purposes of the report. In other words, the carrying out of those general functions of planning and policy development is sometimes inextricably woven with the discussion of the distribution of funds, such as I have just suggested in terms of replacement costs. Unless one makes some type of recommendation on replacement costs, any recommendation does not make much sense at all. Some of these things are so tied up that it is necessary to be able to include those. In some discussions my staff has had with the Government it has been suggested that `recommendations' means only formal recommendations. If so, I suggest the Government take back the Bill and redraft it because the word `recommendations' I am quite sure on any interpretation, when it finally came to the crunch, could refer to any recommendations contained anywhere in the report. The suggestion is put that those concerned could gabble on about anything they wanted to in the report itself, but that when it came to recommendations there would be a distinction. There is no basis in the legislation for the proposition. Senator Peter Baume —Convenience. Senator MACKLIN —I know that it is convenient, but there is no basis in the legislation for making that distinction because no distinction is drawn in the legislation between the report and the recommendation. There is none in number two, and that is the only basis upon which any such legal distinction could be drawn. None is drawn, and therefore this is obviously a blanket prohibition on moving anywhere in these areas. But it is so specifically drawn that one wonders what the Government is getting at. The legislation says, for example, that recommendations cannot be made in terms of any particular States or particular institutions. What happens if one talks about regions? Presumably one can. One could talk about institutions in the western suburbs of Sydney. Provided there is more than one, and there is, we are all right. If the Government wishes to take this step, it will have to redraft clause 20. If not, I wonder why the Government wants to stop States and particular institutions who are quite happy to allow financial recommendations to be made about regions. I do not follow the logic, and perhaps at a later stage the Government may be able to explain the logic behind it, if indeed that provision were meant to implement paragraph 2.5, which I presume it was. However, it does not do that. What it does on my reading is two things. First, it does not stop one doing anything about regions; secondly, it could stop one even engaging in any discussion of planning and development of policy by the way it encompasses almost everything and just sucks it up. In terms of planning policy with regard to a particular State, seemingly the councils will be hamstrung in a way that I think is totally inappropriate. It would have been possible to implement that general contention that more emphasis should be put on the development of policy and planning in a way that would not hamstring councils in the general wide-ranging views that they wish to put forward. With regard to the first set of amendments (1) to (3), I would refer to clause 15 of the Bill which deals with the Universities Advisory Council. That is the new name, so presumably we shall have a large number of new letterheads, though I am not sure why we keep changing these names ad nauseam. I imagine that all honourable senators would know that, after the passage of this Bill, the university councils will have a composition different from that before the introduction of the Bill. Why we should go on and on changing the names, I do not know. It must help somebody; I hope so, anyhow. Clause 15 of the Bill states: The Universities Advisory Council shall inquire into, and furnish information and advice to the Commission with respect to, such matters relating to universities, or relating to university education, as the Commission requires. In other words, all the initiatives in these areas will now come from the Commission. The Commission will simply say to the Universities Advisory Council `We want X', and the Universities Advisory Council will go and do it. It seems to me that, if we are going to establish a universities advisory council, a TAFE advisory council or the college advisory councils, we should at least give them some respect and recognise their professionalism. I will be moving a set of three amendments in respect of each of those new advisory councils to attach at the end of clauses 15, 20 and 25 the words: `or as the Council determines'. In other words, because the Universities Advisory Council knows the sector and because it is the advisory council there may be matters on which it wants to give advice. If its wants to give advice on some matter of great urgency to it why should it be prevented from doing so and be able to give advice only on matters on which the Commission wants to receive advice? If we are to set up these advisory councils I would have thought that it would be perfectly reasonable to allow them to have an initiative of their own to offer advice, otherwise I think the people who serve on them will feel very hamstrung indeed. The rest of the Bill carries into effect, in a technical way, the general recommendations of the Hudson report. I believe that, because of the way it has now been organised, it ought to be possible to get advice from the councils to the Commission in time for the Commission to get its report to government. The structures that are provided and the time tables that are set down will now enable that to occur, and I think that has to be an advance. However, I would be concerned if, in using this new structure, any attempt was made to stifle the free flow of information to the Parliament and to the general community which is crucial for an informed debate about the structure of tertiary education in Australia. It is a sector vital to the health of this country not only socially but also, as I have said many times, economically. It is really the power-house from which we can move forward. It can and should provide Australia with citizens capable of producing an economy to maintain the standard of living that we have had in the past. We need to take every bit of skill, every bit of ingenuity and every bit of talent which could be enhanced by tertiary education and so enhance it. We cannot afford to waste any of that in our community. In the past Australia has been in the forefront of almost every technological development. As the Minister for Science (Mr Barry Jones) is wont to point out in the speeches that he makes around Australia time and again, unfortunately that inventiveness in Australia too often has not been followed through to completion. In the end it is not that we do not have the ability, the understanding, the ingenuity, the foresight or the inventiveness to come up with the types of things which are necessary to maintain our stance in the world; it is that we do not then take them forward in terms of their development. We as a community have been extremely well served by the tertiary sector in Australia. However, an organisation of that size is always and should always be subject to criticism. There is always something that can be done better, more economically, more expeditiously and more efficiently. But unfortunately, I believe, too much of our education debate in Australia, as in so many other areas, is concerned with the knocking and fails to address itself, at least on some occasions, to the enormous value that the community derives from our tertiary sector. I think we can be proud as a nation that we have devoted the resources we have to the establishment of that sector. We can be disappointed that we have not done more. We can be disappointed that we are progressively falling behind so many countries with which we like to compare ourselves in terms of the availability of places in the tertiary sector for our young citizens who need retraining and upgrading. We are dropping further and further behind. We cannot expect the tertiary sector to supplement this by saying to it `You can take more students', and then not funding them so that the tertiary sector cannot deal adequately with them. In the last exercise we increased the number of students and funded them to the tune of about $4,000 each. The Government then turned round and said that it had calculated the cost of a full time student at $10,000-plus. In other words, the Government, on its own reckoning, said to the universities and to the colleges: `You can take as many students as you like but you will get $6,000 less for each student that you take'. That just seems to me to be an exercise in making sure that we keep the good news in one compartment and do not actually link it up with the bad news on the other side. The tertiary institutions understand that they are being squeezed. They are doing their utmost to cut costs and to cut corners. Let us hope that, in the long term, by implementing that type of exercise, we do not effectively cut our own throats by not having the type of people we need in this country for the years ahead. Senator REYNOLDS(Queensland)(10.53) —I am pleased to support the Commonwealth Tertiary Education Commission Amendment Bill because I believe that the amendment Bill, as outlined, will be responsible for increasing equity in education in this country. That, of course, is a goal which this Government is thoroughly committed to and which I believe it is implementing very successfully. I must admit that I find it somewhat hypocritical of Senator Peter Baume of all people to talk about the problems associated with the limited numbers of tertiary places in Australia today. Of course, this is a concern that we all share. However, unlike a number of honourable senators Senator Baume was in a position during the 1970s perhaps to have limited the present situation in Australia. As we are well aware, there was a serious cutback in tertiary education funding in the early 1970s after the Whitlam years. Under a former Liberal Government, of which Senator Baume was a member, we had very serious cutbacks in the universities, the colleges of advanced education and in the technical and further education sector, and that sector has not fully recovered as yet. However, I argue that this Government has done a great deal more to address the problems that have accumulated over the last 10 years than Senator Baume and his Government did when they were responsible for tertiary education. When it comes to the razor gang of the Fraser years, I have very strong personal recollections because I, as a former teacher in a college of advanced education, was a victim of the razor gang. Like many of my colleagues I lost my job and students were seriously affected because they did not have tutors to assist them. These students were disadvantaged students who very much needed the extra staffing that had been built up under the Whitlam regime. I put it on record for Senator Peter Baume's notice that this Government, between 1983 and 1987, will create approximately 28,000 new places in higher education. I ask Senator Peter Baume: How many new places were created when he was Minister for Education? Senator Peter Baume also talked about the way in which the various councils created attention for the competition for funds between the university, CAE and TAFE sectors. He said that he thought this was a good thing because it allowed them to compete openly and for the Commonwealth Tertiary Education Commission to be in a position to establish its priorities. As a former CAE teacher, I am biased but I believe that there is very much a need to recognise more definitely the work being done in the CAE and TAFE sectors. For far too long universities have been the darlings of the tertiary education sector. Of course, this is traditional and is to be expected. However, a number of the proposals put forward in this Bill at least start to address some of the inequities between the TAFE and college of advanced education sectors and the universities. I remember well my first visit to a TAFE college library. Having been a student at a university and a teacher at a CAE, I was fairly used to seeing high standard libraries. I was absolutely horrified at what passed for a library at a TAFE college. There seemed to be a belief, certainly in those days, which was back in the late 1970s, that TAFE colleges did not have the same need for expenditure as the university and, to a lesser extent, the CAE level. I shall now refer to some of the comments that Senator Macklin made. I and other Government members would share his concern about the serious overcrowding in a number of the larger and older universities. This is a problem that I know is continually being addressed by the Commission, the Minister for Education (Senator Ryan) and the Government as the economic climate allows. One of the ways I would like to see the overcrowding problem addressed is by focusing even more on the need to expand non-metropolitan and regional institutions. I am well aware, as I visit institutions in my State, that there is a lack of space there; it is not just in the large, older universities and, to a lesser extent, colleges. Just recently I visited the Capricornia Institute of Technology, which is gravely concerned about the lack of space that it faces right now. Some jokes were made about the lack of space for staff; nevertheless it is obviously a very serious matter. Also there is a lack of teaching space. The Capricornia Institute is particularly concerned-I am sure this would apply to a number of other institutions which are in a similar situation- because it is expecting to be first in line to develop nurse education programs. The Institute says: `If we are overcrowded now, what are we going to do when the nurse education programs in this State get going?' Of course, we assume that the Queensland Government will finally move to accept the Federal Government's overtures in developing nurse education in that State. Both Senator Macklin and Senator Peter Baume commented about the status of the councils. I would like to run through some points of clarification about the status of the councils. Sectoral councils have been re-designated as advisory councils which advise the Commission rather than the Minister. They are required to provide triennial reports very much along the lines that Senator Macklin talked about on policy directions, rather than getting caught up with administrative trivia, to the Commission on needs and new policies without including detailed financial arrangements. While the number of part time members in each council has been reduced there is now a requirement for a commissioner to be appointed for his or her knowledge and expertise in relation to each relevant sector. I welcome the inclusion of commissioners who represent institutions outside the Melbourne-Canberra-Sydney triangle. Whenever I look at various advisory bodies of the Government I find that there seems to be a preoccupation with assuming that all wisdom comes from that area of Australia. It is very important that we appoint people from outside metropolitan areas, particularly from outside Melbourne-Sydney-Canberra, to bring in new perspectives and perspectives on some of the very specialised problems that are being faced in institutions in places such as north Queensland and central Queensland. I am sure that other States have particular problems that they also wish to be addressed. The TAFE advisory council will have one member more than the other two councils. This is a most important initiative because, as I said earlier, TAFE colleges have not received the recognition that they should have received in the past. The reason for this is the continuing development of that sector both in its own right and in its preparatory role for the higher education sectors and the enhanced role of TAFE due to the change in the balance of youth labour market programs as a result of the findings of the Kirby Committee of Inquiry into Labour Market Programs. I will run through the major changes embodied in the Bill which will extend the charter of the Commission to include in its functions the promotion of developments across the various sectors of tertiary education. The report concluded that the present structure impedes the promotion of the Government's participation and equity objectives as it acts as a barrier to cross sectoral developments. From that point of view, I am very pleased to see this change introduced in this legislation. The amended Act will include institutes of tertiary education in the types of tertiary institutions on which the Commission can provide advice and will include provision for the Minister to declare a specified institution or authority to be an institute of tertiary education for the purposes of this Act. Also this Bill will redesignate the sectoral councils as advisory councils with the function of advising the Commission on the needs and new policies in their respective sectors. The report concluded that the existing system of sectoral councils advising the Minister, with the Commission in turn developing its advice to the Government, results in excessive report writing and considerable duplication and leads to unrealistic resource bids. Of course, especially at present, we want realistic projects and we do not want unrealistic proposals coming out of these councils. Each advisory council will publish a triennial report on the state of its sector, its problems and priorities for future development, but will no longer develop detailed financial recommendations for Commonwealth grants. The Bill further reduces the part time membership from eight to six in the case of the universities and advanced education councils, and from eight to seven in the case of the TAFE council. However, in addition, a part time member of each council will be appointed to membership of the Commission, in addition to the full time council chairpersons, to provide expertise in sectoral matters. Part time membership will be increased from five to six. Savings, of course, must be a consideration, and it is estimated that a saving of $100,000 per annum will result from these changes. The Bill also provides for the insertion of non-sexist terminology in the legislation in place of existing sexist language, such as `chairman'. In addition, a replacement listing of recognised colleges of advanced education is provided, reflecting name changes in a number of institutions and the establishment of the new Gold Coast College of Advanced Education. Of course, it is in regard to this latest initiative that I am particularly pleased to be in a position to support this piece of legislation. I have become well aware, over a number of years, of the need for further education developments at the Gold Coast, and I know that a number of my Queensland colleagues on the other side of the chamber will welcome this move also. In its submission to the Commonwealth Tertiary Education Commission for the 1985-87 triennium, the Queensland Board of Advanced Education proposed the establishment of a CAE at the Gold Coast and sought capital funds to enable the college to accept students as early as 1986. In terms of access to higher education, the Gold Coast and surrounding local government areas represent one of the most disadvantaged large population concentrations in Australia. There are many people from other parts of Australia who probably just do not realise the extent of the population on the Gold Coast and the difficulty for students who have previously been travelling to Brisbane institutions to further their education. Whilst the journey along the highway is a little faster now than it used to be, since our Minister for Transport has been giving priority to national highways, nevertheless it takes a great deal of time out of students' work and study periods if they are continually having to organise themselves and their lecture and tutorial timetables around that trip up to Brisbane and back again. The existing population of the Gold Coast region is in excess of 200,000 and it is growing at a faster rate than that of metropolitan Brisbane. It is also a relatively youthful population when compared with that of Brisbane. The Commission, in its triennial report for 1985-87, recommended that a capital grant of $1m be provided in 1987 to enable the first stage of the development of advanced education facilities for the Gold Coast to be commenced, and the Commission's recommendation was accepted by the Government. The Queensland Government has now advised that it proposes to establish the Gold Coast College of Advanced Education with the intention of commencing teaching, in rented premises, from the beginning of 1986. In January this year, the Queensland Premier wrote to the Prime Minister (Mr Hawke) on this matter advising that he intended to seek special recurrent funding for that project. A detailed submission to this effect has been provided, and it has been considered by the Commonwealth Tertiary Education Commission in the context of its supplementary report for 1986-87. The Commission has advised in that report that it considered that provision should be made for better access to higher education for the rapidly growing population of the Gold Coast. It also accepted the need to increase the level of participation in higher education for Queensland as a whole. However, the Commission has advised that the current arrangements with existing institutions for providing opportunities for students who live in the Gold Coast area should be continued for 1986. But I am very pleased to see that that $1m has been set aside for the introduction of the college in 1987. Senator Sir JOHN CARRICK(New South Wales)(11.10) —The Senate is debating the Commonwealth Tertiary Education Commission Amendment Bill 1985. That Bill seeks to amend the present structure of the Tertiary Education Commission. That structure was put in place by the Fraser Liberal Government. I should add, so that my remarks are clearly understood, that I was the Minister at the time who put that structure in place. Therefore, some may, if they choose, view the remarks that I make now as subjective. I believe that the structure was, and is, the optimum one for the development of the post-secondary sector. I believe that what is happening with this Bill, if it is passed, is retrograde. I believe that the Bill effectively destroys the three councils-the Universities Council, the Colleges Council, and the Technical and Further Education Council; that it pretends that they have a function for the future, but, by making it simply in semantics an advisory council, by taking away its right of independent reporting, by taking away its right of reporting on finance, virtually emasculates it. It would be better that it were removed than left in that state of shambles. To understand this situation one must look at the antecedents. One must first remember that the universities themselves gained their great impetus by the recognition by the Menzies Government in the 1960s of universities for Federal funding. One must also look at the impetus given to colleges of advanced education from two factors of the early 1970s. First of all, there was a report from a standing committee of this Senate on teacher training-a committee on which I was proud to serve. This report was picked up by the then Minister for Education, Mr Malcolm Fraser, and, as a result of it, a series of reforms were made and foreshadowed for colleges of advanced education. Above all, what was recommended was that there must be drastic reforms in teacher training in Australia and that single purpose colleges should, desirably, be made multi-purpose. The second thing to understand is that when the Whitlam Government came to power, in its first two years it gave, very generously, funding to universities and colleges. There was a large expansion in those sectors in those days. In its third year it put on the brakes and caused considerable confusion. I commend the gesture of giving more generous funding. That was needed. At the end of the Whitlam era-and this must be understood - the Whitlam Government had put on the table in another place a Bill to create a tertiary education commission. That Bill sought to create a single stratum commission combining both universities and colleges. That Bill was never passed. It completely ignored, in fact, technical and further education. When the Fraser Government came to office, it found a circumstance which was, to say the least, chaotic. First of all, the three sectors each were in a state of great anxiety. The universities had seen themselves as becoming simply factories for primary degrees. They had lost that sense of feeling that they had other creative needs in terms of research and higher degrees. They were fearful that the colleges might dilute the nature of tertiary education and that we might get sub-standard institutions. The colleges were in absolutely total disarray. The Council of Advanced Education was totally demoralised. I use these words advisedly. The colleges did not know where they were going. They feared that they would be engulfed by the universities. They saw themselves as second class citizens. They had no reason to, but they found themselves in that situation. They feared, with great trepidation, that they would be engulfed in a Tertiary Education Commission of one strand. Technical and further education was nobody's baby. It was not recognised federally. The States had not developed it fully. Yet it was the most significant sector in Australia's hunger to create more technical skills amongst its people. I faced this situation as Minister and I came to the conclusion that a number of things must be done. What I concluded then, I put to this Senate, was right then and is right now. I concluded, firstly, that it was imperative that technical and further education be brought into the same stratum as the other two. Secondly, each university, college and technical and further education institution must be given the right to show what its needs were and what its hopes and aspirations were, to feel that it could develop into a pursuit of excellence in its own way and to feel that no institution was superior to another. There is talk in this new Bill about cross-sectoral development. One thing that is certain is that there could be no cross-sectoral development in the pre-Fraser regime because there was no way in which there was a placental relationship between colleges and technical and further education institutions. Yet fundamentally that is where the placental relationship had to exist. It has to be understood that what I and my Government were seeking was the pursuit of excellence in each sector; not that colleges must always remain colleges. Indeed, if colleges could develop in their pursuit of excellence, they would create unique institutions of their own. Those who know America, England and the Continent know that institutions do not have to lie in special compartments. Those who know Australian colleges know that the directors of central institutes of technology colleges - the Canberra College of Advanced Education, the Royal Melbourne Institute of Technology and so on - all developed in a superior way. There is no question of people arguing whether the Canberra College of Advanced Education is inferior to the Australian National University. That is not in dispute. They are both pursuing their own goals. Under the creation of the three sectors lying side by side, there was a chance for an institution to develop without an inferiority complex and without a fear that the other institution was going to engulf it. Fundamentally the colleges believed, and will now go on believing, that the universities were much more skilful than they in pleading for funds, in manoeuvring and in lobbying, and that, unless they had some say in the financial situation, unless their cards were on the table as were the cards of the universities, they would be outbid. Therefore, we devised a system which created a dialogue. My great quarrel with this Bill is that it institutes a monologue. When I read the Bill and I read the phrases in the Bill justifying it, I could almost hear a dictator speaking. Whenever anyone pleads that there is too much paper, too much dialogue or too much discussion, they are the words of the Hitlers and the Mussolinis of this world. The whole art of this Parliament is to institute dialogue. Indeed, if we are going to rationalise, let us not have a Parliament. Fundamentally, the basis of this new situation is contained in the second reading speech, which says that the real reason for this Bill is to overcome excessive report writing, considerable duplication and unrealistic resource bids. The whole of the democratic institution is built upon the need to create dialogue, the need to argue one's sectoral and special needs, the need to have report contending against report. The whole of this democratic system is based on the expression of one's needs through the bids for finance for those needs. There is no possibility of considering institutions which can simply put up generalised concepts of their needs without attaching the Bill or the account to them. Indeed, the ludicrous nature of this Bill is that, taken to its logical conclusion, in the present process of putting together the 1986-87 Budget we should abolish the bids by the 30-odd government departments for their financial needs for the coming year. If it is wrong to have so-called unrealistic resource bids-those are the famous words here-if that fundamental principle is wrong, let the Government, Mr Keating and the Treasury say to the departments: `No longer are you to put in your bids, because they are duplication and they are unrealistic. After all, we have in Cabinet and in the Ministry a representative of your department'. That is the argument here: `We have that; so we do not need your bids'. I repeat the fundamental fact that, wherever democracy has its fora to put forward its arguments, it creates dialogue, it institutionalises dialogue, and that dialogue is based upon needs expressed in terms of money. That is the whole basis of it. When the Fraser Government put its Tertiary Education Commission together, it brought TAFE in alongside the other two and therefore allowed placental exchange, cross-sectoral development and argument between universities, colleges and TAFE institutions. The Fraser Government said to each of them: `This will be a two-strata organisation. Each of you will have your own council. Each of you will have full freedom to search amongst your particular sector-universities with universities, colleges with colleges and TAFE institutions with TAFE institutions-and, without any restriction on your report, to report what you consider to be your needs and what you consider to be the finance necessary for your needs. You-the Tertiary Education Commission-having got together those reports, shall report how you achieve a balance of understanding between those three. All of you shall report in public so that everybody will know and there cannot be any suspicion that the universities are better bidders than colleges or TAFE institutions. Every card is on the table'. Of course, there is duplication. In fact, the very duplication that is being opposed here is the absolute essence of contention. Indeed, if contention were not a good thing rather than a bad thing, this Senate would not be necessary. This Senate is based upon the contention of ideas. It was said, therefore, that we would know and there would be no kinds of conspiracy, no need for anyone to develop an inferiority complex, no need in future for people to think they were second class citizens. If there were problems such as whether colleges should do research or whether that should be a preserve purely of universities, that could be discussed. That could come up through the sectors to the Tertiary Education Commission. If there were a situation in which an institution was growing to a stage where it could be a university, that could be done. After all, to say that it could not be done under the present system is to deny the ability to amalgamate some dozens of colleges with universities around Australia, which was done. Of course, there has been cross-sectoral development, duplication and paper work. Of course it could be simplified. We could cut out nine tenths of the paper work in putting together this year's Budget by simply saying to departments: `Forget your input into this altogether. We, the Cabinet, will do it because we are structured very similarly to the new Tertiary Education Commission. We have a representative from each of the departments. We will know what to do'. To say that is nonsense. We need a system in which quality as well as quantity should develop and one in which, for example, the CAEs should be lifted up, not simply by changing their names from teacher training colleges and raising the salaries of lecturers, but also by making them into multi-purpose institutions, by developing their quality and saying to them: `You have all the horizons before you to improve your pursuit of excellence'. That used to be the structure. Let us look at what is to be. First, these councils are not to report on finance, so that the fundamental matter in which they are interested-the quantum of money to do all their intra-sectorial work-is not for them to discuss. But it gets incredibly worse. They are to inquire into and recommend only what they are told to inquire into and recommend. They are not to think wider than that except perhaps once every three years. I will read proposed new section 21A which is contained in clause 15 so that we understand what we are talking about. It states: The Universities Advisory Council shall inquire into, and furnish information and advice to the Commission with respect to, such matters relating to universities, or relating to university education, as the Commission requires. It is not to be furnished with information that the councils think fit. What are the councils to do? They are to inquire into matters or furnish information only if they are directed to do so. It is not clear, but apparently once every three years they may have a flight of fancy. Fundamentally they are to have an input year by year as budgets occur. What is the use of a flight of fancy once every three years? I should add that that provision is the same for universities, colleges and TAFE so that the double stratum of the Tertiary Education Commission has been virtually wiped out. They are no longer advisory councils. These bodies can advise only on what they are instructed. They do not have freedom at all. They cannot advise on a budget. That is a fundamental use of the institution. Their functions are to be changed because of their sins of excessive report writing. The Hudson Committee goes to great lengths to say that reports often do not arrive in time for the Commission to get on with its work. We are burning down the barn to roast the pig. If the whole of the trouble is simply that the timetable is wrong, a better timetable should be put in and the parts of it should be placed in their right order. One does not excuse the action of trying to wipe out any right of advice by saying that the advice does not get there in time. That is an absolute nonsense. Comments of excessive report writing have been used by dictators and would be dictators of history to say that they believe in monologue not dialogue. What is excessive? The viewpoint is that we do not want the duplication of advice of councils as well as that of the TEC. In other words, we do not want contending bids-that is wrong. How can anybody argue in this Parliament that that is wrong when every aspect of what we do is structured about that. So it goes on. There is considerable duplication. This institution of parliament is based on considerable duplication, excessive report writing and contention. It is getting to the nub of the contention that matters. But then big brother speaks, or is it big sister in this regard? The real crime is that this problem leads to unrealistic resource bids. Who says that these resource bids are unrealistic? Is it big brother? How do we know that they are unrealistic unless they have been stated, a counterstatement is made and we have some comparison? The Government has a fervent desire to have a monologue, not a dialogue, to enforce its will so that it can decide what shall be the budget for post-secondary education and so that it will not have the embarrassment of the public knowing that the various councils do not agree with the Government and that the councils have quite different bids. I cannot believe that anybody with a parliamentary background could take from an advisory body the right to recommend budgets and finance when in fact fundamental to the Tertiary Education Commission is its preparation of a budget. We have three councils and each is supposed to have expertise in its sector. Each university council is supposed to know the separate needs of its institutions, those that over bid and those that are shy, and ultimately to produce a balance which it puts forward. The same thing occurs with colleges and TAFE. Only such bodies can really know by looking into these matters what is the right budget. Is the Tertiary Education Commission to set up an overview of each institution? Will the Commission now monitor each institution and decide which needs more money, which needs less and which is overbidding? How can it do that as well as the sectoral council which has expert knowledge? How can any of us know why it arrived at its decisions unless we have the bids on the table. The Commission says that each advisory council will publish a triennial report. That is simply writing history and reporting that the horse is out of the stable. Three years will have gone by over which it has had virtually no influence. The needs of post-secondary education change enormously year by year. The growth of unemployment and the tragic persistence of juvenile unemployment in the last three or four years creates a demand for us to be constantly reviewing needs in the education sectors. How can we believe that a TAFE council can report only once every three years on the absolutely vital needs of post-secondary education when every year something like 20 per cent or more of our 15 to 19-year-olds who cannot get a job and are unlikely to get a job are turned out of our high schools? As each year goes by under this Government its period of unemployment gets longer and longer. There is a need for education in the transition from school to work. It is a system which I tried to initiate but which has not been fully developed. That need needs to be scrutinised day by day, week by week and month by month. We cannot wait. Are we to tell the technical and further education sector that it has a privilege to report in 1989-that is what is said-on the needs for transition from school to work programs and the needs of the TAFE sector? The statement of these things simply exposes the fallacy of them. In trying to cloak its true intent, which was to take away the clout and the power of the councils to investigate and report effectively, the Government has used euphemisms which are not true. It has destroyed the councils. It calls them advisory councils but they can advise only on what they are instructed to do and no more. They cannot advise on budgetary matters and therefore are completely useless. If they cannot advise on budgetary matters, they cannot advise on the particularity of the structure of their internal budget. They cannot advise on how much a particular institution, university, college or secondary college should get or how much more one should get than another. So presumably, rather than saving money, the Tertiary Education Commission will have to set up some kind of mechanism to advise it on its shopping list at the end of the day. Otherwise, where will it get that shopping list? I suppose the most derisory comment in the second reading speech is that this is great because it will save $100,000. But how many millions of dollars is the Government setting aside at the moment for some of the wonderful bicentennial inquiries into what women do at home and things of that nature? Here we are talking about the most vital domestic issue before us in Australia today-how to upgrade the skills of our young people, how to motivate them, improve their self-esteem and equip them in this technological age. We are being totally out-competed on world markets. The only way for Australia to overcome its adverse trade balance, to uplift its manufacturing industries and to create jobs is for our productivity to equal that of our trading partners. That simply means that we have to upgrade our skills and our attitudes. Education is absolutely vital to that end. The solution of this Government is to destroy dialogue. It says: `We believe in monologue. We believe that the Tertiary Education Commission can get the answers to this. We do not believe in putting all the cards on the table. That involves too much paper. We do not believe in the right to free advice. We do not believe that the councils should have the right to bring down a budget. In fact we are pretending that they still exist because they will have no real purpose'. I believe this is a seriously wrong judgment. In the end the Australian people will want organisations which set out exactly what are perceived to be the needs of the sectors. I believe the step being taken is a very retrograde one. Senator TEAGUE(South Australia)(11.40) —The Senate is debating the Commonwealth Tertiary Education Commission Amendment Bill. Senator Sir John Carrick, my colleague who preceded me in this debate, has expressed very clearly the concern of the Opposition to ensure that there is maximum dialogue and maximum ability for each sector of tertiary education to express its views independently, publicly and soundly. This Bill looks at the now eight-year experience of the Commonwealth Tertiary Education Commission. Currently there is expenditure of $2 billion each year to support Australia's universities and colleges of advanced education and to contribute about 20 per cent of the cost of technical and further education. Thus, all education programs after secondary schooling are encompassed in the decisions and advice brought to Government by the Commonwealth Tertiary Education Commission. This is necessarily a very complex annual process of putting together patterns of advice. The nearly 100 higher education institutions all have views about their needs and growth. The six States and the Territories have views on priorities. There are competing claims, particularly for course development, between the three sectors-the universities, the colleges of advanced education and technical and further education. Until this time the original 1977 Tertiary Education Commission set-up has been a very sound and helpful way of co-ordinating all these inputs into a program for the development of tertiary education in Australia. But, after eight years of experience, this Bill proposes some adjustments to overcome certain problems. As one senator who has taken a close interest in education matters over the last eight years of my time in Parliament, I am certainly aware that during this time a view has developed amongst many of the institutions and the States that the existing machinery is cumbersome, that firm decisions take a long time and that this is impeding some good developments that would provide for better tertiary education opportunities for Australians. I am certainly aware of vice-chancellors, principals of colleges and even TAFE representatives complaining, particularly from 1982 to 1983, about the need to review the machinery for making decisions about the allocation of resources in the tertiary area. This led to the Commonwealth Tertiary Education Commission proposing to the present Government that the Commission should have the ability to review these decision-making processes. Understandably, we need to be very careful, as that initiative came chiefly from the Chairman of the Commonwealth Tertiary Education Commission, that he is not proposing matters too subjectively, particularly as his proposals led to the Government's appointing him to conduct the review. We must be conscious of the genuine views of those who are responsible in the States and in the institutions. I have read carefully the Hudson report on the Review of the Structure of the Commonwealth Tertiary Education Commission and Arrangements for Co-ordination and Consultation with States and Institutions which was brought to the Government in March of last year. Whilst I reserve judgment on some matters of detail, I believe it is a carefully written and clear document that expresses a way of overcoming the cumbersome decision-making processes that have developed in the Commonwealth tertiary education area. There is certainly a second imperative involved in the Hudson review, which led to this Bill, of building better opportunities for cross-sectoral co-operation. My colleague Senator Sir John Carrick, a former distinguished Minister for Education, has already referred to the importance of the universities and colleges co-operating and not negatively competing for resources or for new course developments. For example, in the period of the Liberal-National Party Government some university and college amalgamations were initiated, partly by reports of the Commonwealth Tertiary Education Commission although they were taken up with real momentum by that Government, precisely because it was believed that that would lead to greater educational opportunities, and certainly there would be cost savings as well. In the spirit of those changes, however difficult they may have been for some individual academics or individual governing bodies of institutions, there were positive outcomes from those amalgamations and I believe that from time to time there does need to be a careful and thoroughgoing look at the arrangements that exist. This is the case here. The Chairman of the Commonwealth Tertiary Education Commission has had a thoroughgoing look at the decision-making structure in the Commission and has come forward with a sweeping, comprehensive set of recommendations most of which I welcome. I believe that they will lead to overcoming the cumbersome decision-making processes of recent years and will make for better cross-sectoral co-operation. It will also allow more flexibility to deal with some emerging educational institutions in Australia which are neither universities nor colleges of advanced education but which are now more truly described as tertiary education institutions. I refer to the post-secondary courses in Darwin, a rather isolated part of Australia, sensibly encompassing university, college of advanced education and even technical and further education courses. I refer also to the deprived areas in our cities, the western suburbs of Melbourne and the western suburbs of Sydney, where important constructive initiatives are being taken to bring courses to such geographical regions where we need to give greater opportunity. It is sensible for these additional regional initiatives to be truly tertiary in their organisations. This Bill allows the Tertiary Education Commission to deal with such bodies. I refer also to regional cities such as Whyalla in my own State of South Australia, where the adult community and school graduates need to take a range of courses in their own region. They would include some courses given by satellite lecturers or departments of universities, institutes of technology or colleges of advanced education. I have no quarrel with the objectives of the Hudson review; nor do I quarrel with the objectives of this Bill, which are to overcome cumbersome decision-making, to maximise cross-sectoral co-operation and to give sensible flexibility in dealing with some of the new regional tertiary education institutions. Let me recall for the Senate a conference I attended convened by Professor Caro at Melbourne University in 1982. He was then Chairman of the Australian Vice-Chancellors Committee. The theme of his overwhelmingly well received address to that conference and of other papers given by mostly university representatives was that they were almost drowning in a sea of bureaucracy based on the Commonwealth Tertiary Education Commission's processes here in Canberra and that what was needed was a freeing up, a greater genuine expression of autonomy, and simplified processes of consultation that would allow individual universities and colleges, and the technical and further education systems in the States, to have sensible and useful growth and changes that would benefit students in their areas. I am entirely sympathetic with Professor Caro's call and it is still my view that the simplifications and the shorter timetables for decisions that are contained in this Bill's amendments to the Commonwealth Tertiary Education Commission Act, may not go far enough in some directions. Understandably, the Bill does not touch on some matters raised by the Hudson review concerning new course or teaching developments. Many of these matters can be handled administratively within the Commission, but I certainly welcome the comments of those who have recently expressed the view that there ought to be, within broad money and numbers constraints, the ability for institutions and a range of institutions within any one State to adopt courses more quickly without second thinking in a cumbersome Canberra bureaucracy. I would welcome these parallel changes with regard to the approval of new teaching developments. I will monitor, with all those in the Opposition-I am sure all those in the Parliament; certainly those who have preceded me in this debate- the precise outworking of these new arrangements. Along with Senator Sir John Carrick I will seek to ensure that the three sectors are able to have maximum dialogue, and indeed for each institution to have maximum ability to put views that eventually find their way to decision in the recommendations of the Commission. But I put the dilemma that I referred to earlier: If there is a cumbersome decision-making process which has led to complaints all about the country over recent years, something needs to be done about it, and that simplified situation of having one Commission with three advisory councils may mean that some precise rights of the three sectors can be vested in the Commission. You cannot have your cake and eat it too. If there is to be a simplified decision-making process, some independent stepping stones on the way may be diminished. The Opposition will be careful to see that the provisions in the Bill provide for each of the three sectors to give three-yearly independent reports that are initiated entirely by those advisory councils, that are not circumscribed by the Government of the day and that are not circumscribed by the Commission. In regard to the comments earlier today by Senator Macklin and Senator Sir John Carrick on proposed section 21A of the Bill, I note that the Bill is inadequate and needs amendment such that in the annual reporting of the three sectors the council ought to have the ability to determine its agenda as well as receive requests and requirements from the Commission. I note also that in the second sub-section of that proposed section which talks about the three-yearly review there is no limitation on the content and nature of the findings of the three advisory councils in regard to the state of the universities, of colleges or of TAFE. The only limitation is that the three-yearly reports are not to be aimed at precise financial recommendations. I believe, in the spirit of what I have said about not having one's cake and eating it too, that that limitation on the three-yearly responsibility of the three sectors is acceptable in the context of the whole theme of this change to the Commonwealth Tertiary Education Commission. It is for that reason that when we come to the Committee stage the Opposition will support the amendments which will allow the advisory councils to determine the agenda of some of the matters on which they will advise annually, but will not seek to amend the limitation prescribed in sub-clause (3) that precise financial advice be not included in the three-yearly reports of the councils. I further note that there may be some anxiety in each of the three sectors, that this is an untried pattern of reform for the Commission, and that some matters will need to be worked out. The Opposition will be quick to respond to representations of any frustration in sensible dialogue and independent input in to these new processes. No one has made precise representations to the Opposition saying that this Bill has inadequacies in the general thrust of the reforms it places on the Commonwealth Tertiary Education Commission. It would be too late and crying over spilt milk for anyone to complain in subsequent months that he or she did not have an opportunity to do so in the last 11 months since the Hudson report was given to the Government. In conclusion let me refer to the Liberal and National parties' commitments during 1984 to the need for reviewing the structure and funding of higher education. I will not bore the Senate but just refer to our published 1984 policy statement which called for a more flexible and sensible approach to the relationships there ought to be between universities, colleges of advanced education, institutes of technology and the technical and further education sector. We believed then, and we believe now, that, in higher education in particular, there needs to be a review of the structural arrangements. These are only partly accommodated by the amending Bill that is before us. Let me read three brief paragraphs from our education statement of 1984: We will initiate a major review of structural and funding arrangements in higher education. The brief of the reviewing body will include consideration of options which could generate reconstruction of the higher education sector to produce a coherent pattern of institutions delivering an agreed range of services and a better alignment of funding and authority between the Commonwealth and the States in the sector. The role of the private sector in the delivery of higher education services will also be reviewed. Leading educationists are questioning whether the rationale behind the binary structure of higher education is still tenable. Originally it was intended that the role of the colleges would remain distinct from, but complementary to, that of the universities. As they have evolved, however, their roles have come to overlap markedly and each sector now delivers some educational services which, under the original concept, would be more properly carried out within the other sector. Certain aspects of the binary system-amongst others, restriction of the colleges' access to research funding, and restriction on the granting of some post-graduate awards by colleges-artificially restrict the role, and inhibit excellence in, the college sector. I still very much support those views. It is in the spirit of that statement, along with the precise matters I have referred to in my remarks, that the Opposition decision has been made not to oppose this Bill but to welcome the objectives of overcoming the cumbersome experience of the Canberra bureaucracy in recent years, to maximise cross-sectoral co-operation and to make for sensible flexibility. I finally note that the Opposition is by no means complacent about tertiary education. It is not happy with the record of this Government. Expectations have been raised by this Government which have not been fulfilled. There has been very little growth in enrolments in universities and colleges. The Government's record in the TAFE sector is, I believe, abysmal. The good record of support for technical and further education of the Liberal and National Party Government has not been continued by the present Government. So whilst I support the sensible developments in the Bill before the Senate, we will continue to monitor them, and every aspect of tertiary education, because we are by no means satisfied that there are sufficient advantages for young Australian people and adults to gain enrolment in the courses they seek. It is not good enough that 30,000 Australians are turned away from enrolment in universities and colleges. We still believe that even these reforms of the Commission ought not to be set in concrete. There is still a need, as I said, to review the structure and funding of higher education. The Opposition will continue to urge that this be addressed. Senator RYAN(Australian Capital Territory-Minister for Education)(12.01) —I was just about to rise and congratulate the Senate for the constructive tone of the debate on the Commonwealth Tertiary Education Commission Amendment Bill 1985 which will rationalise and reorganise the Commonwealth Tertiary Education Commission councils. However, unfortunately I am not able to do so in an unqualified way as Senator Teague, whose contribution to the debate was generally constructive and sensible, decided to conclude his remarks by making some quite outrageous and unsupportable criticisms of the Hawke Government's performance in the area of tertiary education funding. I simply must put on the record that the growth which we will have achieved in the number of places available in higher education, 28,000 at the end of this triennium, cannot in any sensible fashion be described as insignificant or minor growth. There has been massive growth in the number of tertiary places available and we expect that that level of growth will continue. Not only has the Hawke Government been highly successful in turning around the cuts and the decline in the tertiary sector characteristic of the Fraser years but also we have achieved enormous success in increasing participation rates in secondary schooling to the end of secondary school. The demand for places will continue. I think that 28,000 new higher education places is an achievement of which our Government is properly proud. Similarly, I must say that the figure that Senator Teague used in his concluding remarks, of 30,000 qualified students being turned away, is simply unsupportable. At this stage there is no data on the disparity between demand and supply of higher education places. However, last year it was a maximum of about 10,000. There is every reason to expect and to hope that it will be significantly lower than that. To return to the debate, in general I express appreciation for the support of the legislation. I believe that the legislation will result in a more efficient Tertiary Education Commission. The councils will use their time and resources more effectively. The overall outcome of that will be stronger policy advice to government on the needs of the three sectors and of the whole area of tertiary education. Because my colleague Senator Reynolds dealt very adequately with the issues raised by Senator Peter Baume and Senator Macklin, I will not go over that ground. I note that Senator Sir John Carrick expressed misgivings and anxieties about the new structure, but I assure him I have every confidence that his misgivings will prove unfounded. The Government is unable to accept the amendments proposed by the Australian Democrats because, taken together, they substantially undermine the effect of the Government's response to the Hudson report on the structure of the Tertiary Education Commission and ignore the totality of the changes endorsed by the Bill. I remind the Senate, and the Australian Democrats in particular, that the Chairman of the Commonwealth Tertiary Education Commission made his recommendations after a thorough review of the complexities of existing structures and wide consultation. The majority of the submissions received agreed that change to the structure of the Commission was needed and concluded that the extra layer of statutory councils was the cause of much of the complexity in the system. The Chairman went on to identify the voluminous reports as a key factor in the inefficiencies in the existing system. The effect was to absorb council time and deflect councils from the important role of advising on total sectoral needs and priorities for policy action. Councils instead were repeating in detailed terms recommendations on financial allocations. The importance of a major statement on sectoral needs was recognised by the Chairman and by the Government and is reflected in the legislation that is before the Senate, which specifically provides for each council to make a major report each triennium. The Bill also provides for the councils to report to the Commission as required in order to enable the Commission to respond to government funding decisions and requests for advice. The councils will also have a significantly expanded voice on the Commission itself, which is very important. Six members of the Commission which comprises ten members, including the Chairman, will be members of the sectoral councils. In other words, the councils will have significantly more influence on the Commission and their ability to influence the advice provided by the Commission is greatly enhanced. The extra reporting provisions sought by the amendments are unnecessary, while the additions to the financial reporting procedures would result unnecessarily in a return to the old system of extensively detailed claims for institutions or States. I would remind honourable senators that councils will report on the overall needs, but we do not wish to return to a situation where they go into unnecessary and detailed recommendations taking up the demands of particular institutions or particular States. It is not necessary for the councils to provide such detailed financial recommendations at the stage of assessing overall sectoral needs. The Bill as drafted does not remove the right from councils to provide recommendations on needs, including financial needs, to support priorities and the new policies proposed by the councils. The Bill was circulated to the States prior to its introduction in the House of Representatives and I think it is significant that no State has objected to the provisions of the Bill along the lines sought by the Australian Democrats' amendment. In conclusion, I thank honourable senators for their contributions to the debate. The Democrats' amendments are not acceptable to the Government. I commend the Bill to the Senate. Question resolved in the affirmative. Bill read a second time The Bill. Senator MACKLIN(Queensland)(12.10) - by leave - I move: (1) Page 5, clause 15, proposed new sub-section 21A (1), at end of sub-section, add the following words: `or as the Council determines'. (2) Page 7, clause 20, proposed new sub-section 24A (1), at end of sub-section, add the following words: `or as the Council determines'. (3) Page 9, clause 25, proposed new sub-section 27A (1), at end of sub-section, add the following words: `or as the Council determines'. These first three amendments deal with the advisory councils. If I can simply refer to the first amendment, the arguments are identical for each of the other councils. Proposed new section 21A relates to the Universities Advisory Council and in relation to the Council states: . . . shall inquire into, and furnish information and advice to the Commission with respect to, such matters relating to universities, or relating to university education, as the Commission requires. The amendment seeks to add the words `or as the council determines'. It seems to me that in establishing an advisory council, that is a professional advisory council made up of people who are knowledgeable enough to serve on this council and to represent the university sector in the determinations of advice coming to the Government, one must stress that they are also the type of people who are likely to have information and who would come across items on which they themselves would wish to make some recommendations, and give some advice or offer some information to the Commission. I suggest it is odd to have it determined as required here that the Commission itself will only seek information and advice that it wishes to hear and effectively prohibit the Universities Advisory Council, on its own initiative, from rendering information and advice that it believes useful to the Commission in determining its advice to the Government. It seems to me that not to allow councils to provide that type of information will cut off one useful area of facts, information and advice which, while inconvenient, might also be very useful. Senator RYAN(Australian Capital Territory-Minister for Education)(12.12) - In response to Senator Macklin's amendments, I feel it is not necessary to add these additional reporting responsibilities or possibilities. The councils will be able to touch on any subjects they wish in their triennial reports. Insofar as specific advice is sought from the councils by the commission itself, I remind Senator Macklin that the councils will collectively have six members of the Commonwealth Tertiary Education Commission and therefore will be in a very strong position to ensure that anything that they think warrants a special piece of advice is requested by the Commission. Therefore, the amendments are opposed. Senator PETER BAUME(New South Wales)(12.13) —Senator Ryan's intervention offers no good reason for us to oppose the first three amendments. On the basis of Senator Ryan's contribution as much as on Senator Macklin's presentation we will support the amendment. My colleagues Senator Sir John Carrick and Senator Teague in their contributions both drew attention to the urgent need for dialogue and the capacity for each of the sectors to make known its views. Senator Macklin has pointed out quite correctly that there should be no possibility that the advisory councils will be limited in the advice that they may offer on matters referred from the Commission itself. Senator Ryan said that she did not want them to be so limited. On that basis I think the amendments are desirable. Amendments agreed to. Senator MACKLIN(Queensland)(12.14) —by leave-I move: (4) Page 6, clause 15, proposed new sub-section 21A (3), at end of sub-section, add the following words: `except where the Council considers such recommendations to be necessary for the purposes of the report'. (5) Page 7, clause 20, proposed new sub-section 24A (3), at end of sub-section, add the following words: `except where the Council considers such recommendations to be necessary for the purposes of the report'. (6) Page 9, clause 25, proposed new sub-section 27A (3), at end of sub-section, add the following words: `except where the Council considers such recommendations to be necessary for the purposes of the report'. These amendments again add identical words to the provisions dealing with each of the three councils. I refer to proposed new section 21A (3) which deals with the Universities Advisory Council by way of illustration of my point. Sub-section (3) reads: (3) A report furnished under sub-section (2) shall not contain recommendations in respect of grants to be made to particular States or particular institutions. As I pointed out in my speech in the second reading debate I wish to add the words: `except where the Council considers such recommendations to be necessary for the purposes of the report'. The point I was making there is that we accepted that part in the Hudson report which desired a move away from the detailed financial recommendations towards those general policy deliberations - a move away from the discussions of detailed administration to general propositions and discussions. The amendment that I have moved does not run counter to that general contention. We accept that general contention. However, I think the point I made in my speech in the second reading debate is important. If any council wishes to raise any points it may be necessary, as an integral part of that recommendation of general policy matter, to make subsidiary recommendations with regard to some aspect of finance. I pointed to two items in my speech - that of overcrowding and the various unsafe buildings particularly in the older universities. Undoubtedly there are financial aspects involved in solving those matters. If the councils wish to make that a high priority, in terms of the amounts of money that they know are likely to come, they have to bear in mind something about the financial matters. It just seems to me such an artificial division which will possibly render the ability to make the more general recommendations almost inoperative. The second point that I made was in regard to general upgrading or replacement. It is very telling for a universities advisory council report to have made the point that the overall replacement operations would seem to suggest almost a 200-year life for all capital plant and equipment which is currently provided within universities, CAEs and TAFE colleges. If anything is to be done about that some type of priority has to be given to replacement as against, say, new buildings. I would have thought that to put this provision in the legislation in the way in which it is put may very well militate against those types of recommendations. Any council reading this and attempting to abide by it will find enormous difficulties. I think the provision is badly drafted. For example, can councils rehearse these matters in the report, or would a rehearsal of these matters in the report be taken to be a recommendation in terms of this clause? The word `recommendation' in the legislation does not have a large R, it has a small r. Could any of the suggestions within the report be taken to be a recommendation? I would have thought that, on any reasonable legal advice, they would have to be because no distinction is made anywhere in this legislation between `report' and `recommendation'. The only place where this appears to be so defined is in the so-called recommendations. We have looked in vain for a definition of what is meant by `recommendation'. It is not in this piece of legislation. What are we to say? We have to assume that the legislation refers to recommendations in general. It is written in with a small r so we must assume that it refers in general to a rehearsal of these types of priorities and propositions of finance. The second part of the legislation seems to me to be very badly drafted. It states: . . . grants to be made to particular States or particular institutions. In other words, it is fine to make grants to particular regions. Councils can make financial recommendations as much as they like to particular regions but they cannot make recommendations to particular States or particular institutions. That seems to me to be rather poor drafting. If it was meant to cover all it should have covered all. Senator Ryan —We don't make grants to regions. Senator MACKLIN —I know that the Government does not but I am talking about recommendations that may come from these councils. I am talking for example about amalgamations of certain institutions within a particular region that may have financial implications. This legislation does not refer to the States or to a particular institution. By definition an amalgamation has to refer to more than one institution. Is that allowable? I would be interested to hear from the Minister whether or not that type of operation is allowable. Presumably these councils cannot refer to amalgamations. They can, because they can refer to more. Senator Peter Baume —I would have thought that they could. Senator MACKLIN —They can because it is not a State and it is not an institution. This seems to me to be very odd. So there will be rehearsals which presumably the Councils will do in a number of ways. I think those are the two main points that I wish to make. The first point is that I am concerned about the ability to make these general policy recommendations because they are intimately linked with general financial matters. I am quite happy to have a prohibition about the more detailed financial matters and the more detailed administration but I am not happy with this blanket wipe out which does not really give the councils an opportunity to rehearse some matters which they wish to rehearse. The last point I wish to make is that this is only advice going to the Commission which itself gives advice to the Government. The Government is the body which finally has to make the hard financial decisions of where the money is going. All this is doing is offering advice and I think it is rather odd for any government to move to seek to limit professional advice coming to it about such an important matter. Senator RYAN(Australian Capital Territory-Minister for Education)(12.20) —Let me respond to the points made by Senator Macklin. I think he has misunderstood the provisions in the legislation as drafted. There is every opportunity for councils to make general policy recommendations, be they in relation to regions, amalgamations or any other matter that the councils wish to touch upon. The Government does not want-this is the reason why we cannot accept Senator Macklin's amendment-the councils to encumber their advice by putting in very detailed financial recommendations taking up the bids of individual institutions. It is not appropriate at that stage for that sort of detailed financial information to be included. It has not proved a useful practice up until now. The opportunity for financial recommendations will arise when the six Council members meet as part of the Commission. Senator Macklin wanted to know what the councils could say about amalgamations. Under the Bill, as drafted, they would be able to comment on the outcome of an amalgamation or on the need for any other changes in a particular region. They would not be inhibited from doing that in any way. What would not be required under the Bill as drafted would be for such general advice to be given then a recommendation that $Xm should accompany their advice. As to the distinction that Senator Macklin was seeking to make between general reporting and specific recommendations, I do not think that is a distinction that we need concern ourselves with. The Commission and the Government will look at the overall advice from the councils and make a judgment about its appropriateness or usefulness; they will make decisions based on the calibre of the advice, not the particular format of the advice. The amendments moved by the Australian Democrats are not acceptable to the Government. Senator PETER BAUME(New South Wales)(12.24) —A few moments ago the Committee agreed to certain amendments which added words to proposed new sub-section (1) of each of the appropriate clauses. Senator Macklin is now moving amendments to proposed new sub-section (3). I draw Senator Macklin's attention to the fact that proposed new sub-section (3) refers only to reports provided under proposed new sub-section (2), not under proposed new sub-section (1). I wonder whether the amendments which have already been passed to proposed new sub-section (1) do not give to the councils a power to make general reports to government as the councils determine in terms of the words which we have added. To some extent I think we may already have moved by amending proposed new sub-section (1) to give to the councils power which they did not have. This prohibition under proposed new sub-section (3) really will not affect that in any way because that prohibition is limited to the reports which the councils are required to furnish under the next sub-section; that is, proposed new sub-section (2). I hope that the capacity which has been given to the councils to make reports-which we hope the Government will accept-will extend to any matters which the councils may determine they wish to report on. The Opposition, having supported the first group of amendments and having given this extra capacity to the councils, feels that on this occasion it will not support the second group of amendments. Senator MACKLIN(Queensland)(12.25) —I will respond to the Minister's and Senator Baume's comments. The amendment which I have moved states: . . . except where the Council considers such recommendations to be necessary for the purposes of the report. I am referring specifically to the report in proposed new sub-section 24a (2) and not to the general matters which, if amended and accepted by the Government, would give additional powers to provide information on specific matters at other times. We are talking about the report and I have deliberately limited my comments to what is necessary to it as set out in proposed new sub-section 24a (2). When one looks at the proposed new sub-section one sees that the report has to be on the state of the universities, the problems within them and the priorities. It seems to be very difficult to talk about priorities without some way referring to finances. The universities may wish to rehearse some of the difficult problems that some universities have had with regard to upgrading and amalgamation. This applies particularly to universities. I find it very difficult to understand why any government should seek to limit to itself information from its own expert body. I am at a loss to understand why it would wish to do that. It could be said that every time the Government has done this in the past it has been of no use. That is fine. It does not make any difference though, because at some time in the future such advice may be useful. The Government could say that in the past it has never acted upon it. This seems an extraordinary admission. The Minister said in the debate that in the past she has never acted on advice from universities. I find that an extraordinary admission; nevertheless, it has been made. Senator Ryan —And no government has ever received recommendations. Senator MACKLIN —If that is what the Minister is saying, fine. Under such circumstances the universities councils would probably give up giving advice. However, if one looks at previous university council reports, at what the Commission has recommended and at what the Government has accepted one sees that the Government has indeed taken the advice of universities in these matters. The Government cannot have it both ways. It can say that it has not acted on the advice of any of the councils reports. It cannot say the advice is useless. The logic of saying: `We have acted on it' and `It was useless' escapes me. Putting in a conjunction-which the Minister just did by way of interjection-seems utterly and totally fallacious. One cannot argue both that the advice is uses useless and that one has acted on it. The Government has already argued that the advice is useless, so presumably it has not acted on it. That is what I was drawing my logical conclusion from. However, the Minister has now said that she has acted on the advice, so I draw the conclusion that it was useful. If the advice was useful to the Government in the past, it may be useful to it in the future. Question put: That the amendments (Senator Macklin's) be agreed to. The Committee divided. (The Chairman-Senator D. J. Hamer) Ayes . . . . . . . . . . . 7 Noes . . . . . . . . . . . 59 —— Majority . . . . . . . . . 52 —— Chipp, D. L. Sanders, N. K. Haines, J. Siddons, J. R. Macklin, M. J. (Teller) Vigor, D. B. Mason, C. V. J. Archer, B. R. Kilgariff, B. F. Aulich, T. Lewis, A. W. R. Baume, Michael MacGibbon, D. J. Baume, Peter McIntosh, G. D. Bjelke-Petersen, F. I. McKiernan, J. P. Black, J. R. Maguire, G. R. Bolkus, N. Messner, A. J. Boswell, R. L. D. Missen, A. J. Brownhill, D. G. C. Morris, J. Carrick, Sir John Parer, W. R. Childs, B. K. Puplick, C. J. G. Coates, J. Ray, RobertCollard, S. J. Reid, M. E. (Teller)Colston, M. A. Reynolds, M. Cook, P. F. S. Richardson, G. F. Cooney, B. Robertson, E. A. Crichton-Browne, N. A. Ryan, S. M. Crowley, R. A. Sheil, G. Devlin, R. Short, J. R. Durack, P. D. Sibraa, K. W. Elstob, R. C. Tate, M. C. Evans, Gareth Teague, B. C. Foreman, D. J. Townley, M. Georges, G. Vanstone, A. E. Gietzelt, A. T. Walsh, P. A. Giles, P. J. Walters, M. S. Guilfoyle, Dame Margaret Watson, J. O. W. Hamer, D. J. Withers, R. G. Jessop, D. S. Zakharov, A. O. Jones, G. N. Question so resolved in the negative. Bill, as amended, agreed to. Bill reported with amendments; report adopted. Bill (on motion by Senator Ryan) read a third time. Sitting suspended from 12.37 to 2 p.m. Senator CHANEY —Does the Minister for Industry, Technology and Commerce agree that petroleum feedstock is an important input for many manufacturing industries? Does the Minister agree that many Australian manufacturers, especially those in the chemical and plastics industries, are currently paying more for their petroleum feedstocks than their overseas competitors? Will the Minister take action to ensure that Australian manufacturers can have access to petroleum inputs at world prices? Senator BUTTON —I certainly agree that petroleum feedstock is a very important input into a number of manufacturing industries. That is why this Government and the Government before it have made special concessions in respect of petroleum feedstocks of particular kinds for manufacturing industry and, more particularly, for the rural sector. I also agree that it is likely that, given current world oil prices, Australian manufacturers are paying more for their petroleum feedstocks than the current average world market price, and that that is a matter which the Government will have to address in respect of both the rural sector and the manufacturing sector. I make the point, of course, that the problem of inputs into an industry such as the chemicals industry is not confined just to petroleum products. For example, there are a number of inputs into the chemical industry which have very high tariffs on them and which mean that this industry cannot operate competitively in world terms. That is a matter which the Government will also have to address in respect of the current Industries Assistance Commission report on the chemicals and plastics industries. So it is not just a matter confined to petroleum products. Of course, Senator Chaney asked me what I will do about that, having made all those concessions, if you like-- Senator Chaney —That was the easy bit. Senator BUTTON —Yes. Let me say that all those matters are matters which, as the Minister responsible for those areas, I would take into account without any prompting from the Opposition. Senator CHANEY —I ask a supplementary question. I thank the Minister for that answer, but I ask him to explain the comment he made when he said that the Government would have to address these issues for both manufacturers and the rural sector. I ask him whether he is indicating by that answer that manufacturers will in fact get the same consideration as our hard-pressed rural sector when the Government is considering this issue of petrol pricing or oil pricing? Senator BUTTON —No, I am not indicating anything of the sort. All I am indicating is that there is a problem which has to be looked at in respect of manufacturing inputs. Senator ELSTOB —I direct my question to the Minister for Education. It refers to special access programs to promote the successful completion of university courses by disadvantaged groups. Will the Minister say whether the special access programs are a new development in education and, if so, whether such programs are likely to be commonplace in the future? Senator RYAN —There have been programs encouraging and assisting people from disadvantaged groups to get access to higher education for some time now. Since we have been in government we have introduced new measures and continued existing ones. For example, we fund special measures to assist Aboriginal students, in the first instance, to gain access to and then to get support during university studies. Through the equity program of the Commonwealth Tertiary Education Commission we fund higher education institutions to do things such as provide engineering courses for women at the Queensland Institute of Technology, the Royal Melbourne Institute of Technology and the New South Wales Institute of Technology. At La Trobe University, James Cook University and Wollongong University there are support arrangements which assist socio-economically disadvantaged groups to develop their academic skills and give them support during the course of their studies. Some institutions, such as Melbourne University and Sydney University, have established schemes whereby the institutions identify students from disadvantaged backgrounds while they are still at school and give them support, encouragement and advice that assists them to gain places in higher education institutions. There are a number of such programs in operation and I do not intend to take up the time of Question Time going into them in detail, but it is a very important aspect of our Government's higher education policy that the benefits of higher education be available not only to those who almost automatically move into higher education but also to groups which in the past, through socio-economic disadvantage or disadvantages associated with race, have been prevented from having these benefits. I am confident that there has been a great deal of progress and I think an examination of the Commonwealth Tertiary Education Commission's reports covering those matters would demonstrate that there has been progress in improving the access of disadvantaged groups to higher education. But, of course, such groups still have many unmet needs and problems and I expect that we will find it necessary to continue these special measures for many years to come. Senator DURACK —My question is addressed to the Leader of the Government in the Senate. Yesterday both he and the Prime Minister gave unequivocal guarantees in this Parliament that the promised tax cuts would be delivered in September. Will the Leader of the Government now give the same unequivocal guarantee that Australians will receive the full benefit of the big drop in oil prices in March? Senator BUTTON —It is common knowledge that Government Ministers will be meeting about this question later in the week. When we meet we will make a decision about this matter and then we will inform honourable senators, and speculation and incitement from Senator Durack will not stimulate us to bring the meeting forward to this afternoon. We will meet later in the week and we will make a decision about these matters and then he will be informed. Senator CHILDS —My question is directed to the Minister representing the Minister for Aviation. Considerable concern has been expressed by the airline industry about the Government's proposal regarding alternative administration arrangements for the collection of the departure tax. What proposals, if any, is the Government considering in this regard? Senator GIETZELT —The Senate will be aware that the previous Administration, the Liberal-National Party Administration, introduced a departure tax for all those persons leaving our international airports and proceeding overseas. That tax was designed primarily as part of a cost recovery scheme for those using the airlines to make a greater contribution to their upkeep and maintenance. Of course, that has the effect of placing less reliance on general tax revenue for the purpose of providing those facilities. The Government has decided to retain the current flat rate departure tax of $20 for adult passengers on international airlines, but the Government has expressed a view that the airlines themselves should be responsible for the collection of that departure tax from 1 July this year. The Government has made known to the airlines its preferred method of collection-namely, that it should be collected at the point of sale of the ticket. That has a number of advantages. Not only does it put us in line with many other countries overseas but also it eliminates the difficulty that passengers find themselves in from time to time of congestion at the departure point at the international airports. It also eliminates the need for passengers to have cash on hand to meet the commitment and, of course, it puts us in line with other countries, and therefore it follows the general pattern that has developed over the last couple of decades with more and more people travelling overseas. Airline operators, of course, have raised some objections to this, but negotiations are taking place with the airline operators designed to minimise the difficulties. The Government recognises that some operators have objections to the scheme; nevertheless, the Government is determined that the general thrust of its proposals be accepted by the airline operators, because it believes not only that a contribution should be made but also that this is in the best interests of the passengers themselves. Senator SIDDONS —My question is directed to the Minister for Finance. Australia's foreign debt is still expanding at an alarming rate. Is the Government proposing any initiatives to bring this under control? At present corporate cannibalism is increasing our foreign debt simply because small companies are borrowing large sums of money overseas to raid companies many times larger than themselves. The companies are then being split up and sold by the raiders, with disastrous consequences in terms of unemployment and decreases in productive capacity in this country. All this is being paid for by the taxpayer. I ask the Minister: Is the Government considering two obvious steps to preserve our hard-earned foreign exchange; firstly, controlling capital flows in and out of the country; and, secondly, the elimination of negative gearing for corporations as the Government has already done for farmers and individuals? Senator WALSH —Firstly, in regard to overseas borrowings for takeover purposes, that does not necessarily add to the foreign indebtedness because, as Professor Corden pointed out in an article in the Australian Financial Review just before Christmas, it depends ultimately on what the person who sells the shares does with the money received for them. If he spends the money on luxury imports there is, of course, a commensurate increase in overseas debt. However, borrowing by companies or individuals overseas for takeover purposes does not of itself necessarily cause an increase in indebtedness. The Government's response to the foreign debt is very well known-to allow the dollar to find its own level and to deregulate the financial market. Senator Siddons asked two specific questions: Has the Government considered firstly, controlling and regulating the inflow and outflow of capital and, secondly, dealing with negative gearing by corporations? The first answer is that I know I have not considered it and, so far as I know, the Cabinet jointly has not considered it. I do not know whether the Treasurer has, but I will ask him. With respect to the gearing question, when the tax reforms are fully implemented, the advantages which at present are available through the tax laws of having a highly geared company will no longer be present or at least certainly not present to the extent that they are now. Senator SIBRAA —My question is also directed to the Minister for Finance. Has the Minister seen an article in the Weekend Australian of 9 and 10 November last year in which Katharine West supported the construction of a privately owned and operated railway to Darwin? Would such a railway really be privately owned and operated or do proponents of such a railway actually demand a huge subsidy from the Commonwealth? Senator WALSH —I have seen that article. Indeed, I have seen a number of articles published in the Australian written by Katharine West over the last six months or so. Senator Grimes —They are all the same. Senator WALSH —I was about to say that, Senator Grimes. It is not really a number of articles so much as the same article over and over again which repeats the theme that Australia was built by rugged individualists, entrepreneurs and fearlessly independent people and that the Government of today and governments in the past have stifled this rugged individualism and have destroyed the people who have made this country great-who made this country what it is, I think is the phrase that she uses. In so doing she has displayed a profound ignorance of Australian economic history: From the days of the arrival of the rum corps in 1792 when the officers received land grants from the government and labour in chains from the government, and sold their produce to the government store, through the log rolling railway builders of the 1860s, 1870s and 1880s, the irrigation cargo cultists of the late nineteenth and early twentieth centuries and the feather-bedded manufacturers of the 1920s and beyond in particular. Most of these rugged, fearless entrepreneurs have been dependent on some form of government protection or handout and have come to demand it as a right. Indeed, as Ted Seiper observed in a work published a couple of years ago, Australia from the very beginning has been a producers' society and the duty of government, as perceived by producers, was to provide a captive market for anything that anybody wanted to produce. However, even given that record, I was astounded to find someone with the demonstrable and profound ignorance of Katharine West writing, and I quote: The most productive new piece of northern infrastructure might turn out to be a well integrated, privately owned and privately operated-- Senator Archer —I raise a point of order. The question, to me, seemed to be something about railways. We have not heard one word about railways or trains or anything at all. I think that the Minister should come back to the field. The PRESIDENT —Order! There is no point of order. Senator WALSH —I will take up from where I left: set of port and rail facilities to enable Darwin to be used as a major entry and exit point for goods to be efficiently transported to and from the rest of Australia. In other words, she is supporting the construction of an alleged private railway and, of course, the proposal is that there be an enormous Commonwealth Government taxpayer capital subsidy up front for it. She is suggesting that, if such a railway were built, cargo from overseas would be unloaded at the port of Darwin and then sent down the railway initially to Adelaide, then across to Sydney, Melbourne and other places like that. Supporting that and saying that that is a viable proposition is to break new ground, even for a self-opinionated mediocrity like West. However, what concerns me is not that this guru of the ratbag right is published regularly in the organ of the ratbag right, but that she holds an academic post at Melbourne University. I find it alarming, to say the least, that the sort of intellectual sloth and drivel that she churns out with such regularity in the Australian is being inflicted on impressionable students at one of the nation's most prestigious seats of learning. Senator ARCHER —I would like to ask a question of the Minister for Education, who represents the Minister for Housing and Construction. I refer the Minister to last week's release of figures showing a dramatic fall in both the number and value of building approvals throughout Australia. Is the Minister aware that these figures revealed a 19 per cent fall in the value of total building approvals between November and December and a drop of almost 30 per cent in private sector approvals? Can the Minister give any indication as to when this Government's high interest rate policy will be eased in favour of a more sensible and balanced mix of anti-inflation policies which places more emphasis on reduced government spending and labour cost restraint? Senator RYAN —I am afraid that I will have to disappoint Senator Archer in the short term. Because I do not have that information available, I cannot confirm his statistics. I will have to refer his question to the Minister and I will get an answer as quickly as I can. Senator ZAKHAROV —My question is addressed to the Leader of the Government in the Senate. I refer the Minister to recent allegations from the Customs Officers Association and sections of the media claiming that the Australian Customs Service is in poor shape and is unable properly to carry out its functions in the areas of drug importations and surveillance. In particular there were allegations that a Customs launch was hardly ever used. What is the Minister's response to these allegations? Senator BUTTON —On a number of occasions I have said that I believe that the Australian Customs Service is a very good one and that the officers of the Australian Customs Service are predominantly highly motivated and very diligent in the way they perform their duties. However, there have been a number of allegations made about the Customs Service and it is sad to relate that many of them emanate from officers of the union of the Customs Service-the Customs Officers Association. I recall that about three or four weeks ago a number of allegations being made about alleged deficiencies in the Customs Service in drug detection in the port of Melbourne and similar-- Senator Missen —Costigan said a lot about it. Senator BUTTON —Yes, I agree. I make the general point that allegations about the use of customs facilities and so on are quite widespread. They do no credit to and have no benefit for the members of the Customs Service who, I believe, perform their duties effectively and well. The sad thing is that very rarely is there any real substance in these allegations. I remind the Senate that the report of the last inquiry into the Customs Service, the Mahony Review of Customs Administration and Procedures, said: The COA representative, in public hearing, stated that unsubstantiated allegations . . . had been made to the media for the purpose of gaining public support for the objectives of the Association. It is sad that since that time there have been a number of similar allegations. One example is that three or four weeks ago it was alleged by a senior officer of the Customs Officers Association that a customs launch based at Geraldton in Western Australia had scarcely been used since it was commissioned on 14 May 1985. That allegation received widespread media coverage and interest because everybody is in favour of customs launches being used to detect smugglers, drug peddlers and so on. The point is that in the 123 days since the commissioning of that launch until the time the allegation was made, 53 days were lost in use of that launch as a result of an industrial ban placed on its use by the Customs Officers Association. Senator MacGibbon —A strike under Labor-very rare. Senator BUTTON —I agree. It is very rare but it happens occasionally. As the honourable senator knows, we have an enormous legacy of sloth by previous governments to overcome. I remind the honourable senator that last year was the lowest year for industrial disputes in this country for 17 years. He should not forget that. Nonetheless, of those 123 days when the customs launch could have been used, 53 days were lost due to an industrial ban by the Customs Officers Association and 24 further days were lost through crew leave and days off. The Customs Officers Association admittedly put to the Customs Service that there could be additional crewing and other things to enable the launch to be used more regularly. That would have cost the Service $467,000 in a year. It is a matter of judgment and management judgment as to how the facilities of the Customs Service are best used. There have also been allegations made about the number of customs staff used for enforcement as distinct from revenue collection. About 46 per cent of all Customs staff are used for enforcement purposes. I also make the point that there have been three major inquiries into Customs since 1980. None have identified fundamental problems with Customs although there have been a number of minor inadequacies referred to which have been addressed. Recently the Government has established the Australian Customs Service as an independent organisation. It has had that independence for six months and it should be allowed to get on with the job. Complaints made by some senior officers of the Customs Officers Association are not helping in that task. No customs service in the world, including this one, can be satisfied with the degree of success achieved by Customs in dealing with drug running. The allegations which are made from time to time about the Customs Service are immediately and regularly examined by senior management of that service. It does no benefit to what is in essence a fine service to have these sorts of allegations made. I conclude by saying that there is competition within the Australian Customs Service for membership between two trade unions. I mention that without comment but I think that it has a lot to do with the allegations being made. Senator Sir JOHN CARRICK —My question to the Minister representing the Attorney- General relates to the proposal by the Northern Territory Government to institute an inquiry into the Azaria Chamberlain case. In view of the residual responsibilities of the Commonwealth Government with regard to the Northern Territory as a self-governing territory and in view of the need to achieve the most effective inquiry I ask the following questions: First, has the Government had any discussions other than the public gratuitous exchanges yesterday with the Northern Territory Government about this inquiry? If so, what is the nature of those discussions? Secondly, does the Government intend to discuss with the Northern Territory Government the nature of the proposed terms of reference? Is the Government in the process of preparing optimum draft terms? Apart from the Attorney-General's generalised comment yesterday does the Government intend to offer the services of a judge of the Federal Court? Finally, does the Government consider that the inquiry must have the full powers of a royal commission? Senator GARETH EVANS —I need to take those questions on notice. I do not have information on the basis of which I could answer them. I will seek a reply from the Attorney-General as soon as possible. Senator VALLENTINE —I ask the Minister representing the Minister for Foreign Affairs whether the Australian Government supports the views of the new United States Ambassador to Australia, Mr Lane, that New Zealand's anti-nuclear policy makes it the Hartley of ANZUS and that New Zealand will be readmitted to ANZUS if it gets down on its knees and follows the rules. Does the Minister consider this an appropriate analogy especially when the ANZUS Treaty requires the United States to withdraw from ANZUS if it disagrees with New Zealand's stance, rather than requiring New Zealand's expulsion? Would not the Australian Labor Government agree with its fraternal New Zealand Government when Mr Lange notes that statements such as Mr Lane's serve only to reinforce the New Zealand people's determination to have a nuclear-free and independent country? Senator GARETH EVANS —The Australian Government has maintained a position of scrupulous impartiality in the controversy which presently obtains between New Zealand and the United States. We have made our views known to New Zealand on our reaction to the policy issues involved but beyond that we have not sought to mediate or intervene in the dispute in any way. We have not regarded it as appropriate in the past, nor do I regard it as appropriate now, for the Government to comment on the matters that have been raised in the way that they were raised by Senator Vallentine. Senator Dame MARGARET GUILFOYLE —I ask the Minister for Finance whether the reports in today's Press are accurate in their anticipation of a worsening of the current account deficit. Is it expected that the figures to be released later this week for the January balance of payments will reveal another large current account deficit? Further, in the light of all the economic indicators, does the Minister still predict that the Budget forecast for a $4.9 billion deficit remains on target? Senator WALSH —Frankly, I have no idea whether the newspaper predictions about the current account deficit for January are correct. However, it is known that there will be some very substantial aircraft purchases in January or possibly February which will cause a short term distortion-a one-off increase in our monthly deficit. On the other question of the Budget projections, as Senator Dame Margaret Guilfoyle well knows, it is true that because of the Australian dollar's value being somewhat lower than had been assumed in the Budget figuring, so far this year anyway, outlays will be higher than they would otherwise have been. There have also been some decisions taken by the Government since the Budget was introduced which have increased outlays, and other decisions virtually imposed on the Government by the courts which have increased outlays. But at this stage it is too early to say whether an increase in outlays in some areas will lead to a net increase in outlays. Likewise, even a net increase in outlays will not necessarily mean an increase in the deficit if it is matched by an increase in revenue. In addition, the lower value of the Australian dollar has probably had some positive effects on the revenue side. Senator FOREMAN —Did the Minister representing the Minister for Foreign Affairs see the report in the Australian Financial Review of Tuesday 11 February 1986 entitled `US Military Advisers for the Philippines'? In that article it was reported that the United States of America was considering the despatch of United States military personnel to act as advisers for the Filipino army in its operations against the new people's army. Will the Government state what position Australia holds with respect to United States military advisers being sent to the Philippines? Senator GARETH EVANS —The Australian Government has no information to confirm that any specific proposal is being considered by the United States Government for the despatch to the Philippines of military advisers on counter-insurgency. The Press report to which Senator Foreman refers describes the possible despatch of military counter-insurgency advisers as one of a number of options allegedly under study by the United States Department of Defense for improving the capability of the armed forces of the Philippines to combat insurgency. The United States Government has emphasised that its military assistance program to the Philippines is directed towards improving the logistics, mobility and communications of the Philippine armed forces and towards improving military morale and discipline. In testimony to Congress, the United States Administration has pointed out that its assistance program is designed to promote reform and respect for human rights within the Philippine armed forces while improving their capacity to combat insurgency. The Philippines Government has indicated in the past that it does not regard as appropriate the involvement of United States forces in efforts to defeat the insurgency. It is also evident from congressional and public comment in the United States that there is a keen appreciation, particularly at the moment, of the risks of embarking on a gradually increasing military involvement in the Philippines, particularly given the history of the involvement in Vietnam. Senator MISSEN —My question is directed to the Minister representing the Prime Minister. I refer to the statements made by the former Ombudsman, Professor Richardson, as reported in the Age of 22 January 1986, relating to the failure of the Government to provide adequate funding or staff to enable the Ombudsman to carry out his obligations imposed on him by Parliament under the 1983 amending Freedom of Information Bill. Firstly, is it correct that the Government has failed to supply the funding and staff, as alleged? Secondly, is this part of Senator Walsh's campaign to diminish the strength and usage of the FOI Act? Thirdly, what action is the Government taking to remedy the situation? Fourthly, is it a fact that Professor Richardson's period of office terminated more than two months ago and that he has not yet been replaced? Fifthly, was this vacancy at all times known to the Government and why has the replacement not been made immediately? Sixthly, is this a further part of Senator Walsh's campaign to blunt the effectiveness of the Ombudsman in performing his FOI role? The PRESIDENT —Order! The honourable senator's question is getting a bit long. Senator MISSEN —There are three more matters; they are all related and the Minister has had notice of them. Seventhly, has the Attorney-General's report on FOI performance for 1984-85 been unavailable to the general public since its tabling late in the previous session? Eighthly, has this limited the opportunities of those preparing submissions to the Standing Committee on Constitutional and Legal Affairs for its three-year review of the FOI Act? Lastly, what involvement has Senator Walsh had in causing this deficiency? Senator BUTTON —Fortunately, I have had notice of Senator Missen's question and I have an answer. The answer, if I might horrify the Senate, is much longer than the question. Perhaps I can summarise it and seek leave to have it incorporated in Hansard. The first part of the question related to the funding and staff of the Ombudsman's office. That was a crucial part of the question. The answer is that the Ombudsman's office has had its average operating staff level maintained when many government departments and authorities have had their staffing levels reduced during the present fiscal restraints. The Ombudsman's office staffing level over the past four years has been 52 in 1981-82, 55 in 1982-83, 60 in 1983-84 and 64 in 1984-85. The 1985-86 level is 68, although this includes for the first time the four statutory positions. I am asked in a number of parts of Senator Missen's question whether this is all part of some campaign by Senator Walsh. There is no such campaign and the answer to those parts of the question is no. Senator Walsh has views about these matters, as we all have, but they cannot be described effectively as a campaign. I hope Senator Walsh is not offended by that description. It is true that Professor Richardson's period of office terminated two months ago; the vacancy has at all times been known to the Government, and it will be filled in due course. It has been filled in an acting capacity by an experienced Deputy Ombudsman. The Attorney-General's report on freedom of information performance has not been made available yet because of printing problems experienced by the Australian Government Publishing Service. However, the report has been cleared by the Attorney-General's Department for sale in late January; I think this is an old answer. I understand it is now available for purchase. As to the other parts of Senator Missen's question I seek leave to have the answers incorporated in Hansard. Leave granted. The answers read as follows- 1. ``Is it correct that the Government has failed to supply the funding and staff as alleged?'' The Ombudsman's office has had its average operating staffing level (AOSL) maintained when many Government departments and authorities have had their staffing level reduced during the present fiscal restraint. The Ombudsman's office staffing levels over the past four years have been: 52 in 1981-82, 55 in 1982-83, 60 in 1983-84 and 64 in 1984-85. The 1985-86 level is 68, although this includes for the first time, the four statutory positions which means, effectively, no change in 1985-86 compared with 1984-85. 2. ``Is this part of Senator Walsh's campaign to diminish the strength and usage of the FOI Act?'' There is no such campaign. 3. ``What action is the Government taking to remedy the situation?'' The staffing of the Ombudsman's Office is constantly under review to meet needs as required as is the case with all Commonwealth departments and agencies. The Government notes that the Senate Standing Committee on Constitutional and Legal Affairs is undertaking a review of the FOI Act this year. The review will include the question of costs and efficiency in the administration of the Act and the weighing of future benefits against future costs. 4. ``Is it a fact that Professor Richardson's period of office terminated more than two months ago and that he has not yet been replaced?'' Yes. 5. ``Was this vacancy at all times known to the Government and why has the replacement not been made immediately?'' Yes. The Government is aware of the vacancy and has taken steps, through advertising and other avenues, to ensure that a wide range of people are considered. It is important that the person selected possess the personal and administrative qualities appropriate to meet the Government's wish that the appointment be of the highest calibre. There has been no disruption to the role of the Ombudsman because the position has been filled continuously by an experienced Deputy Ombudsman, Air Vice Marshal Jordan, who has acted as Ombudsman since the retirement of Professor Richardson. 6. ``Is this a further part of Senator Walsh's campaign to blunt the effectiveness of the Ombudsman in performing his FOI role?'' There has been no such campaign either by Senator Walsh or by the Government. 7. ``Has the Attorney-General's report on FOI performance for 1984-85 been unavailable to the general public since its tabling late in the previous session?'' Yes. Unavoidable printing problems have been experienced by the Australian Government Publishing Service (AGPS). However, Attorney-General's Department cleared the FOI Report with AGPS for sale in late January. It is now available for purchase. 8. ``Has this limited the opportunities of those preparing submissions to the Senate constitutional and legal affairs committee for its three-year review of the FOI Act?'' The Senate Standing Committee advertised widely in December, inviting written submissions from all interested members of the public. Anyone wishing to lodge a submission has the opportunity to do so. If any person feels that he or she has been disadvantaged in any way in this context, I am sure the Secretary to the Standing Committee would view sympathetically any application to lodge a late submission. 9. ``What involvement has Senator Walsh played in causing this deficiency?'' In line with answers to questions 2 and 6 above, Senator Walsh has had no involvement in this matter. Senator WATSON —My question is directed to the Minister representing the Minister for Science. What does the Government propose to do about the serious and potentially life-threatening inadequacies of the Australian weather forecasting system? Does the Minister agree with the long time director of the Queensland Bureau of Meteorology, Mr Arch Shields, that Australia is placing far too much emphasis on satellites, computers and automatic weather stations, all of which can and do malfunction, for its weather forecasting, virtually ignoring the vital role played by trained weather observers on the ground? Is the Government concerned that too many forecasts are now being issued with the rider `meteorologists warn that this forecast is based on inadequate information'? Senator BUTTON —I am aware of current concern about changes to the weather forecasting system. I am not aware of the views of Arch Shields but, of course, there are changes in the methods of weather forecasting; the satellite is of use in that respect, as are computers. In his time, Indigo Jones was of use in respect of weather forecasting and maybe Mr Arch Shields belongs to the Indigo Jones school. I do not know. I will get a more detailed answer from the Minister for Science on the more specific elements of the honourable senator's question. Senator REID —My question is directed to the Minister representing the Minister for Territories. I refer to the recently released Sax report on nursing within Canberra public hospitals, which concludes that patient care has deteriorated to such an extent that babies are not receiving rostered feeds and patients are at risk through the breakdown in our hospital system. This is a totally unacceptable situation. Other than merely referring the report to the Australian Capital Territory Health Authority, what action will the Government take to rectify this scandalous situation? How long will it take to implement some real solutions? Senator GIETZELT —Senator Reid asked me a question about the report of the Sax Independent Inquiry into Nursing Services within the Australian Capital Territory Health Authority. My briefing from the Minister indicates that the report is receiving consideration by the Government. It was dated 31 January 1986 and identifies a number of issues for management attention as well as the problems that have been raised by the Royal Australian Nursing Federation relating to staffing problems in the Australian Capital Territory hospital system. As well as identifying the problems of a local nature that have been referred to, the report reflects the Australia-wide problem confronting the nursing profession and the need to take measures on a broad front to overcome these problems. The Australian Capital Territory Health Authority is already taking steps to solve some of these problems, particularly those of a local nature, within its existing confines. It has set up a joint review team to review such matters as nurse recruitment, career structure, skills mix, education, child care and facilities and the like. On the broader issue, the Authority is involved in discussions with the Public Service Board and the Department of Veterans' Affairs, because there are nine hospitals within the responsibility of my portfolio, about the need to develop a better career structure for nurses in Commonwealth hospitals. The more precise terms of the Sax inquiry are receiving the urgent consideration of the Government and we will be in a position shortly to make a full disclosure of the Government's acceptance or otherwise of the recommendations. Senator BJELKE-PETERSEN —Is the Minister representing the Treasurer aware of reports in yesterday's media regarding the release of the Business Council of Australia's economic statement? What is the Minister's reaction to the warning from the BCA that this Labor Government's policy of tight money and high interest rates is threatening to cut Australia's prospects for economic growth and future investment? Is the Government prepared to take the advice of this very pertinent report which suggests a reduction of the Budget deficit by at least $500m? Senator WALSH —I am grateful to Senator Bjelke-Petersen for drawing my attention to statements made by the Business Council of Australia because I recall very well a statement that the Business Council made last week about the coalition's wages policy. The Business Council said essentially that it would be a catastrophe for the country if the coalition's wages policy were ever to be inflicted on it. I note also for the record that that discussion in which the BCA bucketed the coalition was then promptly leaked by some of Mr Howard's colleagues. I do not know whether it was the ideologues or the wets, the wets or the dries, who leaked the record of that discussion but I suppose that both groups have reason to feel aggrieved with Mr Howard because they now realise that they made a terrible mistake in electing him as leader. The ideologues voted for him and then found out that he went to water as soon as he got into the position. So none of the wets, dries or pragmatists are satisfied with the present Leader of the Liberal Party. I suggest to Senator Bjelke-Petersen, in response to her question, that the coalition would be well advised to take notice of the Business Council of Australia's views on wages policy and to dump the disastrous policy being advocated by the present coalition leader, which he himself says will lead to five years of industrial warfare. In regard to the statement reported yesterday, I did see on my desk a piece of paper from the Business Council of Australia and I had a quick glance at it. I particularly agreed with the last paragraph which referred to the way in which the States collectively have undermined the Commonwealth Government's policy. Senator Crowley —Any State in particular? Senator WALSH —No State in particular; it just identified the States in general. Of course, no State has done so much to undermine the Commonwealth Government's economic strategy and minimise its success as the State Government of Queensland. It is dragging the rest of the country down, of course not quite to the Queensland Government level because the arithmetic cannot work out that way, but certainly it is dragging the rest of the country down. As to the need to cut $500m off the deficit, I do not think that anybody who knows anything about it would argue that one can be so precise, within a few hundred million dollars, about the size any particular deficit ought to be, but I can tell Senator Bjelke-Petersen that the policies that her leader, the Leader of the Opposition, is advocating-that is, to throw away anything up to $1 1/2 billion in revenue and spend an extra $1 1/2 billion revenue via that irresponsible shopping list of promises he has made, which would lead to increased expenditure-would lead not to a reduction in the deficit but to a blow out in the deficit of the order of $3 billion or $4 billion which would bring him back to the sort of prospective deficit that the current Government inherited from him. I remind Senator Bjelke-Petersen that, if she is really concerned about the size of the deficit, she ought to repudiate all the revenue and expenditure promises that the coalition has made over the last couple of years. Senator JESSOP —I refer the Minister representing the Minister for Primary Industry to the vine pull scheme which was initiated to allow grape growers under financial stress to withdraw gradually from the industry and to which the Federal Government has allocated something of the order of $7.5m. Is the Minister aware that in South Australia some 500 inquiries, representing 25 per cent of the grape growers in South Australia, have been received concerning this vine pull scheme and that 135 definite applications have been received to date? Will the Government give serious and immediate consideration to extending the 30 May 1986 deadline for applications to the scheme in order to allow grape growers under financial stress time to make a considered and correct decision regarding the future direction of their livelihood after this year's vintage? Senator WALSH —Senator Jessop gave me some notice that he would ask a question like this but unfortunately his correspondence was sent through the internal post and it did not arrive in my office until half past twelve. I have not been able to get any information from Mr Kerin for that reason. I will pass the question on and provide Senator Jessop with an answer. Senator TOWNLEY —I direct my question to the Minister representing the Minister for Immigration and Ethnic Affairs. In view of the extremely large number of people coming to this country from New Zealand, many of whom immediately receive the unemployment benefit, costing this country in excess of $60m a year, does the Government intend to continue the open door policy it has with regard to people coming from New Zealand? If the Government does not intend to change this crazy policy, will the Minister table in the Senate figures detailing the number of New Zealanders who have arrived in this country over the last five years, the number who have received unemployment benefits and the cost to the Australian taxpayer of those benefits? Senator GRIMES —I have not at hand figures on the number of New Zealanders coming to Australia or the number of New Zealanders who receive unemployment benefits. I point out to Senator Townley that what he describes as this crazy policy has been the crazy policy of successive governments from both sides of the Parliament. Senator Townley —All governments are crazy. Senator GRIMES —The honourable senator may well think that all governments are crazy. I will get the information that Senator Townley seeks. All I know is that last time he asked a question like this I think it concerned the number of supporting parent benefits we paid in Fiji or somewhere. It turned out that it involved one person in the whole of Oceania. Senator Townley —That is absolutely untrue. Senator GRIMES —If it was not him, it was someone else; someone like him! Senator Townley is well known in this place for his xenophobia. I remember that he used to get upset about portable pensions. I have not noticed him being upset about that lately. He used to object to us paying pensions overseas to everyone except ex-parliamentarians and Sir John Kerr. He said that everyone else should be banned from receiving such pensions. I will seek the information from the Minister for Immigration and Ethnic Affairs. The matter of our policies and relationships with New Zealand should probably be referred to the Minister for Foreign Affairs. I will check on that. Senator MAGUIRE —Does the Minister representing the Treasurer have recent official indicators of the current position of the Australian economy? Do the economic indicators show that the strong economic recovery which has been occurring in Australia over the past three years is continuing? Why are bankruptcies rising in Queensland but falling in Western Australia? Senator WALSH —The easiest part of the question to answer is the last part. The answer to the question why bankruptcies are rising in Queensland and falling in Western Australia is self-evident. Queensland has a National Party government and Western Australia has a Labor government, recently re-elected, if I may observe in passing, by a vote which, if repeated in a Federal election, would have increased the Labor Party majority in every Federal seat held by the Labor Party in Western Australia. So, there is absolutely no joy for the Western Australian Liberal Party, or the Collins Street clique which temporarily controls it, in the result of the Western Australian State election. In response more directly to the question asked by Senator Maguire, let me say that this Government has been in office for almost three years. Throughout that period, leaving aside only the few months crank-up period that it took to reverse the disastrous trends which had been established by Mr Howard when he was Treasurer, the country has enjoyed economic growth approaching 5 per cent a year. The present indications are that that growth rate is continuing. To select just some of the more recent economic statistics, the unemployment rate fell from 7.9 per cent in November to 7.8 per cent in December. Manufacturing production rose by a further 2.4 per cent in the September quarter, which made it 5.2 per cent higher than it was a year previously. The value of retail sales rose by 1.2 per cent in October and by 3.4 per cent in the three months to October. The number of new motor vehicle registrations rose strongly in November to an annual figure which, incidentally, was a record, although admittedly there was some decline-in case somebody from the Opposition is aware of this-in motor vehicle registrations for the month of December. Nevertheless, motor vehicle registrations, like building approvals, remain at levels which are historically high and certainly extraordinarily high compared with the very depressed levels of three years ago. Because of this economic growth, the number of people employed has increased by more than 500,000 in less than three years, which is even more jobs than the present Leader of the Opposition managed to destroy in 12 months when he was Treasurer. Senator CHANEY —My question, which is addressed to the Minister for Finance, follows the reply he gave to a question asked by Senator Dame Margaret Guilfoyle. The Minister stated that it was the Government's policy to let the Australian dollar find its own level. Does the Minister for Finance deny that his Government has kept interest rates in Australia high to support the Australian dollar and to stop it falling even further than it has? If he agrees that that has been so, does his answer to Senator Dame Margaret Guilfoyle mean that interest rates will now be eased and that the Australian dollar will, in fact, be allowed to find its own level? Senator WALSH —This Government is following a broadly based approach to macro-economic management. The three legs which support our economic policy are expenditure restraint, which the previous Government, for all its windy rhetoric, failed to practise for the last five years of its existence, a wages policy which has led to real labour unit costs falling to the lowest level at which they have been for 15 years and industrial disputes falling to the lowest level at which they have resided for 15 years, and so on. Senator Messner —Interest rates are at their highest level. Senator WALSH —No, Senator Jessop, I keep telling you that interest rates reached their record level in May 1982 when Mr Howard was Treasurer and when the 90-day bank bill rate rose to 22 per cent. Senator Jessop likes talking about real interest rates. Any fool can get real interest rates down by pushing inflation up, and that is exactly what Mr Howard did. Senator Jessop —Mr President, I take a point of order. I interject occasionally, but I object to being mistaken for my twin brother, Senator Messner. The PRESIDENT —If you did interject, Senator Jessop, it was clearly out of order. Senator WALSH —I certainly apologise to Senator Jessop if I did that. The point is that this Government has a balanced approach to macro-economic management based on and supported by those three legs, whereas the previous Government ran monetary policy and nothing else. It had no wages policy. It walked away from any wages policy in May 1981, which led to a wages explosion, both in that calendar year and in the next calendar year, of 13 per cent and 14 per cent respectively, an inflation rate of 11 1/2 per cent and an unemployment rate also in double figures. As I said, despite all its bold rhetoric, simultaneously-- Senator Chaney —Mr President, I take a point of order. The Minister was asked a question about interest rates. He has not addressed the question of interest rates at all. He is debating economic policy generally. I ask you to bring him to order and to ask him to answer the question. The PRESIDENT —I ask the Minister not to debate the question but to come to the purport of the answer. Senator WALSH —Certainly, Mr President. Indeed, I do not think there is much more that I need to say on the subject, except that this Government is running a well thought through and highly successful economic policy. Senator CHANEY —Mr President, I ask a supplementary question. I ask the Minister again: Does he deny that the Government has kept interest rates high to support the Australian dollar and does his previous answer indicate that that policy has now changed and that we will see a reduction of interest rates in Australia? Senator WALSH —I can understand Senator Chaney's desire, I suppose, to have me make predictions about where interest rates are going and when. However, I am not going to do any such thing, because I can remember that poli- ticians sometimes get into trouble if they do things like that. For example, I remember the Deputy Prime Minister, as he then was, in 1977 asserting that if interest rates did not fall by 2 per cent by the end of the year he would eat his hat. Instead of falling by 2 per cent, interest rates went up by, I think, 3 or 4 per cent. It is certainly not my practice to make predictions about future movements in interest rates, let alone put a time-frame on them. Senator ELSTOB —Does the Minister representing the Attorney-General agree that an identity problem similar to that being experienced by children of adoptive parents could well arise with artificially conceived children using donor materials? Can the Minister guarantee that, if such a problem arose, sufficient information about the donor parents would have been recorded? Senator GARETH EVANS —It seems quite reasonable to assume that children born as a result of the use of donor sperm will, like adopted children, want to know about their origins, including, in some cases, identifying information about a biological parent. The report of the Family Law Council on reproductive technology, which was tabled by the Attorney-General last August, firmly puts the view that these children are in an analogous position to that of adopted children. The Council considers that the lessons learnt in the adoption area about the importance of honesty in family relationships for the healthy development of children should be heeded. Recommendation No. 9 of the Family Law Council report recommends, I am told, that, in recognition of the importance of access to knowledge and information of genealogical origins, legislation and practice should provide for access to such information by the child or adult, that such information be of a non- identifying nature prior to the child reaching 18 years of age and that identifying information be available for adults over 18 years of age. The Attorney-General has before him this and other related recommendations put forward by the Council and will no doubt be responding in due course. As to the latter part of the question, the Attorney advises me that the Commonwealth is not in a position to guarantee that sufficient information about a child's genetic origins will be available if required at a later date, because it does not have the legislative power to do so. I should finally mention that the Government is considering the recent report of the Senate Standing Committee on Constitutional and Legal Affairs on in vitro fertilisation and the status of children. That recommends, among other things, that pending possible establishment of a national advisory body, as recommended by the Family Law Council, the question of record keeping and access to information relating to donors should be considered by the Standing Committee of Attorneys-General. Senator KILGARIFF —I refer the Minister representing the Minister for Aboriginal Affairs to an article in the Age of 11 February 1986 concerning the comments of Mr Gerry Hand, the member for Melbourne, on the Federal Government's intentions concerning Aboriginal land rights legislation. Given the statement by Mr Brian Burke prior to the West Australian election that he would resign if the Federal Government imposed land rights legislation on Western Australia, and given the Prime Minister's response that he had no problems with Mr Burke's position on land rights and that he did not expect that the Labor Party would be losing Mr Burke, can the Minister say whether the Prime Minister's comments are to be interpreted as meaning that there will be no Federal land rights legislation? If that was not the meaning conveyed by the Prime Minister's comments, is it still the Federal Government's intention to introduce uniform Federal land rights legislation? Noting the reference in the Age to a Federal Government decision to pursue a State by State approach to land rights legislation, does this not imply that each of the States has different needs and conditions in relation to land rights? That being the case, would it not be more appropriate for the States and Territories to deal with land rights in their own legislation, thus ensuring local expertise and familiarity with the particular needs of the people of the State or Territory would result in the most appropriate legislation being enacted? Senator RYAN —I am advised by the Minister for Aboriginal Affairs, Mr Holding, that when he announced the Government's decision on the preferred model, which is a State by State model, in August last year he indicated that there were to be further discussions with Aboriginals, States, and the Northern Territory Government and other interest groups and that he would report back to Cabinet in the earlier part of this year. Those processes of discussion have been set in place and are well advanced and Mr Holding expects to be in a position to report to Cabinet within a few weeks. Until there has been that report back to Cabinet and Cabinet discussion and decisions in relation to it, there is nothing further to add to the statements regarding land rights that have already been made by the Prime Minister and Mr Holding. The PRESIDENT —It has been brought to my attention that this week is the last week of broadcasting for Mr Kevin Chapman, a voice familiar to many Australians through his long association with parliamentary broadcasts on the Australian Broadcasting Corporation. He has been on the air continuously since 1942 and has been broadcasting the Parliament since 1957. Kevin and his brother Ray, who commenced broadcasting in 1938 and retired last year, hold the world record for brothers in broadcasting-over 90 years. Mr Chapman has had a most interesting career in broadcasting and television. He was involved in television in this country from its outset in 1956 and maintained his participation in that medium until 1984. He was radio supervisor at the Melbourne Olympic Games in 1956. He broadcast for NHK Tokyo in Japan in 1966-67 and for Blue Danube Radio, Vienna, in 1983 and 1985. I personally have had a long association with Mr Chapman. As a former Minister for the Media and now as President of the Senate, I wish to pay a warm tribute to him for his great contribution to broadcasting in this country, and particularly for his service to parliamentary broadcasting. I am sure that all honourable senators join me in extending best wishes to Kevin, his wife Pamela and their family. We trust that he will have a healthy and enjoyable retirement. Senator BUTTON(Victoria-Leader of the Government in the Senate) —by leave-I would like to associate the Government and Government senators with your comments, Mr President, and your tribute to Mr Chapman. Probably the nicest, shortest thing I can say is that when one sometimes has the good fortune to be absent from the Senate when it is sitting, it is a great pleasure to hear Mr Chapman. That is more than I can say of a lot of other people that I hear on the same program. Senator CHANEY(Western Australia-Leader of the Opposition) —by leave-I join the Leader of the Government in the Senate (Senator Button) in his comments and indeed you in yours, Mr President, I am somewhat nonplussed as the Leader of the Government stole my joke. I imagine that we do not get a lot of jokes in here-- Honourable senators-Oh! Senator CHANEY —I am so overcome with emotion at Mr Chapman's leaving that I have put my foot in it. I wish Mr Chapman well in his retirement, which I understand he is undertaking most reluctantly. I am sure that many of the listeners to these broadcasts will wish that some of us were retiring and not Mr Chapman. Senator CHIPP(Victoria-Leader of the Australian Democrats) —by leave-I associate my Party, the Australian Democrats, with your tribute, Mr President, to Mr Kevin Chapman. I was amazed when I received your note on this matter, for which I thank you. I said to the Assistant Clerk at the Table: `Chapman? He is only about 50-odd or in his late forties, isn't he?' That in itself is a tribute because every time I see him and pay my greetings to him, he always has a pleasant smile and a happy retort. It confounds me that someone who has been imprisoned in a semi-darkened chamber, as he has been for 29 years reporting Parliament, still maintains his sanity, let alone his sense of humour. Mr Chapman has done that and has done so remarkably well. Mr Chapman dignifies this place with his quiet, detached description of events. Perhaps the most distinguished thing about him and of the greatest credit to him is that he has been able to restrain himself in describing some events in this place which, to say the least, should not have happened let alone have been described. I am sure that I would not have the capability or the mental discipline to be able to do what Mr Chapman has done over the years. He has carried out his task with great distinction and I compliment him. Senator COLLARD(Queensland-Leader of the National Party of Australia) —by leave-I also wish to be associated with the remarks made by you, Mr President, the Leader of the Government in the Senate (Senator Button), the Leader of the Opposition (Senator Chaney), and the Leader of the Australian Democrats (Senator Chipp). As has been indicated, Mr Chapman is to those in this place but a shadowy figure behind darkened glass, but to the millions of people we think are out there listening to our every word, he is something more than that. He is the person who interprets events quite impartially in this place. As Senator Chipp said, probably many times he has been tempted to go far beyond his brief when things have gone a little awry in this chamber and in the other place. Service as long as 29 years certainly puts him in the ranks of the fathers of this institution as we call it-probably even more so than you, Mr President. Nonetheless, he has seen many things happen and it is noteworthy that he has been able to undertake his job in such a distinguished and skilled manner over many years. I wish him well in his retirement. As Senator Chipp said, obviously Mr Chapman is getting out with his sanity intact. I hope he will have many years of happy retirement. I am not sure what he will be doing when Parliament is being broadcast. I rather suspect he will be listening to FM broadcasts, cricket or something along those lines. Senator HARRADINE(Tasmania) —by leave-I, too, would like to associate myself with your remarks, Mr President, and the remarks of other senators on the retirement of Kevin Chapman from his position as broadcaster of Federal Parliament. As other senators have observed, Kevin has brought to that task over many years a dignity and a rounded voice which often does not emanate in like manner from many of us. I, too, wondered about his being able to keep his sanity, and clearly he has been able to do so; he is a most personable man. I wonder whether it is a fact that he has been able to do two jobs at once. I wonder, though I have no evidence, whether while we are speaking and he is making the appropriate commentary he has not had the form guide before him, making appropriate choices. If he has been able to combine both tasks, he has done both well. He might have some quibble about the latter, but certainly in broadcasting Federal Parliament he has carried out his job most effectively and in a dignified manner. I wish Kevin all the very best in his retirement. I would hope also that his experience in this place will be called upon by those who have the responsibility to determine whether the proceedings of this chamber and the House of Representatives will be broadcast in another form-for example, via television. I am sure that Kevin would be able to tell us whether or not there is a difference between the attitudes of members of Parliament on broadcast day and the attitudes of members of Parliament on non-broadcast day and whether or not-perish the thought-senators tend to act like prima donnas on broadcast day whereas on non-broadcast days-- Senator Chaney —Are we broadcasting today? Senator HARRADINE —Are we on the air? With that, Mr President, I wish Kevin all the best. Senator REID(Australian Capital Territory) —by leave-I was amused to hear Kevin Chapman referred to a few minutes ago as a shadowy figure. Those of us who know him and love him have never quite thought of him as a shadowy figure although the diligence with which he has gone about becoming trim, taut and terrific over the last three months is something that I personally admire and would like to emulate. He has not, of course, been a shadowy figure in our community. I leave aside the comments about his work in the Parliament because that is well known here, but he has given of himself to the Canberra community in the way that some such people are asked to do. He does have a magnificent voice and presence and has been much in demand as a commentator, a compere and a person who featured at functions of importance in the Canberra community since he has lived in Canberra. He will certainly be missed from Australian Broadcasting Corporation radio. I know that he goes reluctantly and I am sorry that he is going. He will certainly be missed by the community and we will miss the role that he has played there. While he is in Canberra, of course, I know that he will continue in that role but I think it should be placed on the record that he has been appreciated. I am sure that he will be at the Canberra racecourse when he is in Canberra if there is anything of significance there and his advice and tips will be as much sought after in the future as they have been in the past. I extend my very best wishes to Kevin and Pam. Senator MICHAEL BAUME(New South Wales) —by leave-I was a working colleague of Kevin Chapman for several years on the Australian Broadcasting Commission in the late 1960s and early 1970s. He certainly had the respect and friendship of his colleagues in those days and, of course, his former colleagues like me. I must say that he has been held in the highest regard by them and certainly all members of the Senate hold him in similar regard particularly because of his skill in avoiding obliterating the one pearl that occasionally appears in speeches in this place when he interrupts to describe the person who is speaking at the time. Senator Gareth Evans —There are plenty of opportunities in your speeches. Senator MICHAEL BAUME —The many pearls he manages to avoid obliterating in my speeches, thank you. One could say that, like the corruption of a ditty that was on the ABC last year about the game, Parliament will not be the same without Kevin Chapman. I hope that the little bit of ill health he had last year will not be with him in what I hope will be a long and very happy retirement. The PRESIDENT —I inform the Senate that I have received the following letter, dated 12 February, from Senator Durack: 12 February 1986 Dear Mr President, Pursuant to Standing Order 64, I give notice that today I propose to move `That, in the opinion of the Senate, the following is a matter of urgency: The need for the Government to pass on to Australian motorists, farmers and other consumers the full benefit of the drop in world oil prices.'. Yours sincerely, PETER DURACK Senator for the State of Western Australia Is the proposal supported? More than the number of senators required by the Standing Orders having risen in their places- Senator DURACK(Western Australia)(3.14) —I move: That, in the opinion of the Senate, the following is a matter of urgency: The need for the Government to pass on to Australian motorists, farmers and other consumers the full benefit of the drop in world oil prices. When the present Prime Minister, Bob Hawke, was seeking a mandate from the Australian people to form the Government-which he received from them in March 1983-he made a very significant promise which is very relevant to the subject we are discussing today. I quote from a statement he issued on 9 February 1983 in which he said: Petrol prices will be immediately cut by about three cents per litre under a Federal Labor Government. In the three years that have passed since Bob Hawke made that statement and that promise, petrol prices in this country have risen by at least 10c per litre. Far from falling, they have increased by that quite considerable sum of money. There has really been no attempt whatsoever by this Government to do anything about that steadily increasing price of fuel. Of course, it is not only petrol prices but also fuel prices generally. As we all know it is not only the ordinary motorist who has been affected by this but also, in particular, our rural industries and, as Senator Chaney mentioned in the Senate today, our manufacturing industries as well. Every sector of the Australian community and every Australian, most of whom are motorists in one form or another and who are engaged in virtually every form of industry in Australia, is affected by that great broken promise of Prime Minister Hawke on petrol prices. The Government is about to make another dramatic switch in policies which it has been pursuing. It is clear from statements that have been made over the last few weeks, particularly by the Prime Minister and also by many other Ministers including the Minister for Resources and Energy, Senator Gareth Evans, who is at the table, that the Government is desperately seeking some way of avoiding passing on to Australians the full benefit of the very considerable decrease in world oil prices which has occurred over the last month or so. Yesterday the Government was taxed on this matter in Question Time and it has been taxed on it again today. We have had no indication that the Government will give Australians the full benefit of that drop in world oil prices. It is for that reason that the Opposition has brought forward a matter of urgency this afternoon in the Senate, which it hopes the Senate will support. It reads: Oil Prices Oil Prices Oil Prices Oil Prices Oil Prices Oil Prices Oil Prices Oil Prices Oil Prices Oil Prices Oil Prices Oil Prices Oil Prices Oil Prices Oil Prices Oil Prices Oil Prices Oil Prices Oil Prices Oil Prices Oil Prices Oil Prices Oil Prices Oil Prices Oil Prices Oil Prices Oil Prices Oil Prices The need for the Government to pass on to Australian motorists, farmers and other consumers the full benefit of the drop in world oil prices. We believe that the Senate will give support to that principle. It is a very great entitlement of Australian people, one which this Government looks set to repudiate or to qualify in some very major way. It is our responsibility as legislators to give a very clear message to the Government on behalf of all Australians-I do not mean just farmers or industry; I mean all Australians-who have been paying these higher and higher prices for fuel and petrol under this Government, that they should now receive the benefit of the lower prices which are available all around the world. It is a very simple principle indeed and it flows from the policy which has been followed by successive governments in Australia since 1979 that Australians should be paying world prices for their petrol. Until then, of course, Australians enjoyed a very low price for petrol. But I think one of the major contributions of the Fraser Government to responsible government in this country was that it adopted the policy in 1979 that Australians should be paying the world price for petrol, and not be allowed the very special low price that they had been getting up until then. The policy, which has been known as the import parity pricing policy, was really a formula which gave effect to the principle of world prices. That was the way the world price was to be ascertained. I might say that leading figures in the present Government-I am thinking particularly of the Treasurer, Mr Keating and the then Leader of the Opposition, Mr Hayden, and others-were highly critical of that responsible approach of the Fraser Government. We can recall statements by Mr Keating in particular about every petrol pump being made a branch of the tax office and so on. However, when the Australian Labor Party came to government it embraced that policy with great enthusiasm and it has pursued it to its great advantage because of the ever increasing revenues that it has obtained by following it. One thing that is very clear and very basic to that policy is that if Australians are asked to pay world prices, if those prices go up, unfortunately they will have to pay more. However, when those prices go down they are clearly entitled to the benefit of that reduced price. It is of elementary fairness, apart altogether from economic considerations, that that should be so. That fact was perceived by the Treasurer, Mr Keating, when he was Opposition spokesman on minerals and energy. Referring to the then policy he stated: Government policy ties Australian petrol prices to the price of crude oil from Saudi Arabia. That was the way it was measured under the import parity pricing formula. He continued: Any fall in the Saudi price must be passed on to Australian motorists in lower petrol prices. All we are asking at the moment-we are asking no more and no less-is that when, as now, the price of oil throughout the world falls to the extent it has, and the people around the world are already enjoying the benefit of those falling prices, as Mr Keating said, they must be passed on to Australian motorists in lower petrol prices. Obviously Mr Keating is about to repudiate that very simple and very fair principle. From his remarks yesterday in the House of Representatives it is clear that that is the way the Government is going and that is the way the Minister for Resources and Energy is clearly thinking. His overseas interviews have been reported widely and he has been reported in interviews in Australia as indicating the great difficulties the Government will have in applying fairly the world parity price for petrol. In recent journals Senator Evans seems to have coined another of his famous phrases. We can remember some of them from the past but the one of the present is this: He says that there is a lot more room for taxation at the pump. That is a refrain we have been hearing and will hear a lot more. Senator Peter Baume —Who said that? Senator DURACK —Senator Evans has been quoted in two recent journals-Australian Business and Australian Business Review-as follows: There is a lot more room for taxation at the pump. Here is the thinking of this Government and the thinking of its Minister for Resources and Energy. Clearly, the Government is doing very nicely out of high petrol prices in this country. From the crude oil levy and the petrol excise duty the Government is getting over $6 billion a year in revenue and it will not give it away. That is precisely the way it is thinking and it is expressed in that quote from Senator Evans. As I said, that it why it is imperative that Australians should be outraged and should express their outrage. We, as senators, should express our outrage on their behalf and demand that having paid higher and higher prices for fuel-as I have said we have paid at least 10c a litre more for petrol during the life of this Government; and there are various reasons for that which I will deal with in a minute-when prices start to go down we are entitled to the lower price now. That very simple, elementary principle has been recognised by Mr Bob Brown who is the chairman of the Government's back-benchers' economic committee. Bob Brown can see the truth. Senator Evans cannot see it; Treasurer Keating cannot see it; Prime Minister Hawke and Senator Button-we have had all the shilly shallying from them over the last few days-do not seem to be able to see it either. On 4 February this year Mr Bob Brown stated: The Federal Government had a duty to motorists who had put up with rising petrol prices under the import parity formula without complaint. To fail now to honour an undertaking to follow the IPP policy when it falls will cause serious damage to the Government's credibility. Of course it will cause serious damage to the Government's credibility; it has already caused serious damage to the Government's credibility. Despite those very strong words of Bob Brown and despite the outrage that has already occurred, the Government will persist in repudiating the very elements of the policy which it has been following. The policy of world parity pricing for Australian oil is, as I have said, one which the Opposition developed when in government and we have followed it when in opposition. We have supported that policy; we supported it in principle last year even when the price of petrol was going up as a result of it. I think the fact was recognised by many people in Australia that it was necessary that that policy should be adhered to in bad times as well as in good times. However, now that those prices are falling very considerably, Australians must have the benefit of that fall. As I have said, the Government cannot simply take the benefit of higher prices yet deny Australians relief when prices are lower. Such a policy, which this government seems to be embarking upon, is nothing short of outrageous. The first of March is the next date on which the Government will fix the price of petrol. It is now considering the matter and is about to welsh on its promise. The best estimate of the world price of oil at the moment is about $20 a barrel-I think this would be a fair price to take. Australian motorists, Australian farmers and Australians generally would be looking forward to a reduction of about 7c a litre in the price of petrol and an equivalent reduction in the price of diesel. For the average motorist that reduction would be reflected in petrol costing $3 a week less. These are very significant figures for a great variety of economic reasons. They are significant from the point of view of inflation and inputs for industry and desperately significant from the point of view of our rural industry. However, I do not want to emphasise any of these economic arguments. I emphasise that, having paid the higher prices for petrol for several years-as Mr Bob Brown said, having paid them uncomplainingly particularly over the last year-now that prices have gone down, in elementary fairness Australians are entitled to get the benefit of the lower prices. They are entitled to receive a fair go from this Government and it is about to deprive them of that fair go. Yesterday we heard Senator Evans say in the Senate-we have read about this in various interviews that have been given not only by him but also by the Prime Minister and in briefings to the Press; it is now becoming absolutely notorious; that the Government will take the view that it cannot afford the loss of revenue. Because of this great dependence on revenue from fuel, which has become a feature of the Government's budgeting, it cannot afford a reduction in petrol prices of that order. That sort of argument simply will not wash. In the last three years the Government has been increasing its revenue in real terms. Every year there has been a significant increase in government revenue from one source or another, particularly from fuel. Its total additional revenue amounts to about $5 1/2 billion. The Government is now saying that it cannot afford a loss of $1 billion or so which would result from passing onto Australians the 7c a litre reduction in petrol prices. But it has had these large increases. As I said, over $5 billion was received and the Government has spent that on its program. Last year alone it received over $500m in increased revenue from fuel and oil which it had not bargained on. Yesterday I gave some figures about the increased costs of this Government. The Government's administrative costs have greatly increased and are now hundreds of millions of dollars more than they were under the Fraser Government. These are simply the Government's costs of administration. As I pointed out yesterday in a debate on the Trade Practices Amendment Bill, its costs of the regulation of business are $700m a year at the very least-and probably $1 billion a year. By its vastly increased revenues the Government has acquired an ease with which to accommodate the sort of decrease in revenue which it says it now cannot afford. The Government should have been planning for this. Senator Gareth Evans yesterday gave the impression that everyone was surprised by this sudden drop in oil prices. The experts around the world have been saying for more than 12 months that oil prices would fall. The dogs have been barking it all around the world. Senator Evans says he has just been around the world and he knows how surprised everybody was. I do not know who he was talking to, but I have been in Australia for those 12 months and I have been reading what people have been saying and forecasting. The oil industry itself has been concerned about it for some time. It has been known for 12 months. The Government's tax package last September must have taken into account the possible revenue implications of falling oil prices, the very thing that has now happened. Senator Watson —What were they doing? Senator DURACK —They were not doing their job or they just could not care less. Government members just want more money to make big fellows of themselves. They talk about tax cuts. What is the good of a tax cut if everybody has to pay virtually the same amount in increased petrol costs? It is a fraud. It is said that the Government was surprised. The Minister, Senator Evans, should resign. If he did not know and could not advise what was going to happen, he should have resigned already. The planning should have taken this into account. All Australians are entitled to this reduction and they should be demanding it, and we should be supporting this motion. The ACTING DEPUTY PRESIDENT(Senator Townley) —Order! The honourable senator's time has expired. Senator GARETH EVANS(Victoria-Minister for Resources and Energy)(3.34) —It was to be expected that there would be just a little opportunism in the air this week on the subject of oil prices. But, as always, the sheer shamelessness of the line being advanced by the Opposition today through Senator Durack really is a little breathtaking. A little extra time will have to be put into the confessional this weekend, I think, after that particular speech from Senator Durack. The Government's position, by comparison with the Opposition's, which I will describe in a few moments, is absolutely straightforward and absolutely honest. What we have said and what I will be saying again today is simply this, and let me spell out the relevant propositions step by step eschewing the flights of rhetoric, or attempted rhetoric, with which Senator Durack burdened his contribution to this debate. The first point to make is that there has been a collapse in the world price of oil over the last month, the direction of which was certainly widely anticipated, as Senator Durack said, but the magnitude and timing of which has taken everyone-not everyone, because it seems that Senator Durack was party to a different perception; but everyone else-really quite by surprise. I am glad to know that Senator Durack had this perception as to precisely where oil prices would end up. I would be indebted if he would point me to one occasion when he communicated that perception on the public record to anybody else because I am not aware of any occasion when he made such a prediction as to the order of magnitude of the particular drop, and the speed and suddenness of that drop, that has occurred. The reasons for it are pretty evident in terms of the reaction by the Saudis, the decision that they made to increase their production for reasons of their own, the way in which that has been unaccompanied by any escalation of demand around the world, and the way in which, so far from encouraging other producers to reduce the level of production, on the contrary, there has been such a scramble to maintain market shares that there has been no sign of that cutback in production, and the world is awash with oil and prices have been responding accordingly. The second point to make is that the market is presently in an extremely volatile situation. Nobody, I think, can predict or is predicting with any great confidence at the moment whether prices in the next few days and weeks will go up or down or sideways. It may be that they will settle out at around $US20 as compared with the present $US17 or $US18, and as also compared with the $US28 to $US30 that we were experiencing late last year. But nobody can guarantee and nobody can plan on the assumption that this will in fact be the case. This situation that I have described has produced very substantial problems for governments all around the world and especially governments of oil producing nations which depend, in some cases solely, in other cases significantly, on oil for both balance of payments and budgetary stability. It is not only, however, a matter of the producer nations having problems in this respect. Very real problems for the world banking and financial systems flow from the possibility, indeed probability if the present price situation is maintained, of very great difficulties being experienced by Mexico and a number of other countries with very large debts in this respect. Although there are compensating advantages for the export manufacturing countries, there are very real problems and a great many people appreciate that that is so. The Australian Government, in common with governments everywhere else in the world, is wrestling with those problems and a proper response to them at the moment. We hope, as the Prime Minister (Mr Hawke) indicated earlier in the week, to make a decision or at least to be close to making a decision before the end of this week. In wrestling with the problem, as the Government is now doing, we are acutely conscious of all the different factors that need to be taken into account in formulating a final decision. Those factors include the implications of a price drop so far as producers are concerned for the future of oil exploration. They require attention to be paid to the implications of a price drop, domestically and overseas, for other energy commodities, including, in particular, coal. They include obviously attention having to be paid to the implications for government revenue and our overall macroeconomic management. Those considerations certainly, however, include pre-eminently among them the desirability-in the interests of farmers, of industry, including the industrial consumers of petrochemical feed stock that were mentioned at Question Time today, and consumers generally, and the implications, of course, for the consumer price index as a whole and the macroeconomic management that is associated with that-of passing on as much as possible of the decline in crude prices, and that is very much present to our mind. Australian prices are not at the moment high by international standards. Australia has, along with the United States and Canada, the lowest petrol prices in the industrialised world. The reason for that is that we have the lowest levels of product taxation at the pump. It is in that sense, by a reference to international comparisons, that the point can obviously be made that in international terms the situation so far as consumers could be concerned and so far as taxation is concerned could be very much more burdensome. But there is no doubt that the question of petroleum prices represents a very significant proportion of domestic household outlays. It is a particular burden for particular sectors of the community, not least in rural and provincial areas, and a price drop would make a significant contribution to improving the overall inflationary situation as well as, of course, as a result of that, helping to improve what is very important for the health of the Australian economy, our international competitiveness. It is for all those reasons-because we fully appreciate the nature of those points that can be made, and be made very much better in fact than they were made today by Senator Durack-that it is our very strong wish that prices be kept down as low as possible. But the extent to which it is possible for any responsible government charged not just with the task of speech making but actually governing the community responsibly and well-the problem of balancing out those considerations-is what we are wrestling with this week. There is not doubt, and it has to be understood, that the budgetary implications of the present developments that we are witnessing are absolutely huge and very much greater than have flown from any previous downward adjustment during the life of the import parity pricing system in this country. The Government has been willing, notwithstanding Senator Durack's implications to the contrary, to lower the import parity price if either exchange rate movements or the world price of crude have in fact justified that. There have been 10 occasions since we came into office in early 1983 when the import parity price has been adjusted. On four of those occasions there was, indeed, a price increase. On one occasion there was no change but five occasions there was actually a drop in the import parity price and a drop in petrol prices in the hand of the consumers. That point is ignored in every contribution that has been made in this debate or in this argument so far. We have moved down as well as up with a parity price system in the past. There has been talk of an increase of 10c in the price of petrol over the life of this Government, nominally, yes, but in real terms the increase in petrol prices over the whole of the last three and a bit years has been only 2c. I think that ought to be understood when some of the more extravagant claims that we have heard today are again being bruited about. What we are talking about today, this week and this last month are potential changes to the import parity price which are of a very much greater order of magnitude than any of the changes up or down that have been in issue in the past. This is what makes this situation that we now confront so very different and so very much more difficult for any government of any colour to handle. As I said in Question Time yesterday, on the working assumptions of a petrol price of $US18 and a 70c exchange rate, what we are talking about is a revenue loss in the remainder of this financial year of $550m and $1.4 billion in the next financial year, 1986-87. Ignoring for the moment any other possible change in the exchange rate which could make the sums larger still, if the price of petrol fell, as is perfectly conceivable, to $US15 we would be talking about a $1.8 billion budgetary implication in a full year. If the price fell to $US10 we would be talking about a budgetary loss of $2.5 billion. Changes of that kind simply cannot be accommodated overnight. No government can tear apart the fabric of its outlays and make adjustments on this scale. Of every dollar of revenue lost that we are talking about, it has to be appreciated that 28c of that dollar would have been spent on social security and welfare, 10c of that dollar would have been spent on defence, 10c of that dollar would have been spent on health, 7c on education and another 20c on payments to the States, which again very largely flow through to ordinary citizens in the form of a whole miscellany of services. This is what we are talking about when one talks about revenue losses translated through into Budget cuts of the order of magnitude that we are contemplating in this debate today. Of every dollar of revenue lost one is talking about 28c alone coming off pensions, social security and all the other cuts that I have just talked about. No government has the flexibility to accommodate an assault on government outlays of this scale, at least in the kind of time frame that is being urged upon us. The alternative to cutting outlays on that sort of scale and with those sorts of implications, with all the horrendous implications for very important areas of government expenditure, is to let the deficit blow out by that sort of order of magnitude, with all the horrendous macro-economic consequences that flow from that in terms of interest rate pressures, exchange rate pressures and, through that, pressures back on inflation. At the end of the day, bearing those various considerations in mind, the question for this Government, as it would be for any responsible government, is how far can we go in accommodating our very genuine desire, and certainly the desire of large sections of the community, for very obvious and worthy reasons, to pass on to consumers the benefits of the drop in the current world market price of crude. Can we afford to cut this year's and next year's Budget apart to do it at the expense, as I have indicated, of health, welfare, defence, education and all the other programs that that involves or can we afford alternatively to let the deficit blow out to the extent necessary to accommodate the sorts of sums that we are here talking about? One of the numerous difficulties with the motion before us today is that it simply acknowledges none of these difficulties. It simply asserts that there is only one possible and appropriate and responsible course, and that is to pass on the full amount of any price cuts that might flow from the world market price, deteriorating as it has, whatever those cuts are, whatever their order of magnitude and whatever the cost to the national budget and the national accounts as a whole. We might have been able to accommodate a motion had it been cast in terms not of passing on the full benefit of the drop in world oil prices but had there been a reference to passing on some appropriate benefit from the drop in world oil prices. But the absolutist way in which this motion has been cast, coming as it does at a time when the Government has not had a full and final opportunity to weigh and balance all these different factors that I mentioned, means that the Government has no alternative but to vote against it. I hope that the reason for voting against the motion is understood. It is not that we are unsympathetic to the need to pass on as much as possible of the price drop that is implied by the world market price; it is just that we cannot possibly go so far as to commit ourselves at this stage, weighing as we are all the relevant arguments, in the absolute terms that this motion demands. In approaching the problem this way, fairly calmly I hope, the Government has not been helped, nor has, I think, the community been helped, by the strident politicking we have heard from the Opposition. Its performance, repeated again by Senator Durack today, has been, as I described it, a shameless one. Let me explain why. In the first place, it has been a performance which has been quite shameless in its opportunism. All last year, despite what Senator Durack said a few minutes ago, the Opposition was decrying the import parity pricing system. It was arguing that we ought to abandon that system in favour of a free market for crude oil, and the assumption underlying that particular argument was that to abandon the import parity pricing system would be to produce cheaper oil in this country than would be the case by the operation of that particular system. The argument was that we should sever the link with world oil prices, ignore world oil price movements, and let things sort themselves out domestically to the possible advantage, although that was never demonstrated, of the consumer. With the implications of world prices running the other way, the Opposition has scrambled to attach itself to the coat tails of that movement in world prices. Watching that scramble has been a most unedifying spectacle, including the way Senator Chaney and Senator Durack have flip-flopped and behaved in a way which has been nakedly opportunistic. The other bit of shamelessness in the Opposition's performance has been its ignoring of its role when previously in government in creating the very reliance on oil and petroleum revenue which is at the essence of the Government's present budgetary problem. The Treasurer (Mr Keating) said yesterday that John Howard, increased oil revenue by 700 per cent between 1977-78 and 1982-83. John Howard came to office when crude oil and liquefied petroleum gas excise constituted 1.4 per cent of government revenue. He left office having taken the proportion of oil taxation up to 9 per cent of total taxation revenue, a situation which the Australian Labor Party has sought to reverse with long term scenarios in mind of a reduced capacity to derive revenue from oil. We have reduced the reliance on oil taxation to 6.8 per cent of total revenue. John Howard increased oil revenue by 700 per cent during his term in office and increased the proportion of that revenue as a proportion of total taxation from 1.4 per cent to 9 per cent. This is the man who is leading the party which has the shamelessness to argue that we are somehow behaving inappropriately and irresponsibly in thinking twice about the implications of the situation in which we find ourselves. We criticised the then Government at the time. That criticism of the way it went about the task of accumulating that taxation stands. It was taxation by stealth. The then Government made the arguably very necessary transition from low cost to high cost domestic crude. It made that transition too fast and in a way which flowed straight through into a very considerable inflationary burden on the economy. I notice, Mr Acting Deputy President, that you are nodding at that statement because you, presumably alone among your colleagues at the time, were alert to that consequence. The Fraser Government spent irresponsibly on massive white elephant public works and pork- barrelling projects on the kind of magic pudding assumption, which was subsequently unrealised, that oil revenue would continue to increase at the rate that it was being poured into the then Government's coffers. Because of that lack of discipline which was associated with the previous Government's approach to oil taxation, when the magic pudding dried up the Government's budgetary problems were resolved by way of having a massive deficit, which blew out to $9.6 billion by the time we inherited office. We inherited an economy and a system of national accounts which still has a very substantial reliance on oil and petroleum revenue, although we have been doing our best to reduce that reliance because we understand the long term dynamics of this for the Australian economy. However, we cannot turn that reliance around overnight. It would be irresponsible to try to do so in the way we are being urged. But because we recognise the other side of the coin to this argument-the desirability of lower inflation, a lower consumer price index and a lower burden on consumers-we will try to maximise the extent to which that price drop is passed on. But we will not be stampeded by the opportunism and grandstanding of the Opposition into supporting the proposition now before us in the absolute form in which it is expressed. Senator CHIPP(Victoria-Leader of the Australian Democrats)(3.55) —The Senate is debating a matter of urgency raised by the Liberal-National Party Opposition which states: That, in the opinion of the Senate, the following is a matter of urgency: The need for the Government to pass on to Australian motorists, farmers and other consumers the full benefit of the drop in world oil prices. Three of the most fascinating years of my parliamentary career were spent as Minister for Customs for which in those days one responsibility was the initiating and administering of an indigenous oil policy for Australia. I have sympathy with anyone such as the present Minister in a different portfolio who has that responsibility because of the difficulties and complexities in such a policy. The Australian Democrats agree with the Opposition that it is now time for the Australian Government to abandon the infamous import parity pricing formula devised by the Fraser Government and continued with only minor modifications by the Hawke Labor Government. It is clear that over the past decade the Liberal Party and the National Party and subsequently the Labor Party have conspired to rip off Australian motorists, farmers and other consumers by a sleight-of-hand method of hidden taxing. They have done so in their obsession to exploit to the maximum a source of revenue in spite of the inflationary effects of pursuing that policy. The Liberal Party and the National Party are responsible for import parity pricing. They introduced it and they have ruthlessly and mercilessly maintained it, to the detriment of the motorist, farmer and industry. They put forward as a rationale, with which the Democrats agree, that to encourage oil exploration in Australia a basis of import parity should be maintained for newly discovered oil, so that if anybody found oil he should be able to get a world price, otherwise no explorer would bother to find it. There was however no rationale, moral, economic or otherwise, to maintain import parity pricing for old oil, but they did, and they did it, let us face it, for one reason. It was a convenient, hidden, painless way of extracting revenue from the motorist and farmer. Now the Liberal Party and the National Party unashamedly and hypocritically argue that the full benefit of the drop in oil prices ought to be passed on to Australian consumers. Apart from political point scoring, in a desperate attempt to win votes at any cost, what do they really mean by passing on the full benefit? I listened carefully to Senator Durack and, lucid as he always is and was today, I am still no wiser on that point. Senator Durack —Seven cents a litre. Senator CHIPP —Senator Durack says that the full benefit would be 7c a litre. Every reasonable source says that the price drop would not be 7c; it would be closer to 11c a litre. Again, our information differs. The world price of oil has collapsed. There is no doubt about that. There has been a dramatic fall but, strangely, in recent days it has been followed by increases in oil prices. To understand the effect on Australian retail prices of oil, let us look at the situation. Last week the world price of oil fell to $US15 per barrel. If that cost of $15 per barrel were applied to the Australian price of oil the Australian Government would lose $1.9 billion in revenue in a full year. That is what we are talking about in wanting to give the motorist the full benefit. We are talking about a diminution in revenue to the Government at that rate of about $2 billion a year. Just a week later the price has gone up $2 to $US17. At that rate the Government would lose around $1.4 billion in revenue. But there are so many wild cards in this scramble. If oil producers such as Mexico, Iran, Iraq or even Saudi Arabia opened the cocks, let the oil flow-all desperate for revenue-and started a real price war, the price of oil would plummet to below $US10 a barrel. Let us assume that happens. Would the Liberal and National parties favour the full price cuts without compensation being passed to the consumer? That would mean a diminution in one year's Budget of over $3 billion. Is the Liberal Party saying that if it were in office it would have an increased deficit blowout of $3 billion without any compensatory measures? Mr Howard's last Budgets did produce a massive deficit blowout but one must assume that this was not Liberal Party policy, merely bad economic management. The Australian Democrats will support the motion put by the Opposition, but with reluctance for two reasons. The first is that, although we want to abandon import parity pricing, and we have enunciated this, we still do not know what `full benefit' means in the context used in the motion. Secondly, we do not believe that even the Liberals are advocating an immediate $2 billion diminution in revenue, demanding that the tax cuts of $1.2 billion this year and $3 billion in the next financial year should go ahead but not allowing the Government any room to manoeuvre with alternative revenue raising exercises such as increasing excise. I plead with the next speaker or two from the Opposition side to state their position. We know that the Opposition wants a full remission of the drop in petrol prices. It has said that; that is fair. We know it wants the full tax cuts; someone said that today. The Opposition still wants tax cuts of $1.2 billion this year and and $3 billion next year. But what attitude does it take about the deficit? Will the Opposition say: `No, the Liberals and the Nationals will not under any circumstances countenance consideration of increased excise to compensate that to reduce the Budget deficit'? Is that what the Opposition will say? The Senate is entitled to know. Opponents of this tactic, that is, the introduction of a compensatory increase in excise, could argue that it is robbing the motorist on the one hand to feed him on the other. To some extent this is true but at least the Government would be doing it out in the open and would not be using surreptitious means to hit the motorists and raise revenue. The Democrats believe that, if a government is to raise revenue from people, it should not do it in a sneaky way, such as the hidden way of manipulating revenue for government by relying on import parity pricing. That is what the Liberal Party did during its years in office. If the Government decides to allow the motorist to get some benefit from the drop in oil prices and if the Government, after a careful look at the economy, persuades the Democrats that some compensatory increase in petrol price must be levied, I give an undertaking that we will look at such a proposition with care and responsibility. I presume the Liberals would do likewise and that therefore we can read that qualification into the Opposition's definition of the words `full benefit'. I ask: Would it benefit average Australians if petrol prices fell dramatically, say by 11c a litre, but higher interest rates were immediately imposed which increased their mortgage repayments? I believe that large Budget deficits can stimulate an economy; that has been Democrats' policy, as enunciated by Senator Siddons, Senator Mason and others, since our formation. It can stimulate an economy and create employment. But a Budget deficit suddenly blowing out by billions of dollars could be very dangerous at a time when our dollar is under pressure. How would speculators react today if the Government said: `We will take the action today of passing on to the motorist a reduction of 11c a litre in the price of petrol, which will result in a blow out to the deficit of an additional $2 billion and we will take no compensatory action'? Senator Archer —I can tell you; the dollar would reach its proper value. Senator CHIPP —I do not know what proper value Senator Archer has in mind when he says that but, if he is fair dinkum, I think he would acknowledge that speculators, who have no great love for this country per se, would immediately react, would sell dollars and the dollar would plummet further. If the government of the day wanted to maintain the level of the dollar, it would be forced to raise interest rates massively. Senator Chaney —That is what it has done already. Senator CHIPP —That is what it has done already; of course it is. I am not denying that. Surely that is enough proof to the Opposition that, if the Budget deficit blows out by another $2 billion or $3 billion, this Government, whether it would be right or wrong-I am not canvassing that in this debate-would certainly be forced to hike interest rates further. Certainly, it would lead the Government to deregulate the ceiling on interest rates for housing loans. Under that scenario, of course, the Liberal Party would win the next election. Maybe that is what this debate today is about. I ask the Liberal Party to explain in this debate how one can finance an increased deficit of $2 billion a year other than by increasing interest rates or printing money. If anyone from the Liberal Party has the answer to that-any of the smart-alicks who interrupt and interject-I would be pleased to hear it. Opposition senators have today advocated an increase in the deficit of $2 billion. Will they please tell the Democrats and the Australian people how they can finance that blowout other than by higher interest rates or by printing money? The Labor Government is faced with an awful predicament. Mr Keating got it right in 1979 when, as Opposition spokesman on resources and energy, he described the Fraser import parity formula as a tax by stealth, with a branch of the Taxation Office at every petrol pump. The problem is that as Treasurer he has changed his mind. He decided to take the revenue and abandon principles. As a result we are now locked into a budgetary situation in which the Government is overly dependent on oil revenue and is extracting it secretly. The Democrats would have preferred that import pricing parity had never been introduced, except on new oil. We hoped that the Labor Government would remove it and opt for a source of revenue raising which is visible and not so dependent on the vagaries of international economies. The Government did not make the hard decision then. It must make it now. The situation is very dangerous. If the price of petrol continues to fall and sufficient revenue is lost, even abandoning the tax cuts may not save the Government from a massive economic crisis brought about by a deficit blowout. Of course, consumers must benefit from a fall in oil prices and the Democrats will do everything they can to assist that. But the benefit must be sustainable. If our dollar drops to US50c and interest rates soar to 30 per cent, we will have the ingredients for economic disaster rather than any real benefit. We need a new formula for determining petrol prices. The formula should result in lower petrol prices for Australians. However, we will not let a mischievous Opposition destroy the Australian economy in a desperate grab for power and votes. Following the first oil crisis in 1973, there was a massive increase in interest in alternative fuels such as ethanol, methanol and fuels from cassava. I know that the Opposition has chided the Democrats, ever since our formation, for what it calls our peculiar idea of getting fuel from alternative sources. Senator Chaney —We put research funds into alternative fuels. Senator CHIPP —Senator Chaney should look at how much research funds his Government put into it. It would not have run a Sunday school picnic. His Government deliberately and wilfully avoided real research into alternative fuels through the whole tenure of its office. Senator Chaney —Nonsense. Senator CHIPP —If Senator Chaney wants to maintain that record, let him explain to me why Australia is not doing any such research at the moment despite 30-odd years of Liberal government whereas tiny New Zealand now has a methanol plant operating which produces one-third of New Zealand's petroleum needs. Senator Chaney —At what cost? Senator Archer —At four times the cost of oil. Senator CHIPP —Opposition senators can never be satisfied, can they? Their first position is: We are doing more than New Zealand. I am telling them that New Zealand is producing one-third of its petroleum needs from methanol and we are producing nothing. In California cars running on methanol now use about one million gallons a year. In 1979 that one state legislature set aside $10m to investigate alternative fuels, including the production of 500 cars specially engineered for methanol fuel. The Bank of America has converted 10 per cent of all its corporate vehicles to methanol. I plead with the Government and the Opposition to adopt a bipartisan policy for massive research into alternative fuels. By world standards-even the standards of less developed countries such as Brazil-Australia is behaving in an unsophisticated way. This is the kind of far reaching and long term policy that might assist the petroleum and fuel needs of Australia rather than the petty party politicking that has been going on today. Senator BROWNHILL(New South Wales)(4.10) —If ever there was an issue that the Hawke Labor Government has been caught out on, its fuel pricing policy is it. The Federal Government and Prime Minister Hawke especially have treated the Australian public with absolute contempt. Senator Boswell —Particularly the farmers. Senator BROWNHILL —That is correct. The Government assumes that Australian farmers have very short memories. As Senator Durack said in leading this debate, it was Prime Minister Hawke who said in his policy speech in February 1983 that Labor would reduce the price of petrol by 3c a litre. We all know what has happened. The price since Labor came to power has gone up and up. By May 1983, barely two months after Labor came to office, it adjusted the fuel freight equalisation scheme at an estimated cost to rural producers of $10m. It increased the excise on avgas and abolished the depreciation allowances for the on farm storage of fuel. By August 1983 it had cut yet again the fuel freight scheme. The Government removed the sales tax exemptions on oils and lubricants, it increased the price of fuel by 1.5c a litre and it introduced automatic six-monthly increases in the fuel excise in line with the consumer price index. By August 1984 it had again adjusted fuel prices. So the sorry tale has continued. The Hawke Labor Government, in its first 26 months of office, has allowed fuel prices to rise by 10c a litre and the price has continued to rise, by some 1.5c a litre in just the past couple of weeks. All this is from a government that promised to cut fuel prices by 3c a litre immediately on getting into office. Every time that the Opposition has criticised the Government for fuel price rises it has been told that it was this side of politics that tied Australia to import parity pricing. That is fair enough but if it works when the import price goes up how can this Government justify not passing on the savings when the price goes down? It is simply a matter of keeping its word-something on which the Australian Labor Party does not have a sound record. This Government's attitude on the price of fuel was very clear in the last two election campaigns. It made it clear that it would reduce the price of fuel, that it would contain fuel prices. But what is the situation today? The price of fuel is going through the roof, as it is linked to the inflation rate that is more than double that of our trading partners, and, in addition, when the spot price on the world market drops the Australian Government refuses to pass on those savings to Australian consumers. I am glad it is the Labor Party that has to go out and tell the Australian motorists what it is doing with the money that should rightfully be theirs. What possible justification can the Federal Government have for profiteering in such a blatant manner at the expense of every Australian motorist, be he a small businessman, a farmer or a Sunday driver. When one examines the breakdown of the cost of fuel we see the sheer desperate greed of this Federal Government. At the full price government charges amount to some 55.6 per cent of the cost of a litre of fuel and on a discounted litre of fuel it is some 60 per cent. These figures are known well to the Federal Government because in a desperate economic state such as we have in Australia at present the Federal government needs windfalls from petrol price rises to bale it out. With a current account deficit blowout of some $1,033m in December, bring the December quarter deficit to some $3,503m compared with $2,893m only a year before, with the Australian dollar slumping in late 1985 to a record low and with climbing inflation, it is ripping off the motorist to get all the help it can. Rising fuel prices have affected very business enterprise in Australia. Even more adversely affected are those enterprises that trade on export markets. An inflation rate more than double that of most of our trading partners, appalling interest rates and intolerable and rising production costs are all combining to strangle even the most efficient producer. It is the farmer, the rural producer, who is suffering the most. Not only have farmers had to wear the increasing fuel charges but also they have had to adjust to the scrapping of the fuel freight equalisation scheme. Senator Boswell —Around $130m. Senator BROWNHILL —That is right, Senator Boswell. This has been estimated by the National Farmers Federation to cost the rural sector an additional $20m a year. No one ever likes a lift in costs but in the last two years farmers have had to accept increasing costs in all areas of their production while at the same time accepting less and less for their produce. No one in this chamber could have missed the forecasts of the Government's own body, the Economic Planning Advisory Council, for the rural sector. It estimates the real value of Australia's rural products will drop by up to 25 per cent in the current financial year-to the second lowest level in 30 years. One-third of farmers surveyed by the Bureau of Agricultural Economics are estimated to have had negative incomes during 1984-85. Nearly every major rural industry in Australia today is in trouble, be it wheat, dairying, sugar or coarse grains; they are all in trouble. Their problems in July last year were so severe, so devastating and so threatening to our economy that over 100,000 people involved in those industries took to the streets of cities around Australia to demonstrate-a most uncharacteristic thing for the farming community to do. At the biggest rally in Canberra our Prime Minister, Mr Hawke, called the farmers `my friends' and promised them there would be relief but they just had to be a little patient. They were patient. The August Budget came and went without any relief. Overseas borrowing statistics came out and they were up but again the farmers were patient even though their position was worsening. Then interests rates took a swing upwards. There were hints, however, that interest rates would fall if the balance of trade figures for December were good. They were not, so interest rates stayed up. Again farmers were told to be patient. The dollar started to rally and world oil prices started to fall. At last, thought the farmers, here comes the relief. But no; oil prices have gone up and the headlines in last Friday's Australian offered: `PM hints rural fuel bills to be cut'. It has not happened yet. I have not seen it. The Prime Minister hints that farmers might get a few crumbs from the king's table. It seems only now, when farmers' frustrations have been turned into electoral losses, that the Prime Minister is prepared to give some consideration and look at the rural crisis. What is he offering farmers? A real cut on one of their major costs? We do not know. We have to be patient. We have to wait for the right media moment before farmers around Australia can find out whether there really is some light at the end of the tunnel. I only hope that the tunnel is not repossessed before the light starts to shine through. If the Australian newspaper is to be believed, the Prime Minister in a secret but coincidentally photographed and televised trip to the bush told a farming couple at Cowra that they could expect a slight reduction in fuel prices for farmers. As the farmer in question, Mr Gary Bruehm, said: `To be honest, I questioned why he came. We are certainly no better off.' Fuel is one of the major costs for rural producers. It ranges from 5.7 per cent of the total cost for a pig or poultry producer to over 10.3 per cent on a cereal/oil seed property. Converted to dollars, it adds up to something over $600m a year spent by farmers on fuel. It is therefore a major concern for them. Prices for country producers in the New England area-an area in which I live-are probably typical of rural New South Wales. In this area fuel has risen by over 13c a litre for petrol and over 12c a litre for diesel since December 1982. In December 1982 the price of petrol was 40.56c and diesel was 44.06c a litre. By February 1986 these figures had become 57.01c for petrol and 52.89c for diesel. In the last two weeks, at a time when world prices have gone down, farmers in this area and throughout Australia have suffered another rise of 1.5c a litre. Where is the justice? The Bureau of Agricultural Economics has prepared an interesting table of what savings could be made per farm and fishing enterprise if the price of fuel dropped by 7c a litre. I seek leave to incorporate the table in Hansard. Leave granted. The document read as follows- SAVINGS PER FARM FOR 7 CENTS/LITRE FALL IN PETROL AND DIESEL PRICES Type of Farm Savings in Industry (7 cents/ litre fall) Per Farm $ $ Sheep farm... 11m 530 Beef only... 17.6m 580 Sheep-beef... 14m 880 Wheat only... 59m 1,680 Wheat-sheep... 30.9m 1,300 Wheat-beef... 7.8m 1,920 Wheat-sheep-beef... 12.9m 1,570 Dairy... 11.5m 610 Horticulture... 4.1m 610 Sugar... 3.6m 1,100 Total farms... 120m Fishing Industry... 10.1 4 400 per fishing enterprise Total rural sector... 130m FISHING INDUSTRY A 7c per litre cut in fuel prices will save fishing enterprises (individual boats) the following amount per year. Savings for Industry Savings per enter- prise $ $ South East Trawl... 3.0m 1,650 East Coast Prawn Trawl... 0.9m 4,980 Southern Blue Fin Tuna Fishery 0.6m 6,910 Northern Prawn Fishery... 5.6m 23,333 Total savings in the fishing industry per year $10m. Source: Table 7, BAE Submission to the IAC on Petroleum Products, December 1985 Sentor BROWNHILL-The table shows that savings of over $130m could accrue to rural industry if a 7c price drop per litre were to occur. For the wheat industry it would mean an average saving per farm of $1,680 a year. For those engaged in fishing, it would mean an average saving of some $4,400 for every boat and a total of $10.1m for the industry. These are substantial savings for primary producers. It is strongly rumoured that petrol prices in farming states in America have already dropped by 20 per cent. According to a National Farmers Federation submission to the Prime Minister, American farmers are already benefiting to the extent of paying 31 per cent to 55 per cent less for their on-farm diesel and 26 per cent less for their petrol than we are paying at this stage. If their prices are reduced even further it will make Australian farmers even less competitive. This Government must realise that we live in an export economy. To survive we have to be competitive with the rest of the world. The Australian newspaper, in its editorial on 29 January, said: The Hawke Government knows that our precarious balance of payments position can only be rectified if it can successfully tackle the deepseated problems of our export industries . . . it is therefore regrettable to see . . . Mr Hawke . . . about to embark on a new economic path that will see our farmers and many businesses that are leading consumers of petrol . . . paying more for their petrol than they should. We do not have our priorities in order. We are not conducting ourselves as exporters. The Queensland Government also realises that the Federal Government does not have its priorities right. A report in today's Brisbane Courier- Mail indicates that the Queensland Government is preparing Federal Court action to force fuel price cuts. Thank God for Joh. But, as Senator Chaney expressed so clearly yesterday, and as the Courier-Mail says again today: It is clear that the Government's revenue position is extremely tight and the Government feels it must keep the revenue from the crude oil levy to fund its tax cut promises. There in a nutshell is the Government's dilemma. It is finding that its pigeons are coming home to roost. We are having one broken promise after another. While this Government is fiddling, the rural industries of Australia are collapsing. Rural Australia not only needs these fuel cuts, but it must have them and also others to survive. Let me use another couple of quotations from the past. The first comes from Bill Hayden. In 1980 he said: Our policies guarantee that petrol will be cheaper under a Labor Government. Paul Keating, our supposedly esteemed Treasurer of the day, said on 5 March 1982: Government policy ties Australian petrol prices to the price of crude oil from Saudi Arabia. Any fall in that price must be passed on to the Australian motorist in lower petrol prices. Senator RICHARDSON(New South Wales)(4.24) —Today's matter of urgency is really a debate about economic responsibility. It is a debate from which the Australian people during the next few weeks and months will get the opportunity to judge the Hawke Government's response to oil pricing and compare it with the response of the Opposition. Of course, to be able to do that, the Australian people will face something of a dilemma; that is, they will have to find out what the Opposition really wants to do. They will have to find out whether or not there is an Opposition policy for dealing with oil pricing, or at least for dealing with that part of it with oil pricing, or at least for dealing with that part of it which will affect revenue and hence affect expenditure cuts. I have with me an article by David Shires which appeared on Tuesday of this week in the Australian Financial Review. I want to go through some parts of it, because I think it illustrates the dilemma to which I have just referred. Mr Shires states: Mr Howard took time out from a shadow cabinet meeting to slam the Hawke Government on both its oil and agricultural policies, calling for a range of cuts in government imposts on farmers. Fortunately, the Prime Minister (Mr Hawke), the Treasurer (Mr Keating) and others were able to contain their fear of this slamming. There was no gnashing of teeth or wailing from the Cabinet room. The very next paragraph explains why there was no need for fear. Mr Shires, referring to Mr Howard, goes on to say: But he again appears to have run into serious political strife by refusing to address the question of how to pay for those measures. I might say that running into serious political strife has been a pretty common occurrence for Mr Howard over the last few months. As we see his popularity plummet and the Liberal Party's divisions becoming more and more public, it is helpful to look at some of the reasons why. As a purely disinterested observer of who might have done well or badly in the Liberal Party, I think the next paragraph of the article shows why John Howard has so many problems. As an example of a grab bag of promises and of ridiculous extravagance when making promises-so transparent an exercise in duplicity it is that people cannot be persuaded to vote for him-the article says, referring to John Howard: He called for the full impact of oil prices to be passed on to rural producers `and indeed all Australians' . . . He wanted a shift in economic direction to ease interest rates. He wanted the scrapping of the capital gains tax, a backdown on the productivity deal and the abandonment of `that part of the Keating tax package which discriminates against the earning of off-farm income'; in other words, the protection of yet another tax dodge. If those measures caused revenue problems for the Government, he said, it was the Government's problem. He would not discuss the revenue implications of his demands, `preferring to leave that part of solving the problems firmly in the Government's in-tray'. We now get to the crunch, what his argument is really all about when he talks about scrapping $1.6 billion in one go in government revenue. The article states: Should we be looking at a broad-based consumption tax again? He was asked. `Well that's a matter for the Government' was his reply. `Look, we are not in Government- That is obvious. I can agree with that part of it. He continued: and we will be announcing at an appropriate time what our policies are in relation to matters of taxation and matters of expenditure'. I hope that the breathless Australian public out there is not hanging by the neck waiting for the appropriate time to arrive. Having waited three years, they have seen nothing. There is no indication whatsoever that in another three years anything more will follow. He was asked: Should the Government renege on its promise of personal tax cuts? The following is a classic Howard reply: My preference always is that when you have a budgetary problem you cut expenditure and you don't run away from taxation relief. There will be an enormous outcry from the Australian public if the Government abandons the personal tax cuts. My memory is not perfect, but I recall in 1977 the last Lynch Budget which was produced on pretty rubbery figures on both sides of the equation. Whether we are talking about government expenditure or government revenue, that Budget was never going to stand the test of time. It did, however, serve one purpose. It meant that the Fraser Government could run a series of advertisements depicting a fistful of dollars across our screens to get it through one shabby election campaign. However, after that election campaign when Sir Phillip Lynch went the way of all flesh and John Howard was able to take on the mantle of Treasurer of Australia, the Australian people got a pretty quick look at what John Howard meant when he said: My preference always is that when you have a budgetary problem you cut expenditure and you don't run away from taxation relief. He promptly, within days, took away that fistful of dollars. The tax cuts were just swept off. Just to make sure that the Australian people got the message over the next few years, by 1980 and 1981 John Howard had removed even the pretence of the Fraser Government's promise of tax indexation. So all the promises-not just one or two but the lot-were done away with within a couple of years of John Howard's becoming Treasurer of Australia. I return to the article by David Shires to which I referred earlier, as one has not finished the misery of what John Howard is inflicting on himself. When asked where expenditure should be cut back, Mr Howard said: Well, that is a matter for the Government in detail to come up with and I don't intend now or in the immediate future- I would add as my own comment `or ever'- to be detailing the alternative expenditure plans of the Opposition. I will, at an appropriate time, indicate what a coalition government will be doing in the expenditure area at a time of my choosing and not at a time of the Government's choosing or, indeed, of anyone else's. The Australian people in looking at who they want to vote for at the next election might ask just when the appropriate time will be. In three years they have not seen it, they did not see it when Peacock was leader, and now with John Howard they wait and they wait. They have a passing interest in whether Howard is right about wages policy or whether Macphee is right. We watch these brawls from the sidelines and cheer on the participants, but we are still waiting for policies. All we see in the Liberal Party these days are arguments-arguments on all the major fronts of Government policy-but we never see Liberal solutions. As soon as someone in the Liberal Party suggests a solution, at least one other person in the Liberal Party says that it is no good. One then goes back to the interminable, dreary arguments among Opposition members day after day in their caucus room. Senator Walters —We don't have a caucus. Senator RICHARDSON —Take a deep breath, Senator Walters. Let us look a little further through the history of the Liberal Party and where it went. We must remember that these same people opposite who are now talking about big cuts in petrol prices, in their period of government presided over a 700 per cent increase in the amount the Government took of the oil cake. When Howard became Treasurer, crude oil and LPG excise was made up of 1.4 per cent of government revenue. By the time he was thrown out the figure was up to 9 per cent of tax revenue. To make a government dependent on a resource that is not only finite but is bound to run out in a few years was a horrible way of distorting that Government's failure ever to come to grips with cuts in government expenditure. While the rhetoric was always there about small government, there was never any commitment to do anything about the rhetoric. It was rhetoric-and hollow at that. As expenditure went up and up, the only way the then Government could keep down deficits and play with mirrors was to keep dipping more and more into the oil barrel of taxes. I went back to look at what the government of the day said about this matter. I discovered that the best quotes to use to illustrate duplicity in its purest form were to be found-to get off John Howard's back for a moment-in the National Party. We have just heard Senator Brownhill attack the Labor Party's record on honesty. He said that that record was not too good. Senator Boswell —What has the ACTU got to say about it? Senator RICHARDSON —It is strange to hear that comment come from a Queensland senator when one is talking of honesty in government. This is a time when Queensland senators, especially those in the National Party, should keep quiet. Turning to Senator Brownhill's remarks about Labor's honesty not being too good, I would instance two quotes from Doug Anthony when he was Deputy Prime Minister. Senator Cook —Doug who? Senator RICHARDSON —Doug Anthony, the then right honourable member for Richmond. He said in August 1977: I have constantly argued that we should move gradually and predictably towards higher oil prices. To show that he took the same view a couple of months later on 7 November 1977, he then said: There is no need, nor would it be desirable, for prices to move to world parity level overnight. What happened was that in the 1978 Budget oil prices in Australia moved to world parity levels. Overnight there was a 17 per cent increase in the price of petrol. Overnight that increase amounted to 13.6c a gallon. Yet Opposition members today seek to lecture us about the effects of fuel prices on farmers. The then Government record in 1978-79 was disgraceful. The Liberals were the ones who increased the imposts on farmers in that area by 70 per cent in one year. They were the ones who distorted the costs to farmers and who are at the root cause of those problems now. If we are looking at what the Opposition says about the terrible imposts on farmers, let us also look at what the Liberals did when they were in government and compare it to what Labor has done. If one is to complain about the costs farmers have to look at, let us examine the whole range. The price of fuel-and I concede immediately that farmers are heavy users of fuel-is only one element. The reality in looking at their costs is to compare the effective level of inflation. One must compare the effect on farmers of the Liberal Government's inflation of 11 per cent with the effect of our 6 per cent level. What did that level of inflation do to costs? Why do not Opposition senators mention that fact? Why do they never talk about the effect of their inflation on small businesses? Do those Opposition members not remember the many doors of small businesses that closed during 1982? The only place where they are closing at a great rate now is in Queensland, and that is to be expected. I know that Senator Maguire has spoken many times in the House about these matters. To make it worse, when one gets on to the wages growth and looks at the effect of wages costs on farmers, one must compare the 1981-82 figures of 14 per cent and 17 per cent with what has occurred in the last three years when the figure has been less than half of those figures. Opposition members have no record on which to base any statement in this respect whatever. They have had their chance and have blown it. They let wages go out of control. Opposition members now want to return to the old wages policies. Let me turn to an article of 5 February this year written by Gregory Hywood in the Australian Financial Review. I note that the Business Council of Australia had a little to say about what the Liberals were proposing. According to that article Bob White, the Chairman of the Business Council of Australia, took the Liberals to task for polarising businesses into big and small and encouraging the view that Australia was becoming a corporate state. The managing director of Rothmans Australia, Stan Costigan, said that the Liberals had `a long way to go' before they could be considered an alternative government. Not one BCA speaker-and there were well over 50 members there-supported Liberal policy. That is how well the Liberals have done. They have deserted their base and they are scratching round in the dirt to find another issue. They will not find it in this issue. Their record is pathetic and they cannot hack the job. Senator PARER(Queensland)(4.37) —Today we are debating as a matter of urgency the need for the Government to pass on to consumers the full benefit of the drop in world oil prices. There is no choice for the Government. It has a deal with the Australian people-a deal it has to keep. Successive governments have accepted import parity pricing as a mechanism for setting fuel prices in Australia, whatever the drawbacks of the system. Under the import parity pricing formula, petrol prices have risen over the last few years by about 10c a litre under the Hawke Government. Further price rises occurred during 1985 as a result of the depreciation of the Australian dollar. At that time the Minister for Resources and Energy, Senator Gareth Evans assured the people of Australia that any price reduction flowing from currency movements would be directly passed on to the consumer. He must now do the same with a price reduction that flowed from an international fall in oil prices. The Government has no option. The people will demand what is rightfully theirs. The Government has set the rules. It cannot change them now for its own revenue collecting purposes. The Government's credibility is on the line. In 1983 the people were asked to believe that we would not have a capital gains tax. In 1985 we got a capital gains tax. In 1984 the Government promised-before the election of course, when it fiddled with the money supply-that in 1985 interest rates would fall. What did we get in 1985? We got record real interest rates. Before the Tax Summit we were going to have a broadly based consumption tax to enable real reductions in marginal tax rates. Instead we got a collection of anti-business tax measures and some promised tax cuts that we will have to pay for through inflation. The Treasurer (Mr Keating) in his Budget Speech promised a full discounting of wages for the dollar's depreciation. Two weeks later, after the signing of the accord mark 2, there was no discounting at all for the November national wage case hearing. The Government must come to the party on petrol prices and play by the rules it set itself. Labor members know this and the Queensland Labor Party knows it. The Queensland Labor Party has to face an election this year. According to its leader, Mr Warburton, fuel prices for motorists and other consumers should reflect the current drop in world prices. He said: I believe the Government should be apprised of our opinion on this very important issue. The Queensland Labor Party is not often right on anything but it is right this time. The Labor Party has always been very interested in lower petrol prices. It regarded any petrol price increase under the previous coalition Government as a tax rip-off. Mr Keating, in particular, has a consistent record on this and an abiding commitment to lower petrol prices. In his now famous October 1979 Press release in Rockhampton he said: The great petrol rip-off must be curbed. Only Labor will stop this pernicious tax by stealth. I stress the words `Only Labor will stop this pernicious tax by stealth'. He also claimed that the then Government had established a branch of the Australian Taxation Office at every petrol pump. In 1980 the world's greatest Treasurer claimed: Our policies guarantee that petrol will be cheaper under a Labor government. I repeat that Mr Keating said: Our policies guarantee that petrol will be cheaper under a Labor government. In 1983 the Prime Minister, Mr Hawke, promised an immediate 3c a litre cut in petrol prices. Since March 1983 petrol prices have risen 10c a litre. Senator Walters —Of course they have. So much for Labor's promises. Senator PARER —They are plastic people, Senator. It is ironic that in 1978 Mr Keating opposed the introduction of import parity pricing because he said it was inflationary. Now the Government needs an 8 per cent inflation rate to pay for its tax cuts. The Treasurer also said at the time that import parity pricing was simply a grab for revenue and an attempt to hold down the deficit. How our words come back to haunt us! The only reason the Government will not pass on to consumers the current drop in world prices is that it needs the money. Again in 1979 Mr Keating claimed: Without the money, the Government's economic management would be in the deepest trouble. In the last few days this has sounded all so very familiar. Now this Labor Government's management of the economy is in the deepest trouble. It has promised tax cuts to buy off the unions over wage discounting-tax cuts which it cannot afford-and yet its own high interest rate policies are making life impossible for many producers and businesses which desperately need to cut costs to remain competitive. A cut in fuel prices-the benefits of lower prices will flow through to producers in our trading partners-is essential if our own costs are to be reduced. Yet the Government seemingly cannot give us this undertaking. It is in a policy bind of its own making. Its own policies, particularly the accord, have locked it into a situation from which it cannot escape. Again, it is the people of Australia who will suffer. The Government talks a lot about the need to be competitive but everything it does makes our nation less competitive. This Labor Government has given us automatic wage indexation which feeds inflation. Our inflation rate is four times that of Japan and more than twice that of our major trading partners. Our interest rates, again courtesy of the Labor Government, are at record levels and are substantially higher than those of any of our competitors. We have foreign investment controls which prevent much needed capital investment in Australia. We have a new and oppressive tax regime which is stifling those who produce our wealth. We have excessive business regulation. We suffer the burden of enormous taxes and charges and, seemingly, the Australian Conciliation and Arbitration Commission is about to rubber-stamp a so-called 3 per cent productivity deal worked out by the Australian Council of Trade Unions and approved by the Government-a further incredible slug to the productive sector of our economy. So much for the Government's concern about competitiveness! Dropping the price of petrol is one tangible way of easing the burden for our producers. This is particularly the case for our rural producers, as has been pointed out by Senator Brownhill. It is also vital that consumers receive the benefit of cheaper petrol. The people of Australia, every motorist, truck driver, motor cyclist and boat owner, have paid progressively more for fuel under import parity pricing with every increase in the world price of oil and every devaluation of the dollar. This has meant that the coffers of government have been swollen in a relatively painless way. People have accepted grudgingly the principle of import parity pricing. I point out, though, that the remarks made by Senator Chipp were quite incorrect. Import parity pricing was introduced in the 1970s at a time when we had an oil crisis and there was great concern about the future of obtaining oil because of the lack of stability and problems in the Middle East, and it worked. As a result of that pricing policy we have had more exploration and we have discovered a lot more oil and a lot more gas. For the first time government, by collecting tax in this manner, put itself into a market situation for collecting revenue. If the Government had any idea of management it would have recognised that markets do fluctuate. When that occurs with an individual or a company, provision is made for a rainy day. When that happens the private sector or the individual must call on accumulated reserves and reduce costs in order to survive. However, governments at all levels think quite erroneously, that they are above this simple economic principle. People throughout Australia are fed up to the back teeth with government taxes, charges and regulations. Many of them sadly feel beaten into submission and thus helpless to do anything about the greed of the Government. Yesterday, the Minister for Resources and Energy said in this chamber that the fall in world prices could not have been anticipated. That is life. That is what every individual and small businessman faces every day of his life. There is the expectation of a job, for instance, that does not eventuate and the horrific interest rates which the Prime Minister of Australia said a year ago would come down. When the Prime Minister says that, the small business sector could also say that the rise in interest rates to over 20 per cent could not have been anticipated. What does the Government say to the small businessman who says: `I did not anticipate that'. It says: `Tough. Not only that, we are going to make it tougher for you in the tax package and we are going to make you pay an extra 3 per cent tax to cover occupational superannuation'. So the Government is now faced with the situation where it must honour in full its commitment to the people of Australia to reduce the price of petrol by 7c per litre. The Government is making all sorts of noises about the fact that it cannot afford it, that it would be at the expense of promised tax cuts and so on. What do I say to the Government? I say: `Tough. Give back to the people of Australia what they expect. Cut your cloth in the same way as they had to do in the long period of rising oil prices'. How the Government does it is for it to decide. Any half measures of partial reductions will not be acceptable. Any pea and thimble tricks of reducing the price and increasing excise will be seen for what they are-simply cheap tricks to hoodwink an already overtaxed consumer. Yesterday in the other place the Treasurer and others tried to drag all sorts of red herrings into this debate and we have experienced the same thing today with the comments made by Senator Richardson. I do not think that he was talking about the same matter that we are talking about. Senator Gareth Evans talked about wrestling with the problems. He had no difficulty wrestling with the problems when the price was rising. Why does he have to wrestle with the problems when the price is going down? It is a joke. He came up with a whole lot of weak excuses as to why this Government will not keep its promises. That is what he did and that is what Senator Richardson did. I have already commented to some extent on Senator Chipp's remarks. At one time I thought he was trying to take on the world's greatest Treasurer in some sort of competition and take that title off him. He was all over the place and seemed to be having the normal two bob each way that the Australian Democrats have. The matter of urgency that the Opposition has raised is very simple. Everyone who buys fuel in Australia, whether he puts it in his car, truck, bike, tractor or motor mower has paid every price increase in a rising world market over many years. Now that the market has fallen we must be given the full benefit of the 7c a litre reduction in the price of petrol. Australians will settle for nothing less and they will not be conned by any spurious side issues. Senator COOK(Western Australia)(4.51) —This afternoon we are witnessing in this chamber a shameless, opportunist act of political perfidy by the Opposition. The matter of urgency has been spoken to by Senators Durack, Brownhill and Parer. They have called upon the Government to do something that they know full well the Government has before it and is considering in a measured and responsible way. They are asking the Government to do something that they know full well-as the Government has announced its position on petrol prices every quarter-it will do before 1 March. They have sought to be shameless and opportunist by sneaking in this week-the first week of the parliamentary session-and trying to pre-empt the Government by calling upon it to do something that they, in their economic irresponsibility, believe it ought to do. Do they believe that the Government ought to do it? The Opposition has never said at any time in this debate how it would handle the general macro-economic problems created by the changes in oil parity prices. It has run away from that. It has hidden behind all sorts of other shibboleths. What we have seen emerge in this debate is a shambles of an Opposition which has an inability to come to grips with any coherent economic philosophy and present an integrated, comprehensive political, economic view. The Opposition has said: `Let us tackle these parts of the tax package that is suits us to tackle and ignore the hard problems. Let us do the opportunist thing here. Let us do the opportunist thing there'. That is the reason why, in the nine elections held at State and Federal levels in this country since the Burke Government was elected in 1983, the Australian Labor Party has won seven, the Liberal Party of Australia has won one and the National Party of Australia has won one. That is not a bad score. The Government has won seven elections and the Opposition two. I am sure that on the basis of the Opposition's political and economic strategy that will remain the score. As I have said the Opposition knows that before 1 March the Government will announce its position on oil parity pricing. The Opposition knows, because it is widely reported, that the matter is before Cabinet and it will be decided shortly. The Opposition is sneaking in the back door to try to pre-empt that move. What it also knows, but what it has never referred to in this debate today is the international price of oil in Australia compared with that in other Organisation for Economic Co-operation and Development countries. The Opposition has rattled on about Australia's competitiveness abroad and has rattled on about a matter which this Government is seriously considering, is seriously concerned about and is seriously acting on more effectively than any of the Opposition policies. Let us look at the measure the Opposition chose to bench-mark as its particular point of reference: The international competitiveness of oil prices in Australia. The United States of America, in terms of the OECD group, is ahead of us. It pays 52c per litre. We in Australia pay 53c, Canada pays 56c, New Zealand pays 67c, West Germany pays 87c, the United Kingdom pays 91c and then the rest-Japan, France and Italy-pay between 104c and 116c per litre. So Australia's international competitiveness with the OECD group on the issue we are now debating, is not just among the best but it is in second place and then it is only 1c behind the price paid in the United States. On that measure alone the Opposition does not have an argument to put in terms of international competitiveness. We also know, because the Minister for Resources and Energy (Senator Gareth Evans) put this in debate earlier today and at Question Time yesterday, that one of the economic problems-if the Opposition is respectable it should produce an answer to it and wrestle with it-is that if the price of oil per barrel goes to $US18 which as the experts predict is not an unreasonable guess, and if our exchange rate with the United States dollar remains at around 70c, the loss to revenue this year will be about $550m and next year about $1.4 billion. That is a significant hole in revenue. If the Opposition is asking the Government to give up that amount of money it should say how it intends to meet all the other responsibilities of the Budget and whom it proposes to cut out. That is an obligation upon the Opposition if it is serious. I am the last speaker in this debate and I have listened carefully to each speaker. Certainly Senator Chipp identified the problem accurately, and, I think, in an eloquent address to this chamber nailed the Liberal Party, in particular, because of its perfidy on this issue. But no one from the Opposition has addressed that issue and until it does it cannot sit back and pretend that it is an alternative Government. Senator Watson —It is your credibility at stake, not ours. Senator COOK —I hear an interjection `it is our problem'. It is our problem because the people of Australia have conferred the responsibility of government upon us. If the honourable senator waits just a few days he will hear the answer. I do not know what the answer is at this time but I have listened to what Senator Durack told us would be the Labor Government's answer. Other speakers in this debate have told us what we will do. I suggest that before the Opposition tells us what a Cabinet will do before it has met-a Labor Cabinet at that-it ought to wait and hear what it has said and judge the results of its decision. We also know in terms of the tax debate that the Opposition has taken a most hypocritical stance. It has supported tax cuts but opposed tax raising measures. Indeed that just continues the perfidy. I understand that Mr Howard is still on record as saying that he supports a broadly based consumption tax. Yet the Opposition is calling for a reduction in petrol prices. Does the Opposition still support a broadly based consumption tax which will increase petrol prices once that tax is imposed? Is that still the Opposition's position or is that yesterday's position, or the position five minutes ago, or did the Opposition not even think about the matter at all? That is a pertinent question which the Opposition should ask. Let us also look at the Liberal Party's record when it comes to oil parity pricing. I know that many Liberal and coalition senators find the door of this chamber as soon as their record is cited. But let us go to the record for the sake of the record in this debate. The last Lynch Budget in 1977-78 raised $476m from crude oil and liquefied petroleum gas excise duty. Mr Howard took over and he bumped up the excise duty almost three times. In 1978-79 the first Howard Budget raised not $476m as the Lynch Budget raised, but $1,227m. Some $1.2 billion was raised by Howard and that is almost four times what Lynch raised. If one follows those figures through one sees that at the end of the last Howard Budget, when the Australian electors said enough is enough and kicked out the Fraser-Howard Government, in 1982-83 Howard was taxing the Australian people to the tune of $3.486 billion through a crude oil and LPG excise levy. If anyone wants to know who hooked the Budget of Australia into raising money from oil, it is the Opposition which now parades itself as the saviour of the Australian motorist. For the sake of consistency in my remarks I will talk about what this Government has done. Honourable senators can see that in 1983-84 the excise levy rose but it rose by an insignificant amount. Remember, Howard raised $3.4 billion. The first Keating Budget raised $3.6 billion and the figures have remained at the same level. But in terms of the central economic question of who hooked the dependence in terms of revenue for the budgetary process into oil, it was the Opposition, which comes here now and bleats about it. As I have said, Howard still supports a consumption tax and the Opposition still talks about political responsibility. The Opposition's responsibility is about as responsible as Mr Hassell was in Western Australia, or as Mr Olsen was in South Australia, or Mr Kennett in Victoria, or Mr Greiner in New South Wales, or Howard here. The people of Australia see through the charade and the pretence of responsibility that the Opposition mouths. Most recently, and while this very issue was being canvassed in the public domain, the people in the State of Western Australia spoke about their view of responsibility from the Opposition. Labor scored a massive 58.3 per cent of the vote in the Perth metropolitan area. Overall it was a swing of one per cent to Labor in the State of Western Australia, and, importantly for this Parliament, all Federal seats held by Labor in Western Australia were significantly strengthened by the vote last Saturday. It was only three or four days ago that this issue was before the people. If they believed the rhetoric that Opposition senators have come out with in this place, they would have taught us a lesson. They did not. They have confidence in the stability and the longevity of Labor governments. Opposition senators interjecting- Senator COOK —Here we have a few interjections from the Liberal Party. If I were in the Liberal Party I would not raise the Western Australian election at all, because the Liberals got done by the Nationals in that election to the tune of four seats and we took one from them as well. Since we last gathered in this place there has been an election in South Australia which Labor won convincingly, gained another four seats, and, on a two-party preferred basis, had a swing of 2.2 per cent toward it. We talk about responsibility, about credibility, and about who represents the public interest. Let me refer honourable senators to the two most recent and absolute polls conducted in this country about those in whom the people of this country have confidence-and it is not honourable senators opposite. As I said, the Government will announce its decision before 1 March. We will not be stampeded by honourable senators opposite; we will not be called to book by them in this place and have it demanded of us that we reveal what we might finally decide, because we are determined to deal with this in a measured, logical and responsible way. We know that the price of oil is at present still volatile in the world market. It may go down further. We have had a very gross mishandling of the truth in this debate this afternoon by it being alleged that we did not predict that there would be a fall. Certainly world experts, as Senator Gareth Evans said, predicted that there would be a fall, but no one except, it seems, Senator Durack-and he kept it to himself and did not tell anyone-predicted that it would be as rapid and as deep as it was in the event. We expected, after the Northern European winter, when the demand for oil would be less, and with the Organisation of Petroleum Exporting Countries concentrating on winning market share at the expense of price for its product, that there would be a fall. But no one expected it would be as deep, and the price is still volatile. Senator Short —That has nothing to do with it. Senator COOK —It is exactly everything to do with it, because it is on the basis of the world price that Opposition senators are asking us to adjust the price at the petrol pump. In the last few minutes I have available to me I want to talk about the Hawke Government's record on this subject, because it is a record of responsibility and a record that ought to be put in this debate. Since coming to power in 1983 this Government has reduced the import parity price for Australian crude five times. It did so in April and July of 1983, it did so in January 1984 and it did so in July and September of 1985. Consideration by the Prices Surveillance Authority, a body set up under the accord which has been maligned here, has resulted in the reductions in the maximum wholesale price of petroleum products. For example, in July and September 1985 the price was reduced by approximately 0.5 cents and 1.4 cents per litre respectively. The Opposition has made much of the claim that petrol prices have risen by 10 cents per litre since 1983. In real terms, the price of petrol in Australia has risen by only about 2c per litre. So let us end the sort of rabid speculation in which Opposition senators engage. I see by the light on the clock that I have less than a minute to go. Honourable senators opposite should issue a great sigh of relief because I was going to talk about the Opposition's record and what Mr Howard did when he was the Treasurer in the Liberal Government. Under the Liberal Government, he imposed the biggest taxes ever on Australian people, business and farmers. He grabbed huge increases in oil revenues and spent them. When Howard came to office crude oil and liquefied petroleum gas excise made up 1.4 per cent of government revenue. He pushed up these excises to 9 per cent of tax revenue, and under the Australian Labor Party this has been reduced to 6.8 per cent. Between 1977-78 and 1982-83 Mr Howard pushed up Commonwealth oil revenues-and I finish on this, but honourable senators should remember it because if we come back to this debate later in this year let them provide an answer to this-by 700 per cent. Question resolved in the affirmative. Senator WATSON(Tasmania)(5.06) —I move: That the Senate take note of the paper. I must commend the Australian Wool Corporation on another successful year and on both the production and content of its annual report of 1984-85. As a document, it is clear, concise and well presented and it is, indeed, indicative of an organisation that knows where it is going, that knows how to present and market its product and is consistent in its ability to make each year an improvement on the year before. Wool production is the bright spot in a depressed rural environment. While other areas of rural production are being squeezed by a destructive combination of international practices and by excessive and unjustified costs that result from the present Government's policies, wool producers have managed to improve their productivity and profitability. Wool prices have risen by about 6 per cent. The Bureau of Agricultural Economics has predicted a further rise of about 4 1/2 per cent in 1986-87. In spite of increased production, wool sales have increased, and the Australian Wool Corporation's stockpile has decreased considerably. Furthermore, demand by textile mills is expected to remain high, at least for the foreseeable future. The world-wide increase in wool sales and the upsurge in demand are the direct result of two interrelated factors: Increased international demand and excellent promotion and marketing by the International Wool Secretariat, in which Australia plays a significant role. Australian wool producers welcomed the 20 per cent devaluation, which enabled their product to become more competitive on international markets. Our Wool Corporation has played a significant part in increasing the demand for wool. Its achievements have been considerable because it has been open to change. The Corporation has been quick to meet changing patterns of demand and changing conditions in the textile manufacturing environment. The Wool Marketing Service, which made a profit in excess of $500,000 in 1984-85, continues to fulfil a useful purpose as a test bed for marketing innovations and improved practices. The AWC is continually reviewing policies and is always prepared to progress one step further with research and development. In fact, other mostly unsuccessful marketing organisations in this country could learn a great deal from the management and operation of the Corporation. Instead of producing for the market, it is creating markets and creating demand, and it is successful because of it. I take this opportunity to congratulate the Australian Wool Corporation on the promotional materials that it has produced for use in schools and on its foresight in developing a position for an education officer, Ms Christine Reid. In so doing, it has increased demand on the home front, which is a high priority area, and the materials which have been produced are excellent. Its latest educational publication, `The Australian Wool Industry', is now available in multiple copies for schools and I hope that schools throughout the community avail themselves of these materials. In the report the Corporation expresses its concern about the drift of research funds, particularly in the Commonwealth Scientific and Industrial Research Organisation, from rural industries to manufacturing and sunrise industries. The Corporation questions this approach, given the high levels of assistance already received by manufacturing industries, the strong international competition among sunrise industries and the high returns to Australia that have flowed from wool research. Perhaps the most important sentence in the report, and one which provides a sound reason for the success of the Wool Corporation wool promotion, says: . . . the willing co-operation of all sectors of the wool and associated industries, together with research and test organisations . . . has been a feature of the achievement to date, in Australia and many overseas countries. I commend the report to the Senate. Question resolved in the affirmative. Senator SANDERS(Tasmania)(5.11) —I move: That the Senate take note of the paper. I note that on page 1 of the annual report for the Department of Foreign Affairs it says: The Department of Foreign Affairs is concerned with foreign policy advice implementation . . . The report goes on to describe this in detail. I point out that either the Department is failing in its function or perhaps the Government is simply not listening to its advice. In fact, the Government seems to be unaware of much of what is going on in the world. I refer honourable senators to a question I asked yesterday in the Senate regarding the policy of the United States of America, the avowed policy of Admiral James Watkins who, in the proceedings of the United States Naval Institute, said that the United States policy was to destroy Soviet nuclear missile submarines at the outset of a conventional war. I asked a question about the Government's awareness of this policy and its significance, particularly to North West Cape, which, of course, would give the first strike orders. The Minister representing the Minister for Defence, Senator Gareth Evans, said: However, it appears that this is not a definite agreed policy but rather the canvassing of one among many possibilities open to the United States of America in the event of a conventional conflict with the USSR. Certainly, the Australian Government- this is the important part- is well aware of these and other developments, actual and possible, in the United States strategic doctrine. To the extent that the proposal has been canvassed in the way that it has been by Admiral Watkins, it would be fair to say, from an Australian defence analysis point of view, that the wisdom of such a strategy appears to us to be questionable. To attack Soviet strategic nuclear submarines during a major conventional conflict would appear to increase further what would already be a high risk of escalation to nuclear war. That I agree with. It turns out, in spite of that definitive statement by the honourable senator, that the United States policy is in fact other than he stated. It turns out that in Australia the Australian Government-I hope the Department of Foreign Affairs is not involved in this lack of awareness-is simply unaware of United States policies pertaining to this area, to our very own part of the world. Although Senator Evans said that this was not a policy of the United States, in yesterday's Press, namely, the Herald, is a headline: `Sub attack ``Key'' to U.S. strategy'. The article states: WASHINGTON, Reuter-U.S. ships and planes would quickly hunt down Soviet missile submarines if a conventional war broke out between them, Defence Secretary Caspar Weinberger said. I think that someone is amiss in this country-the Government or the Department of Foreign Affairs, although I think it is more the Government's fault-because we are forced to learn what the attitude of the United States towards our area is by reading the newspapers. The United States did not bother to tell the Government of this major shift in policy which, in fact, was foreshadowed in the report by Admiral Watkins. The United States did not bother to tell Australia that North West Cape would be essential to the first strike hunting down of Russian nuclear submarines in the event of conventional warfare in Europe. This is not the first time this has happened. We have seen it over and over again. One very important example of this was in 1971 when Prime Minister McMahon attacked the visit of Opposition Leader Whitlam to China as offensive to the United States, because he was unaware that Henry Kissinger was in China arranging a visit by Nixon, which was announced while Whitlam was still in China. It is time this country demanded that it be told what the United States has in mind for our area and not be forced to read about it in the Press of this country. Senator MASON(New South Wales)(5.16) —There are several points I want to make in regard to the 1984-85 annual report of the Department of Foreign Affairs. My first point is that, as a member of the parliamentary delegation which visited China last year, I cannot praise too highly the spirit of enterprise and enthusiasm I found among our diplomats in that country. China is probably the most important foreign post we have, in many respects, and it is essential that we get things right there where our work is concerned, especially after such a long period in our history when we did not get things right as far as China was concerned. Looking back, I would especially like to commend to this Parliament the dedication, hard work and intelligence of the head of mission at that time, Mr Denis Argall, who I think at great loss to Australia was not able to complete his term as Ambassador but was forced to return to Australia last August because of ill health. I wish him a speedy recovery and I hope that his knowledge of China and the enthusiasm he showed will again be available somewhere in the service of Australia. The delegation was able to meet with Mr Hu Yaobang in Beijing. I was struck by the firmness with which Mr Hu insisted that China intended to persist with its open door policy of co-operation in trade and joint ventures with other countries-a virtual open door as dramatic as the one that Japan made at the time of Commodore Perry. It was certainly in vivid contrast with what I found when I visited China in 1975, towards the end of the Cultural Revolution. I stress this matter because I believe that many Australians do not yet understand how much China has changed and what great trade opportunities exist there for Australia; but, I would say, on a hard-headed, businesslike basis because the Chinese are certainly hard-headed enough. That was our experience of them. Before I went to China, I remember, someone said to me: `What a terrific opportunity it would be if we gave every Chinese one of a pair of Australian woollen socks, as they would then have to buy the other half of the pair and that would be a tremendous breakthrough'. I now hasten to assure that person that the Chinese would immediately trade off a sock so that half of them would have a complete pair of socks. That is the way it is. The Chinese market is available only to Australian business which is adaptable and which is able to supply a good product at a competitive price. However, it is a market that is well worth that kind of effort. It is the world's biggest market, bigger than it has ever been before, and interestingly enough-this is one of the main impressions I think one gets of that country and an impression which our diplomats stress to us again and again-Chinese society is now turning acquisitive. After the years and years during the Mao era during which the people could not have things-during which time I saw them going through department stores looking wistfully at consumer goods which they could not afford-they are now reaching the stage where incomes are going up, especially because of the incentive situation, and where there is a market. It is a market which particularly we in Australia can get into. The reason for that is that, as far as I can see, the Chinese Government is in favour of Australia. We are a small or middle country. We have never been colonists. We have never really been in a position which would excite the Chinese to any kind of opposition ideologically. That gives us a much more important advantage in China, where ideology is still important, than we might understand. There is already a large number of Australian companies operating effectively, efficiently and profitably in China. I ask the Australian Government, even if it feels that it has undertaken a public relations campaign among business and the community generally, to ensure that there is a good and up to date understanding of that country. Almost any effort we can make is worth while. As an example, it is striking that the greater part of the earnings of a Chinese worker are in the form of incentives which are assessed regularly on his reliability and energy. The principal of paying people the same whether they work hard or not has disappeared in China. When I asked one of the new Western-suited young technocrats how this accorded with socialist ideas, he blandly told me: `Ah, this is the new socialism'. Senator Archer —Not in Australia. Senator MASON —If that is the case, maybe we could do with some of it here, Senator Archer. I commend to Senator Archer and others, Senator Siddons's ideas on industrial democracy. They passed the Senate once. Can we not go back to that workable system of industrial democracy where the work force would be largely self-regulating and we would need the doctrinaire unions less. I repeat that the Government could do worse than look at the Chinese system of worker incentives in that light. Senator CROWLEY(South Australia)(5.21) —Much can be said on the annual report of the Department of Foreign Affairs. I will resist wandering through many areas, some of which are fairly unknown to me. I draw attention in particular to two parts of the report that I found very interesting. One is the reference in the report to the Department's equal employment opportunity program and the women's budget program. I do so because foreign affairs seems to be an area of little concern for women. If women are at all concerned, they tend to have nice soft feelings about such things as peace and foreign affairs. That is not a real description of the situation. It is worth noting that the Department is addressing quite different understandings of the importance of foreign affairs to women. I draw the Senate's attention to the difficulties I had in reading the section on page 59 about how the Equal Employment Opportunity Unit is constituted. One would need to be a master of the alphabet to understand it, if not a mistress. It states: The Committee consists of FAS (MFSD) (Chairman); AS Staffing and Organisation Branch (SOB); AS Operations Support (OS); ADAB or Head of Operations Support; Director, Personnel Development; Director, Staffing and representatives of unions and staff associations which have members working in the Department. I appreciate the seriousness with which the Equal Employment Opportunity Consultative Committee is taken and the seriousness and significance of the people appointed. I simply ask that the people writing the report in future spell out what some of those letters mean. It is a matter of some puzzlement to interpret them. They go to the seriousness with which the Department addresses equal employment opportunities. The Equal Employment Opportunity Unit addresses not only the needs of women, but the needs of all people in our society who are disadvantaged or not yet receiving equal opportunities within the Australian Public Service and, in particular, within the Department. Despite some efforts to address the situation, initial statistical work reveals a similar picture in this Department to that in the Australian Public Service as a whole. Women were underrepresented in senior and non-traditional designations and significantly underrepresented in foreign affairs officer, consular and administrative streams. There were few Aboriginals and people with disabilities had little opportunity for career development or promotion. The Equal Employment Opportunity Unit is looking seriously at ways that those categories of under- representation can be addressed within the Department. There are some challenges, particularly considering disabled people or women, in that some of the overseas appointments do not automatically follow for those people. But the Department is serious in addressing both considerations. I turn to page 82 of the report headed `Women's budget program'. Again in response to the last Budget documentation, the Department has produced a women's budget program in line with every other department under this Government's program of having women's budget papers from every department. It is quite interesting to see how the Department can account for some of the steps that have already been taken and some programs already underway to address the concerns of women within the Department and issues of concern for women under the foreign affairs policy section. The report states that the Department's programs have a more direct impact on women overseas through Australian development assistance expenditure rather than on the clientele amongst women in the community. It is curious and is probably some evidence that so far foreign affairs has not been seen as an issue of concern to women. Australian participation in the International Year of Peace is seen as one area in which the Department's policies will more directly concern and interest women in the community as will the contributions by the Government to the Department through the non-government organisations. Senator ELSTOB(South Australia)(5.26) —I also wish to comment on the annual report of the Department of Foreign Affairs. I certainly agree with my colleague Senator Crowley that the report is written with an abbreviation of words. Unless one is used to this, it is almost like reading a foreign manual. That should be taken into account by the people who write these reports. Basically, the report is excellent. It gives a very wide cross-section of the activities of the Department of Foreign Affairs, but it is what is not in the report that I wish to address. The report neglects one aspect, which is rather disappointing. The largest committee in this Parliament is the Joint Committee on Foreign Affairs and Defence. It has 28 members. It is one of the prestigious committees in this Parliament. It meets all the foreign politicians and ambassadors and anyone of note who comes to this country. It has produced a lot of work over the years and its reports have been very helpful to governments. I would have thought that it would have been mentioned in the annual report. I am rather disappointed, and I am certain that people who serve on that Committee would be disappointed that they did not deserve a mention. It has probably been overlooked but I think that in the future some attention should be paid to that Committee. Its members have worked extremely hard and have benefited all governments over many years. The Committee spent a full day at the Department of Foreign Affairs, which was invaluable to the Parliament and the Department. We take up many matters for this Parliament. Since I have served on the Committee not one member has disclosed to the Press what has gone on behind closed doors when speaking with the many foreign visitors to this country. We have been helpful in many different ways which I would not want to go into. I rise with that complaint. It should be addressed in the following reports. I would appreciate some mention of the Committee on Foreign Affairs and Defence in the next report. Debate (on motion by Senator Kilgariff) adjourned. Senator COLLARD(Queensland-Leader of the National Party of Australia) —I move: That the Senate take note of the paper. I seek leave to continue my remarks later. Leave granted; debate adjourned. Senator ARCHER(Tasmania)(5.31) —I move: That the Senate take note of the paper. The statistics produced by the Australian Dairy Corporation should be carefully studied by the people who are in control of the industry and by the Government. Over the last year or two there have been great manoeuvres to try to wind down the dairy industry to fairly low levels. But when I read the figures, which are the 1984-85 figures and thus are eight months old at this stage, the statistics are interesting. They show that in every State the number of cows has decreased. In every State the number of dairy farms has decreased. But they show that productivity has improved and that, in spite of the decreased numbers, milk production is up on the previous year and that the total wholemilk production is up. That has been described as one of the problems of the industry; that, in spite of the fact that the number of cows and farms has decreased, production has increased. I need to draw attention to the statistics on the last two or three pages of the volume. These show that all the countries listed-these include Ireland, France, Belgium, Denmark, the United Kingdom, Germany, the Netherlands, Italy and Greece-are consuming approximately the same amount of butter per year as they have done over the last several years and on average are consuming considerably more cheese per year. The fact that those countries have also steadied their production indicates that there is an increasing world market. There are more people and they are consuming more of the product. I believe that, with Australia's extraordinary high productivity and technology, we can capitalise on this provided that we do not wind down our industry to a stage where we lose the specialists from it. Much research has been done. There are many new products. The technology has improved. New things are being done with dairy produce. I would also like to say how pleased I am that we were able to delay the dairy legislation last year. It has given the industry time to make a few observations about itself. It has given the Government time to make a few changes in the staff which was giving advice, and to look at things slightly differently from previously. In the dairy industry we need to extend our co-operation with our New Zealand cousins across the Tasman. We need jointly to pursue third markets and to avoid too much competition when one or other of us will certainly get the business anyway. Right now the Government is having difficulties with the rural sector and I do not think that that should go unnoticed, but I urge it not to take the action that some people are urging it to take on this industry, which is at the moment productive and profitable. The industry has an opportunity for expansion and it has undertaken high technology. Senator Button —Expansion where? Senator ARCHER —Both locally and overseas. I believe that we would be extraordinarily unwise to wind up an industry at a time when others that are falling to pieces all around it have really nowhere to go. We do not need to put dairy farmers into the same street as the producers of dried fruit, the wheat farmers and the sugar growers, unless that is the Government's aim. I doubt very much that it is; I do not believe that is the case. We have to remember that it is a trader commodity and that our unstable currency at present makes it very difficult for people overseas to have great faith in what we are doing. I seek leave to continue my remarks later. Leave granted; debate adjourned. Senator COLLARD(Queensland-Leader of the National Party of Australia) —I move: That the Senate take note of the paper. I seek leave to continue my remarks later. Leave granted; debate adjourned. The ACTING DEPUTY PRESIDENT(Senator Elstob) —I inform the Senate that the President has received advice from the Leader of the Opposition, Senator Chaney, that Senator Lewis has been appointed the Opposition delegate to the Australian Constitutional Convention in place of former Senator Peter Rae. Messages received from the House of Representatives intimating that it had agreed to the amendments made by the Senate to the following Bills: Judiciary Amendment Bill 1985. Broadcasting and Television Amendment Bill 1985 The ACTING DEPUTY PRESIDENT(Senator Elstob) —The President has received a letter from the Leader of the Opposition, Senator Chaney, nominating certain senators to replace former Senator Peter Rae on the Standing Committee on Appropriations and Staffing and the Standing Orders Committee. Motion (by Senator Button)-by leave-agreed to: (1) That Senator Jessop, having been duly nominated in accordance with the resolution of the Senate of 25 March 1982, be appointed a member of the Standing Committee on Appropriations and Staffing. That Senator Vanstone, having been duly nominated in accordance with standing order 33, be appointed a member of the Standing Orders Committee. The ACTING DEPUTY PRESIDENT(Senator Elstob) —I inform the Senate that the President has received a letter from the Leader of the Opposition, Senator Chaney, nominating Senator Peter Baume to serve as a member of the Council of the Australian National University in place of former Senator Peter Rae. Motion (by Senator Button)-by leave-agreed to: That, in accordance with the provisions of the Australian National University Act 1946, the Senate elect Senator Peter Baume to be a member of the Council of the Australian National University for a period up to, and including 17 July 1986 to fill the vacancy created by the resignation of Senator Peter Rae. Debate resumed from 11 February, on motion by Senator Childs: That the Senate take note of the report. Senator CHILDS(New South Wales)(5.40) —I wish to take this opportunity to discuss some of the conclusions from the third report of the Senate Standing Committee on Industry and Trade into the closer economic relations trade agreement between Australia and New Zealand. This report completes an exhaustive examination of all major traded primary products across the Tasman. The first thing to note is that CER should not be seen as providing only greater access to one another's markets for agricultural goods. The Committee believes strongly that CER will generate more gains for both primary sectors if both countries use the agreement as a basis for the development of third country markets. CER should be used in such a way as to maximise our comparative advantages in primary industry commodities by seeking new markets or niches in markets within the Pacific Basin region and as a supplier during the off-season to North America and Western Europe. Having said that the Committee still believes that there are a number of areas where both Australia and New Zealand could develop significant levels of trade in selected primary products. The first thing to note is that both Australia and New Zealand are major exporters of a number of primary products. This makes us direct competitors in the world market as well as potential or real competitors across the Tasman. The balance of trade in agricultural goods is very much in New Zealand's favour and will continue in that way for the medium to long term. During the course of the inquiry a great deal of attention was given to the issue of fluctuating exchange rates and the impact that these have on both bilateral and multilateral trade. The Committee noted that the adoption of freely floating exchange rate policies by both countries since the commencement of CER had not resulted in exchange rate stability. However, this is not the result of CER. Since July 1984 the Australian dollar has risen from $NZ1.30 to reach an all-time high of over $NZ1.70 and then plummeted throughout 1985 to reach a low of around $NZ1.12 to $NZ1.15 by mid-November 1985. Australian primary industry groups have questioned the lack of recourse under the agreement to take account of government intervention in foreign exchange markets. In particular, they question just how the objectives were to be achieved and the safeguard provisions were to apply to the rural sector. The Committee believes that CER will not achieve its objectives if trans-Tasman trade is to be based solely on the vagaries of relative values of our currencies. Both sides need to sit down and reach agreement about the ways to minimise disruption of trade arising from wide and sudden fluctuations in our exchange rates. In addition, the Committee has recommended that the impact of fluctuating exchange rates on trade be referred to the Economic Planning Advisory Council for examination. CER has exposed some weaknesses or lack of expertise in Australia's ability to market many of its agricultural products. In particular, New Zealand has shown Australia that successful marketing of agricultural products these days does not simply depend on producing goods at a competitive price but rather targeting markets with goods that are especially grown or processed to fill a particular niche in a market. Turning to another aspect of the report, the Committee noted that differences in policies pursued by Australia and New Zealand can give rise to situations where people have claimed that trade is not being conducted on the basis of fair competition. For example, the continuation of any form of export assistance on either side of the Tasman will always confer an unfair advantage on the exporter to the detriment of the local producer. Fortunately, since the commencement of CER, there have been moves by New Zealand to remove many of its support schemes and concessions that have conferred a high level of assistance on specific primary products. In particular, the most contentious scheme from the point of view of Australian producers, the supplementary minimum price scheme has been terminated. Turning to some of the general conclusions of the Committee's third report, the Committee drew attention to the following: The need to remove all forms of export assistance across the Tasman; the inadequacy of the safeguard provisions in their present form for agricultural products, particularly in the horticultural sector; the need to develop third country market development programs jointly; and the need to follow up the regional impact of increased import competition from New Zealand, particularly in the area of processed fruit and vegetables. With regard to particular commodities, the Committee made the following specific findings: The pea-growing industry has suffered some disruption since the commencement of CER; the removal of the embargo on the importation of fresh potatoes for processing did cause a great deal of concern within the Australian potato industry; lack of earlier access to golden jubilee variety of sweet corn did result in a steady build-up of frozen sweet corn imports but these came from the United States, not New Zealand; the export of Australian tomatoes to New Zealand is still limited to only one variety and is still subject to fairly tight controls even though Fruit Distributors Ltd ceased to hold exclusive franchise as from 1 July 1985; the sudden removal of the 20 per cent sales tax on imported New Zealand fruit juice concentrates added to the adjustment pressures faced by the local industry, particularly in Tasmania; the existence of such schemes which take advantage of differences in external tariffs, or by-law or duty drawback provisions are not in the spirit of CER; any attempts by New Zealand to export sheepmeat to Australia in 1986 will be strongly opposed by Australian sheepmeat producers; Australia's ability to market both its sheepmeat and beef to third markets will be of far greater consequence compared to the future prospects of increased trans-Tasman trade in such products; New Zealand has been far more aggressive with respect to its export of meat to third country markets and has been prepared to enter into barter deals; and unrestricted free trade in dairy products across the Tasman would not bring about a situation of fair competition due to existing major differences in the industry assistance programs of both countries. Finally, the major recommendations in the Committee's Third Report include the following: First, all major rural industry sectors take the opportunity to review the past 12 to 18 months and develop more appropriate industry strategies to deal with any future increased competition from or with New Zealand; secondly, the government directs the Economic Planning Advisory Council to study the impact of exchange rate fluctuations on Australia's ability to develop and maintain specific export market activities; thirdly, a joint examination into the possible abuses arising from differences in external tariffs, access to by-law or duty drawback be undertaken with a view to eliminating such practices; fourthly, both governments establish a panel to explore and identify areas of potential joint interest and co-operation with respect to third market country development; fifthly, the need to formalise procedures to avoid the likelihood of counterproductive trade wars across the Tasman, particularly in goods that are facing unfair competition from third countries; and sixthly, all export assistance programs between Australia and New Zealand be eliminated. In conclusion, the success of CER, particularly from the point of view of both countries' primary industries, lies not so much in the ability to increase trade in these products across the Tasman, but the willingness of both countries to co-operate in a number of areas of mutual interest to pursue third country market development. I commend the report to the Senate. Senator ARCHER(Tasmania)(5.49) —I wish to speak on the report of the Senate Standing Committee on Industry and Trade on closer economic relations with New Zealand. This is another of the good references that the Committee has handled in the 10 years that I have been a member of it. While its inquiry into closer economic relations is not yet finished-this is the third report on it-it has been a thorough investigation and I believe that this report does justice to the work that the Committee has done previously. We started this reference with Senator Coleman as Chairman and we regret that she was not with us during a substantial portion of the inquiry. However, we battled on without her. I am very pleased to say that Senator Childs is now the Chairman. I refer once again to the secretaryship of Peter Keele who has been very conscientious, thorough and helpful to us all in circumstances that have not always been terribly easy. In this section of the inquiry we took evidence from people involved in primary industries all over Australia. We heard submissions from witnesses from Brisbane to Hobart. In particular, I thank the New Zealanders who gave us voluntary evidence and who made the trip from New Zealand, in some cases, to see that we got the information. That helped us to build a very good relationship with the people from the New Zealand High Commission and with various industry personalities. It is just as true in this instance, as it usually is, that the time we spent with people over odd meals or cups of coffee has been very rewarding to us. It led them to understand us better and us to understand them. We looked at all the primary industries that are involved in the trade, such as meat, dairy products, vegetables, timber, fish and so on. After dealing with them for some months, trying to look for the common thread, it turned out that the big issue was the currency question. The value of the respective currencies is far more important than any amount of subsidy or support that is provided from time to time by the various governments. It took us a bit of selling to get across to some of our witnesses that we felt that was the case. However, by the time the inquiry was finished and, as Senator Childs said, by the time we had seen the currency go from about $1.20 to about $1.80 and then back again, the people on both sides of the Tasman could see that that was the important issue. It was a matter of how we were to tie that in with normal trade and commerce to keep it intact. It is very disruptive of trade between two countries to have currencies fluctuating like that. It makes it very difficult to enter into any long term arrangements, certainly, and even short term arrangements. In one instance one firm spent $1m preparing for a major advertising campaign at a time when the dollar was very favourable to it. It then became disastrous and the campaign was finished in a lot less than a satisfactory manner. It is a matter of looking at what progress we are making in eliminating the undesirable features of the arrangement. That process has substantially got under way. I believe that now that we know as much about the trade between the two countries as we do-I do not blame those before us for some of the mistakes that were clearly made and some of the over-generosities that were committed to compensate for the mistakes that were made-from now on there should be much more concerted discussion between the two parties to the agreement to tidy up the loose ends as fast as possible and to see that some of the arrangements go on for many more years. I believe that it should be possible to re-negotiate those arrangements in the interests of both parties. We are one another's favoured customers in so many ways. We need to keep it that way. The only way we can do so is by having complete trust in one another as to what we are doing. We need to have these joint operations, as I said when speaking to the dairy Bill a few minutes ago. We need to achieve far greater loyalty in Australian retailers as to Australian produce. I think a disgraceful state of affairs currently exists. If I had my way the next inquiry the Committee would carry out would be into retailing practices in Australia. Senator Button —Hear, hear! Senator ARCHER —With the support of the Minister, I make that recommendation to the Committee. Undesirable practices do exist. Senator Childs alluded to most of them. I wish to make it clear that the undesirable practices are not all against us. We engage in some undesirable practices against the New Zealand producers of various commodities, which does not do us a lot of credit either. I believe that we should eliminate these practices as soon as we can. We should offer to eliminate them, perhaps by bartering them against things we may not like from the other end. We need to co-operate far more. We need to know the extent of one another's plantings of various commodities. We need to know the livestock numbers. We need to know what arrangements are being made to sell various products in other markets. We need to get all that sort of information from one another on a monthly basis. I see no reason why we should not be able to share that sort of information much earlier than we have done in the past. Most of that information until now has been obtained very late in the piece or by some form of subterfuge which should not be necessary. It has been a pleasure to deal with the rural industries of both countries in this inquiry. We hope that in the next couple of months we will be able to put down our next report, which is on manufacturing industry. Senator VIGOR(South Australia)(5.56) —I congratulate the Senate Standing Committee on Industry and Trade on its third report on the development of the closer economic relations agreement between Australia and New Zealand and endorse the remarks made by both Senator Childs and Senator Archer on this matter. I wish to canvass a little later in my speech a few issues that go slightly beyond the report. In order to put these remarks into perspective I would like to go back over a little history. The CER agreement started on 1 January 1983. That means that we have been able to observe the results for three years. The Committee has done a wonderful job in reporting the experiences of the adjustment of both Australia and New Zealand to the problem of having a bilateral trade agreement. Australia and New Zealand are both major exporters of rural products, with Australia also dependent on the export of minerals and coal. However, it has mainly been in the rural sector that the CER agreement has required a large number of adjustments. The European Economic Community's export subsidies, particularly its agricultural policy, and the recent United States export enhancement policy has caused a number of problems to the joint Australia-New Zealand effort in exporting our rural products overseas. The world is currently suffering from an oversupply of most rural products. This means that most rural commodities now sell below the cost of production on world markets. This is causing enormous difficulties to the producers of each of our countries. Thus Australia and New Zealand are competitors for a diminishing world market. It is very important that we co-operate in trying to secure those markets rather than competing with one another in those areas. The problems experienced in adjusting to CER have been canvassed by Senator Childs. I summarise them in the following way: First, we have had a fluctuating exchange rate between Australia and New Zealand, which Senator Archer mentioned in some detail. It is very important that we should tie our two currencies in some way. I believe that the next stage of the inquiry has to concern itself with what financial arrangements will make certain that we do not have massive fluctuations between the Australian and New Zealand currencies. The competitive invasion of each other's local markets has caused a good deal of heartburn. We have heard about the situation of the onion growers who have found that New Zealand onions have caused their crops to return much lower prices. We have had quarantine arrangements which have become difficult, particularly, as mentioned in the report, in the case of potatoes going across the Tasman. We have had differing levels of export support in the two countries which have meant that in some cases a supported industry in one country has competed with a non-supported industry in the other. In these cases we must be prepared to use section 37 of the agreement much more than we have been prepared to do in the past. This section allows for different industries to be protected within the general framework of competitive activity. We need co-operative market development and co-operative market intelligence and to penetrate our local Pacific markets. We need to stop the penetration of these markets by the European Economic Community, the United States of America and other countries which are taking away our traditional areas for selling some of our products. The different tariff levels in the two countries have apparently been exploited by using tariff barriers in one country to do very strange export deals such as that which happened with various juices. Those juices were exported from New Zealand to Australia because Australia had a tariff barrier against the import of such juices. New Zealand then served up to its own people juices imported from overseas. It is very important that we should stop such practices. The sudden removal of the trade barriers between Australia and New Zealand caused considerable industry disruption. We must learn from these experiences and the Committee recommends working towards solutions of these problems. I believe we should use the experience we have had in the bilateral agreement between Australia and New Zealand to move into a new market area. I believe that we have the opportunity of extending the CER into a Pacific economic community. A number of years ago people laughed when the European countries decided to form a European economic community. I believe that we have enormous opportunities for a South Pacific trading community which can be built around the nucleus of our closer economic relations with New Zealand. This can then be grown-out into a broader western Pacific community where some of the fastest growing industrial countries in the world are developing. From the experience we have had in the bilateral arrangements with New Zealand we can learn a number of lessons. Australia's trading relations with our South Pacific neighbours present us with special problems, obligations and challenges. Historically, the south west Pacific has been Australia's economic sphere of influence-some would say a zone of exploitation of human and natural resources, of which `blackbirding' was a particularly sordid example. Now that the winds of change have swept through the South Pacific, with the significant exception of New Caledonia, we can see the need for dealing with independent sovereign states in this area. We should seek to develop closer economic relations with those people as well, learning from the problems we have had in New Zealand-Australian relations. We cannot take it for granted that the existing situation, which tends to favour Australia and New Zealand, will continue indefinitely, or assume that we will not have rivals to our economic influence in this region. We have a positive duty for both moral and practical reasons to assist in the economic development of our South Pacific neighbours. I would argue that the best service we can render them is to promote healthy trading relations with Australia. `Aid' is a short term palliative. A long term solution to economic problems in those countries depends on a healthy and viable agricultural and manufacturing base, with a guaranteed access to developed markets such as Australia can offer. In the past South Pacific countries were locked into trading patterns and relationships which distorted their economies and where the terms of trade discriminated against them, particularly with commodities. This has been true of sugar and of various other commodities which we have got from these areas. I believe that we should look to SPARTECA, the South Pacific Regional Trade and Economic Cooperation Agreement, as a basis for a new trade zone. Such a trade zone will need its own internal currency arrangements and ties, common trading barriers, common subsidy schemes, common marketing initiatives, and a local preferred trading arrangement between members. It could provide mutual support and assistance between the countries of our region and strengthen our bargaining power in purchasing from people in other parts of the world. The solutions we have found to problems in the CER will be useful in setting up such a Pacific economic community. I recommend such a course to the Government. Senator MASON(New South Wales)(6.07) —I wish to enter this debate on closer economic relations between Australia and New Zealand briefly since I think I may be one of very few members of this Parliament who are New Zealanders by birth. As a result I am very interested in the success of the closer economic relations agreement. I recall discussing it a couple of years ago in Wellington with the Minister for Trade, who at the time was Mr Ian Templeton. The point that arose strongly in that discussion was that the agreement should be one to co-operate, not to compete. That point needs to be made now again strongly. The point is that much of the criticism of CER in Australia has been by sectional interests who quite properly feel that their prices are being undercut by cheaper New Zealand products. People are saying: `Why should we have this agreement with New Zealand when it operates to the disadvantage of some Australian industries, especially primary industries?'. Indeed, it is of great significance that the report that it is now before the Senate begins with those words: Since 1 January 1983 CER has received a mixed reaction from within the Australian rural sector. That of course is putting it mildly. Why do we have this and why should we be going on with it? That is a matter I wish to address briefly. Part of the answer is that as the two nations of European origin in a remote corner of the world our survival may well depend at some stage on co-operation. In fact, I say here and now that I would be in favour of eventual unity between Australia and New Zealand as one nation. We should be considering this as time goes on. We should remember that Auckland and Wellington are a lot closer to us than Perth and that the Tasman Sea does not present any more formidable barrier than does the Nullarbor, even in terms of surface travel. It is a fact that the Australian Constitution provides for New Zealand's inclusion if that position ever came to be negotiated between the two communities. That may lie a long way ahead and there may be opposition to it, but I believe that it will come closer with the passage of time. I am one of those people who believe that we should progress in an orderly way towards that objective of making New Zealand and Australia one nation, and the CER agreement is a step in that direction. I opposed here the introduction of passports between Australia and New Zealand, although I know there are good reasons for it. I felt that the overriding consideration is the close commonality between the two nations. In fact, there are very few families in this country who cannot say that somewhere or other in the last few generations they have had people who lived in New Zealand, or vice versa. I do not think there are any other two countries in the world which have closer relationships of that kind. I object strongly to people who try to breakdown that relationship which has been enshrined in the word ANZAC, among other things. The second part of the rationale for CER is that of course New Zealand produces some things better than we can and we produce some things better than it can. While the short term effects of that might not be palatable to some sectors in both countries, especially in the rural industry, it is vital that we co-operate in such things. New Zealand because of its climate can produce very high quality dairy products very cheaply. In some aspects of fruit growing and soft wood timber production it has strong natural advantages. Is it sensible for us to say that we have to take a blind, protectionist view towards these things, or is it more rational to say that there is no reason why the Australian consumer should not benefit from such things, provided-and I stress this-that the process is reciprocal and that New Zealand gives Australia favoured nation treatment in importing, especially in areas of manufacture where the size of our market, our facilities and again our natural resources make it more feasible for us to be the supplier? I was struck by what Senator Chipp said earlier today when he was talking about the New Zealand industry which produces methanol and petrol from natural gas. Mr Deputy President, if you have a look at those factories you will find that the New Zealanders and their architects have gone to great trouble to put up reinforced concrete girdering and so on because it is cheaper and easier for them to use reinforced concrete than steel. However, to put it mildly, steel would have been a much better way of doing it. That is the sort of area of co-operation that this agreement should be working at. It was admitted to me by the people who actually did the building that it would have been better to have it in steel. Senator Lewis —But it is all one way. That is the problem. Senator MASON —If it is all one way, Senator, that is something you ought to be working on rather than just beefing about the thing and saying that it is all a nuisance. I will tell the honourable senators about one area of manufacture which is very important and very feasible for us to operate in that regard. When I was in New Zealand last year I discussed some matters with the Defence Minister there, Mr Frank O'Flynn. Mr O'Flynn agreed that if Australia made defence equipment-and we should be making more of our own defence equipment; we should be building our own aircraft, as my colleague Senator Norm Sanders would agree; and we should be building our own trainer and things of that kind-he would give me an undertaking, which he said the New Zealand Government would give to any Australian government, that New Zealand would look very hard at buying her needs from us under the CER agreement. This was not necessarily only because it has to operate both ways, as Senator Lewis has said- this is a way in which it could operate both ways-but because in the strategic interests of both countries there is much to be gained by a commonality of material and weapons. There are many other areas of manufacture where we can operate more economically and efficiently to the benefit of both communities. I would have thought that that was what we should be doing under the CER agreement. I am deeply concerned that there is this sub-current of pure protectionist interest which says that this agreement between two friendly neighbouring countries is to be shot down and destroyed or somehow torn apart because of short term sectional interests. I cannot accept that. With all respect to the Committee, the thing that the CER is about or should be about is co-operation between the two countries in the best interests of the two communities concerned. I cannot give the weight that the Committee does in this report to the development of third country markets. I agree that everybody wants third country markets. It would be tremendous if we could sell things elsewhere, and the more the better, but that is not basically what CER is about. I suggest that it is a red herring to say that that is the direction in which CER should go. Senator WATSON(Tasmania)(6.15) —I wish to commend to the Senate the Public Accounts Committee Report on Government Aircraft Factories. At the same time I remind the Senate of the lack of interest by successive governments in providing adequate background and information and of the lack of consultation by government generally on the closer economic relations question. Let me place the current report in its historical perspective. Prior to 1983 a great deal of agricultural trade was regulated by various forms of voluntary joint agreements. Australians generally believed that not much would change. Not only were they ill-informed; they were also complacent about the effects of the change because CER seemed to provide the catalyst for a new awareness of opportunities in Australia for New Zealand agriculture. Certainly the debate at the commencement of CER was much more sophisticated and much more advanced in New Zealand than it was in Australia. But CER provided this catalyst for a new awareness of opportunities for the New Zealanders to enter Australian trade. Indeed, it was spoken of as the mechanism by which standards of living and exports to Australia could be lifted. Undoubtedly Australian manufacturers have benefited. It is also true that the volume of trade both ways across the Tasman has increased since CER. Frequently people from the other side of the Tasman, especially the Ministers, make statements to the effect that New Zealand has the better deal. But the point I wish to make tonight is that in all these arrangements and the subsequent spin-offs Tasmanian agriculture has been the loser. Unfortunately there has not been enough debate about the way in which trade under CER is developing and, for that reason, I commend this report to the Senate. Unfortunately, limited monitoring is involved and I think the Government has to be condemned on this issue. The anti-dumping provisions are almost useless. I think it is somewhat unfortunate that the ministerial meeting held in August 1985-just last year-was held in an environment of a strengthening New Zealand dollar against the Australian dollar. There tended to be this complacency unfortunately in the Tasmanian community and amongst the farmers who were going to be subsequently affected because of the high value of the New Zealand dollar against the Australian dollar. Therefore, I believe that not enough emphasis was given at that ministerial meeting in August 1985 to the detrimental effects on agriculture, particularly Tasmanian agriculture. Tasmania is the horticultural State of Australia and provides the bulk of Australia's frozen vegetables. Tasmania is vulnerable to imports from New Zealand and the level of imports, particularly of frozen peas and other vegetables, is directly related to the value of the New Zealand dollar against the Australian dollar. When the New Zealand dollar was weak, Tasmanian pea growers were adversely affected. As the dollar continued to rise, increased acreages were given to Tasmanian producers. The situation has now changed because since November the value of the New Zealand dollar has fallen, so we will tend to find greater pressure from the big buyers in Australia to switch their orders to New Zealand rather than to processors in Tasmania. I believe that some recognition has to be given in the CER agreement to the changing value of the New Zealand dollar as against the Australian dollar. I do not think it is good for trade on either side of the Tasman. Therefore, all mechanisms that will increase government awareness and the level of debate, I think, are welcome. Because of the problems of Tasmanian agriculture and its susceptibility to imports from New Zealand I think Tasmanian farmers, particularly those on the north west coast, will have to continue to voice their concerns about the ramifications of CER, especially in the lead-up to the joint 1988 review. The other concern is that, as a result of CER, we are becoming more dependent on a few crops. We are seeing the disappearance of certain types of horticulture from the Tasmanian scene, which has tended to result in a higher degree of specialisation. I do not believe that is in the best interests of Tasmanian agriculture in the long run, particularly when we have major problems as a result of movements in the Australian dollar. Of course, Tasmania must also help itself. I believe that one way of doing that is the establishment of a major plant breeding centre along the north west coast of Tasmania. I do not believe that the Commonwealth Scientific and Industrial Research Organisation has devoted enough of its resources to horticultural research. The emphasis seems to be on the big cereal crops such as wheat and so on. I think there are other problems that New Zealand has to face, so it is not all gloom and doom. New Zealand had a 16.3 per cent inflation rate over the year to September, which undoubtedly will tend to push up its costs. It has also dismantled certain subsidies to make its industries more competitive. Also the New Zealand export performance tax was reduced by 50 per cent from 1 April 1985. These are all desirable features but I must point out that the New Zealand Government is pursuing what I would term a high risk economic policy. While it maintained very high interest rates, its exchange rate remained at a high level. However, New Zealand has problems. Not only does it have a high inflation rate but also it will introduce a goods and services tax of 10 per cent and this will tend to add further to inflation. The dismantling of the subsidies and the economic policy of the New Zealand Government have certainly been very detrimental to New Zealand agriculture, and this is reflected in the catastrophic drop in certain farm property costs. However, unless we recognise that and introduce some mechanism which adjusts for the varying values of the exchange rate, as a number of previous speakers have acknowledged, Australian agriculture will be unfairly treated. I do not think enough emphasis has been put on the problems of closer economic relations in regional areas, particular the north west coast. I hope further work will be done on this matter, particularly before 1988, so that we can make sure that when the joint review takes place we will have a better anti-dumping mechanism, a faster track mechanism. We were misled earlier. We were told there was supposed to be a fast track anti-dumping mechanism; in effect, it has not eventuated. We must have better monitoring and proper procedures to recognise movements in exchange rates to ensure that regional areas, such as Tasmania, are not adversely affected. Question resolved in the affirmative. Debate resumed from 6 December 1985, on motion by Senator Georges: That the Senate take note of the report. Senator SANDERS(Tasmania)(6.22) —The report of the Joint Parliamentary Committee of Public Accounts on the Government Aircraft Factories outlines, in essence, the difficulties which are being encountered by the Government Aircraft Factories. It also shows up the difficulties of the whole aviation manufacturing industry in Australia. Unfortunately, Australia has been allowed to get into the position of being a secondary aviation country. Basically, we do not design and produce anything here. What we do is build things for other people, as is shown in this report. The Government Aircraft Factories builds components for the FA18 for McDonnell Douglas and the United States Government, it builds wing flaps for Fokker and it builds assembly parts for Boeing and the Royal Australian Air Force. However, the Government Aircraft Factories does not design anything anymore, and that is the problem. It is not enough simply to build bits and pieces of aircraft for other people. We have to have a strong design capability. Some years ago the government of the day recognised this requirement when it set up a group of people to design a trainer for the RAAF. This group of people worked very closely with the RAAF. At the time the Government Aircraft Factories and Hawker de Havilland produced a trainer-the A10B-in close co-operation with the RAAF, the RAAF spelt out requirements such as side-by-side seating as a trainer, soft field capabilities so that the aircraft could land on unimproved airstrips and a capability for close ground support. It was to have mountings for guns on the wings. Australia definitely needs close ground support aircraft. Our defence is sadly lacking in this area. So far so good. Suddenly, on 16 December 1985, the Department of Defence announced that it would not procure this aircraft wholly designed in Australia; it would procure what is called the Pilatus PC-9 which is built in Switzerland. No doubt it is a very fine aircraft; it would be built like a Swiss watch. In fact I have flown Pilatus aircraft and they are quite good; but it is an entirely different aircraft from the A10B. It does not have side-by-side seating, as the RAAF specified; it is tandem, one behind the other. As I understand it, it is built for sealed runways. It will have difficulty operating in soft field conditions. Switzerland, being a peaceful nation, has not fitted it with any gun mountings, so it will have to be redesigned. In fact, at the moment the aircraft is not certificated. The A10B design team worked in close collaboration day by day with the RAAF customer right up until 16 December 1985. The selection of the PC-9 confirms that the RAAF, belatedly, significantly modified its requirements without telling Hawker de Havilland or the A10B team. The RAAF must have known this a year ahead of time, yet it made no attempt to contact the people who were designing the Australian designed and built A10B so that it could compete with the Pilatus aircraft. This has major implications-ethical implications for one thing and financial implications for another. Ethically, if the RAAF is working closely with an organisation which is producing an aircraft specifically for that organisation's requirements, it has the ethical obligation to notify that organisation if it changes its requirements. The other responsibility is a fiscal one. Already that project has cost Australian taxpayers $65m. The sum of $65m has gone into the A10B design which has now been thrown out the window by the Hawke conservative Government, the Department of Defence and the RAAF. One has to ask: Why has this happened? Why has taxpayers' money been squandered? Why has the RAAF changed its tactics? What has happened is that the RAAF and the Australian Government set up a football field and now they have pulled out the goal posts for Australian industry and given the contract to the Swiss. This is a very disturbing thing. Senator Button —Somebody may have shifted the goal posts first. Senator SANDERS —They may have shifted the goal posts, as Senator Button says, but why was the design team not notified of the shift in design? It must have occurred at least a year ahead of time. My concern is not only about the strange behaviour of the Department of Defence and the RAAF and about the loss of money; it is also about the future of the Australian aircraft industry. I am afraid what we are seeing is the well known Australian cultural cringe. Somehow, no matter what we come up with, it cannot be as good as what the Swiss, the Swedes or somebody else comes up with. That is a load of rubbish. When I was in the United States aerospace business I noted that there were a great number of Australian engineers there and I thought: `Gee, Australia must be full of good engineers'. Well, it is not. They all go overseas because they cannot get jobs here as they are not supported by either local industry or the Government. This is another indication of that. This aircraft could have been a source of overseas orders. There is a good market for this type of aircraft, for a well-designed and well- built aircraft which has a combined trainer and close ground support role. The aircraft could have been built here. We have missed a golden opportunity. The irony is that a number of countries that we might consider somewhat backward have flourishing aviation industries. Brazil makes aircraft which Australia imports. It makes aircraft for commuter airlines. Spain has an aircraft industry, which is not surprising, as does Italy, France and, of course, America. But Australia will not have an aircraft industry simply because we have not got the guts to go ahead with our own industry. Our Government does not have the guts to support it and, for reasons which I do not comprehend, the Department of Defence has changed its rules. It will cost the country many millions of dollars to buy aircraft from Switzerland when in fact a perfectly good Australian aircraft was in the works. I hope that the Government takes on board what I have been saying. Senator Button —I did. Senator SANDERS —Senator Button has indicated that he will. I hope that the Government will re-evaluate the granting of this contract to the Swiss and get that A10B project off the ground in Australia, where it should be. Question resolved in the affirmative. Consideration resumed from 6 December 1985, on motion by Senator Coates: That the Senate take note of the report. Question resolved in the affirmative. Consideration resumed from 6 December 1985, on motion by Senator Tate: That the Senate take note of the report. Question resolved in the affirmative. Debate resumed from 6 December 1985, on motion by Senator Colston: That the Senate take note of the report. Senator PARER(Queensland)(6.32) —I would like to make a few comments about the fourth report on the Examination of Annual Reports of the Standing Committee on Education and the Arts. Before doing so, I would like to acknowledge that the Chairman of the Committee, Senator Colston, did an excellent job in chairing this Committee, which we felt to be terribly important. I need not remind honourable senators that the whole education system in Australia has been subject to an enormous amount of criticism in recent years, certainly in the last 12 months. The purpose of this study was to look at the assessment system as used in the Australian Capital Territory. This had a particular relevance to me because the type of assessment system used in the Australian Capital Territory is almost identical to the assessment system used in my State of Queensland. These are the only two parts of Australia that use a system whereby the whole determination of results is based on internal assessment with an Australian scholastic aptitude test which acts as a moderator. The conclusions of the report are that the Committee actually has a preference for an assessment system which combines continuous assessment and external examinations. There was a lot of concern shown by the Committee that the Australian Capital Territory Schools Authority had never taken the trouble really to have a look at it. External exams were abolished in the Australian Capital Territory in 1977 and were abolished prior to that in my State of Queensland. It is quite extraordinary really that after such a long period we now have a system that is not understood by employers, is understood by few teachers, and is understood by very few parents; and even though students said in discussion that they thought they understood it, when they were quizzed on it it was found that they really knew very little about it. The other thing that was of great concern is that once a school curriculum disappears-that is the case in the Australian Capital Territory-a plethora of mickey mouse courses occurs, at the expense of the more basic subjects such as English, mathematics and the sciences. On the face of it, it appears, when one looks at the figures, that people are doing these subjects, but when one gets down to the point of whether the basic subjects concerned are major items, one finds that the numbers decrease very rapidly indeed. Probably the most telling remarks were made by a concerned parent. His view was that the system was inherently wrong, and that justice was not only not being done but not being seen to be done. In fact, he took the view that the system appeared to be totally unjust, that it was not as if people were running the same race. I think it is worth quoting a few remarks from this particular parent and what he said about subjectivity and justice to students. He said: The fate of individual students is almost totally in the hands of their teachers as far as their ranking and thus their ultimate TE score is concerned. Under the old system, justice to individual students was maintained by the external examination system, which ensured that any conscious or subconscious biases of teachers against individual students were unable to influence directly their final assessment. There was, as it were, in the terms of the old system an outside court of appeal-the external examination system which could guarantee justice to individual students. The point is that what has happened, not just here in the Australian Capital Territory but in other parts of Australia, is that the academic educationalists have forgotten who the customers are. They have forgotten about the parents and they have forgotten about the students, and they have forgotten that it is the taxpayers who pay their way. They have taken the view that they are in fact the masters and not the servants of the people of Australia. I think, all in all, it was an excellent report. In some areas, in view of the evidence given, some of its conclusions were somewhat gentle. On the basis of this report, I hope that the serious people, the genuine people who are really concerned about the future education of our children and about their entrance into tertiary institutions-which everybody knows is extraordinarily difficult these days-will take a much closer look at it and do something about it. In fact, in the conclusion to the report the Committee said that it had a preference for the external exam with continuous assessments as a moderator, and that even though we recognise that a change to the Australian Capital Territory system would involve some additional expense, we considered that the Australian Capital Territory Schools Authority should review the possibility of using external exams as part of its assessment procedures in the future. The other concern that came out, which has been discussed ad nauseam, is the Australian scholastic aptitude test. Is it biased, or not biased? Does it favour boys ahead of girls, or whatever? There was no doubt that on the figures produced the ASAT system was seen to be at fault. There was bias. But I do not think that it could be said that there was any sort of certainty as to whether it favoured boys or girls. I think one could also conclude that it was more than likely to favour those students who did science-type subjects rather than the humanities-type subjects. I think where the girl thing comes in is that more girls happen to do the humanities-type subjects. Question resolved in the affirmative. Consideration resumed from 6 December 1985, on motion by Senator Robertson: That the Senate take note of the report. Question resolved in the affirmative. Debate resumed from 5 December 1985, on motion by Senator Zakharov: That the Senate take note of the report. Senator ZAKHAROV(Victoria)(6.39) —in reply-In mid-1983 the Senate referred to the Standing Committee on National Resources the following reference: The exploitation of the natural resources of the Australian Antarctic Territory with particular reference to the extent of the natural resources of the Antarctic Territory, the technical, economic and environmental restraints on the exploitation of the natural resources of the Territory, and the Commonwealth's role. This was later amended to add the further term of reference: The adequacy of existing and proposed Antarctic environment protection and conservation measures. This report was tabled in the last week of the last session and, under pressure of time and Senate business, the tabling speech was incorporated in Hansard, so I welcome this opportunity to speak to this report. Rather than repeating or paraphrasing the terms of that overview in the tabling speech, I would rather this time expand on a few of the aspects of the report which might not otherwise get attention. The DEPUTY PRESIDENT —Order! I am sorry, but the time allocated for the consideration of Committee reports has expired. Senator TATE(Tasmania) —I present the first report of 1986 of the Senate Standing Committee for the Scrutiny of Bills concerning the Australian Nuclear Science and Technology Organisation (Transitional Provisions) Bill 1985 and the Trade Practices Amendment Bill 1985. I also lay on the table Scrutiny of Bills Alert Digest No. 1 dated 12 February 1986. Ordered that the report be printed. Bill received from the House of Representatives. Ordered that the Bill may be taken through all its stages without delay. Bill (on motion by Senator Grimes) read a first time. Senator GRIMES(Tasmania-Minister for Community Services)(6.41) —I move: That the Bill be now read a second time. I seek leave to incorporate the second reading speech in Hansard. Leave granted. The speech read as follows- Mr President, the purpose of this Bill is to establish the Federal Airports Corporation. For many years the Commonwealth-owned airports have been administered by a Department of State-most recently the Department of Aviation. When the Government came to office in 1983 it had as part of its platform a policy for improved administration of major airports. We believed that placing this responsibility with a largely independent statutory authority would offer significant advantages to: the travelling public taxpayers the aviation industry airport administrators. Subsequent analysis has clearly confirmed that view. I hasten to say that this view is not a reflection upon the Department of Aviation and its predecessors, but a recognition that the commercial operation of airports would be better managed by a Commonwealth business enterprise. Departments of State are of necessity bound by the Government processes which inhibit commercial flexibility and responsiveness. The aviation industry has been critical of this fact and of the inability of the current administrative processes to make changes in a timely manner to meet the requirements of a dynamic market. Additionally, governments in the past have unduly influenced the priorities for aviation infrastructure development for reasons unrelated to economics or efficiency. Indeed many of the decisions taken in the past have inhibited economy and efficiency in the industry. This legislation will go a long way towards rectifying these problems and will enable the Corporation to act more readily to meet the changing needs of the travelling public and the aviation industry. The Federal Airports Corporation is an important part of the Government's overall strategy to improve the efficiency of the aviation industry and the levels of services to the consumer. This strategy includes the two reviews which have already been undertaken, that is the Bosch Inquiry into Aviation Cost Recovery and the Butcher/Scully Review of International Air Freight. This Government has made substantial changes to Trans Australia Airlines and Qantas to allow them to operate more commercially. Consequently both have achieved record profits in the past year. We have been steadily improving Departmental efficiency and have moved to separate airport and airways charges so as to promote further efficiency in the aviation industry. Honourable Senators will be aware that we currently have a review underway of the Opposition's 1981 Two Airline Agreement. In framing the legislation the Government has had to face the task of balancing the need for autonomy and entrepreneurial management with the need for public accountability to maximise public benefit. This approach fits in with the Government's policy of public enterprise efficiency consumer responsiveness successful management I believe that we have achieved that balance. While the Corporation will be the sole provider of airport facilities in most areas where it will operate, it will provide an important part of the infrastructure for a competitive aviation industry. Within that context it will in all of its activities be subject to close scrutiny by aviation users and the Aviation industry. This scrutiny will be enhanced through requirements in the legislation for consultation, disclosure of results and for the publication of indicators which year by year will show the performance of the Corporation across the range of its activities and on an airport by airport basis. The Government has set objectives for the Corporation covering social, financial, management and efficiency aspects. The Corporation will be required to take these objectives into account in its planning and operations. Additionally, the Corporation will be required to put forward to the Minister for Aviation each year a three-year forward program including its budget for the following year and details of its corporate plans. These requirements will be exercised at a strategic level, leaving the Corporation free in its day to day management and exercise of its commercial judgment. To enable the Corporation to operate as autonomously as possible, it will be freed from the requirements of staffing under Public Service conditions the requirement that it utilise the Department of Housing and Construction for its capital works-although it will be expected to provide the opportunity for that Department to compete for such work on a commercial basis, and the need for its day to day land dealings to be administered through the Department of Local Government and Administrative Services. This legislation will provide a framework for the operation of airports more efficiently, more commercially and in a manner in which the Corporation's performance will be able to be judged by its owners-the people of Australia. Given the potential for greater efficiency resulting from setting up the Corporation, the Government will require it, and the Department of Aviation, to ensure that there is no net increase in staff over the two organisations at the establishment of the Corporation. The rights and interests of employees transferring from the Department of Aviation to the corporation will be protected. To ensure that their employment is not jeopardised, the Government will require as a matter of policy that the Corporation offer positions to all staff whose functions are transferred. While the Corporation will have power to set conditions of employment for its staff, it will also be required to provide, at the time of the transfer, offers of conditions of employment to transferring staff at least equivalent to those which they currently enjoy in the Australian Public Service. I turn now to the more significant detail of the legislation. The functions prescribed for the Corporation will enable it to own, develop and operate its airports in an efficient and cost effective way. It will, however, have overriding requirements to operate its airports safely and in a manner which accords with the public interest. The Department of Aviation will retain responsibility for the setting of safety and security standards for airports. The Corporation will be bound to abide by those standards. The Department will also retain responsibility for overall national airport planning issues. The legislation makes it clear that the Department of Aviation, through the existing integrated air traffic control system, will retain responsibility for the safe operation of aircraft. The Corporation will be constituted in much the same way as other Commonwealth Transport Business Undertakings with seven members including a Chairperson and a Deputy Chairperson appointed for periods not exceeding five years. The usual provisions for such matters as remuneration, leave of absence, termination of appointment and disclosure of interests will apply. The legislation provides for the specification of certain airports to be the responsibility of the Corporation, with Ministerial approval being required for the Corporation to accept responsibility for others or for the Corporation to close any airport. The Corporation will, at the outset, take responsibility for all State capital city airports including the general aviation airports and will also be responsible for Coolangatta and Launceston airports. Although there has been some public debate about the inclusion of the general aviation airports in the Corporation, it is the Government's considered view that to exclude them would deny those airports the expertise and flexibility of management which will reside in the Corporation. This is of particular significance in Sydney where the operation of Bankstown is a matter of concern and sensitivity to the people in nearby areas. There is no question that Sydney will be the city in which the new Corporation will face its major challenges and will have its major responsibilities even before considering a second Sydney airport. The Government has therefore decided that the Head Office of the Corporation should be located in Sydney. An important aspect of the legislation is the requirement that the Corporation provide the Minister annually with an up-dated corporate plan including its budget and financial targets for the forthcoming year. It is largely through this mechanism and through its reporting procedures, including its annual report, that the Corporation will be kept aware of Government requirements. Similarly the responsible Minister will be able at the strategic level to monitor the Corporation. The successful use of this mechanism will be the major factor in enabling the Corporation to be freed from Ministerial involvement in day to day management issues. The legislation provides for the capital structure for the Corporation to be determined ministerially before the Corporation takes over its airports. The appropriate gearing ratio obviously depends on such matters as the value of assets being vested in the Corporation, its future investment program, levels of working capital required and the level of financial flexibility necessary for proper management. The Minister for Aviation will be consulting with our colleague, the Minister for Finance, before determining an initial capital structure for the Corporation. It will also be useful to have the views of the Corporation's Board on this issue before a particular commencing debt/equity ratio is fixed. It must be recognised that airport operations are highly capital intensive requiring long term investment planning decisions. In setting the capital structure for the Corporation, particular attention will be given to the balance to be struck between the long term viability and needs for future investment of the Corporation, and the reasonable expectation of the Government for a proper return on the substantial public investment in airports. Provision is also made for a specific power of direction, which in particular circumstances would incur reimbursement where such a direction results in financial detriment to the Corporation. A general power of direction will also be utilised at the inception of the Corporation to enable the Minister to convey to the Chairman and members, the Government's requirements on a variety of issues which will not be subject to recovery. Including amongst these will be, for example, the payment of ex gratia payments to Local Government in lieu of rates and the requirement that the Corporation offer employment to Department of Aviation employees whose functions transfer to the Corporation. The Government has decided that the Corporation should not be subject to Commonwealth, State and Local Government taxes. In this respect the Corporation will be in a similar position to other public transport enterprises. If, however, the Corporation engages in activities in competition with private enterprise it will be required to do so through a subsidiary and thereby in respect of those activities be liable to taxation. This decision will continue the existing arrangements for Commonwealth airports and will ensure that taxation does not impose a new and substantial cost on the users of airports. The Corporation will be required to operate in a manner which will enable it to produce a reasonable rate of return upon the assets which it employs. Provision is made for it to be able to levy charges for the use of its airports, to lease property on airports and to let business concessions. Arrangements existing at the time of transfer by way of lease or contract will, of course, transfer to the Corporation and will continue to bind the Corporation. The establishment of the Corporation is a significant step forward in ensuring that the provision and operation of costly airport infrastructure is based on efficiency and investment undertaken only when there is financial and economic justification. In moving to establish the Federal Airports Corporation to operate our airports we are bringing Australia into line with general practice internationally. For the first time in Australia the financial performance of airports will be measured and results made available to airport users. One of the objectives set by the Government is that the Corporation be a good neighbour to the communities they serve. Within this responsibility the Corporation will be responsible to the needs of the travelling public and to those living in close proximity to airports. Mr President, I believe that this Bill represents a major step forward in aviation in Australia. It will assist the airport user. It will provide the basis for rational development and operation of airports. And it will reduce the call on the taxpayer for airport infrastructure costs. Mr President, I commend the Federal Airports Corporation Bill to the Senate. Debate (on motion by Senator Kilgariff) adjourned. Senator GRIMES(Tasmania-Minister for Community Services) —by leave-I wish to advise the Senate of new moves by the Government to significantly reduce social security overpayments and to further improve the administration of pensions, benefits and allowances. These moves are part of the Government's fundamental commitment to ensuring that social security payments go to those who need them, in accordance with their need and legal entitlement. Over the past three years this Government has taken a number of steps to reform the Australian social security system, and to ensure that it is more truly and more accurately needs-based. These steps include moves to reduce overpayments-actions such as the transfer of some two million payments from cheques to direct deposit, and the introduction of much stricter proof of identity procedures. These and other moves are starting to prove very effective-the net level of overpayments detected by the Department of Social Security last financial year fell below $20m. It is important to get this figure in perspective. The Department of Social Security runs one of the largest financial institutions in Australia. In the last financial year, the Department paid out $14.175 billion on social security payments. It generated 100,340,000 separate payments. Its regional offices considered 14,500,000 counter contacts, answered 7.3 million phone calls and handled 27.2 million pieces of correspondence. So given the scale of activities, the fall in net annual overpayments is pleasing. The Government, however, is determined to achieve better results. The level of social security overpayments also needs to be set against the massive scale of tax evasion and avoidance which this Government has had to confront. At 30 June 1983 the Department of Social Security was owed $76m in accumulated overpayments. At the same time, there was $2.9 billion outstanding in tax. It is interesting to note that those most vocal about social security overpayments tend to be those most silent about this savage erosion of the public purse. This Government has met the challenge of tax evasion. It is also prepared to deal with the problem of social security overpayments. By harnessing many recent technological advances, implementing a range of administrative reforms, removing legal ambiguities in the Social Security Act and committing additional resources to this task, we intend to greatly reduce the level of social security overpayments over the next three years. While an increased emphasis on overpayments can be expected to generate some short term increase in notified overpayments, the savings to the Australian public as a result of the campaign could be expected to be in the order of $90m by 1988. The Government's strategy is based on one fundamental precept-that there is no one, simplistic solution to the problem of social security overpayments. Overpayments occur in an extremely complex system for many different reasons, and it is essential to recognise that fact at the outset if there is to be any worthwhile and intelligent debate on this issue. Unfortunately, too many conservatives in this country think and argue that overpayments can be eliminated simply by threatening and bullying people into submission-by abusing the needy as dole bludgers and welfare cheats, by threatening to cut people of whom they disapprove-such as single mothers-out of the system entirely, and by proposing vicious and vindictive measures such as anonymous telephone dob-in campaigns. Years of experience show that these sorts of tactics simply do not work. During the punitive Fraser-Howard years, levels of overpayments mushroomed, more than doubling in relation to the level of expenditure. In contrast, this Government starts from the premise that the vast majority of people on social security need and are entitled to be treated with sensitivity and compassion. We recognise that if overpayments are to be tackled effectively, then there must be a comprehensive strategy in place which integrates a wide range of measures, covering all aspects to do with the prevention, detection, calculation and recovery of those overpayments. As a result, the Government has decided to implement a three-phase campaign which involves, first, reviewing and collecting as much existing debt as possible; second, preventing future overpayments; and third, improving the means of identifying and investigating fraud and overpayments. This strategy has six principal points. The first point will be a major publicity campaign to increase community awareness of the Government's commitment to combating fraud and overpayments and of the obligations of people on social security under the Act. It is important we make it clear that reducing poverty is too important a goal for us to tolerate fraud in the social security system. The second point will be to ensure that all clients are better informed of their exact entitlements, thereby eliminating the many overpayments which occur as a result of misunderstanding and confusion. Letters to all clients setting out in clear and simple English exactly how their level of payment has been arrived at, will be issued for the first time in May this year, and at regular six-monthly intervals thereafter. The letters will also clearly inform clients of their obligations under the Social Security Act to notify the department immediately of any changes in circumstances which affect payment. The Government is confident that simply by telling people more clearly about the rules of the system and their obligations under these rules, the level of overpayments-and also appeals-will drop significantly. At the same time, of course, those who are deliberately cheating the system will also be put on notice that they are running an ever-increasing risk of detection. I am going to truncate my statement to enable Senator Baume and Senator Haines to speak. What we have done is, as I have said, introduce these principal points. We are also reviewing the collection of existing debt. We are taking action to ensure that the Department will be much more effective in the future in recovering detailed overpayments. From May, all withholdings will be automatically indexed in line with the six-monthly increases in pensions and most benefits. I suppose the most controversial part and the most public part of the Government's plans has been the suggestion that we have an amnesty. As a result of this, the Government has decided to declare a three-month amnesty for some categories of people who have been paid more than they were entitled to in the past. The amnesty will take effect from today and run until 31 May. Unfortunately, there has been a great deal of ill-informed and overwrought criticism of the amnesty in recent weeks, most of it based on little more than prejudice and self-interest. Without waiting for the terms of the amnesty to be finalised and announced many people have rushed into print to condemn the amnesty for `thieves and cheats'. The amnesty, I wish to assure all honourable senators, will in no way apply to people who have been systematically and deliberately defrauding the social security system. All those who have been morally outraged solely as a result of their over-active imaginations in recent weeks can therefore relax. Contrary to popular mythology, not everyone who is overpaid by the Department of Social Security is a hardened thief or calculating criminal. Too often, overpayments occur simply as the result of misunderstandings or confusion. In fact, most overpayments occur as the result of genuine clients failing to advise the department when their circumstances change, rather than people deliberately setting out to rip off the system. The amnesty is designed to help those people who have, or at least originally had, a genuine right to a social security payment, but who have subsequently been overpaid because their circumstances changed and they did not inform the Department. It does not for instance, cover people who register for unemployment benefit in two or 22 different names. It does not cover people who deliberately misrepresented their circumstances in the first place in order to gain a payment to which they were not entitled. It does not cover cases of internal departmental fraud, nor does it cover incorrect payments deliberately initiated during the amnesty period. It covers only those people who come forward of their own free will before 31 May-not people who are already being prosecuted, or are under notice of investigation. The statement is the same as that delivered by the Minister for Social Security (Mr Howe) in another place. It consists of six pages. Rather than delay the Senate by reading the whole six pages and therefore preventing Senator Peter Baume or Senator Haines speaking, I seek leave to incorporate the remainder of the speech in Hansard. Leave granted. The statement read as follows- The amnesty has been very carefully designed to ensure that as far as possible, it helps only those who may perhaps be described as ``treadmill'' cases-genuine clients who have failed to notify of a change in circumstances, who are anxious and concerned about detection, but who are too frightened to come forward because they can't afford to repay the debt incurred, and may face prosecution. The Government recognises that in a social security system as large and complex as this, there are many genuine clients who in the past could have stumbled almost unintentionally into being overpaid. Even where people have intentionally failed to notify of a change of circumstances, the Government sees little point in forcing people to maintain the deception-continuing to receive payments to which they are not entitled-because they fear the consequences of owning up. As far as possible, the amnesty is designed only to help those people who made an initial mistake and who would welcome the opportunity to set the record straight-not those people who deliberately set out to get money to which they are not entitled and who have every intention of continuing their theft. These people will instead be subject to increasingly vigorous investigative and detection procedures. Before outlining the final stage of the three phase strategy, I would like to point out to the Senate that the amnesty is designed primarily to improve the social security system and reduce overpayments-not primarily to help individuals (although of course many people in hardship or needy circumstances will benefit). But some of the advantages of the amnesty to the Department of Social Security, and to all taxpayers, include: it will free staff and administrative resources to concentrate on detecting deliberate fraud; it will stop many overpayments immediately that might not otherwise have been detected for some time. Finally, I wish to outline briefly to the Senate some of the improvements to be implemented in identifying, investigating and recovering overpayments. These improvements will include the installation of a personal computer-based system in all regional offices so that staff can calculate overpayments much more speedily and efficiently. Procedures are also being developed to ensure that the maximum rate of withholding is correctly and automatically applied in all new cases where a debt to the department is identified. The direct credit method of payment will continue to expand, thereby further reducing the incidence of fraudulent cheque negotiations. Additional staffing resources have been allocated within the department to deal with and eliminate the backlog of fraudulently negotiated cheques presently awaiting investigation. I am pleased to present this detailed strategy to honourable senators, because I believe that the long-standing problem of social security over- payments can only be overcome by a comprehensive, integrated program which combines the very latest technological advances with an informed appreciation at both Government and departmental level of the complexities involved. I am confident that the strategy I have outlined meets these demands. Senator GRIMES —I move: That the Senate take note of the statement. Senator PETER BAUME(New South Wales)(6.51) —I thank Senator Grimes for his courtesy. In so far as the statement deals with the proposed amnesty it raises as many questions as it answers. It seems to introduce new inequities in an attempt to improve the system and to do equity to those who may have made mistakes. For a start, the Opposition shares the concern expressed in the statement for the clients of the Department of Social Security and for the proportion of clients who have made genuine errors or who have incurred overpayments inadvertently. We do not differ from the Government in that respect. But it is clear that equity questions arise in the context of what has happened over the last three years. I will briefly go through some of the elements. Attacks have been made upon the retirement income of many pensioners since 1983. I will go through those attacks. First was the promise that was broken not to introduce a pensions assets test. One was introduced. It affected retirement income. A promise was made not to expand the income test on pensions. It was expanded. A promise was made to raise pensions to 25 per cent of average weekly earnings. That promise has not been kept. In all these ways, retirement income has been reduced for many people. We have had foreshadowed a proposal to abandon the capacity which has been enjoyed by some people who earn a little extra income to average that earning over an income year and thus lessen the amount by which their pension is reduced. If the loss of averaging proposal is carried through the retirement income of many people will be reduced. To bring that matter home, I remind honourable senators that two of the people who serve us in the tea room are invalid pensioners. They serve breakfast to you, Mr Acting Deputy President, and me. They work in the Parliament to earn some extra income. While the averaging provisions exist they can spread that income over a year and reduce the amount by which their pension is affected. Those two women, Janet and Rosa, will be adversely affected by the loss of averaging capacity. Those people who help us in the Parliament will be losers as a result of that measure. A number of things have happened-that is one with which we will deal when it comes before us-which reduce the retirement income capacity of many Australians. In this case they were invalid pensioners but the same principle applies. Having shoved pensioners around for three years the Government is now proposing not to shove around some people who have misused the system. I will quote from page 5 of the statement. It says: Even where people having intentionally failed to notify of a change in circumstances- The Government will extend the amnesty even to those for whom it was not inadvertent and who may have intentionally abused the system, at the same time as many other people who have observed all the rules have taken all the blows. The Government and Senator Grimes dare to call us the friends of tax cheats. We are not the friends of anyone who defrauds any system, tax or social security. It concerns me that the proposals will also create inequities between classes of pensioners and beneficiaries. Let us consider this for a moment. Senator Michael Baume —It will disadvantage them more. Senator PETER BAUME —Those who have revealed all and have followed all the procedures, as have Janet and Rosa in our own dining room, and who have kept nothing back from the Department of Social Security will be disadvantaged. Senator Michael Baume —It will disadvantage the honest. Senator PETER BAUME —Yes, it will disadvantage those in honest need. They will be disadvantaged and will attract all the imposts and so on. Those who are already repaying overpayments will continue so to do. Those who come forward and confess under the amnesty will not repay. Those under investigation will repay. We will have different classes of pensioners who should be on the same pension, whose circumstances may be equal. Some, because they have been honest, will be disadvantaged. Some, because they have been rogues, will be advantaged. Senator Puplick —Crime does pay after all. Senator PETER BAUME —Senator Puplick says that crime does pay after all. The inequities between groups of pensioners concern me. Senator Grimes —If what you say is true. Senator PETER BAUME —It looks from a reading of the statement, Minister, that that is entirely likely. It seems that some pensioners who have claimed nothing extra will find that they have neighbours who have fiddled the system. I refer back to page 5 of the statement which says that, even where people have intentionally failed to notify the change in circumstances, if they take advantage of the amnesty they will be advantaged. I finish by reminding the Senate that Lady Caroline Lamb said of Lord Byron that he was mad, bad and dangerous to know. Senator Haines —Among other things she said of Lord Byron. Senator PETER BAUME —Well, among other things. Many pensioners may wish to apply that description to the Department of Social Security. Senator HAINES(South Australia)(6.57) —Senator Baume is quite right of course. Amnesties inevitably produce inequities but one wonders whether not going ahead with an amnesty would produce even greater ones to a wider range of people. Certainly I agree that there is considerable concern about the removal of the averaging provisions which the Government is contemplating. I say only that as I understand it something that has existed for the last 40 years without disturbing too many people ought to cause some curious and new problem to force us to stop the practice now. I daresay that I am one of the people to whom the Minister for Community Services (Senator Grimes) referred in his speech when he said that there has been a great deal of ill-informed and overwrought speculation in recent weeks about the amnesty. I can say only that members of parliament on all sides of the House are placed in a position of reacting on a day to day basis to stories which appear in the newspapers. Indeed, the story on the amnesty was one such article. When I put out the Press release relating to that I made the point that we were warning the Government about its proposed social security fraud amnesty. We said that we believed that it should not be absolute for premeditated fraud. I said that for them there should be no amnesty. I think that everybody agrees with that. However, the original story that came out indicated something quite different. I think that members of parliament and members of the community were quite right to react to that sort of comment. Debate interrupted. The DEPUTY PRESIDENT —It being nearly 7 p.m., under sessional order, I put the question: That the Senate do now adjourn. Senator MICHAEL BAUME(New South Wales)(7.00) —I wish to raise a political stunt. Today, four Labor members of parliament in the House of Representatives joined the Special Minister of State (Mr Young) in a stunt to try to recover some political ground that they had lost over the Government's decision to remove Commonwealth Police representation from Wollongong. These four MPs saw Mr Young to ask him to review this decision. As I understand it, he did no more than tell them that he would agree to refer the matter to the Australian Federal Police. Of course, as a result of that, nonsensical public statements were made in the Wollongong media this evening about the great success of this political stunt and how there was now a chance that perhaps the Government will reverse this decision. The fact that this is a token attempt by Illawarra's Federal Labor members of Parliament is evident from the history of this little affair. These Labor MPs had in fact refused my request yesterday and the request of Mr John Sharp, the Federal MP for Gilmore whose area is also affected by this decision, to include us in the delegation, which would of course have added considerable weight to such a deputation. It would have indicated that there was bipartisan support for the proposal not to close the Commonwealth Police office. It would have been clear evidence of the strength of feeling in the Illawarra region, crossing all party bounds, including Labor, Liberal and National Party representation. Had those people wished it, it could have been supported by the independent position of the Lord Mayor who has also complained about this decision. This bipartisan approach could have been followed. It was not followed and there is a very sensible political reason why it was not followed; that is, when I first publicly protested about this closure almost four weeks ago, not one local member of Parliament raised his voice in support. The only local MP who did so was the State member and Lord Mayor, who is an independent, Mr Frank Arkell. It was only after widespread expressions of public concern over the planned removal of Commonwealth police from Wollongong that local Labor MPs eventually and belatedly climbed on to this bandwagon, having shown no interest or concern over the downgrading of this essential service to the Illawarra region until it obviously became a political issue. They were dragged screaming into the arena, having been either indolent because they decided to do nothing or incompetent because they did not know that everything was happening-they have a choice. I should point out that at the time, back on 19 January, I issued a Press release which stated: The Federal Government should reverse its decision to close down the Commonwealth Police office in Wollongong. . . I've requested the Federal Government to maintain this eight year old Commonwealth presence in Wollongong which is planned by the Government for closure on Friday, February 14th, 1986. Friday, 14 February is, of course, this week. The Press release continued: It's regrettable that the Hawke Government is downgrading Wollongong by withdrawing our Commonwealth Police representation, particularly when there has been no reduction in demand for services provided by the four police officers on duty. Offences relating- I stress this- to drug importation, social security fraud, sales tax fraud, illegal immigrants and family law matters in the region, Helensburg to Ulladulla, have been handled by the Wollongong office. I want a guarantee from the government that there will be no reduction whatsoever in Commonwealth Police attention to these matters in our region as a result of the transfer of the four local officers to Sydney. Apart from the continuing drug problem, every tax payer suffers when people get away with cheating on pensions, unemployment benefits and sales tax. It would be directly the fault of the Hawke Government if the withdrawal of the Commonwealth Police resulted in an increase in these problems in the Illawarra region. This is only the lastest example of the low priority the Hawke Government gives to Wollongong and follows the government's failure to respond to my request three months ago to open a branch of the Taxation Department in Wollongong now that one's been opened in Newcastle, where by the way the local Commonwealth Police office is being retained. I concluded by saying: It's about time that the Government stopped regarding Wollongong as some sort of poor relation that it can ignore! Well, today's Illawarra Mercury has as its major story `Drug Squad chief fears for life'. It states: The head of Wollongong's Drug Squad had gone into hiding after discovering a $10,000 contract had been taken out on his life, police told Wollongong Local Court yesterday. Prosecutor Sgt Peter Morgan told Magistrate Mr John Seberry police learned of the contract on drug squad chief- this is the State drug squad chief- Detective Sgt Henry Karpik after five men were arrested this month on drugs charges. However, Sgt Morgan stressed he had no evidence to link the five with the threat. . . . . Charges against them allege that between November 25, 1985 and January 30, 1986, at Wollongong and other places they conspired to supply heroin, and each faces other drugs charges . . . Sgt Morgan alleged the arrest of the five men followed a heroin trafficking operation at Cringila in which bribe offers were made to police for protection. He said police worked in `agreement' with the five in an operation based at a coffee lounge in Cringila from where it was alleged heroin was sold. It was alleged the operation was uncovered when . . . the ring-leader offered Det Karpik $23,000, estimated to be 10 per cent of the ring's profits. Sgt Morgan said the prosecution had eight hours of recorded conversations between the ring members and police. Opposing bail, Sgt Morgan said he feared for the safety of not only the witnesses involved in the case but also `other innocent people as well.' He alleged on the day of . . . arrest a shotgun had been found in his car. Sgt Morgan said the case not only involved the sale of heroin but also other facets that would `shake the foundations of the judicial system.' The magistrate said that the allegations of fears for the safety of some witnesses had to be taken into account and refused bail to all five. Is it not remarkable that there we have clear evidence of the massive need for Commonwealth police who are concerned with drug matters in the Wollongong area coinciding with the positive, dynamic procedures of the Commonwealth Government in assisting this matter by removing Commonwealth police from the area! It may be just a `fortunate' coincidence that we have this clear evidence of the need to maintain Commonwealth police in the area. As I have said, Mr John Sharp, the National Party member for Gilmore, which electorate includes Nowra which was covered by the operations of the Wollongong office of the Commonwealth Police, joins me in protesting strongly at the closure of this police office. As I stressed earlier, there has been no diminution in demand for the services of the Commonwealth Police in the region. On the contrary, there is clear evidence of continuing increase in the need for them to be there. As this coincides with a report today from the United States of America that Australia is expected to be a trafficking point for massive amounts of cocaine and other drugs which are in surplus in the United States, it dramatises the absolute need for there to be no reduction whatsoever in the efforts of the Commonwealth Police, along with Customs officers, to try to block this sordid traffic. In fact, senior representatives of the Customs Officers Association have protested strongly to the Government about the closure of this Commonwealth Police office. All I can do is to plead with those Government Ministers in the Senate now to approach this properly, sensibly and rationally. At this late stage, having been spurned on a bipartisan approach, the Government Ministers should at least recognise that maybe when I and my colleague John Sharp raised this we had a strong point. I would be happy to see the four Labor members who ran this political stunt claim a victory if only the Labor Government would ensure that this reduction in this essential service did not take place. Senator KILGARIFF(Northern Territory)(7.09) —A fortnight ago a Liberal Party of Australia delegation went to Jakarta and various other places in Indonesia. The purpose of this parliamentary delegation's visit to Indonesia was essentially fact-finding and familiarisation. As far as I know, there had been no parliamentary visit to Indonesia over recent years and we, the members of the delegation, saw the visit as an important way of demonstrating to the Indonesians a continuing Australian interest and commitment. It is not my intention tonight to go into the visit to Indonesia or our activities there in depth other than to make some comment on a situation that was embarrassing to us to some extent. This happened in Jayapura when the Governor of Irian Jaya invited the delegation to go to a gaol to meet some detainees who were border crossers. The Press with us at that time reported this matter in an embarrassing way-- Senator Michael Baume —It was wrong. Senator KILGARIFF —Of course the report was wrong. It said that we pushed our way into this situation. It caused some comment and David Connolly, the leader of the Liberal Party delegation, a delegation of which Senator Michael Baume was a member, sent a letter to the Australian Financial Review because it was the Australian Financial Review of 31 January that misreported the situation. There was considerable misinformation. Mr Connolly's letter to the paper read as follows: I refer to your article, ``Liberal MPs in push for direct involvement in Irian Jaya issue'' (AFR, January 31). Despite the concern previously expressed by Indonesian officials over Australian journalist reports on Indonesian events, two journalists were permitted to accompany the recent Liberal Party delegation to Irian Jaya. Unfortunately, your article contained serious factual errors on highly sensitive matter which would have justified the reservations of the Indonesians that we had attempted to assuage. We did not, as was alleged, at any time speak of a direct involvement for Australia in the PNG/West Irian border issue. In fact we emphasised that the matter was entirely a bilateral issue between Indonesia and PNG and that Australia had no direct interest other than an understandable desire to see stability in the region which includes our own common sea border. You should be aware that no Australian reporter attended any of the delegation's discussions with ministers and senior officials in Jakarta. Nor did they attend discussions in Merauke when border crossings of the Australia-Indonesian sea border were referred to. Senator Michael Baume —They could have if they had wanted to. Senator KILGARIFF —Yes; I note that interjection. The letter continues: Furthermore your correspondent did not attend the final press conference held in Denpasar which was well attended by the Indonesian press. Despite this, your correspondent wrote an ``in-depth'' comment on the Irian Jaya visit and drew a completely inaccurate picture of events. In particular he omitted to mention in relation to the jail visit that the invitation was issued, without any prompting, by the Government of Irian Jaya who emphasised that ``Indonesia had nothing to hide''. I make no apologies as leader of the delegation for offering to pass on to the Papua New Guinea High Commission in Canberra a proper request from the detainees that they have a copy of their PNG release documents. This was necessary because they were being detained. It goes on: To have failed to make such a humanitarian gesture under those circumstances would be quite unacceptable. There was no commitment to involve the Australian Government. The delegation's visit was well received by the Indonesian authorities, it was a trail-blazing effort which should see further reciprocal exchanges. This visit was a serious commitment by the Liberal Party to demonstrate to the Indonesian people our desire to strengthen relations through improving mutual understanding of issues in our respective countries. It is no secret that Australia's relations with Indonesia have been under strain in recent years, but it is in our mutual interest to see a better climate develop. The Australian media can help achieve this objective through accurate and responsible reporting. The letter was signed by David Connolly, leader of the Liberal Party delegation to Indonesia. At a later date there will be a report from the delegation tabled in the Senate for its information. I do not wish to take up the time of the Senate, so I seek leave to incorporate in Hansard a copy of a statement made on my return headed `Need to strengthen Australian and Northern Territory links with Indonesia'. Leave granted. The document read as follows- Need to Strengthen Australian and Northern Territory Links with Indonesia Following his return from an Opposition Parliamentary delegation visit to Indonesia Senator Bern Kilgariff has stressed the need for Australia, and in particular the Northern Territory to strengthen its relationship with Indonesia. `Indonesia, our nearest northern neighbour, is a culturally diverse nation of immense proportions, with a population ten times that of Australia spread over 13,000 islands. `Areas of Indonesia are vastly over-crowded. For example, Java is the home of 67% of the country's total population. `The Indonesian Government is attempting to overcome these problems through its transmigration program which involves re-settling people from over-populated areas in the less crowded parts of the country, where they receive a land grant. `The delegation of which I was a member was able to view a couple of the re-settlement areas, and see just how the scheme operates. `These transmigration programs have been operating for a number of years in many parts of the country, and more recently Irian Jaya has become the site of transmigration activity. `In spite of the complexity of the cultural make-up of Indonesia the country has welded itself into a strong nation, recognising the diversity of its people and all their cultural and religious differences. `It has become a major force in ASEAN, the regional association of South-East Asian nations. `The visit of the delegation, last month, was very much a recognition of the importance of that part of the world to Australia. `There has been some indifference and lack of liaison and understanding between Indonesia and Australia in past years, but this situation is gradually changing. `Indeed, I believe, that it is of paramount importance that our two nations improve our understanding of each other, through trade, cultural exchanges and the building of friendships. `We have many mutual interests, such as our attitudes to problems in the Pacific, our outlooks on defence, and our common border-the Timor Sea. `The delegation also took the opportunity to discuss with the Indonesian Government the question of access to Timor-we urged the Indonesians to open the area up to Australian travellers and representatives of the Australian media. `Australia must make more efforts to increase dialogue on these matters, and from the reaction we received in Indonesia, it appears that the Indonesians also recognise this need for increased liaison. `The Northern Territory is well ahead of the rest of Australia in developing its relationship with Indonesia, with a large number of Territory people travelling to Indonesia, and particularly to Bali, each year. `In speaking to the Governor of Bali I was assured that the people of Darwin are most welcome, and indeed, play a major part in the economy of this part of Indonesia. `Another example of our Territory links with Indonesia is in the teacher exchange program whereby Territory teachers go to Indonesia, and Indonesian teachers come to the Territory. This gives both countries an opportunity to participate in and learn from each other's education systems. `This annual exchange is a valuable project, and I believe that another group of Territory teachers will be heading off to Indonesia at the end of the week. `Cultural exchanges also provide opportunities to develop our ties with Indonesia, and the Indonesian people are very keen to bring their culture to us. `The Governor of Bali has indicated that he would like to send a top Balinese traditional dance troupe to the opening of the Performing Arts Centre in Darwin, later this year. `The movement of people between the two countries looks like increasing even more this year with the old Kupang-Darwin air link being re-established. `The annual boat race to Ambon is also significant in the Territory's ties with Indonesia, and is a reminder that our first contact with the Indonesians was by sea, going back to the Maccassans who came from Indonesia to fish for trepang. `The Indonesians showed a good deal of interest in Mr Peter Spillet's intention to re-enact the journey of the Maccassans in the bi-centennial year. `Our ties with Indonesia will be further enhanced by the forthcoming visit of the Chief Minister, Ian Tuxworth, to Jakarta and Timor. `Indeed, I believe that future ties between our countries will be developed very much at the regional level. That is to say between the Governors of the Provinces and the Chief Minister. `While the Indonesian Government looks with approbation to increased contact with Australia, the enthusiasm for contact between our countries, shown by the Governors of the Provinces, of Java, Bali, Irian Jaya and Marauki-the closest settlement to Darwin-in particular, should provide great encouragement for the Territory to initiate new trade and cultural programs with these areas. `Indonesia is a very beautiful group of islands, whose people are very warm and friendly towards Australians of whom they have developed fond memories over the past years, and we have much to gain from developing our relationship. `One thing which Australians and Territorians must realise is that of the millions of people who make up Indonesia many are very poor-health facilities are lacking in many places. `Education is not available to all, and the standard of living, generally, is quite low, as is life expectancy in many areas. `In certain areas the infant mortality rate is extremely high. `Being aware of all of these problems, should reinforce in Australians an acceptance of our responsibilities to assist the people of Indonesia in upgrading their standard of living which in no way compares with that of Australia.' Bern Kilgariff 4 February, 1986. Senator Michael Baume —Could we thank the Australian Ambassador? Senator KILGARIFF —I am also prompted by Senator Michael Baume, though I should need no prompting, to thank publicly the Australian Ambassador in Jakarta, Bill Morrison, who did much to assist the delegation. I must say that I believe that, as Ambassador for Australia in Indonesia, he is doing a quite remarkable job. I thank also the staff of the Embassy who accompanied us. I take the opportunity, too, to thank the Indonesian Ambassador in Canberra for all the assistance he gave us and, naturally, for all the assistance that was given by the Indonesian Government and the people of Indonesia. In addition to clarifying this rather embarrassing matter of misinformation concerning the Opposition's delegation to Indonesia, I wish to raise an aspect of the recent release of Mrs Lindy Chamberlain. The Chamberlain case would have to be the most controversial case that Australia has ever seen. A great deal of emotion surrounded the events leading to the trial and that emotion continued for the duration of Mrs Chamberlain's imprisonment. It is pleasing to see that she is now back with her family. There has also been a good deal of misinformation concerning the trial and matters surrounding the case. One of the unfortunate aspects of the whole affair has been the unwarranted smears on the reputation of the Northern Territory police and the judiciary, whose members have carried out their duties in relation to the case with nothing but professionalism. They have come out of the affair with a clean record-eventually this will be shown to be an accurate statement-and do not deserve the treatment they have received in the media or the criticisms levelled at them by many people, including politicians. These politicians will be well aware that the police, legal officers and judges involved in the case, being public office holders, are unable to speak out in their own defence. I would not even begin to attempt to canvass all the issues in the Chamberlain case here tonight as there simply would not be the time but I take this opportunity to consider one aspect of recent developments. I refer to the attack of the Attorney-General, Mr Lionel Bowen, upon the administration of justice in the Northern Territory. Yesterday in Question Time Mr Bowen, in a rambling, reckless statement-an astonishing statement to come from the Attorney-General of Australia-implied that there may have been some perversion of the course of justice in the Territory. His attack was, to say the least, irrational and irresponsible, and in an attempt to ensure that the true position is made known I seek leave to incorporate in Hansard a letter prepared by Paul Everingham, the honourable member for the Northern Territory and the former Chief Minister of the Northern Territory, and forwarded today to the Federal Attorney-General. It is now a public document and it should clear up any misconceptions created by Mr Bowen's comments yesterday. Leave granted. The document read as follows- 12 February 1986 The Hon. Lionel Bowen Attorney-General of Australia, Parliament House, CANBERRA, A.C.T. 2600 My dear Attorney-General, Yesterday in Question Time you received a question on the proposed Chamberlain Inquiry. Your answer seemed to adopt all manner of wild allegations against the fairness of administration of justice in the Northern Territory. You said: ` . . . it should be pointed out that in the administration of justice it is expected that there would not be an overzealous zeal to obtain a prosecution if there were not sufficient evidence to warrant it. . . . in fairness to the administration of justice, it is also very important that no unfair emphasis be placed on evidence which might be to the detriment of the accused.' ` . . . that there appears to be very strong evidence that the forensic tests that were carried out were not in accordance with established procedures and that was known to the prosecution.' ` . . . finally, there seems to be the further evidence that when there was a reassessment of that inquiry by the Solicitor-General in the Northern Territory it was not a fair reassessment . . .' Now those statements concern me greatly, as Member for the Northern Territory, and particularly the inference or suggestion that there may have been some perversion of the course of justice in the Territory while I was Attorney-General. Let me say unequivocally that the Chamberlains were not in any way discriminated against by Northern Territory law authorities. They had a fair trial with every opportunity to adduce any evidence they wished. You are well aware that it was Mr Justice Toohey of Perth, a Federal judge holding an incidental Territory commission, who reopened the inquest. It was Mr Justice Muirhead, a Federal judge formerly of the Adelaide Bar and now of Perth who, also holding a Territory commission, presided at the trial. The Federal court heard the first appeal and unanimously dismissed it. Then of course the High Court dismissed the second appeal. The forensic evidence adduced at the trial was, except for the most elementary parts, from outside the Territory. Let me list the witnesses: Professor Cameron-Professor of Pathology at the London Medical Hospital, Dr B. Sims-Forensic Odontologist, London Medical Hospital, Mr Ruddock-specialist photographer, London, Dr Andrew Scott-Serologist, Adelaide, Mrs Joy Kuhl-New South Wales Health Commission, Professor Chaikin-University of New South Wales, Sergeant Barry Cox-South Australian Police. Professor Cameron was first brought into the matter not by the Northern Territory Government, but by Mr Ken Brown, a forensic odontologist of Adelaide (and, incidentally, a Seventh Day Adventist). Your suggestion that this diverse group of experts would have allowed themselves to be used by the Northern Territory law authorities is patently absurd. The Crown, unlike the Chamberlains, retained the same counsel throughout. It would be interesting to know why the Chamberlains found the services of Mr P. J. Rice, Q.C., Mr John Phillips, Q.C., and at least two other silks, unsatisfactory. They changed ``horses'' at every stage of their case. It is interesting that Mr Ian Barker, Q.C., who lead for the prosecution (with overzealous zeal, according to you) has now, it is reported, been retained by Mr Justice Murphy. For my part, since the discovery of the matinee jacket, I would welcome an inquiry. It is difficult to see the jacket being of any help to Mrs Chamberlain, but justice must not only be done, it must be seen to be done. As to the Commission of Inquiry, it may be presumptuous of me, but I am sure the concerns of all, including the Premier of New South Wales and yourself, would be allayed by the appointment of three judges with, say, Sir Laurence Street, Mr Justice Beach of Victoria and Mr Justice Williams of Queensland, all of whom have previous experience of this type of inquiry and who are well known and respected, eminent even, to use a word with some current vogue, in the wider, as distinct from the legal community. I will certainly urge this course on the Northern Territory Government. In conclusion I ask that you either retract the remarks I have earlier referred to, or repeat them outside the House. If you will directly relate them to my administration of the office of Attorney-General, I am more than ready to give you the opportunity to make good your assertions in the Supreme Court of the state of your choice. Yours sincerely, PAUL EVERINGHAM Member for Northern Territory Senator PETER BAUME(New South Wales)(7.19) —Several weeks ago I attended the opening session of the Australian Constitutional Commission representing the Federal Opposition. I begin by wishing the Commission success in the rather onerous task it has undertaken. It was quite obvious when one looked at the personnel serving on the Commission and on its committees that there was a serious gender imbalance. There were 39 people involved-five on the Commission and the balance making up the various committees that assist the Commission. Of those 39 people the Labor Government saw fit to appoint only two women. It would have us believe that it picked eminent Australians on the basis of talent. It would therefore appear to be the judgment of the Australian Labor Party and the Labor Government that, in picking a citizens commission of 39 people, the choice of two women reflects Labor's view of the talents available from women in the community. It should not be thought that people had to be legal or constitutional experts to serve on the Commission. Certainly, the five commissioners are all qualified and one is a distinguished woman lawyer. However, the people who make up the advisory committees are not all lawyers. In fact, the Labor Government made it clear that it wished to have some broad community participation. It saw fit to select a writer. It saw fit to select a singer. The writer it chose was Mr Tom Keneally, and the singer, Mr Peter Garrett. I have no argument with their selection. The Government chose many other people because they were prominent citizens. However, it saw fit to appoint very few women. In fact, the only woman appointed to those committees was Philippa Smith from the Australian Council of Social Service. Soon afterwards the Labor Party, through the Minister Assisting the Prime Minister on the Status of Women, issued a declaration saying that it was seeking to establish a register of the names of suitable women so that it could continue to appoint suitably qualified women to its commissions, committees and various other bodies which it was establishing. That is fine rhetoric for the Labor Party to put out, but it is absolute hypocrisy when placed against its performance so recently in regard to the Constitutional Commission. There has been an outcry from women's groups that, in selecting a group of Australians who are willing to examine the Constitution which governs our lives, the majority of the community, the 52 per cent who are women, were given scant representation. I am aware that today the Women's Electoral Lobby has seen fit to issue a media release which it has called, tongue in cheek I suppose, WEL's alternative Constitutional Commission. Just to drive home to the Labor Government how chauvinistic, sexist and selective it was in leaving women out of the Constitutional Commission almost entirely, WEL has presented an alternative list of names of people such as the Chief Judge of the Family Court, the New South Wales Solicitor-General, a member of the Board of the Australian Bicentennial Authority, a senior associate in political science at Melbourne University, the founder of the Australian Council of Trade Unions working women's centre, professors-people who are eminent and well known to most Australians, who all happen to be women and who are all available in Australian society. Any one, any several, could have been called upon to assist the Government in what it is doing. A number of us who are watching the Government's performance admire much of the rhetoric which is used by the Labor Party and by Senator Ryan, one of its Cabinet Ministers. We are delighted that the Labor Party is following the political traditions which we established when Dame Enid Lyons was appointed to the Federal Ministry. However, the rhetoric is very thin when recently, in appointing one of the most important public bodies, a body to examine the Australian Constitution, the Australian Labor Party saw fit to ignore women almost completely. It makes a mockery of what it has been on about. The only answer is to expand the size of the Constitutional Commission and its committees to ensure that women get decent representation. Anything else will make a mockery of what Labor claims it is on about. Question resolved in the affirmative. Senate adjourned at 7.24 p.m. The following papers were tabled: Acts Interpretation Act-Correspondence and Statements relating to extensions of specified periods of time for presentation of the Australian War Memorial Annual Report 1984-85 and the Legal Aid Commission (A.C.T.) Annual Report 1984-85. Census and Statistics Act-Australian Bureau of Statistics-Release of Lists-Statement No. 2 of 1986-List of names and addresses of business establishments for Institute of Family Studies. States Grants (Tertiary Education Assistance) Act-Direction under section 46 to reduce amounts specified in Schedule 1 and 3, for 1985, dated 11 December 1985. The following answers to questions were circulated: (Question No. 26) Senator Bolkus asked the Minister representing the Minister for Defence, upon notice, on 22 February 1985: (1) What are the locations and periods of operation of all satellite ground stations and observation posts in Australia which have been involved in operations with United States geodetic satellites. (2) What are the formal designations and orbital parameters of all United States geodetic satellites with which Australian satellite ground stations and observation posts have been involved. Senator Gareth Evans —The Minister for Defence has provided the following answer to the honourable senator's question: (1) Portable geodetic satellite receivers have been operated by the Army Survey Corps at over 650 locations since July 1974. They are also operated by other Australian government agencies and private organisations. In all, the locations of some 1500 sites have been determined by satellite receivers. The coordinates of these locations are available from the National Mapping Council's Geodetic Horizontal Control Data Base. Comprehensive information about the periods of operation of those ground stations and observation posts is not held by the Department of Defence, nor is it readily available from other Departments. (2) Satellite programs which have been used for geodetic work, in addition to the TRANSIT satellites and their successors (the Navy Navigation Satellites and NOVA satellites), have included the ANNA, DODGE, SECOR, PAGEOS, SEASAT, MAGSAT, GEOS, GEOSAT and Beacon Explorer programs. To provide all the other information sought by the honourable senator would require the diversion of significant departmental resources as well as the resources of other departments and organisations which have been involved in satellite geodesy. I am not prepared to authorise the diversion of Defence resources to this task and in the circumstances do not consider it appropriate to request the other departments and organisations concerned to gather information on my behalf which may be held in their records. (Question No. 720) Senator Vigor asked the Minister representing the Minister for Local Government and Administrative Services, upon notice, on 28 November 1985: (1) Are many national organisations which the Government consults on legislative and other matters and which receive grants-in-aid in recognition of the expertise and assistance they are able to offer, forced to pay high rentals for their Canberra facilities and therefore not able to take on extra staff that are needed. (2) Will the Minister for Local Government and Administrative Services examine details of government buildings and accommodation in the Australian Capital Territory to see if excess capacity or underutilised space can be offered to national organisations at rentals somewhat more modest than what is available on the commercial market in order that Commonwealth grant-in-aid money be used more effectively. Senator Gietzelt —The Minister for Local Government and Administrative Services has provided the following answer to the honourable senator's question: (1) I am not in a position to provide the information you seek on national organisations as the provision of their accommodation is not a matter about which my department is consulted. (2) The Commonwealth at the present time does not possess excess accommodation in the Australian Capital Territory and is also obliged to rent office space commercially to satisfy requirements. Several departments currently suffer cramped and otherwise unsatisfactory conditions as a result of the shortage of office accommodation, a situation which will be corrected as newly constructed office buildings become available for occupation. On occasions when Commonwealth owned office space becomes temporarily surplus to requirements it is leased by way of public tender. This allows for the equitable treatment of all organisations seeking accommodation in Government premises.