Monday, 14 April 1986 The PRESIDENT (Senator the Hon. Douglas McClelland) took the chair at 2 p.m., and read prayers. The Acting Clerk-Petitions have been lodged for presentation as follows: National Flag To the Honourable the President and members of the Senate in Parliament assembled. The petition of the undersigned shows: That the Australian flag symbolises the continuity between Australia's past, its present and its future. That we are completely satisfied with the design of the existing Australian National Flag. 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 hundreds of years of struggle for individual liberty against the forces of tyranny and oppression. Nevertheless we recognise the right of all Australians to contribute to any future decisions on the design of the flag. Your Petitioners pray that the Senate, in Parliament assembled, should: Object strongly on our behalf to any change being made to the Australian flag without the consent of the entire community through a referendum. And your petitioners as is duty bound will ever pray. by Senator Bjelke-Petersen (from 15 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 proposed Bill of Rights because it adversely affects areas of the liberty and freedom of Australians. It will operate against: The States and our Federal system of Government Criminal Justice The Police Education Families Employer/Employee relations It will remove the power of the people through Parliament, by giving power to a new more powerful Human Rights Commission which is not elected, but can act as a Star Chamber. We do most earnestly wish to keep our system of Common Law. Your Petitioners therefore humbly pray that the Senate in Parliament assembled should reject this Bill. And your petitioners as in duty bound will ever pray. by Senator Bjelke-Petersen (from 13 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 will do nothing to advance the rights of Australians, because it is dangerously ambiguous and will cause confusion within the legal system; it endangers our Federal system; and, it is to be administered in an authoritarian manner inconsistent with the present legal rights of all Australians. Your Petitioners therefore pray: That the Senate rejects the Australian Bill of Rights Bill and all cognate Bills. And your petitioners as in duty bound will ever pray. by Senator Jessop (from two citizens). To the Honourable the President and members of the Senate in Parliament assembled: The humble petition of the undersigned citizens of Australia, respectfully showeth: That the proposed Australian Bill of Rights Bill 1985 will endanger the Federal system in Australia, the State and Federal criminal justice systems, the State and Federal Police Force, the State and Federal education systems, the independence of the churches and religious associations, marriage and the family, children, the unborn, the handicapped, the aged and the infirm employer and employee relationships and Australian society generally. Our 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 Senator Archer (from 21 citizens). To the Honourable the President and members of the Senate in Parliament assembled. The petition of the undersigned respectfully shows: That we strongly support `The A.C.T. Smoking and Tobacco Products Advertisements Prohibition Bill' introduced by Senator Evans, because it represents the first positive national step towards the eventual elimination of widespread serious ill health caused by smoking tobacco. And your petitioners as in duty bound will ever pray. by Senator Vigor (from 150 citizens). To the Honourable the President and members of the Senate in Parliament House assembled. We, the undersigned citizens of Australia, humbly pray that the parliament act to outlaw the practice of the large petrol companies also controlling petrol retail outlets in competition with independent petrol distributers and retailers who they supply, thus acting in a position of unfair competition, and leading to the large companies exerting unconscionable pressure on those independent distributors and retailers. And your petitioners as in duty bound will ever pray. by Senator Vigor (from 82 citizens). To the Honourable the President and members of the Senate in Parliament assembled. The petition of the undersigned shows: That the Hawke Government should; Pass on the full benefit of lower international oil prices on 1 March 1986; Not increase or extend fuel taxes; and Maintain its tax cut commitments. Your petitioners humbly pray that the Hawke Government honour its commitment to the Import Parity Pricing policy. And your petitioners as in duty bound will ever pray. by Senators Childs (from 10 citizens) and Hill (from 25 citizens). To the Honourable the President and members of the Senate in 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 Hill (from 19 citizens). To the Honourable the President and members of the Senate in Parliament assembled. The petition of the undersigned respectfully brings to your attention: that there are individuals who have a conscientious objection to war because of their religious or general moral principles; and that the Parliament of this country has already recognised the right of such individuals not to have to participate in military service in time of war; and that all Australian taxpayers are required to contribute to military expenditure, regardless of their beliefs, through that part of their tax that is used for the Defence budget; and that while we acknowledge the right of the Government to levy taxes and to decide on the expenditure of money so collected we cannot accept that those with a conscientious objection to war should be forced to contribute to military expenditure. Your petitioners therefore pray that the Federal Government will acknowledge the right of those who have a conscientious objection to war to withhold their taxes from military allocations and enable the military related proportion of their taxes to be used for peaceful purposes only and, as we note that taxes are collected or disbursed for specific purposes (such as for Medicare), that the Commissioner for Taxation be directed that the military-related proportion of taxes collected from conscientious objectors to war be set aside in a separate fund, the Peace Tax Fund, to be used only for peaceful purposes, such purposes to be determined by the Government. And your petitioners as in duty bound will ever pray. by Senator Sanders (from 240 citizens). To the Honourable the President and members of the Senate in Parliament assembled. The petition of the undersigned shows: Your petitioners request that the Senate, in Parliament assembled, should seek for Australian merchant seamen's time served on ships of the United States of America to be added to time served on Australian ships during war time to qualify for the Australian Service Medal. And your petitioners as in duty bound will ever pray. by Senator Maguire (from 72 citizens). Senator BJELKE-PETERSEN(Queensland) —by leave-I present the following petitioning letter which is not in accordance with the Standing Orders from 68 citizens requesting that the Australian Bill of Rights Bill 1985 be rejected: LAWNTON BAPTIST CHURCH Dear Madam, In the next session of Parliament the proposed Bill of Rights will come before the Senate to be debated. We would like to voice our protest at the proposed Bill. 1. Because of the haste with which this legislation was passed through the House of Representatives in view of the fact that it affects adversely areas of immense importance to liberty and freedom. 2. Because it is based upon the United Nations International Covenant of Civil and Political Rights which has been rejected by the United States of America and Great Britain but was accepted the Warsaw Pact countries. 3. Because our Australian Constitution states that ``whereas we the people'' give you the government these rights. The Constitution limits the rights and power of government. The proposed Bill of Rights reverses this totally and states that ``we the government give you the people these rights''. This totally reverses the nature of government in this country. Our rights are now protected by current legislation, Common law and the present Constitution. 4. Because it transfers the power of interpretation of legislation from the Parliament of Australia (the democratically elected institution) to the Courts (an unelected body of people). 5. Because the Bill of Rights will be administered by the Human Rights Commission which is an unelected body of people with powers which are outside and not subject to the normal processes of law-no appeal, closed hearings, no legal representation. We therefore request that you vote to reject this proposed Bill of Rights. Petitioning letter received. Senator BOLKUS(South Australia) —by leave-I present the following petition which is not in accordance with the Standing Orders from 26 citizens requesting that the proposed national identification numbering system be rejected: We, the undersigned . . object to the introduction of a national numbering system as such a system poses a threat to the civil liberties of all Australians, particularly those who are already socially and economically disadvantaged in our society. . . demand that the Australian Government halt all proceedings with the proposal to introduce a national identification numbering system as it is unacceptable to the Australian public. . . demand a public statement from the Government to the effect that the introduction of such a system is highly inappropriate in a supposedly free and democratic society where the right to privacy of the individual should be upheld. Senator Dame MARGARET GUILFOYLE(Victoria) —by leave-I present the following petitioning letter which is not in accordance with the Standing Orders from eight citizens of Liverpool, New South Wales, requesting that the Australian Bill of Rights Bill 1985 be rejected: Dear Senator, We wish to express to you our alarm at the proposed Human Rights Bill, now before Parliament. Rather than preserve the legal and human rights of Australians, now in operation, this Bill lays the way right open for tyranny and abuse of these rights. It is a Bill which has received no public debate, insufficient Parliamentary debate, and bears all the hallmarks of being hastily put together. The far reaching effects of this Bill could be devastating to the time-tested and highly-valued system of justice in this country. It is most worthy of note that the Bill is being received gladly by the leaders of totalitarian governments, but has been rejected by the democratic parliaments of Great Britain and United States of America. This nation should, in fact, must also reject the Bill. We urgently request that you vote against this Bill, in its entirety, when it comes before the Senate. Petitioning letter received. Petitions received. Senator BOSWELL(Queensland) —I give notice that, on the next day of sitting, I shall move: That the Senate- (a) Notes that the Australian Bureau of Statistics Taxation Revenue 1984-85, released on 7 April 1986, states; (i) Queensland has the lowest per capita mainland taxes, fees and fines and is below the national average by 24.1 per cent, (ii) Queensland has the lowest per employed persons payroll tax of the mainland States and is below the national average by 22.9 per cent, (iii) Queensland has the lowest per capita mainland taxes on property and is below the national average by 12.2 per cent, (iv) Queensland has the lowest per capita taxes on provision of goods and services of all the Australian States and is below the national average of 54.45 per cent, (v) Queensland has the lowest per capita taxes on use of goods and performance of activities of any of the Australian States and is below the national average of 24.9 per cent; (b) congratulates the Bjelke-Petersen led Government on its low tax policies that encourage the growth of the private sector in Queensland; (c) notes that these policies are working and have made Queensland the largest job creator of any State in Australia in the 12 month period ending December 1985, with 70,300 jobs being created, or 28 per cent of all jobs in Australia, with only 16.6 per cent of Australia's population; and (d) condemns the Federal Labor Government for its continued attack on the Queensland State Government and its economy and setting itself up as a de facto opposition in exile. Senator MACKLIN(Queensland) —I give notice that, on the next day of sitting, I shall move: That the Senate, noting that- (a) equal access to information and equity in the provision of radio services is fundamental to the health of a democracy; (b) Radio 4EB which services Brisbane's ethnic communities is 1 of only 4 full-time ethnic radio stations in Australia; and (c) the level of funding received by 4EB has been halved in real terms in the past 4 years, receiving the equivalent of less than 4 per cent of the Federal Government funds provided to 2EA in Sydney and 3EA in Melbourne, urges the Government to upgrade funding to 4EB in the 1986 Budget to a minimum allocation of $250,000 for the 1986-87 financial year and to undertake that funding in subsequent years be at an adequate level. Senator VALLENTINE(Western Australia) —I give notice that, on the next day of sitting, I shall move: That the Senate- (a) views with concern the escalating hostilities between the Government of the United States and the Government of Libya in the Gulf of Sidra; (b) understands that the complex issues involved cannot be resolved by further acts of terrorism and counter-terrorism by both governments; and (c) seeks reassurance that the Joint Facilities in Australia will not be used for surveillance, electronic eavesdropping or communications in this conflict situation as occurred during the Middle East War in October 1973 without the knowledge of the Australian Government. Senator MICHAEL BAUME(New South Wales) —I give notice that, on the next day of sitting, I shall move: That the Senate- (a) notes the further, disastrous $1 billion deficit in Australia's external current account for March 1986, lifting the total deficit on the balance of payments current account for the first 3/4 of the 1985-86 financial year to $10.4 billion, more than for the whole of the 1984-85 financial year and approximately the official budget target for the 1985-86 financial year, although there are 3 months remaining; (b) regrets that the Federal Government has continually misled the Senate on this matter by claiming its target would be met; and (c) calls on the Government to provide a realistic estimate of the extent to which its repeatedly inaccurate and misleading forecasts of the current account deficit for the 1985-86 financial year will be exceeded. Senator GRIMES(Tasmania-Manager of Government Business) —I table papers in accordance with the list circulated to honourable senators. With the concurrence of the Senate, I incorporate the list in Hansard. Leave granted. The list read as follows- 1. Government's response to the National Inquiry into Local Government Finance-text of a statement by the Minister for Local Government and Administrative Services made in the House of Representatives on 10 April 1986. 2. South Australian Local Government Grants Commission-Annual Report 1985-Pursuant to section 10 of the Local Government (Personal Income Tax Sharing) Act 1976. 3. Joint Coal Board-Annual Report 1984-85-Pursuant to sub-section 20 (3) of the Coal Industry Act 1946. 4. Australian Capital Territory: Statement of receipts and expenditure for 1984-85-Pursuant to section 10 of the Seat of Government (Administration) Act 1930. 5. Norfolk Island-Annual Report 1984-85. 6. Australian Capital Territory Gaming and Liquor Authority-Annual Report 1984-85. 7. Legal Aid Commission (A.C.T.)-Annual Report 1983-84-Pursuant to sub-section 97 (1) of the Legal Aid Ordinance 1977 of the Australian Capital Territory. 8. Australian Safeguards Office-Annual Report 1984-85. 9. Australian Heritage Commission-Annual Report 1984-85-Pursuant to section 43 of the Australian Heritage Commission Act 1975. 10. Compensation arrangements for members of Parliament, the Federal Judiciary and the Inter-State Commission-Remuneration Tribunal Report-Pursuant to sub-section 6 (5) of the Remuneration Tribunals Act 1973. 11. Australian Agricultural Council-Resolutions-123rd Meeting-Hobart, 10 February 1986. 12. Australian Soil Conservation Council-Resolutions-1st Meeting-Hobart, 11 February 1986. 13. National Standards Commission-Annual Report 1984-85-Pursuant to section 19c of the National Measurement Act 1960. 14. Advance to the Minister for Finance-Statement on Expenditure for February 1986. The PRESIDENT —Order! Before I call on Questions without Notice, I must say that for some time I have been concerned at the increase in the numbers of supplementary questions during Question Time and the types of some questions being submitted as supplementary. It might be recalled that, in 1973, during the presidency of Senator Sir Magnus Cormack, the practice developed of allowing a supplementary question to a questioner. The then President said that, within reasonable limits, he would allow supplementary questions to elucidate an answer already given. This has remained the practice. Since that time successive Presidents have consistently ruled that supplementary questions are appropriate only for the purposes of elucidating information arising from the original question and answer. They are not appropriate for the purpose of introducing additional or new material or proposing a new question, even though such a question might be related to the subject matter of the original question. I am happy to continue the practice of allowing appropriate supplementary questions, but I remind the Senate of what I have said from time to time-the granting of the opportunity for supplementary questions diminishes the time available for first questions on behalf of other senators. This, of course, must be seen in the context of an increased number of senators in the chamber. Without reflecting on any senator or senators, it is my impression that recently attempts have been made to extend the scope of supplementary questions by the use of what I would call double-barrelled questions; the second, the supplementary question, being held back for asking, virtually irrespective of the answer to the original. I do not believe that is a proper use of the supplementary question procedure which I remind senators is completely within the control of the Chair. Supplementary questions have a useful purpose, to seek a full response to the original question or elucidate information given, but must not extend the parameters of the original question. I do not propose in future to allow supplementary questions which, in the opinion of the Chair, go beyond that limited purpose. Senator CHANEY —My question is addressed to the Leader of the Government in the Senate. I refer to his admission on Friday in relation to his position as a director of the Industrial Printing and Publicity Co. Ltd that he probably would have been aware that the company held shares in a wide number of industrial shares but that he could not say which companies. With that general knowledge when he became the Federal Minister responsible for industry, the member of Cabinet specifically charged with policy bearing on the future of Australian industry, how can he attempt to justify not having inquired as to the specific holdings of the company? Is this not a clear case of negligence on his part as a senior Minister of the Government? Senator BUTTON —I said in answer to questions on Friday in this place what I construed as involving conflict of interest. As I said on Friday, conflict of interest involves a Minister being in a position where, as a result of knowledge and personal financial interest, he might exercise his judgment in one way or another. In that circumstance I said I had no personal financial interests in the affairs of the company and in that circumstance I do not believe I had any conflict of interest. Senator CHANEY —I want to ask a supplementary question with very considerable care, Mr President, in light of your ruling. Indeed, the question is simply to ask the Minister, as I originally asked, how he justifies not having inquired into the specific holdings of the company, given his clear responsibilities for industry generally and the policies with respect to industry under this Government. Senator BUTTON —Senator Chaney has been pursuing a series of questions, as I understand it, about ministerial conflict of interests, as he sees it. The point I was making on Friday and which I again repeat is that in the exercise of my duties as Minister for Industry, Technology and Commerce I was not open, at any stage, to my own personal financial welfare being advantaged or disadvantaged by my position-- Senator Chaney —That is not the point. Senator BUTTON —It may not be the honourable senator's point; it is mine-as a director of the Industrial Printing and Publicity Co. Ltd. That answer, as I said, was given on Friday. I give it again today. Senator MAGUIRE —Has the attention of the Minister for Resources and Energy been drawn to recent reports about the high prices country consumers, such as those on Eyre Peninsula in South Australia, are paying for petrol? What are the reasons for relatively high country petrol prices? Is it the case that the oil companies and petroleum distributors are seeking to maintain high retail prices in the country at the consumers' expense? Senator GARETH EVANS —I think it has to be appreciated at the outset, as I have said previously on this subject, that the Commonwealth Government's legislative authority to control retail prices, including petrol prices, is to a very large degree constrained by constitutional limitations and that constitutional authority to control retail petroleum product prices does lie primarily with the States. We have, however, been able to maintain a wholesale price surveillance system through the Prices Surveillance Authority because of the essentially voluntary co-operation of the State and Territory governments and of the oil industry. But that does not mean that we have the power to enforce any PSA direction if the States or any part of the industry decide to ignore it. Therein, perhaps, lies part of the difficulty in this whole area of retail petroleum prices. Retail prices of petrol are generally determined by the refining companies and their distributors and agents. There are familiar and extensive price differences between metropolitan and country areas, but they mainly reflect two factors: One is the higher cost of supply to consumers in country areas, the familiar transport imposts, plus the higher wholesaling and retailing costs which are associated with smaller sales volumes in country locations. There is a third factor which often quite seriously compounds that basic difference, and that is the existence of discounting near sources of bulk supply, in particular in periods of excess supply or refinery underutilisation. That discounting, which has become almost a fact of life in its ups and downs in Sydney, Melbourne and Adelaide in particular, does not usually occur in the more remote areas. So country consumers never ever seem to get the benefit of those discount wars that are so much a familiar feature of the landscape from time to time in the major metropolitan areas. The problem is that petrol prices reflect differences in both supply costs and differing levels of competition. It is not surprising that, for the reasons that I have indicated, these sorts of variations in pricing that do occur are as they are; it is simply a function of seeing a competitive market at work. I have not been persuaded in most of the specific instances that have been drawn to my attention that country consumers are getting a much worse deal than one would expect them to on the assumptions of a wholesale maximum price being imposed, plus transport costs, plus the margins that are appropriate to essentially small retailers. The difficulty is not so much that prices are being escalated to higher levels than they should be by some collusive activity by the oil refiners and others in country areas; the problem, for country consumers is rather that they have, as I have said, added to the initial disadvantage of extra transport costs and so on, the disadvantages that flow particularly from being so far removed from the hot competitive environment that does give consumers in the major metropolitan areas a benefit. The PRESIDENT —Order! I draw the attention of honourable senators to the presence in the presidential gallery of the members of the New South Wales Legislative Council Select Committee on Standing Committees chaired by the Hon. R. N. Dyer, MLC. On behalf of all honourable senators I welcome the Committee to Canberra and I hope that its two-day visit to the Senate will be informative, educative and pleasant. Honourable senators-Hear, hear! Senator COLLARD —I refer the Leader of the Government in the Senate to the definition he gave in his reply to Senator Chaney on the question of conflict of interests. I understand that he also gave a similar definition on the 7.30 Report last Friday. I also draw his attention to the statement by the Prime Minister last Friday that a conflict of interest may exist in individual circumstances even though the personal interests of a Minister or those of his immediate family are not involved. Therefore, I ask: Does the Leader of the Government still say that conflict of interest can occur only in situations where a Minister stands to benefit personally? Senator BUTTON —Where a Minister's state of mind in terms of making a decision, as in the exercise of his public duty, is affected by interests of which he is aware and which are of a private nature there would be a conflict of interest. If it is not so affected, there would not be a conflict of interest. Senator ELSTOB —My question is directed to the Minister representing the Minister for Defence. Is the Minister able to advise the Senate how successful were recent joint defence exercises with Indonesia? Are these exercises likely to continue and possibly include air defence systems? Is the Minister of the opinion that such exercises have enhanced the defence co-operation program between Australia and Indonesia? Senator GARETH EVANS —I am advised by the Minister for Defence, Mr Beazley, that since 1972 Australian and Indonesian naval forces have conducted combined maritime exercises in the New Horizon series. The last of those was held in 1984. Those exercises met the aim of improving combined operating procedures between the two navies. As to whether those exercises are likely to be continued and possibly extended, the Minister has advised me that exercises in the New Horizon series will be continued. The next is scheduled to take place later this year in waters off Western Australia. As Mr Beazley indicated during his visit to Indonesia last week, we would also like to see joint exercise activity at some future time in the air defence area, which was specifically mentioned by Senator Elstob. This opportunity and other opportunities for joint exercising are being considered. As to the last part of the honourable senator's question, joint exercises do play a significant role in the enhancement of our overall defence relationship with Indonesia, as do activities such as joint projects and training under the defence co-operation program, senior level visits and professional exchanges. These activities do contribute to the development of a mature and mutually beneficial defence relationship with Indonesia, which supports our own common interest in regional stability and security. Senator MASON —My question is directed to the Minister representing the Minister for Foreign Affairs. Can the Minister yet confirm reports that the Indonesian Research and Technology Minister, Dr Yusuf Habibie, has cancelled an official visit to Australia because of the publication last week of an article in the Sydney Morning Herald referring to President Suharto and his business dealings? Will the Government inform Indonesia officially and forthwith that Australia does not accept media censorship from it or any other country? In relation to that, has the Government ever received any sort of information from the Indonesian Government regarding any sort of official inquiry into the murder of five Australian journalists in East Timor by the Indonesian Army in 1975? Senator GARETH EVANS —I am advised by the Minister for Foreign Affairs, Mr Hayden, that Dr Habibie has told our Ambassador in Jakarta, Mr Morrison, that he felt he had no option but to cancel the visit because of the publication of an article about President Suharto in the Sydney Morning Herald last week, on 10 April. The only additional point that Mr Hayden would make on behalf of the Government in this respect is that he, on behalf of the Government, has always made it clear to the Indonesian Government that Australia is a pluralistic democratic society and that the right of the media to express itself freely, independently and critically is something which, although it causes us discomfort, we are bound to uphold. As to the latter part of the question, the fate of the journalists was one of the matters Mr Hayden raised with the Indonesian Foreign Minister, Dr Mochtar, on his first visit to Indonesia in April 1983. Dr Mochtar assured Mr Hayden on that occasion that no new information had come to light. Official inquiries into the deaths of the journalists have been vigorously and persistently pursued over many years. We regret to say, however, that the information that we have collected is a mixture still of direct and hearsay evidence containing major internal inconsistencies and contradictions. After all this time the Australian Government cannot realistically hold out much hope that firm information will come to hand that will allow us to draw definite conclusions. Senator REYNOLDS —I address my question to the Minister representing the Minister for Primary Industry. Is the Minister aware that the Queensland Minister for Primary Industries, Neil Turner, has announced his early retirement, presumably because he is tired of trying to resolve the long-standing conflict over assistance to the sugar industry while the Premier consistently and persistently interferes in his portfolio? Can the Minister report on the Federal Government's current negotiations with the Queensland Government? Will a final package of assistance be jeopardised by Mr Turner's departure as the long-suffering primary industry negotiator? Senator WALSH —With regard to the first part of the question, I was aware that Mr Turner had announced his impending retirement. I have no certain knowledge, but I think that his retirement is almost certainly due to the ignorant and persistent obstruction by the Queensland Premier in relation to reaching agreement with the Commonwealth in response to the Commonwealth's very generous offer of assistance to the sugar industry. I understand that the Commonwealth and the State have been on the brink of reaching agreement several times, but then the tentative agreement has been shattered by the intervention of the Premier who has no grasp of the economics of the sugar industry, or indeed of the economics of anything else, probably, other than how to raid the public till in order to enhance the value of his son's farm by building a dam on the Mackenzie River. The Premier has a good understanding of Marcos-type economics, but no understanding of the structure of the sugar industry and the way in which it needs to be changed. In the general sense, the Queensland Premier and the Bjelke-Petersen Government are dragging Australia down, but in this instance there is the additional reprehensible fact that that Government is dragging down Queensland's second most important industry as well because of the Premier's obstinacy, ignorance and Otto the Hun-like attitude towards any form of co-operation with the Commonwealth Government for the benefit of a major Queensland industry. Senator CHANEY —My question is addressed to the Leader of the Government in the Senate and it follows his extraordinary answer to Senator Collard that suggested that the existence of a conflict of interest, where there is no personal interest, depends on whether a Minister's state of mind is affected. I ask the Leader of the Government in the Senate whether in a case where a Minister is involved in decisions to pay Broken Hill Proprietary Co. Ltd more than $70m a year by way of bounty for each of the five years from 1 January 1984, there is no need to declare the interest if the Minister decides that his state of mind is unaffected or if he does not bother to check on a shareholding which existed when he was an active director of a company of which he was still a director when the decision was made. Is there any objective test or is this a totally subjective matter, depending on the whim of the Minister's mind at the time of the decision-making? Senator BUTTON —It is not a question of whether there is any objective test. The first and most essential point is whether the Minister has anything personally to gain financially from exercising his ministerial discretion in a particular way. That is what conflict of interest is all about. Senator Chaney —That is not what the Prime Minister said. Senator BUTTON —Senator Chaney interjects that that is not what the Prime Minister said. I am quite aware of what is in the Prime Minister's statement on this matter and I commend Senator Chaney to read it with greater care. Senator Chaney —It goes beyond personal interest. Senator BUTTON —Do not get excited. The fact of the matter is that there is an objective test in that regard and there is also a series of subjective tests-so subjective in the case of the previous Government that it was not prepared to tell the public at all what Ministers' interests were. That was a matter for the privacy of the Cabinet. Senator Chaney talks about subjectivity, but he should have a look at his own Party's standards in relation to subjectivity before he makes pious and sanctimonious judgments about me. Senator DEVLIN —My question is to the Minister for Veterans' Affairs. While I and other senators are aware of the efforts he has made to overcome the long delays in the repatriation determining system, the Minister will be aware that we are continuing to receive complaints about delays. Can he indicate what progress has been made to date in bringing determination times down to acceptable levels and when, on present trends, he expects to achieve his target? Senator GIETZELT —All senators would be aware of the completely unacceptable and inordinate delays that have occurred in the determining system in recent years. No Minister or government could be satisfied with the delays, having regard particularly to the age component of veterans who served in World War I or World War II. Questions similar to the question asked by Senator Devlin have been asked in Estimates committees and in the Senate. It is true that there have been long and unacceptable delays. The Government has taken a number of steps to overcome these intolerable delays, including the new legislation which the Senate passed in 1984 and which led to the overhauled and streamlined determining system which began on 1 January 1985. In addition to that, the Government has put on extra staff and arranged for more outside medical appointments within the medical profession to assist in the determination of claims. However, I have to say that, despite all those steps that have been taken, unacceptably long delays are still taking place. However, I am able to tell Senator Devlin and the Senate that in this financial year at the primary level we have reduced the backlog of entitlement claims by 29 per cent and assessment cases by 43 per cent. We have taken steps to ensure that those new processes will achieve even greater success in the immediate period. All told we have finalised 57 per cent more cases at the primary level to date this financial year than we did in the first nine months of the previous financial year. However, no matter how encouraging that evidence is, we are still concerned at the growing backlog at the level of the Veterans Review Board. I am not able to tell Senator Devlin precisely when we will achieve the target that we had placed in the determining system of a 90-day average processing period. A table has been provided, arising out of questions asked of me in the Senate Estimates Committee last Thursday. This table shows some progress in determining the claims with which the system is plagued. I seek leave to incorporate in Hansard this table, which shows that, while considerable progress has been made, we are still in a position of not finding it as satisfactory as we had hoped. Leave granted. The table read as follows- REPATRIATION DETERMINING SYSTEM Primary level Entitle- ment Assess- ment Backlog (number) 21.6.85... 28,075 13,753 28.3.86... 19,847 7,799 Change... -29% -43% Rates of Completion (number per month-first 9 months only) 1984-85... 1,649 1,225 1985-86... 3,011 1,674 Change... +83% +37% Primary level Entitle- ment Assess- ment Processing time (days) 21.6.85... 391 328 28.3.86... 248 230 Change... -37% -30% REVIEW Backlog (number) 21.6.85... 237 28.3.86... 88 Change... -63% Processing time (days) 21.6.85... 300 28.3.86... 149 Change... -50% VRB Primary level Entitle- ment Assess- ment Backlog (number) 21.6.85... 9,678 4,039 28.3.86... 11,996 6,928 Change... +24% +71% Processing time (days) 21.6.85... 895 763 28.3.86... 540 423 Change... -40% -37% Senator Sir JOHN CARRICK —I refer the Leader of the Government in the Senate to earlier requests for the release of information given to the ministerial committee by Bell Resources Ltd and the Broken Hill Proprietary Co. Ltd on which the committee based its view that no action was required in the national interest. I ask: Will the Government release the information without further delay? Senator BUTTON —Certainly, as Senator Sir John Carrick knows, I indicated that it was the Government's intention to release those documents at the conclusion of the case in the Supreme Court of Victoria before Mr Justice Marks. Of course, further litigation is proceeding in the Supreme Court of Victoria and the Federal Court of Australia at this time relating to some of the issues which were in dispute at the time that the original Part A statement was lodged by Bell Resources Ltd. I cannot answer without referring this matter to other colleagues in the Ministry who are concerned with the matter, but it is still the Government's intention to publish the documents. I am not sure whether we can do so with good faith to the parties at this time. Senator FOREMAN —I ask the Minister representing the Minister for Foreign Affairs: What is the Government's attitude to the possible escalation of tensions between the United States of America and Libya? Will the Minister advise the Senate how many Australians are currently in Libya and whether they will be advised to leave that country, considering the present situation? Senator GARETH EVANS —Senators will of course be aware of speculation about a further United States military engagement with Libya. Following the engagement between the United States and Libya in the Gulf of Sidra last month, Libya threatened terrorist acts against United States diplomatic missions around the world. Since then there has been the bombing of the Trans World Airlines aircraft over Greece and the terrorist attack on Americans in West Berlin. It is a matter of most serious concern that there is a substantial and growing body of evidence of Libyan involvement in international terrorism. Such behaviour is totally unacceptable to the international community and represents an extreme act of hostility towards other nations. The United States has been, with justification, deeply concerned at the number of terrorist incidents in recent months in which American property and American citizens have been subjected to violent attack. While the frustration of the United States over these attacks and threats can be fully understood, it is the Australian Government's position that it hopes that confrontation between the United States and Libya will not escalate further and that restraint will be shown by both sides. Mr Hayden has already publicly expressed the Government's views on this matter to that effect. The current tension between the United States and Libya is being discussed in the Security Council, and Mr Hayden has instructed our delegation to participate actively in the Council's consideration of this matter. I should add, finally, on this general issue that it remains the firm view of the Australian Government that terrorism in all its forms must be unreservedly condemned and that it will only be through concerted international action and attention to the root causes of terrorism that this problem will be effectively combated. The Australian Government, once again, calls on all nations to work together to actively discourage and counter terrorism. As to the latter and more specific part of Senator Foreman's question, the latest information available, I am told by the Department of Foreign Affairs, is that 44 Australian citizens are known to be in Libya. The Embassy of the Federal Republic of Germany, in Tripoli, represents Australian consular interests in Libya. In March, when there was heightened tension in Libya, the Australian Government did not issue a travel warning to Australian citizens. It is not considered appropriate to issue a travel warning at this time. However, the Department of Foreign Affairs is closely monitoring the situation. Senator MESSNER —My question is addressed to the Minister for Finance, both in his own capacity and as Minister representing the Treasurer. I refer to weekend reports that the Government will not be able to bring down a mini-Budget or statement of expenditure cuts in May or June. Will there be a major statement on Government spending this year, as there was in May 1985, even though that was shown to be quite unsuccessful? If not, is that because Ministers on the Expenditure Review Committee have been unable to come up with savings of more than about $300m, or is it because of fears of provoking delegates to the July conference of the Australian Labor Party? Senator WALSH —I am not going to satisfy Senator Messner's idle curiosity about whether there will be a statement in May or June, or at any other time. He referred to the 1985 statement as being unsuccessful. I do not know on what grounds he judged it to be unsuccessful. It is true that a number of the savings which had been identified in the May statement were subsequently not achieved because they were sabotaged in the Senate by Senator Messner and his colleagues. Therefore, the entire savings have not been achieved. However, compare that with the previous puny effort of the discredited Fraser-Howard Government in 1981, which produced a lot of propaganda over many months over his razor gang exercise and the huge slashes that were going to be made into government expenditure as announced in May 1981. As I recall it, that amounted in total to a saving of about $200m, most of which was never achieved. Senator BLACK —I direct my question to the Minister for Veterans' Affairs. Recently the Minister announced grants to ex-service organisations for joint venture projects to assist elderly veterans and war widows. Unlike other States, Queensland had a high number of approvals for projects to provide help with the home and garden maintenance. Why was this so? Senator GIETZELT —The Government provided $600,000 in the last Budget for the establishment of what were called joint ventures. This has been a recognition of community initiatives to keep elderly veterans in their homes, as well as war widows, as long as that is possible and safe. The response to this Government initiative from community organisations has been overwhelmingly successful. An examination of the schedule shows that the response has been particularly high in Queensland. Part of the Government's philosophy in respect of care of the aged is that the quality of life for aged persons would be improved if we were able to avoid unnecessary institutionalisation. That, of course, is part of our experience from the home care initiative that we took two years ago. Approval generally throughout Australia, and particularly in Queensland, has been given to such programs as day clubs, wood chopping, exercise programs, garden and home maintenance, craft programs and telephone links for blinded soldiers, all of which are designed to provide a better quality of life for the people concerned. However, an examination of the initiatives that we have received shows that Queensland provides very little assistance to the aged and pensioners. The Grants Commission estimates that Queensland spends 60 per cent less on welfare than the average in other Australian States. That explains why we had this overwhelming response from Queensland where a means test on community care projects severely affects the eligibility of a great number of pensioners, particularly veterans. Therefore, there are many more applications for home help projects from Queensland ex-service organisations than from those in other States. The Government is currently giving consideration to approving the greatest number of these projects in the hope that it will assist in improving the quality of life for Queensland veterans. Senator PARER —I direct my question to the Leader of the Government in the Senate. Senator Button will be aware of the latest balance of payments figures for March which indicate yet another deficit in excess of $1 billion. This means that for the first nine months of this year the deficit is in excess of that for the 12 months for 1984-85. Does the Minister see any basis for comfort in the balance of payments figures for March released today, or does he believe that the elusive J curve effect is still as far away as ever? Senator BUTTON —I congratulate Senator Parer on his question. I agree with Mr John Elliott, the new principal shareholder in the Broken Hill Proprietary Co. Ltd, when he finds it quite staggering to think that the sorts of issues that the Liberal Party of Australia seeks to score points on today have any significance to Australian politics. Senator Chaney —Declare your interest now. Senator BUTTON —I am sorry? Senator Chaney —Declare your interest on that matter. Senator BUTTON —Of course, the balance of payments figures are not as satisfactory as the Government would wish. The depreciation induced improvement in the current account was expected all along to take some time, particularly when new capacity has to be installed in Australian industry and the essential and large element of imports remains in the transport and heavy equipment area. On a seasonally adjusted basis, I think the March balance of payments figures show some improvement on the February figures. There are, again, one-off factors, such as the purchase of $210m worth of aircraft for Qantas Airways Ltd, which is a large sum having regard to the relatively small difference between the February and March figures. So there are some explanations. I think there is some room for some reasonable encouragement from the figures. I think the important point is that in the nine months to March compared with the same period a year earlier, imports have increased by 29 per cent. As I said, that increase was 35 per cent in relation to machinery and transport equipment. That sort of importation will, hopefully, underpin domestic industries' capacity for both import replacement activities and exporting activities which will strengthen the trading position in the longer term. I think it is quite clear now as a matter of public record that I have never had great anticipations about a speedy and deep J curve effect following the devaluation. That has been a matter for judgment by various people concerned, and I suppose my judgment has been a bit more pessimistic than others. It is worth pointing out that a lot of the economists expected a much quicker J curve effect that we have had. Senator Sanders —So did you. Senator BUTTON —No, not I. I do not think that anybody with a knowledge of some of the structural problems of Australian industry would have been so sanguine in assuming that result. Senator COOK —Has the Minister for Resources and Energy seen Press reports over the weekend which largely are syndications such as Saturday's Melbourne Sun exclusive, headed: `$125 Million Handout to Oil 6'. Do these reports clearly set out what in fact is the Government's position? Senator GARETH EVANS —No, they do not. If that is the best that the Sun can do by way of an exclusive I fear for the future of the Herald and Weekly Times. The proposed payment was clearly announced by the Treasurer and myself in a very widely reported joint Press statement on 24 February relating to the 1 March import parity price reduction. We then indicated that of the $600m approximate stock loss that was then thought likely to be incurred by the industry, the amount of compensation which the refiners could justifiably claim-both in the market place and through direct Government reimbursement-was of the order of $220m. The figure mentioned in the story over the weekend is clearly consistent with that order of magnitude in identifying a likely government reimbursement under legislation introduced this week of around $125m. I should say that there is a clear justification in principle for at least partial reimbursement of the industry for stock losses incurred as a result of major recent IPP adjustments. It ought to be understood that after all it was as a result of adhering to the Government's domestic crude allocation policy that the industry acquired certainly a good proportion of its higher priced stock in the first place, and secondly it is as a consequence of adhering to the Government's maximum wholesale price policy-as administered through the Prices Surveillance Authority-that it has been unable to fully recoup its stock losses in the market place. To that extent the oil refiners are operating very much in a regulated environment which has to be acknowledged. A more immediately significant consideration from the point of view of the Government was the justification for payment of this kind on straightforward revenue protection grounds. If the Government had not in February indicated its willingness to put together a compensation package of the kind that is involved here, with elements both of market place recoupment and of government reimbursement, the reality is that the refiners would not have proceeded with liftings of domestic crude until after the 1 March IPP adjustment had occurred, with a consequent reduction in Government revenue in the order not of $125m as is involved here but of something like $350m. There is the further consideration that in the aftermath of the massive oil price plunge in January, not only the short term operation but also the long term survival of the whole allocation system was at stake. The collapse of that system, had it occurred-which would again have been very likely in the absence of the Commonwealth Government's announced compensation package-would have had quite massive implications, measure- able in many hundreds of millions of dollars, for the balance of payments, for Government revenue, and for the viability of the domestic exploration and production industry, the interests of which are very much present in our minds at the moment. There is much more that can be said about this matter, and there is much more that will be said when the issue is debated in Parliament, but it is useful to clarify the record at the outset in that particular respect so people can appreciate that the story which occupied the entire front page of the Sun on Saturday was in fact a quite considerable beatup. Senator Dame MARGARET GUILFOYLE — Is the Leader of the Government in the Senate aware of an article in the Australian Financial Review of Friday, 11 April, entitled `Labor tilts closer to freer wage policy'? I further ask the Minister whether he agrees with some of the comments made within that article in particular: But with the trade account in such a bad state and the need for export growth from outside the traditional agricultural and mineral sectors they want industry agreements that can help the manufacturing sector effectively compete in achieving overseas contracts. As such wage flexibility is being talked about in government circles as a crucial element in achieving long-term economic growth. Is the Minister able to give any information to the Senate with regard to the development of a freer wage policy or is there no basis at all for the article to which I have referred? Senator BUTTON —Senator Dame Margaret Guilfoyle asked me whether I agreed with some of the things in the article. It is very difficult at Question Time to say that I agree with some of the things in the article without having it in front of me-- Senator Withers —You are a very agreeable person. Senator BUTTON —It is very difficult to say whether one agrees with some of the things in an article or not without actually seeing them or identifying them. I think the best thing I can say in answer to the general question is this: Of course, the Government relies, has relied and will continue to do so on a centralised wage fixing system as the basis of its wage fixing policy because of the very widespread benefits which we believe it has brought to both wage and industrial stability in Australia. It would be a dogmatic, narrow-minded and thoughtless government if it was composed of people who did not think about issues involving greater flexibility in the wages system at some time in the future. Certainly those thoughts have crossed Ministers' minds. I do not regard this as a dogmatic, inflexible or thoughtless government and, of course, those things have crossed Ministers' minds and have to be discussed from time to time. Having said that, I have no announcement to make at Question Time in the Senate which will satisfy the honourable senator's thoughtful and natural curiosity. Senator JONES —My question is directed to the Minister for Community Services. I ask: Has the Minister's attention been drawn to an article by Andrew Casey in the Sun-Herald of 13 April 1986 which says that the Government will cut nursing home beds, and which is very critical of church and charity nursing homes? Do the views expressed in this article represent the views of the Government? Senator GRIMES —Yes, I did see the article. It was a front page article and was hard to miss. I think the most prominent thing about the article was the fact that the headline which, as Senator Jones said, suggested that the Government was to cut the number of nursing home beds and funding for nursing home beds, did not reflect the article itself. This happens sometimes, of course, when sub-editors or editors are looking for sexy headlines to fairly dull articles. The article did say that it was thought that the Government probably thought that the rate of increase of nursing home beds in the future would not be as rapid as it had been in the last 10 or 15 years. I think that is true. I have said that in this place and a report I will be bringing down later today says that. The article does go on to be critical, by implication, of some of the charitable and religious nursing homes-the deficit funded nursing homes-but I think the article was less than fair to them. The article suggested that these nursing homes, in fact, provided care and attention largely for middle class people of the same religion as those who run the nursing homes. Certainly it is true from reading the McLeay Report of the House of Representatives Expenditure Committee, the Giles report of the Senate Select Committee on Private Hospitals and Nursing Homes and Senate reports on nursing homes that fewer poor people are in these deficit funded nursing homes than would have been intended by the governments which previously administered the deficit funded scheme, but I think this was the result of faults in the system rather than faults in the churches or charities. I will also be saying something about that later this afternoon when I bring down a report. The headline certainly does not reflect the views of the Government and the report, insofar as it is over harshly critical of religious and charitable nursing homes, equally does not reflect the views of the Government. Senator SANDERS —My question is directed to the Minister representing the Minister for Defence. I ask: Firstly, what is the Government's attitude to Pine Gap's electronic spy satellites being used to spy on Libya as they were used to spy on Greece and Israel last year? Secondly, has the Government been consulted over the use of North West Cape to communicate with United States naval forces preparing for an attack on Libya? Thirdly, can the Government offer assurances that Darwin will not be used as a staging post for B52s en route to Diego Garcia to support United States actions in Libya? Finally, does the Government believe that such involvement by Australia in attacks on Libya may lead to conflict with that country? Senator GARETH EVANS —As to that part of the question concerning Pine Gap, the honourable senator will recognise that I cannot answer his question without being drawn into his speculations about operations of the joint facilities. For very good reasons the Government is quite unwilling to do that, as Senator Sanders well knows. Might I mention though, specifically in relation to his assertion about Greece, that this was a matter well and quite specifically addressed by the Minister for Defence, Mr Beazley, in his Press conference statement of 9 April last year, which I will not now read into the record but I will refer to him afterwards, unless he wants me to read it into the record. Senator Sanders —Yes, read it. Senator GARETH EVANS —It states: The Government maintains its position that it could not confirm or deny anything that is reported to be associated with an operation at Pine Gap. However, we were able to give the community assurances- he is referring here, of course, to his meeting with representatives of the Greek community which had preceded this conference- that the judgments made as far as we are concerned about the use of Pine Gap, and indeed our intelligence operations altogether, were made in the light of the fullest consideration of all aspects of Government foreign policy . . . particularly in the area of our being concerned that we operated in a manner that did not destabilise friendly governments. We also gave assurances that we were aware of developments associated with the usage of joint installations and any operations at those joint installations required the acquiescence of the Australian Government at not just official level, but also at the level of Ministers. I also mention in respect of the Pine Gap reference to Greece that there was a Sun article this morning, 14 April, entitled: `Greek Prime Minister to raise spying row', which I am now assured, through the office of the Prime Minister, is absolutely false. Indeed, there has been a communication from George Papandreou, the Deputy Minister for Culture who is said to have raised this issue when in Australia, to that effect. So if we could manage without some of the more lurid and inaccurate speculations about Pine Gap's operations in the past, we might have a slightly more sensible approach to its operations in the present and future within the limits of what it is possible for any government to say about the operations of that facility. As to the second part of the question relating to North West Cape, as the honourable senator will appreciate-I hope he does-Libya is a long way from North West Cape. I understand it falls outside that facility's area of operations. North West Cape is concerned primarily with very low frequency communications with submarines in the Indian and Pacific Oceans. Reported US deployments in the Mediterranean off Libya involve primarily aircraft carrier battle groups. Under the arrangements which govern the operations of North West Cape, the Australian Government must be informed of any change of alert status, and specific procedures exist for consultations between the Australian and US governments on developments which may affect the operation or use of the North West Cape facility. As to the question of Darwin being used as a staging post for B52s en route to Diego Garcia to support US actions in Libya, which was the third part of Senator Sanders's question, I am advised by the Minister for Defence that US B52s staging through Darwin are engaged solely on routine navigational training and maritime surveillance missions. They do not stage through Diego Garcia and they are unarmed. No change in these arrangements is contemplated, and the US has not asked for any. As to the last part of his question, it should be clear from my previous answers that the Government does not endorse Senator Sanders's supposition that Australia is involved in any way in the tension between Libya and the US. There is, I understand, no specific indication of any threat to Australia arising from the tension in the Mediterranean. Nonetheless, I am advised that the Minister for Defence has taken the precaution of asking his Department to assess whether any additional security measures are called for at US-Australian joint facilities during the current tension. Senator CROWLEY —I refer the Minister for Education to the announcement last December by the Minister Assisting the Prime Minister on Youth Affairs concerning the young homeless allowance which was to be implemented in January 1987. Will the Minister inform the Senate whether the Government still intends to proceed with this allowance? To what extent, if any, will the allowance increase the educational opportunities of homeless youth, and will the Minister say what is the amount of the allowance to be paid? Senator RYAN —It is the case that the Government was committed to introducing this new allowance which would cover young people who have no support from their families and who are not able to earn income but who wish to continue their education. It was our intention to bring in that allowance at the beginning of next year. However, because we were acutely aware of the number of young people in that situation and of the inadequacy of current allowances or support services to assist them, I am very pleased to inform Senator Crowley and the Senate that we have decided to bring forward by six months the implementation of that allowance scheme. In fact, the new young homeless allowance will be implemented from 1 July this year. This is a very important decision because it will ensure that unsupported young people in genuine need will be provided with adequate and equitable support which, of course, was the objective we announced in the Priority One program. As to the effect of the allowance on educational opportunities for those disadvantaged young people, I hope that it will have a very positive effect on improving educational opportunities for them. The situation up to the implementation of this allowance is that such young people normally have no option other than to go on the dole. Once they are in receipt of the dole they are not eligible to pursue studies on a full time basis. This was a particularly unsatisfactory situation for young persons of, say 16 and 17 years of age or, sometimes, even younger, as they would have absolutely no marketable skills and, of course, being on the dole does not give them an opportunity to gain them. The new provisions will extend the level of assistance to be equal to the independent rate of the tertiary education allowance which, at this stage, is $73.28c per week. That rate will be paid to homeless junior rate social security beneficiaries and to homeless full time students in post-compulsory schooling. I hope, and John Dawkins, the Minister Assisting the Prime Minister for Youth Affairs who, with me, was involved in developing this new scheme, also hopes that it will mean that those young persons not only will have improved economic security but also will be able to use that security to pursue their educational opportunities. Senator DURACK —My question is directed to the Minister for Resources and Energy. In view of the recent cutbacks in exploration expenditure and, therefore, the cutbacks in employment by oil companies and companies associated with them in the exploration for oil and gas due to the recent and continuing fall in world oil prices and also the high cost structure in Australia, will the Government provide some taxation relief to oil producers, or at least to the smaller producers, such as a cut in the crude oil excise? Senator GARETH EVANS —As I announced at last week's Australian Petroleum Exploration Association conference in Adelaide, at the same session at which Senator Durack and the Opposition were given a fairly comprehensive serve by Mr Ted Harris of Ampol Exploration Ltd for the Opposition's numerous misconceived statements about oil industry policy, the Government has embarked on a full scale review of measures that might conceivably be suggested as helping the present situation, particularly with regard to the smaller explorers and producers and the Government will be closely looking at what might be able to be done with regard to excise scales. I am not yet in a position to announce the result of that review. I should make it clear, however, as I made clear at the conference, that even if one were to remove Commonwealth crude oil excise completely on on-shore oil production the amount of revenue involved, on current estimates of on-shore production this coming financial year would be around only $10m. Clearly, concessions of that magnitude, although they might have some marginal utility for some producers, are hardly likely in themselves to solve the problem presently confronted by that category of producer-developer-explorer. The reality is that when one is confronting the kind of tidal wave that the oil industry has been confronting in regard to the plunge in oil prices, an extra oar or two will not necessarily make very much difference in how one handles that market situation. But the Government is extremely sensitive to the problem, sympathetic to the plight of that sector of the industry in particular and will be very closely reviewing the situation in the period immediately ahead. Senator MORRIS —I direct my question to the Minister representing the Minister for Aviation. What is the purpose of the cost recovery program operating in the airline industry? Is it justified and what is its cost to taxpayers? Senator GIETZELT —The early formative years of the Australian airline industry required a great deal of government assistance, encouragement and subsidisation. Consequently, taxpayers were called upon to pay a substantial sum towards those infancy years. However, I think it would have to be accepted by Senator Morris that those days have long passed and the airline industry in Australia is now thriving, to the point where companies, for example, are seeking to break into the industry and overcome the current two airline agreement. The time when the Australian airline industry was entitled to the subsidisation which was necessary to those early days has long passed. We have moved more and more towards a new industry, and one that is capable of standing on its own feet. I am advised that currently taxpayers are paying in excess of half a million dollars a day-precisely $550,000 a day-towards the cost of providing aviation services. The Government believes that that cost should be met fully by the industry. So we are moving towards that position. The Bosch Independent Inquiry into Aviation Cost Recovery, which was established by the Government to examine ways and means of reaching that more equitable position, has made suggestions to realise the objective. Currently consultations are taking place with both the industry and unions to establish a timetable to ensure that by the time the next Budget is brought down savings of that magnitude-which, if my arithmetic is correct, represent about $200m a year by taxpayers subsidising the industry-will be made. I think we are entitled to suggest that that matter ought to be thoroughly examined with a view to saving taxpayers' money generally. Senator PUPLICK —My question is directed to the Minister representing the Minister for Employment and Industrial Relations. Has the Government agreed to allocate $30m, including $8m in supplementary estimates currently before the Senate, to the Government of New South Wales for work on a bicentennial project at Sydney's Darling Harbour? Is the Government aware that the New South Wales Labor Government has entered into what is claimed by the union to be a water tight arrangement with the Builders Labourers Federation which guarantees the continued employment of BLF members at Darling Harbour, regardless of the deregistration of the union and its exclusion from the conciliation and arbitration system? Does the Government believe that it is proper to pay taxpayers' money to the New South Wales Government which can only spend it on a project which exclusively employs members of the BLF as part of some covert sweetheart deal? Senator WALSH —I have heard something, either on the wireless or in a newspaper, about an allegation by the Builders Labourers Federation that it has an agreement of the type described. I do not know whether it is true, but I will refer the question to Mr Willis for definitive answer, if he can get a definitive answer. Senator CHILDS —I refer the Minister representing the Attorney-General to the Australian Broadcasting Corporation radio program Background Briefing of 13 April in which it was alleged that there is documentary evidence of at least 150 nazis and other war criminals entering Australia shortly after World War II. Is it the case, as alleged in the program, that the then Australian Prime Minister, Robert Menzies, agreed to British and American requests that our normally stringent immigration procedures be relaxed as many such immigrants would be potentially valuable in prosecuting the cold war? In view of the allegations that 66 of 99 archived files pertaining to these immigrants and held by the Australian Security Intelligence Organisation are missing and others have been released only in severely censored form, is the Minister satisfied that ASIO is co-operating properly in accordance with its charter in the investigation of these allegations? Senator GARETH EVANS —I do not appear to have a brief on this matter. I will seek an answer from the Attorney-General and let the honourable senator know. This might also involve some input from the Department of Immigration and Ethnic Affairs, in which case I will seek to liaise accordingly. Senator REID —Is the Minister representing the Minister for Territories aware of the long waiting time experienced by the frail aged in the Australian Capital Territory to obtain nursing home accommodation? Is he aware of the bans imposed on admissions to Morling Lodge Nursing Home, which have nothing to do with quality of care, but are merely the result of a demarcation dispute between the Hospital Employees Federation and the Federated Liquor and Allied Industries Employees Union of Australia as to which union the kitchen staff of the home should belong to? Is the Minister aware of the hardship that this demarcation dispute is causing? In view of the employees' refusal to abide by the Australian Conciliation and Arbitration Commission's order made last Wednesday that the bans be lifted, which has been ignored, what action will the Government take to end this dispute? Senator GIETZELT —I have some peripheral knowledge of the issues raised by Senator Reid, but I think I should draw that matter to the attention of the Minister for Territories for a precise answer. Senator BJELKE-PETERSEN —Is the Minister for Resources and Energy aware that since January 1983 excise duty on fuel has increased from 6.155c a litre to more than 15c a litre? Does the Minister not agree that an increase like that is as good to the Government as income tax at around 30c in the dollar? Does he not agree that the excise duty on fuel should be lowered? Senator GARETH EVANS —With the utmost respect to Senator Bjelke-Petersen, I am not sure which country she has been in for the last three or four months because that escalation in the product excise on petroleum products has been a result of a quite deliberate Government policy designed to substitute a source of revenue for the disappeared source of revenue which has resulted from the plunge in world oil prices as far as crude oil excise is concerned. The increase to which she referred has not been a matter of some piecemeal, bit by bit, incremental action taken by the Government to tax petroleum products to consumers. The Government's decision was quite up front, quite open and explicit and it was made with the aim of recouping first a proportion and then, more recently, the whole amount of the revenue lost as a result of the collapse in world oil prices. I remind Senator Bjelke-Petersen that it is only with appropriate revenue resources being available to the Government that the Government can spend money on defence, social security, health, transport, support for the farming industry and all the other things which she and members of her Party hold dear. In fact, 28c of every single dollar we raise through fuel excise and other revenue sources is devoted to social security; another 10c to health; another 7c to education; and another 20c, in fact, goes to the States-so that the other part of the family can spend money on useful services to Australian citizens. With the utmost respect, I must point out that it is pointless to talk about these sorts of issues in the abstract without recognising what is involved. When one buys a gallon of petrol, one is buying something more than petrol-one always has in this country and one still is. One is buying defence, health, social security, services to the States and all the other things on which the Government spends money. Senator GARETH EVANS —Senator Kilgariff asked me on 11 April, in the latest instalment of his Dr Helen Caldicott series of questions, following an earlier exchange between us on 20 March, a question concerning alleged funding by the Commonwealth Government of her visit to Australia. I wish to confirm that no International Year of Peace funds under the control of the Commonwealth were involved in financing any aspect of Dr Caldicott's visit to Australia. I understand that the Victorian Government made a grant of $1,500 from the funds it has set aside for IYP to assist with Dr Caldicott's visit. Victorian Government funds for IYP are, of course, solely under the control of the Victorian Government. Whether it feels that it has derived value for the money expended in this respect is, of course, a matter for it alone to decide. Commonwealth IYP grants have been approved for both the United Nations Association of Australia and the Medical Association for the Prevention of War. None of the applications, however, is concerned with funding any aspects of Dr Caldicott's visit. Senator GRIMES(Tasmania-Minister for Community Services) —I seek leave to make a ministerial statement in response to the report on private nursing homes in Australia by the Senate Select Committee on Private Hospitals and Nursing Homes. Leave granted. Senator GRIMES —In a brief statement to the Senate on 21 August last year I foreshadowed that I would provide a response to the report of the Senate Select Committee and I now do so. First, let me express the Government's appreciation of the work done by parliamentary committees in this most important area. The report of the House of Representatives Standing Committee on Expenditure, know as the McLeay report and entitled `In a Home or at Home', made a major contribution to debate on care of the aged, particularly about the imbalance between home and community care and residential provision. Many of the initiatives taken by this Government, including the establishment of my Department and the Office for the Aged, the implementation of the home and community care program and the development of geriatric assessment teams, represent a response to the issues identified in that report. The Senate Committee's report has made a major contribution to the debate about the provision of residential care, focusing on the lack of planning and need for significantly tightened growth control, together with the need to introduce funding arrangements which provide incentives to operators to be more efficient. Quality of patient care, the need for more consistent inspection and better quality control arrangements, and the crucial place of assessment and rehabilitation were also key elements of that report. These major parliamentary reports are not the only indication of concern about the current program. The Auditor-General in the efficiency audit `Commonwealth Administration of Nursing Home Programs' expressed considerable disquiet about the operation of programs now costing over $1 billion a year. The report of the Committee on Care of the Aged and the Infirm in January 1977 foreshadowed many of the concerns which were to be more fully articulated in the various reports which followed. These reports cover private, government, and religious or charitable-so-called deficit funded-homes. There is broad consensus that, firstly, there is a lack of balance in government and community provision for the aged with nursing home accommodation favoured at the expense of hostels and home and community care programs; secondly, there is an urgent requirement for effective assessment and rehabilitation procedures through which to better match services to the individual's particular requirements; thirdly, there is insufficient co-ordination between the efforts of various levels of government, including in the area of inspections and maintaining standards; fourthly, the current nursing home cost reimbursement funding arrangements discourage efficiency, and fifthly, the results of government intervention in aged care have largely been unseen, unplanned and unco-ordinated. Against that background I commissioned an urgent report from my Department into our residential care programs, with the objective of developing a strategy for change drawing on the constructive analysis and recommendations of the Senate Committee. I made it clear that to be acceptable to this Government the strategy would need a clear statement of philosophy and goals, including, firstly, that aged and disabled people should, as far as possible, be supported in their own homes, in their own communities, and that nursing home accommodation should be provided only where community services or hostels are not appropriate to people's needs; Secondly, the point of entry to any form or level of service should be through an assessment process to help people gain access to a range of appropriate rehabilitation and caring services. That assessment should provide ongoing monitoring of the need for services or for higher or lower levels of care. Thirdly, there should be an assurance of a reasonable and appropriate standard of care which should focus not only, as in the past, on staffing and other inputs, but also on consumer outcomes reflecting the quality of life provided for the client. The Government endorses the broad strategy and general directions for change in this review report. While we acknowledge that there will be costs associated with the proposed changes, including the building up of home and community care and development of geriatric assessment services, the Government is, of course, reserving its position on the specific funding implications in the report. We will be considering these matters in this year's Budget, in the light of views put forward in this Parliament and after consultations on the report with the States, the nursing homes and hostels industry, consumer and other welfare groups and professional and staff bodies. Arrangements for these consultations are being made by my Department at the national level with a view to sufficient progress being made for some decisions in the Budget context. Over 5,000 copies of the report will be distributed. State offices of my Department will be available to provide information and promote discussion of the changes proposed in the review amongst organisations and individuals in the community with responsibilities for, or interests in, care for the aged. Families of elderly people in residential accommodation also have a contribution to make. My objective at this stage therefore is to provide a focus for consultations on changes in current program arrangements. There are a number of factors which the Government believes are crucial in planning a new residential care program for elderly Australians. They include: (a) The fact that the client population is aging rapidly with particular acceleration in numbers of those aged 80 or over. The issue for this Government is not whether expenditure on residential care will grow nor whether there should be growth in the overall provision of residential care. In both cases there will undoubtedly need to be growth for the next few decades to meet needs brought about by general demographic trends. The issue is how additional resources should be allocated. (b) There is no information available which would support the differences in the level and nature of assistance for aged care between States, and hence in Commonwealth expenditure. Since there is no evidence that the needs of aged people vary significantly between States, there should be more consistent arrangements across States. (c) The overall provision of nursing home beds and hostel places should be maintained at approximately its present level in relation to the population aged 70 years or more. (d) There should, however, be much more rapid increase in hostel provision in recognition of the growing body of evidence that there is considerable overlap in the population of nursing homes and hostels and of inappropriate admissions to more intensive levels of care. The increased role of hostels, in turn, will require a greater Government priority for strengthening the social support and personal care aspects of hostels. (e) There is insufficient flexibility and capacity for innovation within the present residential program which is incapable of responding quickly to changing needs. This is now most evident in respect of the ethnic communities, the Aboriginal groups, and those who suffer from dementia. (f) A planning framework is needed which will enable a clear determination of government priorities as between residential programs and other services. A rolling triennial planning process, based on a determination by Government of the number of new nursing homes and hostels beds that it would be prepared to fund in any period, is probably the preferred option. (g) The distribution of low income categories of persons aged 70 or more in nursing homes and hostels should closely reflect the distribution in the general community. About 90 per cent of residents in nursing homes are required to pay no more than the standard amount which is 87 1/2 per cent of the pension and rental assistance. The review proposes that any new arrangements should continue to provide at least this degree of financial protection for low income groups. Mr Acting Deputy President, the statement goes on to outline the strategy proposed in the review over about 12 further pages. It was distributed to the Opposition some two hours ago, as is the rule. I ask that the rest of the statement be incorporated in Hansard to enable any debate to occur now, or, in particular, to enable more time for the business of the Senate to go ahead. I seek leave to incorporate the rest of the statement in Hansard. Leave granted. The remainder of the statement read as follows- The Strategy Assessment and Rehabilitation 11. All the major reports on residential programs have endorsed the importance of developing assessment and rehabilitation services to ensure appropriate care for elderly people based on their physical, medical, psychological and social needs. An essential element in a geriatric assessment service is that if advice is given that institutional care is considered inappropriate the assessment team should be able to arrange access to alternative services, including home care. 12. To manage these functions it is envisaged in the Review that geriatric assessment teams would need to be: multi-disciplinary and backed by a specialist physician with experience in geriatrics and other medical and paramedical services; regionally based; linked to an acute hospital with general access to inpatient beds for treatment and rehabilitation, respite and day hospital care; and able to depend on co-operation from non medical community service providers for personal and social support services. 13. The States have been quite active in developing multi-disciplinary geriatric assessment and rehabilitation services. The Commonwealth is currently spending about $4m a year to increase the availability of assessment services. Information systems are being developed which will be helpful to those engaged in planning residential accommodation, and community services and assessment services are being evaluated. 14. The further development of assessment will require cooperation between the Commonwealth and States. Discussions will be initiated with the States to develop a strategy for expanding the availability of assessment and to explore the possibility of instituting some delegation of nursing home admission approvals to appropriate geriatric assessment teams. The pace of development will be dictated not only by the amount of resources which the States and Commonwealth are prepared to provide but also by the availability of suitably qualified staff to operate assessment teams. Program Structure 15. We believe a relatively simple program structure should be retained for residential care within which carers and assessment authorities can respond with some degree of flexibility. Therefore we intend to retain the present tiered structure of hostel, respite and personal care categories in hostels; and the ordinary and extensive care categories in nursing homes. 16. Within that structure we believe that hostels should expand the role which they are already assuming in caring for the frail aged, while nursing homes should concentrate on the most highly dependent group. 17. We will need to develop a strategy which will: significantly increase hostel places over the next 10 years; build up assessment processes for hostel residents; adjust hostel subsidies to ensure that the industry can maintain or enhance its care role; and promote greater flexibility in recurrent funding arrangements to enable those hostels which are prepared to be innovative in caring for the more frail aged and for dementia sufferers to receive additional funding. 18. The present funding arrangements recognise the additional care required for the most highly dependent aged people in nursing homes by providing an additional extensive care benefit on their behalf. This will continue. However, an effective system of aged care must be sensitive to concerns that people placed in settings providing more intensive levels of care may very quickly become dependent on that level of care. We should therefore ensure that the community's resources for caring for the aged are concentrated on those who have most need of it. Growth Control 19. Control over the growth in number of nursing home beds was introduced in 1973 as a result of Commonwealth Government concern about the rapid growth in beds which had followed the introduction of the nursing home benefit scheme. 20. The Senate Committee reached the conclusion ``that the significant growth in the numbers of nursing home beds since 1963 has been the result of funding policies of successive governments rather that a mere response to population change or socio-economic factors''. In addition, the Committee expressed concern at the present high level of provision of nursing home beds and drew attention to the likelihood that the current control method could actually result in a significant increase in this provision. The Committee recommended an alternative method of controlling and limiting nursing home bed growth with a view to setting a lower level of growth. 21. The Government accepts the main thrust of the recommendations made by the Senate Committee on this issue, but believes that it should go further in including hostels within the growth control arrangements. 22. The Government accepts the principle advanced by the Senate Committee that growth control be expressed as the maximum addition to the total stock of nursing homes and hostel beds over a given period. Decisions on the bed numbers which the Government is prepared to fund over the next 3 years will be indicated in the 1986/87 Budget. 23. The main features of the Review's proposed arrangements are that a national ratio be adopted of 100 hostel and nursing home places per 1000 people aged 70 or over. While this ratio approximates the current place/bed provision, it would represent a significant change in existing arrangements which impose no finite limit on places. 24. The main result of implementing the recommendations in the Review would be: (a) over 38,000 additional nursing home and hostel places would be provided over the next 10 years, of which a maximum of 10% would be nursing home beds; (b) the proportion of people receiving extensive care in nursing homes would be specified, with the long term aim of using all nursing home bed stock for that group only; and (c) improved equity between States in terms of bed numbers and the proportion of elderly people receiving the extensive care. 25. The outcome of consultations with the States, and nursing home and hostel industry and community representatives will be carefully considered when the Government takes decisions on the level and type of residential care to be provided. Innovation and Flexibility 26. The Senate Committee sought greater flexibility within current arrangements to provide special programs for the confused elderly, ethnic aged, Aboriginals and rural communities. There is an urgent need for a capacity to provide for flexible approaches to the provision of care and, in principle, I support the concept of the new Innovative Projects Program proposed in my Department's Review. 27. The Review proposes that this new program would put the funding of day centres attached to deficit funded nursing homes or hostels onto a new basis. It would provide, for example, for care of dementia sufferers together with rehabilitation programs and respite care. It is envisaged that nursing homes or hostels would receive special grants, but only in respect of planned programs with defined aims and objectives, staffing hours, patient throughput and method to be used, training components and arrangements for evaluation. 28. This Government has already recognised the requirement to give greater consideration to the special needs of ethnic communities through earmarking funds in the capital program and in the development of special guidelines for ethnic nursing home provision. The numbers of ethnic aged, many of whom are non English speaking, are increasing significantly, and a new residential care program must necessarily respond to the special needs of those groups. Standards 29. The Senate Committee highlighted two important issues relating to standards. First, the importance of establishing uniform staffing levels progressively throughout Australia and, secondly, the urgent requirement for action in respect of nursing homes providing sub-standard care. 30. The Government shares the view of the Senate Committee that the Commonwealth should indicate the level of care for which it is prepared to pay. If we do not take the initiative in establishing uniform staffing levels, significant inequities will continue between States and we will continue to have no effective national control over the level of resources provided for residential care. 31. Difficult though it has proved in the past to achieve agreement on these matters in Commonwealth/State discussions, I am hopeful that progress can now be made within a framework for change embracing funding and assessment arrangements. The consultancy which I commissioned on the quality of care in nursing homes and which is due to be provided to me shortly will lay the basis for a better understanding of the provision of care across Australia and for discussions between Commonwealth and State officials. 32. All Senators would share a common concern with the Senate Committee about the need to take action against those few proprietors suspected of providing sub-standard care. The short term imperative is to ensure that: inspection and enforcement activity is focused on homes which give cause for concern; the Commonwealth and States act co-operatively in the inspection and enforcement of such homes; a more active role is given to Commonwealth Medical Officers; and better use is made of sanctions where necessary. 33. The Senate Committee was also concerned about achieving a framework within which the individual rights of those in residential care can be better protected. I support that view and believe that the longer term objectives which underlie the recommendations made by the Senate Committee can only be achieved on the basis of a comprehensive strategy which would include: (a) the ready availability of information about the range of community services and programs; (b) agreement between service users and service providers on user participation in the management and policy making processes of service providers; and (c) adequate consultation and complaint resolution mechanisms. 34. These issues are the subject of a joint exercise between my Department and the Attorney-General's Department with the aim of developing a departmental ``user rights'' strategy. Already there have been discussions with New South Wales and Victoria and it will be important to broaden those discussions out as soon as possible. 35. The promotion of adequate standards in all nursing homes requires a process of public debate about quality of care and minimum standards. My Department has a draft document in hand which will be the subject of discussion as soon as possible with the industry and consumer groups with a view to developing a more effective system for the determination and enforcement of standards within three years. Funding 36. The Senate Committee recommended that present recurrent funding arrangements for both participating homes and deficit financed homes be replaced by a system of program grants. In the interim the Committee suggested that measures be taken to ensure that nursing homes with very low profitability receive a level of profit sufficient to ensure their viability, until the program grants scheme commenced operation. 37. The Government took action in early 1985 to improve profitability in the nursing home industry. Most nursing homes gained from this and a number with low profitability received substantial gains. 38. Let me now remind the Senate of some of the other major concerns often voiced about current funding arrangements: (a) the dramatic increase in nursing home recurrent expenditure from $93m in 1973 to $940m in 1985 in current prices. In terms of expenditure per average bed day in nursing homes there has been a 606% increase in nursing homes compared to an increase of only 233% in the CPI and 308% in the average weekly earnings index; (b) the lack of equity in nursing home funding between States. Commonwealth nursing home expenditure ranges from $717 per head of population aged 65+ in 1984-85 in South Australia and Northern Territory and $621 in Victoria to $519 in Tasmania and $549 in Western Australia; (c) the administratively complex arrangements for fees control and the lack of incentive provided to nursing home operators to be more efficient. Matters relating to fees control are the continuing subject of complex and costly legal proceedings and generate considerable bad feeling between all parties; (d) the need for a uniform system of funding all nursing homes. Both the Senate Committee and the House of Representatives Expenditure Committee made recommendations in favour of a uniform system of funding both private and non profit-making homes and noted the higher cost structure in deficit financed homes than in participating homes. Both suggested that deficit financed homes were not providing any greater access for the financially disadvantaged than participating homes. 39. On the basis of the work done by the Senate Committee, my Department has recommended a fundamental change in funding nursing homes phased in over a period of 5 years. Under this proposal, we would move from the current cost reimbursement arrangements based on assessed costs of individual nursing homes to a benefit system based on a standard fee and benefit structure across Australia. This would be derived from average costs of ordinary and extensive care. The Commonwealth would stipulate the standard of care to be provided. It is envisaged that the same system would be broadly applicable to participating and deficit funded nursing homes. However, deficit financing arrangements will need to continue for those homes operating outside the cost structure applying to aged persons homes, such as special purpose homes for younger disabled people. 40. The changes proposed are consistent with the essential feature of program grants which is to require organisations to provide a specified level of service in return for a specified level of grant and to move away from the present cost reimbursement system and its emphasis on inputs. The proposed arrangements would provide: a system for funding participating private and voluntary homes on broadly the same basis; some scope for nursing home owners to increase efficiency; better control over cost escalation; less detailed administrative control over individual cost items; and a means of directly tackling concerns about funding inequities between States. 41. Establishment of the Review's proposed system would, of course, involve discussions with the industry on major issues relating to the setting of the standard fee and consideration of the transitional arrangements which should be made for moving the fees charged by the industry towards that standard fee. The cost data contained in the recently published consultancy report on the Cost of Nursing Home and Hostel Care Services would be helpful to these discussions. 42. No changes are proposed in the structure of the recently introduced hostel subsidy arrangements. The 1985 Joint Review of Hostel Care Subsidies Arrangements found that the structure and levels of subsidy introduced by this Government had significantly improved the financial situation of most hostels. But the view that hostels should cater increasingly for the frail aged will require a reassessment of the personal care subsidy necessary to enable the care needs of those residents to be satisfactorily met. Capital Funding 43. The Senate Committee recommended that Government priority for the provision of capital subsidies for nursing homes be redirected towards the provision of other forms of accommodation. The Government supports that objective, and in recent years the priority has been to redirect capital funding resources to hostel accommodation. It is evident, if hostel accommodation is to expand by some 35,000 places to 1996 as proposed in my Department's Review, that specific strategies will need to be developed including through the capital program. 44. The capital program should be used to expand services in high need areas and for special groups. It will be important in terms of Government priorities to give increasing assistance to ethnic groups and Aboriginals. 45. Greater flexibility will be introduced into current funding arrangements to ensure that priority is given to the needs of the most disadvantaged. 46. It is proposed that a capacity for funding self contained units should be retained in the program to ensure innovative projects can be funded (e.g. in rural areas), and to promote new approaches to community housing. I will be taking up with the Commonwealth Minister for Housing and Construction longer term issues which relate to the provision of housing and community programs with a view to initiating discussion with the States. Home and Community Care Services 47. There is no doubt that the vast majority of elderly people want to be able to live as independently as possible, for as long as possible, in their own homes in familiar surroundings. This is their first preference. 48. The Government understands and supports this view. The introduction and promotion of the Home and Community Care Scheme represents a direct response to this obvious need. 49. In the first two years of the HACC program the Commonwealth and States will make available up to $88 million for the extension of existing community care services or for new services. This program is designed to grow at the rate of some 20% per year from 1987-88. 50. Although the focus of my Department's Review was on residential care services, the Review recognised the need for more resources to be directed to home and community care as a means of: ensuring that care services would be better matched to all elderly people's needs; addressing current shortfalls; enhancing people's independence and preventing premature deterioration in their health and general well being; and avoiding unnecessary entrance to more intensive and inappropriate residential care. Next Steps 51. The major changes which the Review is foreshadowing in current arrangements for the provision of aged care would: (a) provide for a planned expansion of nursing home and hostel accommodation, with an emphasis on the provision of greatly expanded hostel accommodation; (b) seek changes in funding arrangements for nursing homes based on a standard of care determined by the Commonwealth; (c) result in the more rapid development of assessment teams to assess the appropriate level of care for an aged person; (d) require adjustment in the subsidies available to hostels to reflect the increasing role which hostels will take on in respect of the more frail aged; (e) provide for greater innovation and flexibility in mainstream provision through a new innovative grants program; (f) require a redirection of resources in the capital program to provide for additional hostel places and provision for special groups; (g) encourage the development of standards of care and quality of life measures against which to better assess the care provided for our aged and disabled people; and (h) a strengthening of home and community care services to ensure a better balance in the provision of care. 52. Taken together these changes will provide a better range of services for elderly people and their families, particularly through the development of enhanced community services and a stronger hostel sector. 53. Further work is also being done on residential services for the non-aged disabled and those ageing with severe disabilities. This will be released at a later date. Conclusion 54. We are faced with the fact that a succession of major reports have highlighted major deficiencies in the present arrangements for care of the aged. My Department's Review is about responding to those criticisms in a way which leads to changes in the overall balance of the provision made for care of the aged whether through community services, hostel accommodation or nursing home beds. The underlying concern is to ensure that the care provided to elderly people is sensitive to their medical and social needs. The clear message is that there is a need to reflect now on how resources are used for care of the aged given the anticipated rapid ageing of the population between now and the end of the century. 55. A new framework is needed within which it will be possible to plan the increased resources which will be needed to care for an ageing population. The Review provides the basis for consultation on the changes necessary and for promoting a wider community understanding of these important issues. Senator GRIMES —For the information of honourable senators, I table the report entitled `Nursing Homes and Hostels Review' prepared by my Department. I seek leave to move a motion. Leave granted. Senator GRIMES —I move: That the Senate take note of the statement. Senator PETER BAUME(New South Wales)(3.25) —I thank the Minister for Community Services (Senator Grimes) for making the statement available in advance and for allowing me to be briefed on some of the contents. We receive a large number of representations from elderly Australians concerned about their future and their circumstances. They are concerned about where and how they are going to live. They have a number of complaints in relation to sheltered accommodation, whether it be nursing homes or hostels. The first complaint is that there is nowhere for them to go. Irrespective of whatever plan is in place, many people come to me and say: `Our need is now. We have someone who is dependent and there is nowhere for them to go. They cannot find accommodation anywhere'. I look to the Government to meet, as a first outcome goal, the provision of accommodation where it is needed and where it is not now available. The Minister may well want to respond to that. One of the reasons that accommodation is not now available is that some of the existing accommodation is being inappropriately used. I understand and acknowledge that. But the fact remains that a cohort of dependent people is now occupying places. These people, who may not have been dependent previously, are taking places. Large numbers of people tell me that no accommodation is available for their relatives. I am not so much interested in looking at a new structure or new processes alone. I want something to happen in terms of outcomes. I want a guarantee that places will be available, if needed, for Australians who have contributed so much over the years; if they are properly assessed, if their need is genuine and if their need is accepted. That is not presently the case. The second reason people come to me is that there are gaps in the funding which put them under particular pressure. One example of this is where the fees charged by a nursing home exceed the pensions by an amount which pensioners cannot meet. People say to me: `What are we to do?' If they do not have a family or any means of support and there is a gap of $10 or $15 a week, they say: `What are we to do? Are we to be turned out?' The proprietors come to me and say: `What are we to do? We do not wish to turn these people out. Will you tell us how we are to cope with the situation?' My constituents present to me again and again the very real problem of the gap between the fees which are payable and the refunds which are available. Tied to this problem is the fact that over time there have been very considerable delays and failure to upgrade the amount of recurrent support for aged persons' accommodation. Therefore, the refund is not upgraded as costs go up. Indeed, there is often considerable delay before it is upgraded. As an ex-Minister I know that this is the kind of slippage which the Department of Finance might be happy about because it helps the national bookkeeping. However, Ministers for Community Services are not happy about such a situation because of the extra hardship it puts on their client group. Let us for one moment assume that we are dealing with a group of proprietors who genuinely have had cost increases, who genuinely require some increase in the refund so that fees can be kept within the reach of their clients and who are finding it difficult to get determinations from the Department in respect of those new fees. This is not happening, the gap is increasing and financial pressure on people continues to mount. We continue to have representations from aged Australians who ask: `What are we to do this week and next week? We are being asked to fill a $15, $20 or $25 gap and we do not have families to help us'. So the second outcome that I am seeking in terms of aged persons accommodation is for something to be done about the fixed pressure on people and the homes themselves. It seems to me that the Government has taken an approach of seeking to overcome some real and significant problems. Some problems need fixing: The problems of mismatching between the type of care required and the type of care available; mismatching, say, between States and areas and mismatching between different types of accommodation. The Government is attempting to address the question of the assessment of people before they enter this kind of accommodation. That assessment is said not to be adequate at present. If the figure of between 10 and 25 per cent of people being in nursing homes unnecessarily is true, it is correct that we should seek to have better assessment because it may be that better alternatives may meet the needs of some of these people. It is correct that the Government seeks to attack the problem of unevenness of provision between homes, between areas and between States. One of the problems which I am not sure has been adequately addressed is that some of the State administrations are themselves creating some of the problems because of their different requirements by way of standards of provision. The States make these standards and then looks to the Commonwealth to fund their largesse. That has to be fixed. I am interested that the Commonwealth will seek to provide a uniform, standard provision. Even if this takes the Government 10 years, it is a desirable thing to be seeking. If the Government wants to address the question of poor quality of provision in some homes, we will welcome that because we want every aged Australian, in whatever kind of care, hostel or nursing home, to receive the best quality care. If that relates to inspection services in part we want to see that looked after. If the Government has identified, as it tells me it has, that deficit-funded nursing homes have, to a large part, failed in the objective of helping lower income people find accommodation, it is correct that we try to do something about that. If the Government wants to address quality, I am not certain that it is correct that it do so through a government agency or through government bureaucratic measures. In the public hospital system a body known as the Australian Council on Hospital Standards has emerged. That body uses self-assessment within the public hospital system. I understand that the Royal Prince Alfred Hospital in Sydney, for example, failed to get accreditation from the Australian Council on Hospital Standards. So even the most famous hospitals may not get their accreditation. That body exists to define standards and to seek to have them accepted from within, in this case, the public hospitals. I believe the same thing can be done with the nursing home industry and with hostels to develop some mechanism of a seal of good housekeeping, some standard of provision, and have them accepted and endorsed, and seek to achieve the standard which is laid down. There are many uncertainties, but above all the uncertainty that stands out is the uncertainty about funding. The Minister has told us that until the Budget comes down we do not know the level of funding which will be provided to meet some of the goals he has laid down, or some of the programs he is seeking to implement. Of course he cannot tell us until Budget time-no Minister can. But the level of resources, the amount of money made available, will in the end determine whether better outcomes can be achieved. The amount of money will determine whether aged Australians will be better off or whether they will be worse off. Unless adequate resources are provided they will, in fact, be worse off. If the Government wants to save money in this Budget-of course it must-it must do so by cutting back some of the optional extras; cutting back on some of the circuses. What I fear is, and our concern is, that some of the savings will be sought and made at the expense of the needy and the aged, and this is par excellence, one of the areas where need is very great, where the need is very real and where, I hope, the Government will respond to the Minister's program with adequate resources. In relation to the Commonwealth-State issues which have been raised in the Minister's statement, including the part that he has not read out, there will be some very delicate negotiations to be made. After all, the States are sovereign in certain areas and some of the States have laid down very lavish standards of provision. My concern is that having laid them down they make no effort to fund them and look to the Commonwealth to meet the bills for what they have laid down as necessary. The only effect this has is to leave a very large cash gap for the clients themselves to meet. The Minister says-and I understand his reasoning-that he wants to move towards a standard provision of benefit. That is fine as long as every aged Australian knows that there will be winners and that there will be losers, and there could well be some homes for which this will involve a lesser degree of funding and some people living in the homes for whom it may involve extra expense. Senator Grimes —I hope not, Senator. Senator PETER BAUME —It could mean that, Minister. The only other matter that concerns me is the question of whether we are using our existing stock adequately and whether we are going to make adequate provisions for what are the undoubted needs of aged Australians. For example, there is still a need for large numbers of new nursing home places in certain areas, if not in others. There is a need that we should be putting our existing stock of public hospital beds to better use, particularly in areas where those public hospital beds are serving nursing home or hostel functions. If that involves some renegotiation of Commonwealth-State funding, I hope it can be done. Lastly, there is the question of making the distinction between capital and recurrent provision. The Minister talks about the kinds of things he wants to do-more money for home and community care, more money for hostels, new money but not quite so much for new nursing homes, new innovative programs-which will all be expensive. It will be interesting to see what the Minister can provide by way of capital and by way of recurrent funding, because only then will we know that aged Australians are better or worse off. Until we see how the Government will support what is contained in the statement we do not know whether aged Australians will get anything out of it; I hope they will. I do not know whether people in desperate situations who phone my electorate office seeking advice-as they phone everybody's electorate office-will have some of their problems met and needs satisfied or will continue to phone me when the amount of funding is announced. Senator HAINES(South Australia)(3.38) —I welcome the report that the Government has put down today in response to the report from the Senate Select Committee on Private Hospitals and Nursing Homes. Although I realise that it is traditional to label those reports with the surname of the chairman of the particular committee, I would like at least to put on record the fact that that Committee would not have been established in October 1981 had it not been for a motion that I, on behalf of the Australian Democrats, put before the Senate. As I recollect it met with some considerable opposition from the then Government, but with the assistance of the Party which was then in opposition and is now in government, we got it off the ground. It may well turn out to be the longest serving Senate Select Committee on record, since we are still meeting and, indeed, had our sixty-fourth or sixty-fifth meeting only last week. Senator Robertson —It is composed mainly of women. Senator HAINES —Yes, it was the first committee that was established in the Senate entirely composed of women. On it served a number of senators whose previous occupation was in the nursing profession and who brought a lot of commitment, expertise and knowledge to that Committee. I take up Senator Robertson's interjection because I suspect that behind it was a suggestion that the reason the inquiry was lengthy was that the Committee had women on it. I point out that we have been extremely enthusiastic in probing the problems that have arisen in both the private hospital sector and the nursing home sector. The recommendations we brought forward in the first of our reports and the recommendations that will come forward on private hospitals will bear testimony to the fact that we have left no stone unturned, so to speak, to get at the anomalies, problems and difficulties that arise in providing adequate, appropriate and cost effective care for the sick and the elderly in Australia's institutions and in looking at ways in which better care, perhaps less institutionalised care, could be provided to those people. Just a moment ago Senator Peter Baume mentioned the very desperate need to provide appropriate and adequate care. He mentioned that there are some people who are inappropriately in nursing homes and who, by their very presence, are denying the necessary care in an institution to people whose needs are sufficiently great for them to require 24-hour a day nursing care in a nursing home of whatever sort. Whether it is private enterprise, religious and charitable or deficit financed is not relevant. The fact of the matter is that what we need to strive for as a government, as a parliament and as a community is appropriate, adequate and cost effective care for those who need it. This report, following the Senate Select Committee's report, will go some way towards that. I have most recently had a personal involvement in just the sorts of problems which the Senate Committee's report raised which this report looked at and which Senator Peter Baume previously mentioned. It was drawn to my attention that somebody very close to me was having difficulty in getting appropriate care. The lady concerned is 77. Her husband is 90. They live in their own home and were perfectly capable of doing so until last year when the lady became ill. She is mentally very alert but is becoming increasingly frail physically. Living in a country area there are, of course, very limited opportunities for being placed in appropriate nursing home care, so she was placed in the local hospital where, after the appropriate 35 days, her doctor had to sign a section 3B form, which was no real problem, but at the end of the next 35 days she was put back into her home under the care of her 90-year-old husband. That was beyond his capacities, partly because at 90 he himself is becoming physically frail and because the nature of her illness meant that for periods she was blacking out and falling to the floor and needed to be lifted up, moved and so on. He was not able to do that. Their only option, because they could not get her into a nursing home in that country town, was to hire private nursing care at over $800 per week, with a very limited return from medical benefits. That lasted for a fairly short period of time, quite obviously, since these people are pensioners. They had to satisfy themselves with day care provided as an adjunct, so to speak, by the hospital to this lady. They are living from day to day and hope that her case does not get any worse because then the only option is going to be for her to be moved to Adelaide, away from her family and friends and completely isolated, which means selling their home and doing all the sorts of things that only make it additionally stressful for a family. It is appropriate that we start to move away from early twentieth century attitudes to the institutionalisation of the frail aged and of the sick generally. The Government's report looks at a number of issues from the provision of respite care, which it acknowledges on page 50 of its report has barely been investigated to an appropriate level, to the question of assessments and standards of care. It looks not only at the institutionalisation in nursing homes of the elderly but also at the institutionalisation of younger people, particularly those with disabilities. This was something that the Select Committee discovered when it was making inquiries into the nursing homes sector. There are numbers of young people in particular with disabilities, often caused through accidents, who are placed in nursing homes along with elderly patients. This is not always appropriate. In fact, very rarely is it an appropriate thing to do, and those who are in a form of institutionalised care on their own, such as in Ashton House in Sydney, find that they run into council regulations or other forms of regulations which are inappropriate to their circumstances although they may be appropriate to nursing homes which cater almost entirely for the very elderly. For example, a requirement that one room be set aside for a morgue is no doubt appropriate in a home where the majority of patients are very elderly indeed, but is highly inappropriate in a place such as Ashton House where the patients are all pretty much under 30 and, apart from the fact that they are in wheel chairs, are otherwise assured of not leaping off this mortal coil within a short space of time. They felt repressed by the fact that this regulation applied, as do similar regulations that are appropriate for large nursing homes which cater for the elderly but which do not necessarily cater for them. The Government, like the Select Committee, has picked up a number of anomalies that exist in funding mechanisms for nursing homes and for nursing home patients, in particular the question of the extended care benefit, which the Committee discovered was quite inappropriately allocated in a number of instances. For example, it meant that nursing homes which had a large number of chair-fast or bed-fast patients were in receipt of the extensive care benefit where those patients do not necessarily require the extensive nursing care and hence the high number of qualified staff that people suffering from dementia require. The frail aged who are ambulant but who are likely to wander off need far more attention from nursing staff, as do patients who are not bed-fast or chair-fast but who may suffer from, for example, incontinence. Those sorts of people are far more likely to require extensive nursing care and hence ought to qualify for the extensive care benefit than those people who are simply chair-fast or bed-fast. Even worse, we occasionally ran into situations where it seemed suspiciously likely that patients were being kept bed-fast or chair-fast, if the drug schedule that was pinned up on notice boards was any indication. It would appear that at least in some circumstances patients were being kept drugged to keep the running costs of the nursing home down but also to gain the extensive care benefit. I point out that that was in a minimum number of cases obviously; nevertheless, it was there and I suspect it was in response to the fact that the extensive care benefit was available in the main only to those patients who were bed-fast or chair-fast because that was the definition of somebody who required extensive care. Senator Peter Baume —It could be a problem of prescribing practices to the elderly, which is another big issue. Senator HAINES —Yes. The number of patients who were swallowing serepax, mogadon, valium or various other forms of those sorts of drugs in some nursing homes was horrific. While not wishing to be overly critical of the medical profession, one sometimes wonders why, in a particular nursing home, one runs into a situation where the bulk of the patients are being kept sedated for long periods at a time, both day and night. The recommendations that are included in the report before us today then look to making more appropriate the availability of the extensive care benefit. They look at evaluating special purpose nursing homes for young people with disabilities and have as their objective the development of less restrictive alternatives to the current models of residential care. Going back to the question of Ashton House, when that group of disabled people attempted to set up a home for themselves they ran into the sort of paternalism that exists in some government areas. In this case they were offered accommodation in a fairly outlying area of Sydney which was not particularly appropriate when they wanted it to be on a main road with access to transport and so on. So we need to look too at our attitude to the requirements of young, disabled people for some form of residential care and what they believe they need. The report then goes on to talk about respite care and appropriate residential and alternative forms of care. I suggest that, if the Government is committed to appropriate, alternative, flexible and innovative forms of care particularly for the disabled, and for the elderly as well, it do something a little bit more enthusiastic about its attendant care program which is not exactly moving on apace and is causing some concern not only from those who are part of the pilot project, but also from those who would ultimately like to become part of the whole program. As one member of the pilot group pointed out to me and to anybody else who would stand still long enough to listen, taking part in the program-that is the attendant pilot program-has allowed him to lead a normal, independent existence in the community. Surely that is something that we are aiming for, not only for people with disabilities but also for the elderly for as long as they are capable and able to live that way. I suggest that, if the Government does put into effect any of the recommendations with regard to respite care, to other sorts of planning for appropriate, adequate and flexible care to the question of geriatric assessment programs and so on, it do not simply as a cost cutting measure, but as an overall integrated program with the aim of improving facilities not only for those who need to be looked after, but also for those who are providing the care, because their needs have to be met as much as those of the person in receipt of the care. I ask the Government not to proceed with the nursing home changes that are envisaged in the recommendations contained in this report until a totally integrated replacement system is capable of being put down in its stead, incorporating all the good recommendations, such as respite care, assistance for people who are caring for somebody with a disability or an aged relative in the home, the proper sort of geriatric assessment programs and to generally put into effect, rather than simply into rhetoric, its apparent commitment to flexibility and innovation in this area. Debate (on motion by Senator Robertson) adjourned. The ACTING DEPUTY PRESIDENT(Senator Jessop) —I inform the Senate that the President has received the following letter, dated 14 April, from Senator Haines: 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 reprehensible conduct of the Government in: (a) selling out all future Australian home buyers by deregulating the interest rate ceiling for new home buyers; (b) selling out to banks and discriminating against building societies; (c) making home ownership the exclusive preserve of the wealthy in Australia; and (d) creating the possibility that Australians will be paying over 20 per cent for home loans, and the urgent need for the Government to (e) reimpose the interest rate ceiling on new home loans; (f) guarantee that the interest rate ceiling on existing loans will not be removed; and (g) introduce as an alternative the plan proposed by Senator Haines which would provide subsidised and affordable interest rates for home loans so that all Australians could afford to own their own homes.'. Yours sincerely, (Janine Haines) Senator for the State of South Australia Is the proposal supported? More than the number of senators required by the Standing Orders having risen in their places- Senator HAINES(South Australia)(3.55) —I move: That, in the opinion of the Senate, the following is a matter of urgency: The reprehensible conduct of the Government in: (a) selling out all future Australian home buyers by deregulating the interest rate ceiling for new homes buyers; (b) selling out to banks and discriminating against building societies; (c) making home ownership the exclusive preserve of the wealthy in Australia; and (d) creating the possibility that Australians will be paying over 20% for home loans, and the urgent need for the Government to- (e) reimpose the interest rate ceiling on new home loans; (f) guarantee that the interest rate ceiling on existing loans will not be removed; and (g) introduce as an alternative the plan proposed by Senator Haines which would provide subsidised and affordable interest rates for home loans so that all Australians could afford to own their own homes. I make no apologies for the fact that this urgency motion before the Senate today is long and detailed. I make no apology for it because the problem will affect a very large number of Australian families, a very large number of people who are currently trying to own their own home and an equally large number of people who would like to be in a position to own their own home. I begin by referring to a cartoon that appeared in the Adelaide Advertiser some days after the announcement was made that the Government was going to bow to the blackmailing pressure from the private banks in this country and lift the ceiling on interest rates for home loans for those borrowers who did not currently have a home. I mention this cartoon, not because I think the issue is a laughing matter-I do not think it is a laughing matter-but because I think that this cartoon encapsulates the attitude that the Australian Labor Government has to the promises it makes to the people of Australia. The cartoon is in several segments. It is one of Michael Atchison's On the Rocks series with which all South Australians who are in the chamber-of whom you are one, Mr Acting Deputy President-will be familiar. It has a very recognisable Mr Hawke standing on a rock-type platform. For the purposes of this cartoon his name is spelt Hork. He is standing there waving his arms to a little man who is hopping up and down on the ground in front of him. The first balloon coming from the Prime Minister says the following: `Simon sez ``Vote for Horky!'' Simon sez ``I promise your hart's desire'' '. The little man down on the floor hops up and down and says: `Hooray!' The next balloon says: `Simon sez ``I promise peace throughout the land!'' Simon sez ``I promise prosperity for all!'' ' The little man on the ground hops up and down again and says: `Hooray!'. The next one says: `I promise not to raise the ceiling on interest rates'. The little man hops up and down again and says: `Hooray!' The fourth one has Mr Hawke saying: `Ha ha. Gotcha! I didn't say Simon sez'. I think that pretty much encapsulates what has happened here. In the past Mr Hawke has quite definitely made the statement that housing interest rates would not be raised. In the 1983 election campaign he committed his Government: To provide a stable and adequate flow of funds for housing at affordable interest rates. The Labor Government will: maintain interest rate controls on bank mortgage interest rates and extend those controls to building societies- How he intended to do that without bringing building societies under the control of the Federal Government, I am not quite sure. He continued in relation to the Labor Government: . . . require the savings banks and building societies to lend a set proportion of their funds for housing and establish an Australian Housing Fund in the Reserve Bank made up of deposits by non-bank financial institutions and channelled through the banks and building societies. We have yet to see that being implemented. A week and a half ago the Government, as I said a moment ago, bowed to the blackmailing pressure of the private banking sector and raised home loan interest rates for people who did not currently hold a loan from 13 1/2 per cent to 15 1/2 per cent. The Government did that at a time when banking profits were the highest they had ever been; when, for yet another year, the private banking sector is making record profits, on occasions in the vicinity of a 28 or 29 per cent increase on what it had made in the previous year. Last year the banks made profits in excess of $1 billion. Yet, mysteriously, they were unable to find the funds to lend for housing. I point out that they were unable to find those funds only when the interest rate was 13 1/2 per cent, which is what it was last Wednesday week. By Thursday, when the rate had gone up to 15 1/2 per cent, suddenly the banks had sufficient money to lend. In the days that followed the Government's announcement that the ceiling on home loan interest rates was to be lifted, the banks were advertising feverishly for applications. Twenty-four hours after the Government's announcement that the banks could increase their interest rates from 13 1/2 per cent to 15 1/2 per cent, those same banks that had been crying poor on the previous day and had been threatening not to lend any more money for housing were advertising that money was available for housing and people who had recently been refused loans could apply again. Senator Robert Ray —It worked. Senator HAINES —It worked? Senator Ryan —Yes. Senator HAINES —Suddenly, money for loans came pouring out of the banks, a day after they had been talking about the funds drying up altogether. The banks had had no time to attract additional deposits at the higher interest rates. From somewhere they suddenly found money for housing at 15 1/2 per cent that was not available at 13 1/2 per cent. That was a clear indication that the banks were deliberately not lending money for housing in order to persuade the Government to deregulate. I consider and my Party considers that action reprehensible at a time when, as I said, the banks were making record profits. The Government has sold out all future Australian home buyers by deregulating in that fashion. It is making it excessively difficult for people, particularly those on or around average weekly earnings, to be able to meet the necessary repayment requirements, much less to acquire the deposit that they will need in order to qualify for a loan in the first place. Currently, average earnings for the Australian male are around $21,500. Given that there is a large number of people on very high incomes, something like 60 per cent of wage earners actually earn below the so-called average income. But $21,500 is classified as the average income for the Australian male. In many cases that means the Australian family which does not have two incomes coming into the home. Of this $21,500, over $5,000 goes in tax. Assuming that the other spouse is not earning a second income, that family would get an additional $1,030 from the dependent spouse rebate. Let us take, for the sake of argument, a family with two dependent children, because that family would get an additional $664.20 a year in family allowance. That family of a sole income earner, a dependent spouse and two dependent children would be left with a disposable income a little under $18,000 a year. That family, to be able to afford the average $50,000 loan at 15 1/2 per cent to put itself into a very average home, will have to repay in excess of $7,500 a year in interest alone, leaving around $10,000 per annum, or about $200 a week, for living expenses, to feed, clothe, transport and entertain four people-two adults and two children. I am not quite sure how the Government thinks that family would be able to do that or how many people it thinks will now be able to afford to take out home loans. Of course, the fewer people who are able to buy or build a home, the fewer commodities are sold that go into homes. I am rather surprised that those organisations that represent small and middle business in this country have not issued Press releases to show their outrage with regard to what has been happening. These businesses learnt, or should have learnt in the early 1980s, when similar high interest rates were occurring under the Fraser Government, that for every house which is not built an assortment of white- goods, soft furnishings and so on is not purchased. For every one of those items that is not purchased, business is making fewer profits, productivity goes down and employment is affected. That is not a figment of my imagination or anybody else's. Anybody who can count ought to work that out. I point out to members of the current Government that in the early 1980s they were as angry as I was at the effect across Australia of the Fraser Government's high interest rate policy. We find now that the Government deliberately is putting itself into the same situation. It is selling out to the banks. In doing so it is discriminating not only against potential Australian home owners but also against the building societies. This is a fact which has not escaped the attention of those organisations that have been moved to take out multi-page advertisements pointing out to their borrowers and, indeed, to the people who lend to them that this decision will have a considerable impact on the building societies themselves and on the people who borrow from them. I quote from one of those advertisements placed in the Weekend Australian of last weekend by the United Permanent Building Society: Last week, as you're no doubt aware, the banks lifted their interest rates on new home loans to 15.5%. This 2% increase was the direct result of a very swift turnaround in Federal Government policy, as well as a handout of federal funds of some $120 million in the form of a subsidy to the banks. I interpolate at this point that I find it extraordinary that on the one hand the Government is complaining that its razor gang cuts are not particularly effective and that it will be strapped for money this year when, on the other hand, it can find $120m to hand out to an organisation which is making record profits and, a week or so later, it can find another $125m to hand out to the oil companies, which are not exactly going broke, in order to compensate them for fluctuations in the price of oil. The sum of $245m was handed out to organisations that are well able to take care of themselves, and a commensurate amount of $245m will not be available to Australian families, particularly those who are trying to buy their own homes. I suggest that that money would have been far better spent if it had been directed at providing some sort of tax concession or other assistance to help Australian families get into homes such as the tax concessions which are part and parcel of the assistance which is provided by the United Kingdom and Canadian governments in their commitments to helping families and individuals own the roof over their heads. The advertisement that was placed in the Weekend Australian by that building society points out that a subsidy will not be forthcoming for the 30 per cent of home owners who borrow money for housing from building societies. This will place an enormous burden on those building societies in their efforts to keep up. They will be forced to raise their interest rates. I point out that they are not making the sorts of record profits that the banking industry is making. It can only mean that a decreasing number of people will be able to afford their own home. Anybody who believes that interest rates will stay at 15 1/2 per cent and not rise any further, or who believes that the Government will not extend the deregulation to people who already own their own homes, is not right in the head. New Zealand rates for home loans have gone over the 20 per cent mark. It is highly likely that within the next 12 months something similar will happen here, unless the Government takes some sort of steps to prevent that, either by reimposing the ceiling or by doing what the Prime Minister said he would do during the 1983 election campaign-that is, requiring the savings banks and building societies to lend a set proportion of their funds for housing. That is surely not an inappropriate thing to do when one considers the impact that home ownership has on the general economy of this country. There is an urgent need for the Government to reimpose the interest rate ceiling on home loans. There is an equally urgent need for it to guarantee that the interest rate ceiling on home loans will not be removed, although one could forgive the Australian community for being somewhat sceptical about any guarantees that are given by governments when the sorts of election promises that the Hawke Labor Party has made in the past are so easily broken. If the Government does not want to take either of those two steps, there are a number of other measures that it could look upon more favourably than it has done in the past. One of those is to reconsider a proposal that I, on behalf of the Australian Democrats, put before the Senate in 1981-that is, to encourage people to put their savings into accounts which pay lower than the highest interest rates that are operating in the market, and to encourage them to do that by offering a tax concession as an incentive. What we put forward then as a reasonable scheme was that people should be encouraged to put their money into savings bank and building society accounts-that is, into institutions which lend money for housing loans-which pay 10 per cent or less on the money. People would be encouraged to do so by the Government giving a tax concession so that, for example, the first $1,000 that people earned on money that they had invested in bank or building society accounts paying 10 per cent or less would not be taxed. That would have given those investors an actual rate of return of about 14 per cent to 14 1/2 per cent, which is not bad, even under current interest rate circumstances. Senator Hamer —How much revenue will be forgone? Senator HAINES —We costed it in the vicinity of $800m. That, in itself, is not excessive. Senator Ryan —Terrific. That is all we need. Senator HAINES —Just let me finish, Minister. When one considers that attendant on that was the removal of things such as the first home owners scheme, which is a discriminatory scheme in every sense of the word, being means tested as it is, and applying only to a limited and not always appropriate group of people in the community, costs would have been cut considerably. If the Government has $125m to throw in the direction of the oil companies and another $120m to throw in the general direction of the banks, it can certainly come up with that and more to assist ordinary Australian taxpayers and Australian families, particularly those with dependent children, to buy their own homes. The pressure that is currently being applied to the private rental market is forcing a great many of those families out of that area, which is their main alternative, into the public housing sector, thereby pushing further down the list those people who are in desperate need, financial and other, for public housing assistance from the Government. There is no doubt that the whole question of home ownership, the money that people pay for the loans that they need for home ownership, is a matter of considerable urgency. This Government has broken every promise it has ever made on this issue and ought to be called to account for that. Instead, the Opposition in this place is in collaboration with the Government in its attempts to deregulate this market and is making an uncharitable and churlish attempt, through its amendments, to reduce this urgency motion to something which is meaningless. The ACTING DEPUTY PRESIDENT(Senator Jessop) —Order! The honourable senator's time has expired. Senator RYAN(Australian Capital Territory-Minister for Education)(4.15) —I suppose the Australian Democrats have to make their weekly bid to get themselves some media coverage. But it is not really very helpful when Senator Haines, who professes to have concern for home owners, people paying off mortgages and people who would like to pay off mortgages, subjects the Senate to the most garbled, distorted account of how housing finance can be, and is being, made available. It is simply not helpful to those who wish to buy houses or to those who are struggling to pay off mortgages to have this sort of misinterpretation and distortion thrown into the public arena. There was a series of inaccuracies and misinterpretations in Senator Haines's presentation today. I will not waste the time of the Senate by going through them all. I say simply that if Senator Haines or her colleagues in the Democrats want to shout about broken promises, they should remember a couple of things. They can make as many promises as they like because they will never be in a position to have to deliver on them. Of course, they indulge themselves in that luxury of powerlessness, which is a luxury they seem to enjoy, since they take every possible-- Senator Vigor —Are you saying we will never deliver on the tax package? Senator RYAN —We have here a group of people who will never run the economy of this country, who will never have to juggle the various legitimate demands on the public purse and who will never really have to deal with the problem of poverty in our community, the problem of unemployment or the problem of homelessness. The only problem they ever deal with is whether they will get into the papers this week. Of course, they will stop at nothing. They will say absolutely anything to attract attention. What they are saying is wrong, mischievous and of absolutely no assistance in regard to any of the matters. I think that the people of Australia are becoming sick and tired of this constant hopping on any passing bandwaggon and screaming and shouting that all sorts of things will happen, with a concomitant failure to deliver anything of practical benefit to the Australian people. I say in passing, too, that the kind of solution that Senator Haines so glibly throws forward in her uninformed and garbled presentation was that we could give tax concessions. Of course, the Democrats are great ones for tax concessions. They say we should give tax concessions to people who are prepared to save in banks which give low loans. Of course, it is typical of the Democrats to provide the tax concession solution on the one hand, while on the other hand asking for increased public expenditure. Every tax concession that this Government or any government makes available reduces the capacity of the Government to spend money. The most crying need in this country in the housing area is in the public housing area. The most crying need is not for those who can get mortgages or can nearly get mortgages, but for those who will never be able to afford a home. We have greatly increased assistance to the public housing sector. But there is no doubt that the real poor in our community who will never own a home are in great need of government support and government expenditure. The Democrats are very happy to hop up and say: `Pay more pensions. Give more public housing assistance. Give more rental assistance to the unemployed'. These are all things we wish to do and which we are doing, slowly and modestly. At the same time they suggest that we should throw tax concessions all over the place, thus reducing our capacity to spend money on the poorest people in the community. It is a total contradiction. It has also been suggested that we should give tax concessions instead of facilitating more home loan funds coming from the banks. I simply point out that again this is either a total contradiction or a total misunderstanding of home loan financing because there is no point in having a tax concession available to people if they cannot get their loan funds. That brings me to a brief description of the situation in which we found ourselves. The banks of this country, which have traditionally provided about half the amount of home loan funds-and we want them to continue to do that-were not able to provide those funds. In that situation of rapidly drying up loans from the banks, talk about tax concessions is economic nonsense. Senator Macklin has been screaming out throughout my speech that he wants some facts and now I will answer his request. I hope that he will pay attention to these facts because facts are aspects of the Australian Democrats' contributions to debate which are always singularly lacking. The first fact is that our Government has delivered dramatically well on its promise with respect to housing. There has been a growth in private and public housing under the Hawke Government, both of which have been unprecedented. Those facts cannot be challenged. There are many more Australians in homes today, be they public or private, than there were when we took office. Just before we took office in the 1982-83 year there had been a collapse of the housing industry. There had been only 105,000 commencements and only $406m had been devoted to public housing. Home ownership assistance had also collapsed. These were dramatic collapses which reverberated throughout the whole economy. There is no point in talking about the housing industry as if it were somehow insulated from everything else that was happening in the economy. It is an integral and crucial part of it and a collapse in that part of the economy signalled a collapse in the economy generally. As soon as we came into office we were able to deliver immediately on our undertakings to improve home ownership. First of all, we increased the first home owners scheme, a scheme which has just been criticised by Senator Haines, but which has been an enormous success in boosting the housing industry and providing better access to home ownership. Since 1 October 1983 we have paid or committed $870m under the first home owners scheme and assisted 186,000 applicants-a fine record for any government. At the same time we boosted public housing by 50 per cent to $570m in direct grants for 1983-84 and to $624m for 1984-85. We had also allowed the States to use Loan Council funds for public housing and, of course, the States received these funds at a 4 1/2 per cent concessional rate, which makes a considerable impact on the total funds available for housing. For example, in the current year total Federal funding is $1,108m-that is, $654m in grants plus $450m in concessional Loan Council loan dollars. With the State contributions to housing, $1.8 billion is available this financial year and that is the highest ever available for housing, even in real terms. Let us just consider these facts when claims about reneging on promises for housing are being flung about in such a careless fashion. Of course, the effect on the industry has been significant. In 1984-85 housing commencements reached 152,000, the highest for 11 years. There was job growth in the housing industry of 70,000 jobs, which has made a considerable contribution to our creation of half a million jobs-another Hawke Government promise which we have more than delivered and of which we are very proud. The upsurge in the housing and construction industry which had been going so well began to falter some months ago. In October last year the Indicative Planning Council forecast a downturn. In fact, it forecast that home commencements would be down to an unacceptable level. When that information was first made available, we did not jump to any instant solution; we examined and monitored the situation carefully. But by the approach of the end of the first quarter of this year it was clear that there was indeed a drying up of funds for housing and that we were on the verge of disaster in the housing industry. That would be a disaster for home owners, for those trying to get home loan funds and for those employed in the industry. Banks were forecasting that their lending would be only $3 billion for 1986-87 rather than the $6.7 billion that they had lent in 1984-85. This is very important, and the importance of the banks' contributions in making home loan funds available appears to have been missed entirely by the Australian Democrats and others who have been critical of this Government's decisions. As I said earlier, the banks have traditionally provided about half the home loan funds in this country and if 50 per cent of the funds were to dry up we would have a crisis. It is not constructive to criticise endlessly the fact that the banks had lost savings deposits and were no longer able to offer loans at 13 1/2 per cent. That is a regrettable fact. There are criticisms of the banking structure in this country to which we would be responsive and, indeed, to which we have been responsive. Our deregulation of the banks has been one of our major responses. The fact was that the source of about half of home loan funds in this country was rapidly drying up. In the face of this our Government could not just sit back and weep and wail and criticise the banks. In the face of this some constructive action had to be taken. We could not simply sit back and watch those funds dry up, see 50,000 jobs in the housing industry disappear and have as our only response a complaint or criticism of the banking structures in this country. Honourable senators opposite who have been critical of our decision should remember too that the banks, because of the ceiling, had been unable to attract savings deposits adequate to service the loans that they had in operation, let alone start new ones. They were in fact borrowing in the vicinity of 15 1/2 to 16 per cent in order to service the 13 1/2 per cent loans that they already had. Senator Haines might say that that is all right, but in fact it is not all right because it affects the profitability of the banks in a fairly disastrous way. The banks had lost about $2.2 billion from their savings bank deposits this year. In comparison, the building societies had not been losing deposits because they were able to offer a higher interest rate to depositors. They had not only maintained their deposits; they had actually had an 11 per cent increase in the 12 months to January. Those facts need to be appreciated. The banks were rapidly losing the funds from which they could service their existing loans at 13 1/2 per cent and make new loans available, whereas the building societies, being able to offer higher interest rates to their depositors, had actually increased their deposits, and therefore their capacity to extend, by 11 per cent. The cries of `Discrimination!' which greeted our decision to assist the banks to maintain at 13 1/2 per cent the loans to which they were already committed and make new funds available up to $6 billion limit really need to be seen in the light of what was happening to the building societies. The building societies were continuing to lend and to attract deposits. They were in a totally different position. I wish to comment also on the claims that have been made quite widely, even within the ranks of the Australian Labor Party, that the increased rates that the banks will now offer will preclude average families or home buyers from taking out loans. The fact of the matter is that in recent years it has been easier for low income families to get loans from building societies than from banks, because banks have much tougher lending criteria than do the building societies. So it is simply not the case that the better off people in the community go to building societies for their loans and the poorer people go to banks. In fact, the situation is the reverse. The more affluent people in the community, who have the sort of security that banks like, have been able to go to the banks, and the poorer families have gone to building societies and have taken loans at 15 1/2 per cent or 16 per cent. So there is no logic in the suggestions that now that banks will be able to compete with building societies in the rates they offer, they will be excluding a set of clients whom they had previously. That is quite illogical and those who claim that show an ignorance of the true composition of the customers of banks. In the few minutes I have available I will devote myself to what will happen in terms of the decision which has been made. The first and most controversial element of the package is that the Government will make $120m available to the major banks, which is not a subsidy to the banks in their profit making capacities, but will enable them to do two things. Senator Macklin —Subsidising the wealthy. Senator RYAN —I hope that Senator Macklin will pay attention to this, because he is obviously very confused. The subsidy will enable banks to continue to service the 13 1/2 per cent loans which they have already made and have been servicing at a loss of approximately $420m at this stage. The banks will still service the loans at a loss, but at a smaller loss because of the Government's $120m subvention. That $120m should not be seen, as it has been by the Democrats and others who have been carrying on about it in a sloppy way, as a gift to the banks but rather as a subsidy to those people who have a 13 1/2 per cent loan, on which the ceiling has not been and will not be lifted. The main purpose of the subsidy is to assist those existing mortgagees who have bank loans at 13 1/2 per cent. The other thing the banks will now do is lift their lending to up to $6 billion in the next financial year. That is very important. Anyone who comes into this place and professes a concern for those who are trying to get home loan funds and then sneers at an extra $6 billion which will come into the pool of home loan funds available, simply lacks any credibility. Senator Macklin —One thousand dollars a week. Senator RYAN —Senator Macklin is very excited and keeps saying `One thousand dollars a week'. The other element of the package, on which the Democrats and other critics have chosen not to focus, is that one of the conditions on which the subsidy has been made available to the banks is that they will introduce more low start loans-a very constructive and welcome measure. That will mean that the banks which get the subsidy will negotiate with their customers so that they will pay a lower rate of return on their loans during the early years when they are really battling and then, as their income goes up, their responsibilities decline and their children get older, they will pay at a higher rate. The consequence of this package may well be that people getting new loans will have either the same rate of repayment as the people who have loans at 13 1/2 per cent, or even a lower rate if they are able to negotiate a good low start package. The Treasurer (Mr Keating) or the Minister for Housing and Construction (Mr West) will be seeking a commitment in writing from the banks that they will honour this undertaking to give more low start loans. That is very important, because anyone who has a home loan knows that it is the amount being paid out every week in the early years, rather than the total debt, which really affects the standard of living. The other element of the package to which very little attention has been paid is the effect on public housing. I would like the Democrats to pay attention to this, as they profess to have a concern for the poor, yet they have ignored the increase in public housing loans available as part of this package. The time is running out, so I simply remind the Senate that we will be making available a further $700m in grants for public housing and we will increase to 60 per cent the amount that the States can use from their total Loan Council funds for public housing. Those measures will boost public housing commencements to 21,000, compared with 17,500 last year and only 9,000 in 1982-83. It is the total package on which the Senate and anyone else interested in housing should concentrate. The total package is good for home owners, prospective home owners and tenants of public housing, and ought to be supported. Consequently, the urgency motion of the Democrats is rejected. For similar reasons, which I am sure will be addressed by my colleague Senator Ray, the amendment by the Liberals is also rejected. Senator ARCHER(Tasmania)(4.35) —Housing is one of the subjects that affect absolutely everybody in Australia. There are many views on how the housing problem should be tackled, allowing for the fact that all the different groups are entitled to have their own views. There are many inconsistent attitudes and the needs of different groups have to be catered for separately. Over the past few years there have been numerous inquiries and much advice has been given, both by committees and individuals, who have produced information and recommendations which in so many cases are either unattractive or impossible for the government of the day to implement. Before I came to the Senate I spent all my working life in industries connected with housing and I still follow it fairly closely now. Of all the things that have happened to housing in the past 40 years, undoubtedly the most successful and useful has been the mortgage guarantee scheme. If we are looking for one item that would be of the greatest use to the housing industry and to the people who are endeavouring to get housing, it is clearly a secondary finance system without any ifs and buts to go with it. The Government's actions have been very piecemeal up to this point. It is a true pressure reaction, and even the Government would not argue about that. It is the politics of unemployment on the one side versus monetary mismanagement on the other. I totally agree that this is a matter of urgency and in that regard I support the Australian Democrats for having brought it forward. As they would recall, we on this side of the chamber brought up this matter only about two weeks ago. We made our point very clearly then as to what our views were, and they have not changed in a fortnight-we are not like that. I believe that the mover of the motion has missed and misinterpreted the position. I wish to deal with some of the points of the motion, which is in seven parts. The motion reads: The reprehensible conduct of the Government in- (a) selling out all future Australian home buyers by deregulating the interest rate ceiling for new home buyers . . . That happened last week. Clearly that is an overstatement. There are cash buyers, Government scheme buyers and other people who will always find a way to purchase houses. It is not a matter of selling out all future Australian home buyers. That is wrong, because the only reason interest rates are high and false is the Government's policy of supporting the dollar. I believe that by reversing that position we could get interest rates back to a natural and normal state. The second part of the motion reads: (b) selling out to banks and discriminating against building societies `Selling out to banks' may be a flamboyant way of speaking, but it is still an extravagant statement. The banks have demonstrated the falsity of the Government's position with the interest situation and the props that they have. I suppose that at this stage the Government was caught out, and when it found it was on the hook, it had to allow the banks to make changes to the system, so that the banks would be able to restore their fund-gathering capacity. The third point in the motion-making home ownership the exclusive preserve of the wealthy in Australia-again does not reflect the case at all. Certainly the savings banks have looked after the wealthy more than the lower price buyers but, by the same token, building societies have endeavoured to look after everyone in the housing market, as Senator Ryan was saying. It is a pity that we have to differentiate between the different classes, and it is a pity that the money available is distributed in the way in which it has been distributed. But the group that is particularly disadvantaged is the people who own housing for the rental market. Many of those who own property and rent it out do not do so because that is their business; they do so because that is the situation in which they wind up. I doubt that the fourth point in the motion-creating the possibility that Australians will be paying over 20 per cent for home loans-is realistic. In Australia, the Government would be tossed out if we were experiencing 20 per cent home loans, and I do not really believe that the author of the motion would believe that that would be the case. On the other hand, if we deregulated and the dollar found a value of about 60c American, I think that the Government would get thrown out anyway. So, those are our two choices: Are we to have a 20 per cent housing rate, or are we to have a dollar worth 60c American? It is a loser both ways. The motion goes on to speak of the urgent need for the Government to `reimpose the interest rate ceiling on new loans'. Clearly, if it was necessary to increase the rate to get money in for home loans, to reimpose a ceiling rate would drive the money out exactly in a reverse situation. That is obvious. The next point in the motion speaks of the urgent need for the Government to `guarantee that the interest rate ceiling on existing loans will not be removed'. Whilst I shall certainly return to that matter shortly, the question of getting guarantees from one or two people to do with interest rates or the housing business, or the management of the country at this stage, would be a little chancy. The last point in the motion concerns the introduction of the alternative of what we now see as the Haines scheme. When I was going to school, I think it was called the granny bond scheme. It was a means of trying to attract money. But this has always been rejected because it provides differential benefits for investors, and those who need the concessions least are the people who get the greatest benefit from such a scheme. That has been the answer. But I support anything that will produce money for housing. As I say, the best way to do this is by having a proper, open mortgage guarantee system, a secondary finance system, so that we can encourage people to buy mortgages and to provide large lumps of money to the people whose business it is to provide housing finance. I return to the question of the value of undertakings that we might get and the questions of getting a guarantee from people that the interest rate ceiling on existing loans will not be removed. We have had such a guarantees. I do not see why another lot would be of any greater reliability than the previous ones. I mention one or two of those. On 14 November 1985, the Prime Minister (Mr Hawke) made this statement: . . . as the Treasurer and I have said on a number of occasions . . . we will not scrap the 13.5 per cent interest rate ceiling . . . This is one area in which this Government is making it quite clear that it will not allow interest rates to rise. On 3 December, in the South Australian election campaign, the Prime Minister said: I have reaffirmed today. I have made it quite clear. I have told Mr Bannon again, not that he had any doubt, that my Government will not lift the ceiling on home mortgage rates. Then the question was: Will they rise after December 7th? The answer was: `Of course they won't'. So it goes on with the Prime Minister, and then we get on to the Treasurer (Mr Keating), who was asked: You are still insisting, are you, that the 13 1/2 per cent ceiling on home loan interest rates should be maintained? Mr Keating said: `Yes, I am'. It just goes on and on. We have so many classic cases of where we have had guarantees on this matter. We even get to the stage at which Mr Robert Tickner, for instance, calls it `a kamikaze political act'. Mr Peter Duncan says that it will `ruin the credibility of our senior Ministers'. Mr Gerry Hand says: I find the assurances of my understanding of the comments made and assurances given are different to what in effect has occurred. Mr Frank Walker says that to float the interest rate at all `could jeopardise all Labor governments'. I do not see why the mover of the motion would have any more feeling of guarantee that an undertaking on this matter would be any better now than it has been in the past. Of course, we also had the same guarantee about a new capital gains tax. Prior to the election before last, we had that absolutely gilt-edged, cast-iron guarantee: `There will be no capital gains tax'. Matters such as that have had a big effect on housing in the last few years. We cannot look to what has happened concerning the effect of this freeing of the interest rate to this extent with the banks, as compared with what the longer term issues are and their effects. Last week a headline in the Hobart Mercury, on the front page, was: Crisis in housing Families forced on to street as Hobart rents soar beyond reach. It is the other actions of the Government that have brought about increases in rent and have made people sell rental properties. It is the high interest rates that have made rents rise. It has caught people who can afford it least-people such as students, the elderly and the frail; and people who need to live somewhere near a relation. Again, I do not think that it is necessarily so that everyone wants to own their own property or needs to own it. There needs to be a pool of rental housing. I do not see that it is necessarily a good thing to try to make everyone into a home owner. I realise that Mr Dedman was of the other opinion, when he said that it was unfortunate if we had too many home owners. But that is not the point. The point is that we need to get people housed, and housed as well as we can. The interest rate question is nothing like as important as are the general economic circumstances, the feeling that tax is around the corner all the time, the knowledge that we are to have capital gains tax and to be caught up in any other ways when the Government wants to pull a few bob out of the market and to make the ownership of property less attractive. Senator Chipp —They just pulled $120m out to give to the banks. It is more than a few bob. Senator ARCHER —That is right. It is a real bank deal, this $120m. I dislike the fact that this is being done under pressure. But all that it shows is that the banks were able to demonstrate to the Government that what it was doing was so wrong that it had to be put right in some way, and the Government chose the messiest and silliest way, which will live with it forever into the bargain. I do not always agree with Max Walsh, but I noticed in the Age of 8 April that he made a very telling comment. He finished an article by saying: Politicians and commentators who try to tell us that a $120 million subsidy to one of the better-off sectors of our community is a victory for economic rationalism should buy themselves a dictionary. That sums it up well. It falls to me, Mr President, to move an amendment to the motion. We accept the basis of what the Australian Democrats have in mind-that the housing market is in a mess, that the Government's actions are inappropriate and that the worst of all worlds is with us-but we cannot accept that they were on the right track. Motion (by Senator Archer for Senator Chaney) agreed to: That so much of the Standing Orders be suspended as would prevent Senator Chaney moving an amendment to the motion. Senator ARCHER —At the request of Senator Chaney I move: Leave out the statement of the matter of urgency, insert: `The reprehensible conduct of the Government in (a) maintaining artificially high interest rates; (b) proceeding with the introduction of a capital gains tax; (c) announcing plans to eliminate housing negative gearing; and (d) providing direct assistance to banks and not to building societies, leading to (e) an increased burden on new home buyers; (f) penalising existing home owners with mortgages other than from the savings banks; (g) higher house construction costs; (h) discrimination against home owners generally and lower income earners particularly; (i) reduction in the availability of rental property; and (j) significant increases in rental levels'. Senator Chipp-Mr President, I take a point of order which I believe is important. It may take a little time-- Senator Robert Ray-Don't cut it out of my speaking time. Senator Chipp-If I take up someone's speaking time it will be my own. As the last speaker in this debate, I will be the only one who will be affected. However, Mr President, I think your ruling is needed on a precedent relating to a matter of urgency which efforts are being made to establish today. The Democrats, through Senator Haines, have moved: That, in the opinion of the Senate, the following is a matter of urgency: I remind you, Sir, that the distinctive thing about a matter of urgency is that the Senate votes on it; the Senate expresses an opinion on it. The Democrats are on their own in this place in that they are critical of what the Government has done in allowing interest rates to rise on loans taken out by new home buyers. The next words of Senator Haines's motion are: The reprehensible conduct of the Government in (a) selling out all future Australian home buyers by deregulating the interest rate ceiling for new home buyers last week; The motion then refers to selling out to banks, making home ownership difficult et cetera. It then refers to the reimposition of the interest rate ceiling on new homes and whatever. That was our matter of urgency. By tradition the three parties in this place-the Australian Labor Party, the Liberal Party of Australia and the Australian Democrats-have adopted a practice which has worked very amicably whereby each party takes it in turn to move a matter of urgency on which the Senate votes. The amendment just moved, I believe in good faith, by Senator Archer will virtually truncate our matter of urgency in every shape and form. It will make it meaningless because Senator Archer has moved that all words of ours-all words in Senator Haines's motion-be left out. The Opposition's amendment then seeks to substitute the words: (a) maintaining artificially high interest rates; (b) proceeding with the introduction of a capital gains tax; (c) announcing plans to eliminate housing negative gearing; and (d) providing direct assistance to banks . . . and whatever. Standing order 139 states: Every Amendment must be relevant to the Question to which it is proposed to be made. Negative gearing and capital gains tax have absolutely nothing to do with the matter of urgency put down by Senator Haines. Senator Haines, on behalf of the Democrats, simply said that it is iniquitous that the Government has done this deal with the banks, paying them $120m subsidy and making new home buyers pay interest rates of 15 1/2 per cent. We think this is scandalous. If, Mr President, you put the question that the words proposed to be left out be left out, which undoubtedly, because of collusion between the Opposition and the Government, will be passed, this chamber will not be able to vote on Senator Haines's motion. As I have said, the practice regarding matters of urgency has worked so well in this chamber. We paid the Liberals the courtesy of asking them whether we could raise this matter today. The Liberals have now constructed a ruse that will prevent the Democrats' matter of urgency being voted on. I just say to members of the Opposition that they can be too smart by half in this place. If they go ahead with this tactic today, for the remainder of the session there will be not one matter of urgency that they bring in that will not be truncated and made totally unrecognisable. What the Opposition is doing is bad sportsmanship, it is not playing the game and it is something that goes against the whole spirit of what co-operation is supposed to mean in this place. Senator Chaney-Mr President, I take it that the Leader of the Australian Democrats (Senator Chipp) has taken a point of order in respect of the amendment moved on behalf of the Opposition. He suggested that it was not a proper amendment under standing order 139. It was, of course, Senator Chipp who introduced this procedure to the Senate. He is waxing very indignant at the moment but it was he who, I think for the first time, introduced this procedure whereby Standing Orders could be suspended on a simple majority to enable these sorts of amendments to be made. The whole point, of course, is that originally under this procedure people could have been put in the position of being embarrassed by the fact that they had to vote either for or against a proposition that might contain various statements, some with which they agreed and some with which they disagreed. Of course, the Democrats have very carefully drawn the motion that they moved today to try to mix up propositions, some of which might have the support of the Opposition and some of which would not. Obviously, the Opposition-and I am sure the Government also would not support the reimposition of an interest rate ceiling on new home loans. The Democrats have listed a series of what they describe as reprehensible elements of conduct on the part of the Government. They seek to make the Opposition cast a vote which could then be represented as being against all propositions contained in their motion whereas there may be some elements in it with which we would agree. For example, we might agree that because of the way this Government is going about running the economy there might well be interest rates going up to 20 per cent. We would certainly find that thoroughly objectionable. What the Opposition is seeking to do with respect to this amendment is to pick up the central concern of the Democrat motion, which is the fact that the Government has indulged in what the Democrats describe as reprehensible conduct in a number of ways which affect home buyers in Australia. We agree with that broad general proposition of the Democrats. We think the Government has engaged in some reprehensible conduct. However, we disagree with some of the items of detail which are contained in the motion. We sought, therefore, to move an amendment which expresses very clearly what the Opposition's viewpoint is and why we believe that the conduct of the Government is reprehensible with respect to the housing industry. We refer to the very high interest rates which this Government has imposed. That is, of course, an element which is in common with the Australian Democrats' motion. Then we refer to things such as capital gains tax and negative gearing which will have a very substantially bad effect on the housing market in Australia. That situation is increasingly evident in the suburbs of Sydney, Melbourne and elsewhere where occupancy rates are so devastatingly bad and so on. Mr President, what we are saying is that, thanks to the lead provided by Senator Chipp, we have in fact moved an amendment which will very clearly specify what the Opposition's position is and why we, in agreeing with the Senate that the Government has engaged in reprehensible conduct, disagree with some of the items of detail. I think to suggest that under standing order 139 this amendment is not relevant to the question is drawing a very long bow indeed. Mr President, I would respectfully suggest to you that all of the items which are contained in the amendment which was put down by Senator Archer on behalf of the Opposition are in fact relevant to the central point and the central concern of the motion which has been put forward by the Australian Democrats; that is, the position of Australian home owners. I draw your attention to paragraph (g) of the Democrats' motion which refers to the objective of all Australians being able to afford to own their own homes. We think that all of these matters are relevant. I would submit, Mr President, that it is a proper amendment. The PRESIDENT —Order! I have given consideration to this matter. Standing order 64 provides that a motion to debate a matter of urgency may not be amended. Recently, leaders of parties in the Senate have given contingent notices of motion for the suspension of standing order 64 to permit them to move amendments to the motion. However, standing order 139 specifically provides that an amendment to any motion must be relevant to the question to which it is proposed to be made. In my opinion, it is clear that the suspension of Standing Orders, whilst it permits an amendment to be moved to the motion, does not absolve the mover from the provision that amendments must be strictly relevant. Accordingly, I rule that parts (b) and (c) of the proposed amendment-that is, the aspect relating to the proposal of the Government to introduce a capital gains tax and the aspect relating to plans to eliminate housing negative gearing-do not relate directly to the subject of the motion, which is the effect of the deregulation of interest rates on home ownership. Accordingly, I rule those portions of the proposed amendment out of order. I rule the other parts of the amendment in order. Senator ROBERT RAY(Victoria)(5.00) —We are discussing today a matter of urgency raised by Senator Haines. I believe that, once again, the Australian Democrats are trying to play the three-card trick, which I suppose one could encapsulate as `all power and no responsibility'. No doubt, the Democrats always have very firm principles on the micro-problems of the world. I have always acknowledged how difficult it is for a group of parliamentarians in this chamber to cover a wide ambit of ides. The Democrats always manage to do it reasonably well. They are able to cover such things as takeovers, rainforests and repatriation-a very difficult task for seven people. But what tends to happen with the Democrats is that they get an expertise in the micro areas but never try to relate those micro areas together to a macro scheme of things. This motion is another classic example. They rarely relate these minor and detailed things to the macro conditions of the time. I understand, of course, that this is really a function of their survival strategy. Never having to appeal to 50 per cent of the vote rarely means that they have to look at the macro problem. It means that they just set out to protect the 8 to 12 per cent in anything they do. Therefore, they do not see the totality of what is developing in the economy. At the same time they never have to account to the electorate for tough measures. We used to call such people in the old black and white television days fringe area dwellers. They send a very fuzzy picture to their supporters; it is rarely clearly defined, rarely able to be debated, because they are never brought to book for the final responsibility of how the totality comes together. For instance, the Democrats always want to spend money, but they never want to raise it. Hence they can have the theoretical belief that some of them once had about death duties and capital gains taxes, but the nearer those propositions come to legislation and they have to put their hands up or whatever in this chamber, we have the difficulty that they suddenly go into a mode of indignant opposition and not support. As a colleague from South Australia said before, it is a form of popularism. If I were a Democrat I would also be into this popularism-of course I would. But I would not address it with the same sort of pious hypocrisy that they often bring into this chamber, and I would not have those holier than thou principles which have as much solidity as quicksand. Let us put the motion moved by Senator Haines under the microscope and examine the various clauses. The first one says that we are selling out home buyers. Let us look at some of the facts. The previous Government in its last year in office presided over a fairly large collapse in the housing industry. In 1982-83 we had 105,000 home starts. By 1984-85 the figure had risen to 150,000 home starts. A lot of that increase to 150,000 obviously is to do with going back and taking up a bit of the slack from 1982-83. No one in this chamber would suggest that this country could sustain 150,000 housing starts a year. It would lead to a form of demand inflation that none of us would find acceptable. Given the current economic conditions in this country, it is the view of this Government and almost the view of the Opposition that 135,000 housing starts is the most acceptable and desirable level. Senator Archer —One hundred and thirty thousand home starts. Senator ROBERT RAY —Senator Archer says 130,000. I am not here to argue. The level of housing starts we need this year to keep the economy viable and to meet existing demand is just a matter of judgment. We need 135,000 housing starts this year, next year and the year after. We do not need 100,000 one year and 150,000 the next-the cyclical boom and bust conditions that have afflicted the housing industry no matter what government we have in Canberra. We have to cut out the cyclical nature of that. In March this year, we were facing the position of seeing a major erosion of savings bank deposits, indicating that the savings banks would be lending something like $3 billion less for housing than the Government and anyone else in the community would think desirable. This would have left us in a situation where there would have been 100,000 housing starts this year and that, we all agree, would have been disastrous. It would have meant that in the order of 50,000 jobs would have disappeared. Senator Haines in her speech mentioned the multiplier effect of the building industry. By lifting the rate on new loans it appears likely that just on $6 billion will be lent by the banks this year, thus ensuring those 135,000 housing starts. I am not about to come in here and say that that decision did not involve a fair amount of political pain and that we will not pay a price for it in the electorate with a degree of unpopularity-we will. In fact, what we are doing is showing some courage in government, a courage that I would commend to the Democrats on occasion to ape. In the second point of the motion we are accused of selling out to the banks. The Democrats apparently do not realise that banks have to service existing loans. If the ceiling theoretically were lifted on existing loans the banks would be entitled to $480m more than they are currently getting. We are criticised for subsidising that $480m gap by providing $120m. We should ask ourselves where the other $360m forgone profit is. People talk about the record profits in banking last year-I acknowledge that. I would be terribly surprised if the figures were anything like that this year, because in the first quarter of this year the banks have had to sustain and service those existing loans at a loss. We are arguing in government that to retain the ceiling on existing borrowers it was necessary to subsidise the banks by up to $120m. We do not know how much that will be over a full year because the subsidy is applied over quarters and will depend on the rate of interest later this year and early next year. It could go up to $120m; it could be $70m. We are not in the business of predicting future interest rates particularly. That has always been difficult to predict, as both sides of this chamber have discovered. My guess is that, given the current downward trend, the whole $120m will not be expended. I move to point (b), where we are accused of discriminating against building societies. The reality is that building societies have not been affected by the collapse of savings or deposits in the same way as savings banks. The savings bank deposits grew only 2.3 per cent last year compared with the rise for building societies of 11 per cent. We have to remember that building societies did not have the 13.5 per cent ceiling imposed on them and have been in a far better competitive position than the savings banks. All we are doing through our subsidy to the savings banks is restoring the competitive position of those savings banks. We are not giving them any undue advantage. The third point in the motion moved by Senator Haines is that what we are doing is exclusively for the preserve of the wealthy. If there had been only 100,000 housing starts this year, of course it would have favoured the wealthy. The reality is that under past financing of home loans there has been nothing equitable about it at all. Most of the funds come from the poorer people and are stuck in deposits at 3 or 3 3/4 per cent and then lent to people who have a better credit rating. There has been nothing particularly fair about this past system that the Democrats find so wonderful. If we had only 100,000 housing starts this year, we would have found that only the well off would have got them. By keeping the level up at 135,000 we enable many more people from many more sections of society to undertake those borrowings. As well as that, banks have given commitments to a new way of financing home loans and are guaranteeing more low start loans. The old credit foncier loans system is on the way out and the sooner it goes, I would argue, the better. Senator Ryan pointed out that the Democrats have overlooked our commitment to public housing. Public housing starts were 9,000 in 1982-83. They are currently running at 17,500 and we are proposing in the next financial year to go to 21,500. There are a variety of measures that in fact belie Senator Haines's claim. Indeed, I would argue fairly strongly that many of the people who are less able to pay loans are paying well above 15.5 per cent now. Bank loans are not available. They have to go into all sorts of weird and assorted cocktails that sometimes raise their repayment rates to 18 to 19 per cent. It is a truism that the least well off in the community get screwed by financial institutions far more than anyone else. Let us move to point (d) in Senator Haines's motion, in which she condemned us for a potential 20 per cent home loan interest rate. I am not particularly good in the prediction stakes. However, the first point I make is that rates on bank notes have come down four points in the last four or five months. Every other indication is that interest rates are trending down. I do not think anyone in this chamber would deny that that has been the trend over the last four months. Whether that trend will continue is dependent on a number of factors. It will depend on the terms of trade over the next 12 months. It will depend on the rate of inflation in this country over the next 12 months. It will depend on the degree of Budget deficit adopted for 1986-87. It will depend on all those sorts of things but there is every indication at the moment that interest rates will come down. The real question is how far. If currently people are paying 15.5 per cent for a bank loan on new loans, will it go down to the 13.5 per cent barrier by, say, December? That is the $64,000 question. One point I would like to make at this stage is that by deregulating the new interest rate, every government now has to come to account on the level of interest rates. Governments cannot hide behind the ceiling any more. If there is a prevailing rate of interest out there of 15, 16 or 17 per cent on home loan interest rates, any government that sustains that level over a long period of time will be defeated by this electorate. Abolishing the ceiling has, in fact, made governments more conscious of monetary policy. It means that instead of hiding behind monetary policies, they will have to take more responsible fiscal measures in future. Point (e) calls on us to reimpose that ceiling. The question was asked, of course, by Senator Haines and others: Where did the banks suddenly get money from to lend? The Democrats should ask themselves where the banks got the money from over the last three months as deposits fell away. The banks have been moving money over from their trading bank accounts and lending it out at a loss. Senator Chipp —Offer them this handkerchief, will you? Senator ROBERT RAY —They were able to do it in the short term in anticipation of increased deposits for savings banks. The Democrats will bleat on and carry on here trying unsuccessfully to interrupt the train of my thought. They can do that as much as they like, but I did listen and I wonder what their solution is. They are always good on criticism. They come in here and bleat about this and that but when we ask them for a solution to anything, it is absolutely missing. Their policy, if I can assume a policy for them, is that they would like us to go and borrow billions of dollars, increase public indebtedness, keep interest rates up forever and subsidise interest rates forever. That would be their policy. That is the soft option. Am I wrong? Of course it is their policy. I would not have to hear their policy, I would just have to go out of this room, work out what is the weak soft option and I predict that the Democrats would come up with it every time. The Democrats will do it on housing and they will do it on everything else. As I said before, the Democrats are in the market-place for 8 to 12 per cent of the vote, not 50 per cent of the vote. That is their goal. They should protect their constituency and we will protect ours. We were asked under point (f) whether we would give a guarantee that existing rates would not be cut. We will give that guarantee because we are not in the business of slashing our wrists. If we lifted the existing rates on existing loans we would be sitting over there very quickly. They know it and I know it. We can give that guarantee under point (f). The final point was that the Senate should support Senator Haines's proposal. I did not hear it today. I do not know what it is. How can I vote for that? Where is it? Why did not Senator Haines mention it in her 20-minute speech instead of going on with cartoons and the rest of the rubbish she started with and the other froth and bubble? Why did she not introduce into this chamber the Democrats' alternative? Senator Haines —It was in my private member's Bill. Senator ROBERT RAY —I have one final point to make. I was going to attack the policies of the Liberal Party but I cannot. The ACTING DEPUTY PRESIDENT(Senator Elstob) —Order! The honourable senator's time has expired. Senator HAMER(Victoria)(5.15) —The Senate is discussing a critical question for the community; that is, the cost of housing loans. Investment in a home is the most important single investment that nearly every Australian will make during his lifetime. These new housing loan interest rates cannot be considered in isolation. We must also look, not only at the cost of housing loans for new acquisitions, but also at the cost of servicing existing loans for housing, at the availability of welfare housing and the availability of rental accommodation. All must be looked at as a whole. The other thing we must look at as a whole is the effect of interest rates as a total. Housing interest rates reflect other interest rates. They cannot be separated from the effects of economic policy and are a consequence of interest rates. The fact is that the general management of the Australian economy at the moment is a shambles. The Australian community-people in employment, particularly-is not aware of what the general economic situation is in this country. At the moment we are borrowing overseas $1,000m a month to support our current standard of living. The much heralded J curve which was going to solve all our problems by increasing the competitiveness of our exports and by solving the balance of payments just is not working. We have recently received the accounts for March. The current account deficit in February was $979m. In March it was $1,023m. That should be compared with the current account deficit for March 1985 of $593m. It has gone up over the last year from $593m to $1,023m. If one looks at the promised effects of the J curve, so beloved by Treasurer Keating, even more telling is that in March 1985 our balance of trade was a credit of $187m. In March 1986, after devaluation when the J curve should have taken effect, our balance of trade was a loss of $221m. There was a swing of nearly $400m in our trade. What are we doing to face the situation? Under the pressure of this Government we are granting ourselves three pay rises this year. Looked at from outside those pay rises would have to be seen to be insanity. A pay rise is being negotiated now of about 2.2 to 2.4 per cent. There will be a so-called productivity rise costing about 3 per cent in the middle of the year and later in this year there will be a further pay rise, probably of about 4 per cent. One would like to think that a country that is trading at a loss and borrowing $1,000m a month to support itself would at least devote its productivity rise to making itself more competitive in international trade instead of, under the pressure of this Government, giving it back to the workers as a pay rise. The consequence, of course, is a depreciating Australian dollar. We have seen how it has fallen against the United States of America dollar. What we have not noted is that the United States dollar has fallen about 25 per cent against other currencies such as the West German mark and the Japanese yen. Our currency is falling very fast against nearly all the currencies of the world. We cannot carry on depreciating the Australian dollar because every time we depreciate it, the cost of servicing the $70 billion overseas debt rises more sharply and takes a larger proportion of our export earnings. The only way the Government is propping up the Australian dollar is by keeping interest rates exceptionally high. At the moment the Australian prime interest rate is 18 per cent. Let us compare that with other countries in the world-Japan, 6.9 per cent; West Germany, 9.1 per cent; France, 10.6 per cent; the United Kingdom 12.5 per cent; and the United States, 9.5 per cent; but Australia is 18 per cent. The effect of this, of course, is that it deters investment. This might, of course, be temporary assistance for the balance of payments, because it stops our companies which are supposed to be the ones which are turning around our balance of trade by investing particularly in the secondary industry sector. It will deter investment in machinery and capital equipment. In the short term that may have some benefits for the balance of payments, but in the longer run it will reduce our growth and stop us curing our chronic unemployment. This high interest rate is very damaging to the whole community. The future of Australia depends on getting our economy in better shape. It is urgently necessary that the Government take the necessary action to tackle the fundamental problems of the economy. But that is a debate for another day. Today we are looking at one of the consequences of this total mismanagement of the economy by this Government; that is, the consequence for housing, reflected by high interest rates. The Australian Democrats have moved a motion on this subject referring, in terms we will undoubtedly agree with, to the reprehensible conduct of the Government. They then listed four aspects of reprehensible conduct, all of which have a grain of truth, but all of which, I think, are somewhat overstated. Therefore, we would not support them in their present form. In the first aspect the Democrats state that the Government is: selling out all future Australian home buyers by deregulating the interest rate ceiling for new home buyers . . . There are many points about this. The first is that what the Government has done is a perfect example of Hawkespeak: The fact that the Prime Minister (Mr Hawke) promises one thing and does the opposite. For instance, he stated categorically that he was committed to the retention of the ceiling on housing interest rates. Two weeks later Mr Hawke announced that the Government had lifted the ceiling on new housing loans. Senator Reynolds —But only on new ones. Senator HAMER —That is right. He said he was committed to the retention of the ceiling on them. He immediately weaseled out by saying that he was just lifting it on new ones. He promised that inflation would come down; he promised that the dollar would not fall to where it is; he promised different action on petrol prices. This is all correctly known as Hawkespeak, which means that the Prime Minister says one thing and does another. But I think the value of his promises is doing somewhat worse than the Australian dollar because there is no high interest rate to keep up the Prime Minister's credibility. That is the first aspect. We would not agree with the actual wording, but we support the sense of what is there. The second aspect of reprehensible conduct claimed by the Democrats is: selling out to banks and discriminating against building societies; It is not entirely clear, bearing in mind the clients of banks tend to be the more wealthy section of the community, why a $120m subsidy to the banks is necessary, but I suppose the Government has its own reasons for giving this sort of subsidy. The third aspect is: making home ownership the exclusive preserve of the wealthy in Australia; Again, this is over-stated, but it is true that new home buyers under the present system are subsidising existing borrowers. That is a point we should emphasise over and over again. The existing borrowers are being subsidised by the people who are trying to get their first home. The fourth aspect is: creating the possibility that Australians will be paying over 20% for home loans. I suppose that is a possibility, but I think, as Senator Robert Ray has said, the Government would be out of office very soon afterwards. Senator Macklin —They are still in office in New Zealand. Senator HAMER —One would think the New Zealand Government would be out too. The Australian Government would be out very soon after housing loans crack the 20 per cent barrier. We agree with the general thrust of the motion by the Democrats but not the detail. We disagree what they propose should be done; that is: and the urgent need for the Government to reimpose the interest rate ceiling on new home loans; As the Government is managing the economy at the moment, if it did that it would mean that there would be no money at all available for housing loans at 13.5 per cent. So the critical question is that the Government must improve its management of the economy, but it will not achieve much by going to this particular solution. That would merely ensure that there was no money at all available from banks for new housing loans. The Democrats then call on the Government to: guarantee that the interest rate ceiling on existing loans will not be removed; I heard Senator Robert Ray give that guarantee. I think honourable senators will find that that is another piece that may be called Rayspeak instead of Hawkespeak. I do not think the Government will stick to that. The final proposal is for the Government to: introduce as an alternative the plan proposed by Senator Haines. . . I think that was dealt with adequately by my colleague, Senator Archer. What we propose is more directly credible than the somewhat exaggerated criticisms, and not very accurate criticisms, of the Democrats. We propose that the Senate should recognise as a matter of urgency that the Government's conduct is reprehensible and irresponsible in maintaining artificially high interest rates. Its management of the economy is deplorable. The effects have not yet hit the Australian public, but the Australian public is suffering now and will suffer more in the future from the Government's refusal to tackle the fundamental problems of our economy. The second point is that the Government should be criticised for providing direct assistance to banks and not to building societies. We have heard no credible explanation of why that should be so. These problems lead, firstly, to an increased burden on new home buyers who are subsidising existing borrowers, existing home owners, and, secondly, they penalise existing home owners with mortgages other than at savings banks. That is true. Why should a subsidy be given to borrowers from banks who tend to be the wealthier people, and no subsidy given to borrowers from building societies who, on the whole, tend to be the less affluent people? We also have higher house construction costs. I have recently seen figures of the soaring cost of home ownership. Last year the cost of an average home went up in my home town of Melbourne by 13.5 per cent. Housing costs are rising very sharply. The fourth consequence of the Government's maladministration is discrimination against home owners generally and lower income earners particularly. I think that is self-evident. The last two consequences will be dealt with by my colleague, Senator Reid; that is, the reduction in the availability of rental property and the significant increases in rental levels. The provision of accommodation and homes must be considered as a whole and rental accommodation has a very strong impact on the other aspects of home ownership. As I said at the outset, the whole Government economic management is the source of this problem. It is a shambles and it is impacting through high interest rates on the community. As a matter of fact, this Government reminds me very much of Neville Chamberlain, the British Prime Minister, when faced with the rise of Hitler. Those who read history will remember that Neville Chamberlain was all for discussion, appeasement and trying to take trivial actions which bore no relation to the scale of the events he was confronted with. He even came back with a piece of paper, an accord I suppose he might have called it, which he flourished saying: `This represents peace in our time'. I think our accord should have been drafted in Munich. The Government is failing to represent to the community the real economic situation faced by this country. I repeat that we are borrowing $1,000m a month to support our current standard of living. What is the Government doing to tackle it? Nothing. We have got to face up to our economic future. We must tackle these problems as a nation united. The Government is here to govern and it must give leadership. This problem of housing interest rates is merely a symptom of a deeper problem. Senator REYNOLDS(Queensland)(5.28) —I thank Senator Hamer for his comments that at least gave recognition of the exaggeration that the Australian Democrats have put forward in this matter of urgency this afternoon. However, I cannot let pass his accusations about what he calls Hawkespeak or Rayspeak. All I can say is that if honourable senators look at current opinion polls it appears as if Hawkespeak is considerably more acceptable than Howardspeak in the Australian community today. To listen to the long and sorry tale of woe from Senator Haines and others here this afternoon, anyone would imagine that nothing had happened in regard to housing policy in the last three years. We have heard at length constant criticisms of the situation that has arisen in the last couple of months but, of course, the Opposition has conveniently ignored the very positive moves that the Hawke Government has taken with regard to the provision of housing for many thousands of young and not so young Australians. If anything in this debate this afternoon is reprehensible it is the gross misrepresentation by members of the Opposition in failing to acknowledge the very sound commitment that has been given to housing policy by this government. Where has Senator Haines been during the last three years, for example? She spoke as though she had never heard of the first home owners assistance scheme under which, from 1 October 1983 to 29 August 1985, some 157,615 applications were approved to assist young home owners to buy their first homes. This assistance was provided at a cost in excess of $477m; yet, listening to the debate this afternoon, one would think that absolutely no financial commitment had been made and no planning had been put forward by this Government. What about the massive commitment to public housing? Members on the Opposition benches-I am referring to members of the Liberal Party-can certainly do nothing but hang their heads in shame when one considers the lack of commitment to public housing during the Fraser years. Under the 1985-86 Commonwealth-State Housing Agreement the States will receive the following amounts for housing: An amount of $517.5m will be given for untied grants; $36.5m for rental assistance to pensioners; $54m for rental assistance to Aborigines; $22.5m for mortgage and rent relief scheme; $13m for crisis accommodation; and $10m for the local government community housing scheme. Those last two schemes were initiatives of the Hawke Government. That scarcely sounds like reprehensible circumstances with regard to the Government's commitment to housing. The hypocrisy of members of the former Liberal Government to cry `shock, horror' with regard to that commitment! Let me remind them of their pathetic performance under Malcolm Fraser's rule. When we came into power the housing situation was absolutely hopeless. The industry had collapsed. There were only 105,000 commencements in 1982-83. Public housing funding had been completely slashed under the former Liberal Government. Only $406m in direct funds to public housing had been spent. Home ownership assistance had collapsed. As soon as this Government came into power we took immediate steps to save the situation. We introduced the first home owners assistance scheme. We boosted public housing funding by 50 per cent, to $570m, in direct grants for 1983-84 and $624m for 1984-85. Do those figures sound like reprehensible circumstances with regard to the Government's commitment to housing? Of course not. The effect on industry was significant. In 1984-85 the number of housing commencements was 152,000-the highest for 11 years. The job growth in housing and construction resulted in some 70,000 persons being employed. This, of course, was a significant contribution to meeting the Hawke Government's target of half a million jobs. This afternoon Senator Ryan and Senator Robert Ray documented the background to the Government's decision. I think it is important just to restate some of the points that were made. The announced package has given clear commitments to Australian home buyers and some of the key features need to be restated. The Government has maintained its commitment to protect existing savings bank home loans. The interest ceiling of 13.5 per cent will remain in force for the entire term of those mortgages. Senator Hamer and Senator Macklin can be sceptical, if they please, but the commitment has been given and I, for one, would vouch absolutely for the commitment. The savings banks will be assisted to lift their home lending, firstly, by the Government providing them with cash assistance to ensure that they can maintain the deposits necessary to underpin existing home loans and, secondly, through the removal of the 13 1/2 per cent interest ceiling on all new home loans to allow banks to offer higher interest on deposits. Both measures combined will enable the savings banks to make $6 billion available for home lending in 1986-87 compared with the expectation of an annualised rate of lending of less than $3 billion. To help low income borrowers-these are the people whom Senator Haines is so concerned about-the banks have also promised to offer more low start loans and similar packages. One of the problems with Australia's old banking system was that it lacked innovation, especially in home lending. Usually repayments, as a proportion of income, are greatest in the early years of a loan, just when the home buyer is struggling to make ends meet. The burden is far easier down the track when people are more established in their jobs and more likely to be on higher incomes. In the last couple of years financial deregulation has seen the advent of new housing finance packages tailored so that people pay less in the early years when their families are young and when they have more commitments to meet in establishing their homes, and they make up the difference later when they are more able to afford it. With funds drying up generally, those sorts of loans were drying up too. Now, the banks have committed themselves to making those loans much more readily available and, obviously, we will be monitoring the banks' commitment to ensure that that commitment does become a reality for many low income borrowers. In conclusion, I suggest that Senator Haines listen more attentively to her more senior colleague Senator Chipp, whose understanding of the real issues with regard to housing seems to be more astute. I do not have with me the text of an interview that Senator Chipp gave, and I certainly would not wish to misrepresent him in any way. However, in Brisbane on Friday, 4 April, just after the announcement by the Minister for Housing and Construction (Mr West), Senator Chipp was interviewed on Australian Broadcasting Corporation radio about the Government's housing decision. Despite the fact that on the news on the same day my good colleague Senator Macklin, who is sitting on my right, was pontificating and predicting doom and gloom, the comments of Senator Chipp seemed totally rational and totally recognised the dilemma that was facing the Government at that stage. Far from predicting doom and gloom Senator Chipp did acknowledge the Government's dilemma and the need to protect the building industry. I am sure that Senator Chipp will speak for himself with regard to this interview but, as I recall it, he certainly was not predicting the kind of doom and gloom and hysteria that we have heard this afternoon. Senator REID(Australian Capital Territory)(5.39) —When the Minister for Education (Senator Ryan) responded on behalf of the Government earlier in the debate on the matter of urgency, she indicated that housing was an integral and crucial part of the economy. There can be little doubt about that. That is why we are concerned about the chaos that exists in the housing industry at present about which we have heard quite a lot lately. I think the issue was debated quite recently in the Senate. We need real solutions to the problems of the housing industry. We need to reduce the rate of unemployment. That has not been mentioned today, but it is also part of the problem when one thinks about the number of people on the list seeking welfare housing at present. We need to reduce interest rates. The rates of interest in Australia compared with those in other countries with which we deal were mentioned earlier in the debate to show just how high our rates of interest are. The rate of interest for housing is not specifically the problem; it is the rate of interest that all sections of the community are required to pay. The solution is not just to allocate more for public spending. We have heard, as Senator Reynolds has pointed out, the big spending solution to the housing problem. It is a question of spending more money when one sees a problem. As Senator Withers indicated earlier in the debate, if one spends a lot of money, the problem may go away, but we all know that it will not. We have had the big spending solutions. Do honourable members remember Priority One: Young Australia? It was the big announcement in the August Budget last year. An amount of $5m was to be spent in 1985-86. Certainly, much of it has been spent, perhaps all of it by now. Mainly, it was spent on a big promotion for the Government. It was real bread and circuses act. It was supposed to have produced 10,000 jobs in each of three years. What has happened under Priority One so far this year? Has it provided as many as 600 jobs? It will be interesting to find out exactly what the figure is, but certainly it has not done for young people what it was supposed to have done. Last week we had another big spending solution. We heard that $1,000m was to be spent on the drug offensive. Certainly, the aims are quite laudable. But the $1,000m is not being given now. It incorporates many initiatives that are already under way. It is really a bit of a gimmick to talk about $1,000m being spent on the drug offensive over three years. If one looks closely at it, one sees that what is being addressed is an education program. There is no attack on the source of drugs. There is no increase in penalties for those who are involved in this area. There is no serious threat that anyone will actually spend a long time in goal if he is convicted of an offence. There is no increase in the powers of the National Crime Authority. Now we have the big spending solution to the crisis in the housing area. We need economic policies which will cause interest rates to come down, so that farmers, small business, home buyers and would-be home buyers will benefit. An amount of $120m is to be spent by the Government. We have heard today why this amount is being spent in the way that has been announced. Building societies are being left out and will not benefit. We have heard that $700m is to be spent to maintain the real value of public housing. But no solution has been offered in regard to cutting down the number of people on the welfare housing list who need welfare housing because the economic circumstances in which they find themselves are such that they have no alternative. It is not really surprising that there is such a split in the Australian Labor Party in regard to this policy. Without taking up too much time, I mention the newspaper headline `Wran Attacks Government on Housing'. He criticised it for directly paying to the banks and not to the borrowers. He dealt with the serious implications-naturally being the New South Wales Premier-for the New South Wales building societies, which would be placed at a competitive disadvantage. Of course, the same disadvantage applies to all other building societies. But it was not just in New South Wales that we saw this split in the Labor Party. The State Council of the Queensland ALP strongly condemned the Federal Government at the weekend for allowing banks to lift interest rates on new home loans. There are problems in the housing industry. The media also noticed it. Mr Laurie Oakes, speaking on the Midday Show with Ray Martin on 3 April, said: It was a backflip of Olympic gold medal standard. The Opposition is referring to it as a U-turn, but it is more of a wheelie. The Australian Financial Review said that it was one of the more remarkable political backflips of recent times, and there were many other similar quotations. The Government cannot hide behind what it has done in this area. It has not addressed the real problems and found real solutions. The rental market is seriously affected by the Government's policies in this area and other areas. Of course, I accept the President's ruling that it is not appropriate to discuss the capital gains tax and negative gearing under the terms of the original motion, but one can refer to them as additional ways in which the rental market has been affected. I am sure that all of those in the industry are well aware of it. Rents are very high at present. It is very difficult to obtain rental accommodation because it is no longer attractive for landlords to be involved in renting. They are getting out of that area and new investors are not entering it. If the Government thinks that only big business is involved in the rental market, I can assure it that that is not so. In a place such as Canberra a number of people in the past have had a second house which they have paid off as a means of forced saving. Either the capital gains or negative gearing situation has made it attractive for them to do so. It meant that houses were available for those people who needed to rent. But one cannot escape the fact that over the six months from June to December 1985 the list of those needing rental accommodation in the public sector escalated from 143,000 to 159,000. Many of them, of course, were unemployed and not able to meet the sorts of rents that they would have to meet in the private rental sector. Many of those people would have once hoped that they would have been able to buy a house. Perhaps they hope that the time will come when they will be able to do so. But because of the high interest rates many have had their hopes dashed. Whereas once upon a time one could buy a house and expect that a quarter of one's salary would be spent on servicing the mortgage, that is no longer the case. The present situation is that there must be virtually two wage earners in a family for the family to even contemplate paying off a mortgage. I think many of the people who have entered into low start loans and the fancy arrangements that have arisen will find in the future that they are not in the position that they thought they would be and that the additional costs on their mortgages are extraordinarily high. If they want to sell the house quite early in the mortgage period, they may even find that they owe a great deal more than the house is worth at that time. Those are some of the problems that flow as a consequence of the economic policies of this Government which have clearly led to the position we are in today. The motion before the Senate is about matters which need to be discussed as they are matters of urgency. Let us not forget the impact on those in the rental market. They are particularly vulnerable, both socially and in other ways, as a consequence of their situation. Some people are required to move frequently and must move from one rental property to another. They may live in a caravan here and a room there. This has an impact not only on the mother and father, but also on the children of those families. They are required to change schools frequently. The two disadvantaged schools that exist in the Australian Capital Territory have within them a number of students who move frequently so that the turnover of students is particularly high. Those people are being disadvantaged more than ever because their education is disrupted in this way. The problem flows from the general economic situation of unemployment and high interest rates. Again, we are meeting the problem by imposing a big spending solution and not the solutions which will bring down interest rates, provide people with jobs and give them some stability in their lives. I support the motion which has been put forward by the Opposition as an amendment to the original motion. I specifically refer to those areas which affect the rental market and the impact that will still be felt in that area. I believe the number of rental properties will continue to drop. I also refer to one other aspect which concerns a local matter. I noticed in the papers presented by the Department of Terri- tories in its supplementary estimates last week that $1.4m has not been spent this year under the Commissioner for Housing loans scheme. We have had a pretty bad run with housing in the Australian Capital Territory. We had the complete collapse of the scheme because of overcommitment a year or so ago and this year the Territory has underspent. I think the Minister needs to re-examine the criteria in order to see whether the means test, the total that can be borrowed and the value of houses on which it can be borrowed are right. It seems extraordinary at a time like this that there should be money left over-to the tune of $1.4m in this financial year. I support the amendment which we have put forward. Senator CHIPP(Victoria-Leader of the Australian Democrats)(5.51) —I thank Senator Reid for finishing early in order to give me a few minutes to speak on this motion. In four minutes time the bells will ring and senators will be called into the chamber to divide on this motion. At that time seven Australian Democrat senators will sit on one side of the chamber and every member of the Liberal Party of Australia, the Australian Labor Party and the National Party of Australia will sit together on the other side to defeat what the Democrats wanted to emphasise-namely, a condemnation of the deregulation of interest rates for new home buyers. This is what this is about. Why are we doing this? We were elected on a slogan which you, Mr Deputy President, will not allow me to say here; let us say it was `Keep the blighters honest'. We said more than that. In the 1983 election campaign, the Prime Minister Mr Hawke said in clear, unmistakable language: A Labor Government will maintain interest rate controls on bank mortgage interest rates and extend those controls to building societies; require the savings banks and building societies to lend a set proportion of their funds for housing; establish an Australian Housing Fund in the Reserve Bank made up of deposits by non-bank financial institutions and channelled through the banks and building societies. In other words, Mr Hawke said that under no circumstances would a Labor Government deregulate interest rates on homes. Now he has done that with the total, full and passionate support of the Liberal Party. Let us look at the figures which show the effects of this action. The average income of an Australian worker is about $21,000 a year. After he has paid tax and received a few social service benefits he takes home about $18,000 a year-that is, $360 a week. I emphasise that: The average worker with a couple of kids takes home $360 a week. Because of this new move by the Labor Government, supported by the Liberal Party, $180 of that will go to paying off his home. Because we have deregulated interest rates we are now asking the Australian worker to buy food, clothing, education and every other expense for $180 a week. Into the bargain the Labor Government has donated $120m to the banks, the reason for which has not yet been made palpably clear. That is why the Australian Democrats have brought this matter forward today. We believe it is an intolerable burden to have placed on the ordinary Australian at a time when the banks are being given this bonanza. Banks, for goodness sake! The banks have made record profits, they have made billions of dollars in the last few years. Yet we not only allow them to charge the worker anything up to 20 per cent on buying his new home, but also give them a subsidy, a donation out of taxpayers' money, of $120m. That is not the worst of it. At the moment interest rates are falling. What happens if they should rise again in a year or two following a run on the Australian dollar, for instance? Had the current housing policy prevailed three months ago, Australians would have been paying not 15 1/2 per cent but 20 per cent on their new housing loans. If that situation occurs again, the average family which I described earlier, will be forced to sell its home. I resume my seat at this point so that a vote can be taken and the Australian Democrats can push the Senate to a division. Question put: That the words proposed to be left out (Senator Archer's amendment to Senator Haines's motion) be left out. The Senate divided. (The President-Senator the Hon. Douglas McClelland) Ayes . . . . . . . . . . . 62 Noes . . . . . . . . . . . 7 —— Majority . . . . . . . . . 55 —— Archer, B. R. Jones, G. N. Aulich, T. Kilgariff, B. F. Baume, Michael Knowles, S. C. Baume, Peter Lewis, A. W. R. Bjelke-Petersen, F. I. McClelland, DouglasBlack, J. R. MacGibbon, D. J. Bolkus, N. McIntosh, G. D. Boswell, R. L. D. McKiernan, J. P. Brownhill, D. G. C. Maguire, G. R. Carrick, Sir John Messner, A. J. Childs, B. K. Morris, J. Coates, J. Newman, J. Coleman, R. N. Parer, W. R. Collard, S. J. Puplick, C. J. G. Cook, P. F. S. Ray, RobertCooney, B. Reid, M. E. Crichton-Browne, N. A. Reynolds, M. Crowley, R. A. Richardson, G. F. Devlin, R. Robertson, E. A. (Teller)Durack, P. D. Ryan, S. M. Elstob, R. C. Sheil, G. Evans, Gareth Short, J. R. Foreman, D. J. Sibraa, K. W. Georges, G. Tate, M. C. Gietzelt, A. T. Teague, B. C. Giles, P. J. Townley, M. Grimes, D. J. Vanstone, A. E. Guilfoyle, Dame Margaret Walsh, P. A. Hamer, D. J. Watson, J. O. W. Hill, R. Withers, R. G. Jessop, D. S. Zakharov, A. O. Chipp, D. L. Sanders, N. K. Haines, J. Siddons, J. R. Macklin, M. J. (Teller) Vigor, D. B. Mason, C. V. J. Question so resolved in the affirmative. Question put: That the words proposed to be inserted (Senator Archer's amendment) be inserted. The Senate divided. (The President-Senator the Hon. Douglas McClelland) Ayes . . . . . . . . . . . 37 Noes . . . . . . . . . . . 31 —— Majority . . . . . . . . . 6 —— Archer, B. R. MacGibbon, D. J. Baume, Michael Macklin, M. J. Baume, Peter Mason, C. V. J. Bjelke-Petersen, F. I. Messner, A. J. Boswell. R. L. D. Newman, J. M. Brownhill, D. G. C. Parer, W. R. Carrick, Sir John Puplick, C. J. G. Chipp, D. L. Reid, M. E. (Teller)Collard, S. J. Sanders, N. K. Crichton-Browne, N. A. Sheil, G. Durack, P. D. Short, J. R. Guilfoyle, Dame Margaret Siddons, J. R. Haines, J. Teague, B. C. Hamer, D. J. Townley, M. Hill, R. Vanstone, A.E. Jessop, D. S. Vigor, D. B. Kilgariff. B. F. Watson, J. O. W. Knowles, S. C. Withers, R. G. Lewis, A. W. R. Aulich, T. Jones, G. N. Black, J. R. McClelland, DouglasBolkus, N. McIntosh, G. D. Childs, B. K. McKiernan, J. P. Coates, J. Maguire, G. R. Coleman, R. N. Morris, J. Cook,P. F. S. Ray, RobertCooney, B. Reynolds, M. Crowley, R. A. Richardson, G. F. Devlin, R. Robertson, E. A. (Teller)Elstob, R. C. Ryan, S. M. Foreman, D. J. Sibraa, K. W. Georges, G. Tate, M. C. Gietzelt, A. T. Walsh, P. A. Giles, P. J. Zakharov, A. O. Grimes, D. J. Colston, M. A. Walters, M. S. Button, J. N. Chaney, F. M. (Senator Gareth Evans did not vote, to compensate for the vacancy caused by the death of Senator Missen). Question so resolved in the affirmative. Original question, as amended, resolved in the affirmative. Senator LEWIS(Victoria)(6.08) —I move: That the Senate take note of the paper. This is the Government's response to the Self report of the National Inquiry into Local Government Finance. The report is nearly 480 pages long and is a very important and well put together report. The reason I have mentioned the size of the report is that the Government's response is remarkable, both for its brevity and for its lack of substance. The response of the Minister for Local Government and Administrative Services (Mr Uren) takes up three columns of the House of Representatives Hansard. There is no reference to what the States are doing and no attempt to deal with the question of rate pegging, and the question of rate exemptions has not been addressed. These are absolutely vital matters, which the Minister has made no attempt to address. There are many hundreds of other matters that the Minister has just allowed to go by; he has let the ball go through to the keeper. The Advisory Council for Inter-government Relations is about to be abolished. Although the Minister does not say so, it is obvious from his response that local government will not get the increase in the consumer price index plus two per cent which currently is the negotiated position with the States and the Federal Government. That position was negotiated by us when we were in government. The Minister does not refer to it. He talks about funding being guaranteed on a real consumer price index basis for 1986-87 and 1987-88, and that is where he ends. It is clear that if he was going to give local government the CPI increase plus two per cent, he would have said so. The fact that he is talking only about giving it the CPI increase indicates clearly that he will cut out the extra two per cent. It is clear that all the difficult decisions have been swept under the carpet or ignored and simply not dealt with by Minister Uren. He says: The principal objective of the new program will be to provide financial assistance to those local councils who are most disadvantaged in respect of their ability to raise revenue and to provide services. That is, assistance will be provided principally for the purposes of horizontal equalisation. The words `horizontal equalisation' are clearly gobbledegook. Local councillors really ought to have a good look at what this socialist Minister-Minister Uren is without doubt the most socialist Minister of this Government-did with the Australian Capital Territory when he was in control of it for a very short time. He tried to introduce socialisation as much as he possibly could. Local councillors should note that he is saying here that the most disadvantaged councils in respect of their ability to raise revenue and provide services will get the money. So it is clear that those councils which do their best to raise their rates from their customers will get the money. Those councils that do not bother to raise the rate revenue to the highest possible rate that they can get from the ratepayers will get the Federal funds. That is what this Minister is all about. This is the Minister who approved funds for the Wyuna fiasco and for Tilley Devine's. There is a worrying absence of detailed financial commitment on the part of this Government. In regard to any financial arrangement with local councils, I say to local councillors: Get it set in concrete, otherwise you will surely not get anything out of this Minister. The DEPUTY PRESIDENT —Order! The honourable senator's time has expired. Senator MAGUIRE(South Australia)(6.13) —This evening we are debating the statement made last Thursday by the Minister for Local Government and Administrative Services, Mr Uren, on personal income tax sharing arrangements for local government. It is a fact of history that in 1974-75 personal income tax sharing for local government was introduced by the Whitlam Government. I think it is fair to say that had there not been a Labor Government at that stage, there would have been no personal income tax sharing for local government in Australia today. The funds that were provided by the Labor Government in the 1970s were, in fact, the first untied funds made available to local government in this country from Canberra. Initially, some $50m a year was paid over by the Commonwealth to local government. By 1984-85, that sum had escalated to a very handsome $486m, and in the current financial year it is estimated that local government will receive from the Commonwealth Budget $534.7m. The funds that are paid are based on the previous year's personal income tax collections, and it is estimated that the growth in funds paid to local government in nominal terms this year will be 9.9 per cent. That represents a rise of 2 per cent on top of the estimated consumer price index increase for the current financial year. On average across Australia, personal income tax sharing funds from the Commonwealth Budget represent the equivalent of about one-third of the rate revenue of local councils. I must say that in my State of South Australia some district councils receive more funds from Canberra than they do from rates. I instance the local government at Carrieton, in the mid-north of South Australia, which will I believe, in the current financial year, along with two other councils in South Australia, receive more funds from the Commonwealth Budget than it does from its own rate revenue. Personal income tax sharing funds have been a vital source of revenue for local government and they have enabled much needed services to be provided by local government. I am very pleased that the Minister, in his statement last Thursday, undertook as a result of the Self Inquiry-that is, the National Inquiry into Local Government Finance-to continue on behalf of this Government a system of untied general revenue grants for local government. That is a very commendable policy from my point of view. The Minister has indicated that for the next two financial years-1986-87 and 1987-88-the base figure allocation for local government from the Commonwealth Budget will be this year's allocation of $534.7m, but also escalated to take into account cost rises reflected in the consumer price index over the next two years. Local government right around Australia can take heart from the Minister's statement that its general revenue funds, its untied payments from Canberra, in the next financial year and in the year after will be subject to a guarantee that maintains those funds in real terms. But over and above that, there is potential for a larger percentage increase in local government funds in the next two years. The increase will be not less than the percentage rise in the total general purpose funds available to the States, so that local government bodies can do better than a real terms maintenance of their funds; they can also expect some rise in real terms if there is a rise in real terms in general revenue funds available to the States. That is a very commendable policy, and I am sure that it is welcome news to all local government bodies. It has certainly been warmly welcomed in my State of South Australia, where I undertook an extensive tour within the last few days of local government areas. Everybody in that State has been overjoyed at the news in the Minister's statement. His statement has certainly exposed the beat up by Senator Jessop on this matter in the Adelaide Advertiser of 24 March, in which he said that there would be big increases in rates for local government because this Government in Canberra was going to cut funds to local government. That is not true. It has been exposed as fear-mongering. The DEPUTY PRESIDENT —Order! The honourable senator's time has expired. Senator Sir JOHN CARRICK(New South Wales)(6.18) —It is impossible in the space of five minutes to comment effectively upon the massive Self report-the report of the National Inquiry into Local Government Finance-and the diminutive ministerial response to that report. It is important to understand that the response of the Minister for Local Government and Administrative Services (Mr Uren) comes against a background of the very great reforms brought in by the Fraser Government. It is important to remember that the present Minister was party, in the Whitlam Government, to a massive intrusion into local government, firstly by tied grants. The aim was to tie as far as possible the activities of local government; indeed, the stated policy of the Australian Labor Party then was to force local government, by means of tied grants, into a small series of regions. The whole aim was to centralise as far as possible into regions which were to be dominated from Canberra. When the Fraser Government came into office it sought to disentangle this mess and to give to local government for the first time in history an equality of opportunity around the conference table. The Advisory Council for Inter-government Relations, which I was privileged to set up in my time as Minister, brought for the first time local government, the State governments and the Commonwealth Government around the table for dialogue, discussion and research. Indeed, local government has more representatives on this body than does the Commonwealth. It will be a very grave matter if that advisory council is destroyed. The Commonwealth Government and Labor State governments tend to regard local government as captive creatures of the States to act as their puppets. It would be ironic to take joy in the 1985-86 Budget decision regarding local government because the Fraser Government was responsible for local government receiving a 2 per cent revenue share. That percentage was reduced in the current Budget. So, in fact, if Labor takes joy, it is doing so in respect of a major reduction of funds from the previous level of 2 per cent. By using this year as a base for the future it is entrenching this practice. It is important to recognise that local government in Australia represents a far smaller segment of government than is the case in almost any other democratic country. We tend to think that we are over-governed in Australia when we talk of a Commonwealth government, six State governments and 800-odd local governments. The fact is that if we look at even the unitary system in England, with its great county councils and local government areas, and if we look at the United States of America, with all its district boards, county boards and county taxes, we will see that there is far greater decentralisation of government in other countries than there is in Australia. This is a retrograde step. What has happened, tragically, particularly under Labor governments, and notably under the Wran Government in New South Wales, is that the funds made available by the Fraser Government in accordance with the 2 per cent formula resulted in a withdrawal of funds by State Labor governments and the imposition of more duties. As a result, the full benefit of untied grants and the full independence of decision-making has not been possible. Under Labor there has been a movement to destroy the independence of local government and now, of course, there is a move to shackle it. It is a very great pity that we do not have time to debate in full the Self report and to analyse in detail the Minister's statement which runs true to the kind of pattern that we saw emerging under the Whitlam Government and which we now see emerging in terms of reduced freedom and real funding for local government. I regret that this should be so. Senator COONEY(Victoria)(6.23) —Senator Sir John Carrick spoke of the work that the Fraser Government did in the area of local government. Of course, the Whitlam Government took the initiative in this field. It thought up the ideas that are now being put into practice and are a reality. The Whitlam Government has come in for considerable criticism for many of its actions. However, it is proper to praise the Whitlam Government for the initiative which it showed in this area which was then accepted by the Fraser Government. Senator Maguire said that over $530m had been set aside for local government this year and it is interesting to note the basis upon which that amount of money was made available. Senator Lewis said that the size of the response to the report of the National Inquiry into Local Government Finance is in contrast to the size of the report itself. Nonetheless, this report is of considerable quality. In the few minutes available to me I would like to quote from page 5 of the statement made by the Minister for Local Government and Administrative Services (Mr Uren), who has been accused of being the most socialist Minister in the Government. Whether that is so or not, it is interesting to see his very benign approach, the very great regard he has for local government and the efforts he makes to put that regard into practice. He said: Contrary to the recommendations of the National Inquiry the Government does not propose to make grants for local government conditional upon States maintaining their assistance to local government. It is important that local government be independent of the States in regard to funding. As Senator Sir John Carrick has said, there is a tendency for the States to regard as captives the councils within their domains. So, by making funds available to local government and thereby not making local government dependent on the States, the Government is giving to local government an ability to exercise its powers above and beyond what the States might allow. Mr Uren went on to state: Nor will the Government seek to interfere with States policies which limit rate increases. Should the Commonwealth act in these areas, it would only serve to penalise the local governments concerned for decisions in which they had no part. Maintenance of State assistance however, will be one of the matters subject to future review. It is proper that the States should look to local government and try to make it more efficient. In fact, that is exactly what the State Government in Victoria is doing. The Victorian Government has set up a commission which includes Mr Stuart Morris, a member of the Melbourne Bar and a State planning tribunal and a man with an outstanding record in the field of local government. Mr Morris was President of the Shire of Sherbrooke and knows a great deal about local government. It is proper that reform should take place which will enable local government to perform tasks and give services which in many instances it is capable of doing. It is important that the services which are needed are amalgamated and provided to the citizens of the areas in which local government operates. The simple services that come to mind are the collecting of rubbish, the development of streets, the planting of trees and the other things which so affect the life of the ordinary citizen. It is important that local government be seen to be doing that. Indeed, it is important that the areas over which local government has responsibility be looked at more closely than has been the case. For instance, we should look at the green triangle of Victoria which spills over into South Australia. We should also look at the La Trobe Valley, the Goulburn Valley and other similar areas. One sees the logic, as Senator Sir John Carrick said, of establishing areas on a more sensible basis. The report of the Self National Inquiry into Local Government Finance is an important report. The Government's response is a most proper one. It shows the Minister's regard for local government; it shows this Government's regard for local government; and it shows that this Government is carrying on the traditions established originally under the initiative of the Whitlam Government. Senator VIGOR(South Australia)(6.28) —I share the relief of the councils around the nation. The Minister for Local Government and Administrative Services (Mr Uren) has, on this occasion, carried the day against the forces of reaction and darkness from the Treasury and the Department of Finance. How those two departments can continue with their pig-headed obstructive approach to most exciting new measures, on the basis of statistics from the 1960s, is beyond the comprehension of reason- able people. The Self National Inquiry into Local Government Finance dealt rather lightly with the outdated and inaccurate assertions emanating from these departments. The following remarks are made in chapter four of the inquiry's report: Both the Commonwealth Treasury and Department of Finance have relied heavily on Groenerwegen's 1976 study of rate effort in New South Wales. This survey was based on data from the 1960s, and so predates the introduction of General Revenue Sharing. In other words, the departments were drawing conclusions about the operation of the personal income tax sharing arrangements solely on the basis of figures before those arrangements came into operation. That is a very disturbing tendency, all the more so because of the influence these departments command in view of their vice-like grip on all economic information and activity within this country. If they behave as badly in other areas and decisions are based on as shonky or irrelevant information as we have here, we will continue to have problems within Australia. I know that most councils welcome the commitment of 30 per cent of untied funds on a per capita basis. This recognises the roles of all councils in delivering Commonwealth services in their areas and provides a guarantee against sudden cutbacks in project funding. The other 70 per cent of untied funds is to be allocated on the equalisation principle so that those councils most in need will get the largest amounts. The Government is offering real terms-guarantees for overall funding in the next two financial years. This is a good thing if the Government keeps its promises. Sitting suspended from 6.30 to 8 p.m. Senator VIGOR —The Government is offering real term guarantees of overall funding for the next two financial years. However, it is doing so in very vague terms. I hope that a 2 per cent growth rate will be included. This would tie local government to the same treatment as the States. Local government should be treated in the same way as the States. However, because of its expansion which has been half the rate of the Commonwealth and State bureaucracies and its funding avenues have been hemmed more tightly it will be important to ensure that Treasury and the Department of Finance do not lumber local government with the same sins as those of the States. It is also very important to note that rural councils are much more reliant on untied Commonwealth funding than are the metropolitan ones. In the 146 metropolitan councils, an average of 13 per cent of rate revenue is available from untied Commonwealth funding. However, in the 691 councils in rural areas, Commonwealth funding represents an average of 31 per cent of rate revenue. The situation is more marked in rural towns and purely rural councils where the untied Commonwealth money can be half of the rate revenue or even more. What that means is that any cut back in overall funding will hit hardest at the rural councils which are most reliant on that income. In the present rural crisis these councils have no way of increasing rates to make up for any Commonwealth short fall. They would have to cut services and lay off staff which would add further to the climate of depression in the worst affected rural areas. At least the Government has not worsened the predicament of rural Australia with this particular decision although a number of other decisions may be called into question. What the Government must do, however, is to face up squarely to the hornets' nest of the fringe benefits tax which itself is going to hit local councils and create an enormous number of problems. When one looks at areas such as the Pilbara, one sees that there will be an extra $200,000 in tax on subsidised housing and $70,000 on free air travel for employees, which will make an enormous difference to the viability of those particular councils. It would be outrageous for the Commonwealth Government to claim back in fringe benefit taxes the `potentially extra' money it is giving in untied funds. I hope that the Government will examine this matter very carefully and refrain from putting rural and isolated Australian communities at a further unfair disadvantage. Question resolved in the affirmative. Senator VIGOR(South Australia)(8.03) —I move: That the Senate take note of the paper. The 1985 annual report of the South Australian Local Government Grants Commission outlines the procedures used in determining the amounts councils have received in untied Commonwealth funding in the current financial year. From July 1981, the base amount of funding available nationally for this purpose had been 2 per cent of personal income tax collected by the Commonwealth Government. In the light of the solemn promises by the Prime Minister (Mr Hawke) about treating local government as a genuine partner in our three sphere system of government-these promises were made at the eighth National Institute of Municipal Management Seminar in May 1984-the Government's written commitment to 2 per cent of personal income tax was made just before the 1984 Federal election. Councils were not expecting unilateral action to undermine the Self National Inquiry into Local Government Finance. They received a rude shock last May when the Treasurer (Mr Keating) announced that the 2 per cent of personal income tax would be watered down to a `2 per cent in real terms increase guarantee for any one year'. This statement came while the Self inquiry was still collecting evidence. Unfortunately, the Liberals and Nationals joined the Government to cut back the councils' entitlements. That means, in practice, that the Self inquiry could not realistically put forward a guaranteed percentage of taxation if the members wanted some action on the report. The South Australian Local Government Grants Commission had, in October 1984, submitted that the 2 per cent of net personal income tax continue to be paid until another formula could be agreed on based on the range of services and functions performed by the various levels of government. That should have been the course of action, but a single stroke of Lib-Lab opportunism changed the rules of the game, despite both groups being committed in their policies to the 2 per cent of personal income tax. I hope that the new arrangements about to emerge will prove more stable and not be susceptible to the same sort of tampering. The expanding roles of councils in providing human services and jobs that help sustain the rural communities should not be shrugged off again. I note that in the 1984-85 year the South Australian Local Government Grants Commission visited 47 councils and received 24 detailed submissions about special problems experienced by those councils. By such means it is able to get a feel for what is happening in each community. That is a very important factor in winning the confidence of recipient councils. The Commission reports a continuing problem with data provided by the Valuer-General as there are quite large jumps associated with new valuations. A three-year moving average has been used. This cuts out wild fluctuations in assessed entitlements. Large fluctuations in this area invite discontent amongst councils, particularly those which have lost out because their revenue earning capacity is much higher than the average revenue of the top 25 per cent of councils in their category. This uncertainty creates a climate of instability in which councils become very disturbed and reluctant to take on new services or to innovate. I commend the South Australian Local Government Grants Commission on its work and look forward to further excellent contributions in the future. Question resolved in the affirmative. Senator PUPLICK(New South Wales) —by leave-I move: That the Senate take note of the paper. I seek leave to continue my remarks later. Leave granted; debate adjourned. Senator VIGOR(South Australia) —by leave-I move: That the Senate take note of the paper. I seek leave to continue my remarks later. Leave granted; debate adjourned. Senator ARCHER(Tasmania) —by leave-I move: That the Senate take note of the paper. I seek leave to continue my remarks later. Leave granted; debate adjourned. Senator ARCHER(Tasmania) —by leave-I move: That the Senate take note of the paper. I seek leave to continue my remarks later. Leave granted; debate adjourned. Senator ARCHER(Tasmania) —by leave-I move: That the Senate take note of the paper. I seek leave to continue my remarks later. Leave granted; debate adjourned. Motion (by Senator Cooney) agreed to: (1) That the Standing Committee on Regulations and Ordinances have power to appoint sub-committees, consisting of 3 or more of its members, for the purpose of attending Delegated Legislation Conferences and that the quorum of a sub-committee be 2 members. (2) That the Committee, or any sub-committee appointed pursuant to paragraph (1), have power to move from place to place. Motion (by Senator Grimes) agreed to: That notwithstanding anything contained in the Standing Orders and Sessional Orders and unless otherwise ordered- (a) on Tuesday 15 April 1986, the Senate meet at 2.15 p.m., or after the ringing of the bells, whichever is the later, and (b) the Order of Business for that day be as follows: (1) Petitions (2) Notices of motion; (3) Formal Motions-Discovery of Formal Business (4) Questions (5) Ministerial Statements, by leave (6) Presentation of papers (7) Adjournment Motion (by Senator Reid) agreed to: That Business of the Senate, Notices of Motion Nos 1 and 2 standing in my name for this day, for the disallowance of a paragraph and a section of the Health Authority Ordinance 1985 be postponed till five sitting days after today. Message received from the House of Representatives intimating that it had agreed to the amendments made by the Senate to this Bill. Motion (by Senator Grimes)-by leave-agreed to: That Senator Colston be discharged from further attendance on the Library Committee and that Senator Aulich be appointed a member of the Committee. Motion (by Senator Grimes)-by leave-agreed to: That Senator Walters be discharged from further attendance on Estimates Committee B and that Senator Messner, having been duly nominated in accordance with Standing Order 36AB, be appointed a member of the Committee. Senator MACKLIN(Queensland)(8.14) —I move: (1) That where a Bill is introduced by a Minister, or is received from the House of Represenatives, after 30 May 1986, and a motion is moved for the second reading of the Bill, debate on that motion shall be taken to be adjourned upon the conclusion of the speech of the Senator moving the motion, and the resumption of the debate shall be made an Order of the Day for the first day of sitting in August 1986, without any Question being put. (2) That this Order cease to have effect at the commencement of the first day of sitting in August 1986. The motion is self-explanatory. The reasons for bringing it forward are that we find, despite the good intentions often of Ministers, that this House is confronted at the end of each of its sessions in any one year with an enormous amount of legislation which has come from the House of Representatives or which is introduced directly into the Senate. Senator Grimes —I hope you can demonstrate that. Senator MACKLIN —The Minister for Community Services (Senator Grimes), who is at the table, asked whether I had the figures. I am happy to provide them. In the Senate up to 7 May, that is, three weeks before the end of the session-last year we did not sit in June, hence 30 May is the date mentioned-22 Bills were introduced. From 7 May to 31 May 91 Bills were introduced. Eighty per cent of the Bills introduced in the session last year were introduced in the last three weeks of the session, which is an extraordinary percentage in anyone's terms. Some of the old hands around the place who have been in government informed me that the method has very little to do with the Ministers and an awful lot to do with the bureaucrats. Indeed, it is very much in the interests of the bureaucrats within departments to find particular reasons why a Bill's drafting is not actually finished or why the directions the Minister has given have not been able to be followed. If this happens, lo and behold the Bill cannot really be available until almost the end of the sitting, in which case the hope is that this chamber, having run out of time, will give it a speedy passage and nobody will scrutinise it too much. It sounds to me like a pretty useful tactic and if it is not the tactic that is used, I would have thought it should have been. Nevertheless, I believe that this chamber-- Senator Haines —We know the ways of the Government. Senator MACKLIN —Knowing the ways of government, yes. Senator Puplick —That is how the Democrats would do it if they could. Senator MACKLIN —Yes, that is right. This chamber should take some retaliatory action with regard to the operation of using this chamber to dump the stuff in and move it through with no opportunity for debate. Generally at the end of the sittings we find that for a couple of weeks this chamber sits on its own to finish its business. I think that is acceptable. In fact, I have suggested that we should not sit in the first couple of weeks but wait until the legislation arrives. We could save some money, but there does not seem to be a great deal of interest in that. What worries me is that every time it happens, whether under this Government or the previous Government, there is an element of blackmail. There is an element of governments saying: `Look, if the Senate amends this urgent legislation the world will end'. I have operated with responsibility for five portfolios and I can assure the Minister that that has been said to me on numerous occasions. Another old hand in this place informed me that the only urgent Bill is in fact the Budget Bill because the Government actually needs that each year. Lo and behold I remember the Minister at the table relaying to me, when he was in opposition-he was not the origin of it-that, indeed, one could look back and see that when governments wished to hold elections they could do so without all these absolutely urgent Bills having been considered or voted upon. I am sorry to bring that one up but I can remember the Minister informing me of that home truth and I have remembered that since then. I also went back and read a very interesting speech that the Minister made in 1984 when he was in government. This was not in relation to a Bill but I think the sentiments he expressed at that time are very apposite. He said: . . . I apologise to honourable senators, particularly Opposition senators. From the amount of work that has been done, and from the careful preparation of this work, it is clear that these proposed works have been under consideration by the Department of Housing and Construction for some months, if not some years. I think the same can be said of most Bills if they have been done carefully. He continued: The Government Ministers in the Senate received this reference today. I believe this happens too often. There is no reason for a department suddenly to rush in on the last day of the sitting and present us with a proposal for the Public Works Committee without being able to give proper notice of motion, as we should in this place. I have informed that Department and other departments that if I have anything to do with it, if they do this again they can wait until the start of the next session. I think that is good advice. If it is that late, I think the advice that Senator Grimes gave then was very good; that is, they should wait until the beginning of the next session. Senator GRIMES(Tasmania-Manager of Government Business)(8.22) —I appreciate the intention of Senator Macklin and the Australian Democrats in moving this motion. I certainly appreciate from my fairly short time here the problem faced by honourable senators and the intention of Senator Macklin to prevent, as he sees it, the crush of legislation which seems to occur before the end of every legislative session in this place. However, we should really think about what we are doing. I know that people in this place become very macho about the Senate, its powers and the fact that it is the most powerful upper House in the world. This motion dictates to the other chamber the procedures it should follow in debating the legislation before it. Senator Macklin says that a certain amount of blackmail is associated with the procedures he talked about at the end of a session. I do not believe that is necessarily blackmail. I think it has always been in the capacity of this chamber to say: `If we want to amend it, we will amend it and the House of Representatives will have to come back'. I can remember only one occasion when that sort of accusation could have been put to a government at the time. The effect of this motion will be, in fact, to tell the other chamber how to go about its business. Some people may not think that that is important, but I think it is important. I think a possible outcome of the motion that Senator Macklin has put is that, as a result of the deadline that this motion may put on the other chamber, it may be the case that if an unscrupulous government were in power-I am not suggesting for one minute that this Government would do it-there would be an increased use of the gag or guillotine in the House of Representatives, therefore stifling the rights of members of that chamber. I do not think we should really indulge in that sort of behaviour. I really would like to point out that the bunching of legislation, if it occurs in this place this year, will not be as a result of a large number of Bills being introduced by the Government. Senator Macklin was asked to demonstrate that that would be so, and he cannot. It will stem from the fact that we have a piece of legislation before this chamber which has already broken the record for the number of hours it has been debated. The Bill of Rights legislation has been debated for 35-plus hours, which is longer than any Bill since Federation. Senator Knowles —So it should be. Senator GRIMES —It has been the result of grandstanding and filibustering by the likes of the honourable senator who just interjected. That is a pity because, as I think I said at the end of the last session, we now have more senators and those senators seem determined to speak about everything that comes into this place, speak at great length and speak repeatedly. The inevitable result of that-I do not argue with it at all-is that we will have to sit longer, and I think we are going to have to sit-- Senator Macklin —If you introduce them before then they can be adopted afterwards. Senator GRIMES —Just a minute. I will come back to the honourable senator. He should not get excited about it. I think it is inevitable that we in this chamber will have to sit longer. We will have to sit many more weeks and in fact we will have to consider sitting many more hours in those weeks because what has happened is that there are more of us here for a start, more people want to speak and more people want to speak at inordinate length. I think the Standing Orders about tedious repetition have been forgotten years ago in this place, given what has happened with the Bill of Rights legislation. It is absolutely ludicrous that this chamber cannot make up its mind about such a piece of legislation after 35 hours of debate. Not even the filibustering in the United States of America approached that degree before it introduced the changes in its Standing Orders to stop it. I would have liked members of the Opposition to reconsider their position on this matter, but it is quite clear they are going to vote for the motion. Therefore, I feel bound to move an amendment which states: Paragraph 1, after ``That'' (first occurring), insert ``, unless otherwise ordered''. In other words, another unless otherwise ordered clause should be inserted into this motion. I do not think any government or any opposition could rule out at this stage of the sittings the possibility that genuine, urgent or emergency legislation may be required. Important legislation may arise. I do not actually anticipate this occurring but it may occur. Should this happen, we would have to move for the suspension of standing order 134, which requires either seven days notice or an absolute majority. We may not have an absolute majority even with goodwill in this place. Therefore, I think it is reasonable that the words `unless otherwise ordered' be inserted to provide a sensible version of the motion, which I admit has been put forward by Senator Macklin in all good faith and in order to overcome the problems that all of us have faced in the past. Accepting the fact that I have shortcomings in lots of areas, but counting is not one of them, and that this motion is going to go through, I urge honourable senators to support my amendment. I move: Paragraph 1, after `That' (first occurring), insert `, unless otherwise ordered'. Senator CHANEY(Western Australia-Leader of the Opposition)(8.27) —It gives me a great deal of pleasure to rise on behalf of the Opposition to support the motion which has been put forward by Senator Macklin on behalf of the Australian Democrats. The motion in fact reflects a point of view which has often been put forward by the Opposition in this place and probably it has been put forward by oppositions of both a Liberal-National Party persuasion and a Labor Party persuasion. I think the motion does reflect a genuine difficulty that, for some reason, the process is one which leads to a bunching of legislation at the end of a session. It has long been my personal view that the only way to cure that is to introduce machinery which means that legislation which is introduced late will be held over. Just as a matter of curiosity, I went back over the discussions we have had in this place with respect to programs that the Government has announced. I looked at the Senate Hansard of 22 February. Senator Grimes —You are not going to quote me too. Senator CHANEY —No, I am not going to quote Senator Grimes; I am going to quote myself. I stated my view on 22 February. I stated: The Senate must look to its legislative function in a very careful way. I again put the view that if the Government introduces legislation of a substantial nature, which does have substance which requires attention, we should not deal with it in a way which prevents our giving it proper attention. If that means that legislation needs to be left until the Budget session because it has been introduced too late, I believe so be it. I quote that merely to say that our support of the motion that has been put before us by Senator Macklin reflects our consistent view that time is necessary to consider legislation and the bunching of legislation does prevent us from doing the job that we are elected to do. I do not think it is a matter, as Senator Grimes suggested, of Senate powers; I think it is more a matter of Senate responsibility. I think we do have a responsibility to perform our legislative function in a more careful way. We cannot do that under the pressures under which this Government puts us and, indeed, previous governments have on occasions put the Senate. So I am delighted to support the motion which has been put forward by Senator Macklin. Incidentally, I accept the point made by the Manager of Government Business, Senator Grimes, that the Senate should be able to vary this if it wishes. I do not think it is necessary for the amendment that Senator Grimes has moved to be carried. I would have thought that it was open to the Senate to vary its own resolutions. Even if that is so, at worst, it is a belts and braces amendment, and the Opposition proposes to support it. Last week we had a very good example of the sort of emergency Bill which had to be dealt with quickly. I refer to the legislation relating to the Builders Labourers Federation. There can always be some issue which arises which requires the Parliament's attention. I give notice to the Government that it certainly would not be our intention to use this proposal as a fetter to that sort of emergency action if it is required in the national interest. I do think it would be in the national interest to have a slowing down of the process if, indeed, a lot of legislation were introduced late. I take issue with Senator Grimes on one other point. He criticised the debate which has taken place on the human rights legislation. I have not been directly involved in that debate, but a number of senators who are in the chamber now have been involved. I notice Senator Sir John Carrick and Senator Macklin, and there are others who have taken part in the debate. Having heard a deal of it and having looked at the Hansard, I must say that I dispute Senator Grimes's suggestion that there has been anything in the nature of a filibuster. In fact, this is new legislation which introduced novel concepts to Australia. I think the quality of debate has been extremely high. I, on behalf of the Opposition, certainly reject any suggestion that there has been anything in the nature of a filibuster. That is certainly not true. Even if that suggestion were true, the motion moved by Senator Macklin is not one which would be affected by that suggestion because it relates only to when legislation is to be introduced. So there is nothing to stop the Government introducing its legislation day by day. That motion does not put any fetter on dealing with legislation which is introduced right up to 30 May this year. With regard to whether the Senate will continue to sit after the dates which have been laid down, I take this opportunity to alert the Government and, indeed, the Australian Democrats to the fact that, given that the program envisages our sitting for a continuous three-week period at the end of May and the beginning of June, it is the view of the Opposition that we should not then just continue to sit week by week. It is the view of the Opposition that that puts an inordinate strain on all senators including, and perhaps most of all, Government Ministers. We will be asserting the view that if additional sittings are required there should be at least a one-week break after that proposed period of three weeks at the end of May and beginning of June before we resume sitting, if resumed sittings are in fact required. I have only one other point to make. I cannot move an amendment because there is an amendment before the Chair. I foreshadow that when we have dealt with the Government's amendment to Senator Macklin's motion, I will move a further amendment, which has been circulated in my name, and which seeks to insert an additional paragraph in the motion. I shall speak to that amendment now, if I may, to save time. The amendment seeks to insert the following paragraph: `(1a) That immediately after debate on a motion for the second reading of a Bill is adjourned in accordance with paragraph (1), or following the giving of notices on a subsequent day, a motion may be moved without notice to refer that Bill to a standing committee for inquiry and report by a day not later than the first day of sitting in August 1986.'. The point of that amendment is that under the Democrats' proposal, which we are supporting, it may well be that a series of Bills will be left on the Notice Paper between May and August of this year. What we would like to do is to preserve the opportunity to send those Bills to relevant standing committees of the Senate. Honourable senators will recall that there have been a number of attempts to formalise the arrangements for Bills to be given more detailed committee consideration by sending them to our standing committees. There is usually a reluctance on the part of the Government to see that done. To this day, we have been unable to obtain the support of the Democrats for a number of specific proposals but, after discussion with them, I think we are in agreement that where Bills will be held over in any event it may well be useful for them to be given some detailed scrutiny during the recess period so that we can examine them more carefully and deal with them perhaps more expeditiously when we return to Canberra in the Budget session in August. The purpose of my amendment is simply to give the Senate the opportunity, where Bills are to be adjourned until the August Budget sittings, to move that those Bills be sent off to the standing committees. I stress that that is in no way pre-empting the Senate's decision on any particular Bill. That will be a matter for consideration when we move for the reference of any Bill to a committee for such consideration. I suggest that that could be a valuable way for us to test whether we will get a better legislative performance out of this Parliament by having a number of Bills subjected to that sort of committee scrutiny rather than merely dealt with in the second reading debate and in the Committee of the Whole. The motion which has been moved tonight may be a very useful step in introducing more regular and ordered procedures in this place which would give us a better opportunity to perform our legislative function. I have been somewhat disappointed at the low level of senatorial interest in the purely legislative function of this place. For most of us the politics of immediate issues tends to take precedence. Any opportunity we can take to provide a better atmosphere and a better set of procedures for the exercise of our purely legislative functions is worth trying. I hope that, from this experiment, we might see, just as we saw with the establishment of the Standing Committee for the Scrutiny of Bills, another useful step in improving our performance as legislators. I say to the Manager of Government Business (Senator Grimes) that I can assure him in a totally non-partisan way that I think the problems his Government faces are totally similar to the problems which we faced in government. I believe that some of the changes that the Government has made, in particular the gradual extending of the sittings to a longer period in the year, are potentially positive changes. This new initiative may add to those changes and may lead to less defective legislation being foisted upon the Australian people. Amendment agreed to. Amendment (by Senator Chaney) proposed: After paragraph (1), insert: `(1a) That immediately after debate on a motion for the second reading of a Bill is adjourned in accordance with paragraph (1), or following the giving of notices on a subsequent day, a motion may be moved without notice to refer that Bill to a standing committee for inquiry and report by a day not later than the first day of sitting in August 1986.' Senator GRIMES(Tasmania-Manager of Government Business)(8.38) —I wish to speak to Senator Chaney's amendment. The Government will not oppose and certainly will not divide on this amendment. I appreciate and I accept Senator Chaney's proposal as a positive proposal to try to improve the legislative function of this chamber. Unlike him, I think some of the changes we have made, including the setting up of the Standing Committee for the Scrutiny of Bills, have not brought about the great positive changes that some people would like to believe. Since I have been a member of the Senate the number of committees has increased and the work of those committees has increased. Senator Hamer —Not the Scrutiny of Bills Committee. Senator GRIMES —Certainly not. To start referring Bills willy-nilly to those committees might create considerable difficulty for those committees. Even in the time that I have been here people on committees have made some complaints about their capacity to keep up with the work. Therefore, I would be reluctant to see this process introduced without the introduction of some mechanism whereby the whole committee in question could be consulted on its capacity to deal sensibly with this issue. It does not add to the efficiency of this place if we add to what Senator Chaney perceives as an inefficient mechanism for dealing with legislation in this chamber a further inefficient mechanism whereby the committees of the Senate will deal with legislation. I can remember being on the Standing Committee on Social Welfare, or whatever it was called in those days, and one of the things that we dealt with, for some strange reason, was reports from statutory authorities which came in late. Until the former Senator Peter Rae and his Committee, the Senate Standing Committee on Finance and Government Operations, dealt with that issue, almost all statutory authorities seemed to bring in late reports, and the Standing Committee on Social Welfare, which really had no knowledge and not much interest in that process, used to deal with all of those endless late annual reports of statutory authorities in an afternoon and come up with some form of words which would please the Senate and make us all think that we had done the right thing. My personal view is that the procedures in this place are defective. That does not mean I want to turn them upside down. But I think the Standing Orders Committee and all senators should look at them. Senators should start to look at the procedures we use to deal with legislation to see how sensible they are. They should see how sensible are some of the words that Ministers and members of the Opposition use when introducing legislation. It seems to me in this day and age they have little purpose, although I accept that the system of first, second and third readings was introduced to ensure that legislation was dealt with in a steady way and so that people could not rush legislation through the Parliament unnecessarily. But surely we can change the procedures and methods that we have used. One of those changes may involve the standing committees having a greater role in the consideration of legislation. But I think that that can only be done with the co-operation of the standing committees and the co-operation of the chairmen of those committees. I do not think it will assist us to have this chamber refer legislation to standing committees in a sort of offhand way, which is a great danger in the sorts of procedures that Senator Chaney talks about. I do not think it will do anything more than add another layer of inefficient procedures to the ones we have now. As I say, we do not oppose the proposal. Quite frankly, one of the reasons that we do not oppose it is that we do not intend to introduce any legislation after 30 May. But if we do, I accept that Senator Chaney's proposal is a sensible one. If we as a government start to introduce legislation after 30 May and if that legislation will clearly not be dealt with until the Budget session, why should not the Senate standing committees, if they are willing to do so-or even if they are unwilling to do so-consider that legislation? If they are willing to do so we as a Senate can judge the efficiency and efficacy of their considerations at a later date. As Senator Chaney says, it will add a layer to the experience of the Senate when we consider changes to procedures at a later date. So I certainly do not oppose this amendment. But I give notice that if such a circumstance should arise, we would expect that the committees and the chairmen of those committees would be consulted before the Senate hands on legislation in that way. Senator HAMER(Victoria)(8.43) —I should make it quite clear that this is not in any sense a proposal for indiscriminate reference of Bills. Each Bill will be examined on its merits and there will be consultation among the Opposition, the Australian Democrats and, one would hope, the Government to decide which Bills should be referred to committees and which committees should consider them. The views of the committees would also be taken into account. The Leader of the Opposition (Senator Chaney) has on the Notice Paper a motion to set up a mechanism to do this. That motion has not yet been proceeded with. We must establish a proper procedure for examining which Bills will benefit from referral and then see how it works. The committees, after all, are known as legislative and general purpose committees. In the past their efforts have been almost entirely general purpose, with a very minor legislative impact. Let us try this proposal and see how it works. I think I can undertake on behalf of the Leader of the Opposition that there will be full consultation with all parties-certainly with the Democrats, in order to produce the numbers, but one would hope with the Government, and in particular the chairmen of government committees. We do not want to foist a Bill on a committee which is reluctant to take it. On the other hand, we are not prepared to give the Government the power to veto Bills which should properly be referred to committees. I think what might emerge from this is a proper consultative procedure to establish which Bills will benefit from being referred to committees. Also there will be a judgment by the Senate as to whether the Senate as a whole benefits from a proper study of legislation and public examination by a committee before the Senate considers it. Senator MACKLIN(Queensland)(8.45) —In speaking to the two amendments, I am very happy to accept the amendment to my motion moved by the Government. Senator Grimes —We have already carried it. Senator MACKLIN —Yes. Senator Puplick —Ex post facto happiness. Senator MACKLIN —Yes, ex post facto happiness. With regard to Senator Chaney's amendment, I think the comments made by the Manager of Government Business (Senator Grimes) are certainly appropriate. Senator Chaney in his comments referred to the recess period. The proposal has been made that committees will sit probably for the entire time of what is normally called the recess. The general proposition that Senator Chaney has proposed previously-Senator Hamer has been one of the major movers in the discussion of this by senators-is an excellent one. However, I would like briefly to go through the problems that we have had in regard to the proposal. One is that the resources that are available to the Senate in terms of Hansard, staffing and so on have not yet been resolved. Fairly obviously, there is a very important resource problem with regard to committees. I am a member of a committee which has been waiting for some weeks for the Hansard before we can get on with the work, because the Committee really needs the Hansard to be able to carry out the review. We have found out that the reason why the Hansard has been delayed-it is entirely appropriate that it should be delayed-is the urgency of another committee's transcript. If we add to this, I think the system will actually crumble. I do not think that Hansard has the resources or the capacity to deal with that extension. Again, the sitting times for such committees is becoming a massive problem. I sit on three or four committees. One spends a considerable amount of time shuffling through one's diary, trying to find a date on which a reasonable quorum can be found. By and large most people say: `No, I can't do that because I am on this committee or that committee'. It is not that the members are doing work in their electorates, but that the committee work is growing enormously. In other words, there must be a rationalisation of sitting times to allow these things to occur. There must be a rationalisation of the Estimates committees, standing committees and select committees. There was a proposal, which I thought was a very good one, for the collapsing of the Estimates and standing committees and possibly an extension to cover all portfolio areas. I think we could probably encompass in that most of the select committees. If we picked up all the portfolio areas there would probably be an appropriate standing committee to which one could refer ad hoc matters as they arise. Senator Crichton-Browne —Haven't you worked on select committees? Senator MACKLIN —Yes, I am a very strong supporter of select committees. We are talking about the rationalisation of all Senate committees. Senator Grimes raised the point in his first contribution to this debate that there was an obvious need for the extension of the sitting times of this chamber. Until we come to grips with that, I think we are probably just playing around. In many ways I think we must recognise that this chamber is unable to do the type of work it is doing. This is not necessarily because of the increase in the amount of legislation. The most fascinating increase in the amount of work is in terms of reports-which are hardly considered in this place, having regard to the vast amount of work that goes into them-papers, ministerial statements and other such matters. I think there is a need for an overall consideration of the work. With all due respect to the comments made by Senator Chaney and Senator Hamer, I really cannot see how we can pick out one of those items without dealing with the others. I think they are interrelated. It is difficult, I know, to treat them in that way. But without treating them as interrelated problems, I do not think we have any means of moving at all. That might be a dispiriting message. Possibly we will have to go back to Senator Grimes to see whether the parties can come up with some reasonable sitting times. Perhaps in those sitting times we can set down sitting times for the committees as well. I think we need to move next in that direction. If that were so, we may very well be able to accommodate some more legislative matters than we have been able to accommodate at the moment. Senator ELSTOB(South Australia)(8.50) —It has been suggested here that Bills be referred to committees. But before that takes place I think there should be a thorough investigation into what resources the committees have. In my experience in this place there have been too many references that have proved too much for a lot of committees. The resources are simply not there. If a Bill is put before a committee and it does not have the resources, I do not believe that committee can do the work. I have run into problems where there is a lack of human resources. I am not criticising the staff in any way, but I think that many of the committees do not have the right type of staff at times. We may need lawyers or we may need all sorts of experts and the cost of having such people available would be enormous. There is an enormous amount of work going on in committees, as Senator Macklin said, and senators are trying to find the time to make themselves available. We have to do our electoral work and it is very difficult to find the time to serve on committees. I would recommend a thorough investigation into all the resources needed if Bills are to go before those committees. I simply rise to give the Senate that warning. Amendment agreed to. Motion, as amended, agreed to. Debate resumed from 11 April, on motion by Senator Gareth Evans: That the Bill be now read a second time. Senator DURACK(Western Australia)(8.53) —The Senate began the second reading debate on the Trade Practices Revision Bill 1986 when we sat last Friday afternoon. I remind the Senate that this is the second occasion on which we have had a general debate on trade practices amendments. The Government introduced a general Bill for that purpose last year and then only a short time ago it split that Bill-debate on which was proceeding in this place until recently-into two Bills, one of which, the Trade Practices (Transfer of Market Dominance) Amendment Bill was disposed of and passed by the Senate last week. This second Bill contains all the other provisions in the original trade practices amendment legislation, other than the question of the transfer of a monopoly power or a bare monopoly, which was the subject of a great deal of interest in the media and in this place as well because of the proposed takeover of Broken Hill Proprietary Co. Ltd by Bell Resources Ltd. However, that particular issue, which started off as relatively minor in this debate and which assumed such large proportions in recent weeks, has not been disposed of and we are back to the original Bill without that particular amendment which caused all that debate. When we were debating this matter on Friday afternoon I indicated that the Opposition was opposed to the present Bill-that is, the series and miscellany of amendments which the Government has put forward to the original Trade Practices Act. We are opposed to it because of the very grave addition to regulation which it imposes upon the business community in particular, the added costs that will impose on the business community thereby reducing the ability of that community to play its part in improving the economy and increasing employment and job opportunities for people. I had been referring to the fact that this was not just the view of the Opposition, that in fact in the last 20 or 30 years Parliament-by the magnitude and complexity of legislation of which this Trade Practices Act is a very good example and these proposed amendments are a further example and by the regulation making power which arises under so much legislation that the Government exercises with carefree abandon-has made so many regulations, all of which add to the problems of the business community. It has reached such a stage that even the present Hawke Government, with all its fondness for legislating answers and solutions to all problems, has begun to realise this fact itself. In fact, the Prime Minister, Mr Hawke, just prior to the last election in December 1984, started to give some recognition to this in public. It may be significant that this recognition was only being made in the course of that fairly unsuccessful election campaign which he embarked upon at the end of 1984. In November 1984 he certainly said that unnecessary, institutional and legal impediments needed to be removed from this country's productive resources. Following that statement during the election campaign, he said in July last year that the Government would set up a body which was to be known as the Business Regulation Review Unit and that this was being done in some recognition of this problem that he had spoken of on behalf of the Government in the 1984 election campaign. At the end of last year in a speech to the Business Council of Australia, the Prime Minister said he understood the complaints of the business world about the ever increasing volume of legislation and the burdens that that had placed on business. He said that his Government would do something about it. This Government is very good at rhetoric and saying that it will do something about problems, but it is not so good at delivering the goods on these matters. At the very same time as the Prime Minister was making these statements at the end of last year to the Business Council of Australia, the Government introduced this piece of legislation which, in itself, is another classic example of the type of regulatory burden of which the business community has been complaining for so long. The Business Regulation Review Unit reported to the Government a couple of months ago and has in fact pointed out that there are 16,400 Commonwealth public servants engaged in or supporting those engaged in business regulation of one sort or another under a vast range of pieces of legislation. I point out that that number of 16,400 public servants refers only to the Commonwealth public servants who are engaged directly in business regulation. It certainly does not deal with the enormous number of State public servants or those who work on statutory authorities, either Federal or State, who are engaged in regulation of one sort or another. Furthermore, it does not include the tremendous burdens that are imposed upon the business community by having to employ servants and agents to comply in various ways with government regulations. The new Business Regulation Review Unit of the Commonwealth Government will have no fewer than 16,500 Commonwealth Government employees engaged in its activities and it estimates that the cost of employing those officers will be no less than $700m per year. One of the more interesting and rather startling and disturbing conclusions of the Unit is that this figure deals only with those Commonwealth public servants who will be engaged directly in this activity. It has estimated that there could be up to twice that number of public servants indirectly engaged in business regulation. There are 16,500 employees identified as being directly engaged in business regulation and possibly up to double that number of employees will spend part of their time on it indirectly, in one form or another, as a result of the activities of those 16,500 employees who will be heavily engaged. Even if one is generous to the Government and takes a rough figure of half that number, one ends up with something like 20,000 Commonwealth Government public servants who will be engaged in business regulation in one form or another at a total cost to the Government of over $1 billion a year. Despite this advice from the Government's Business Regulation Review Unit, which the Government set up with a great deal of fanfare from the Government about how the Government will do something about it, the Government has introduced legislation of this kind which will only add to the burdens, will no doubt increase the number of public servants involved in these activities and will further increase the Government's expenditure on this type of activity. I instance that as another example of the way in which this Government makes sympathetic noises about this, that or the other problem and says it can understand it and will so do something about it, yet it comes into this place with legislation which does absolutely the reverse. It is another classic example of the continuing hypocrisy of the Hawke Government, which more and more people are coming to understand and resent, as is becoming clearer every day. This legislation to amend the Trade Practices Act has approximately 70 clauses, most of which will increase the burden on the community by regulation of one sort or another. It will greatly expand ministerial discretions, without any review whatever, despite much rhetoric from this Government about how there ought to be proper, independent reviews of decisions of Ministers. The Bill will also add to the duplication of Commonwealth and State regulation under the consumer protection laws. The legislation has given rise to a great deal of criticism. A great many submissions have been made to members of Parliament, submissions which I am sure all of us have seen at some stage or another. I list the organisations which have made very substantial and weighty submissions in criticism of one aspect or another of this legislation: The Confederation of Australian Industry, the Council of Small Business Organisations of Australia, the Business Council of Australia, the Law Council of Australia, the Metal Trades Industry Association Inc., the Australian Petroleum Agents and Distributors Association, the Association of Consulting Engineers of Australia, the Royal Australian Institute of Architects, the Queensland Chapter of the Association of Consulting Engineers of Australia, the Australian Institute of Quantity Surveyors and the Food Industry Council of Australia. All of those bodies-there may be others as well-have made fairly major criticisms of some or all of the amendments contained in this Bill. Although one could say that some of these organisations may have dealt with matters of self-interest, the fact of the matter is that many have come forward with very substantial criticisms. The Law Council, which has a direct personal interest in only some of these provisions, has given a very impressive survey of the various deficiencies of this legislation. The way the Government has dealt with these submissions is a very worrying aspect of this legislation. The submission from the Confederation of Australian Industry deals with the way in which the Government dealt with the question of product safety and product information, on which a whole new Division will be included in the Trade Practices Act. The CAI has pointed out that the Bill contains 11 1/2 pages of provisions relating to the recall powers. That was done after the Government had issued a discussion paper in relation to certain options about product recall and had given a closing date for comment on that paper of 31 August last year. Having received all those submissions, the Government brought legislation into the Parliament within five weeks of that date. That is all the attention the Government seems to have given to some of the very detailed and thoughtful comments which were made to it in relation to this matter. It is perfectly clear that the Government, having sought comment on certain matters, must have had its legislation in place and did not see fit to devote much attention to some of the comments that were made. Indeed, the way in which the Government has introduced its amendments to this legislation at a very late stage of the consideration of this Bill would bear out the fact that its so-called consultation with industry was really little less than a hoax. There are a large number of most objectionable features in this legislation. It deals with a wide range of aspects of the Trade Practices Act. Virtually every provision contained in the legislation will add to the complexity, burden and cost of business regulation. One of the most worrying things is that it will introduce very great ministerial discretions which cannot be reviewed under the various processes that have been set up over the past 10 years or so, with bipartisan support in this Parliament, to provide adequate ways of reviewing ministerial discretions. All of that progress that has been made on a bipartisan basis in this Parliament is ignored, and great new ministerial powers are given. We shall be dealing with those in greater detail in Committee. But the Government is setting back the clock 10 years, if not more, by the wholesale adoption and introduction into the Trades Practices Act of these great new ministerial discretions, which are entirely unreview- able. They cannot be reviewed under the ordinary administrative review process or in the courts of law. It is for that combination of reasons that the Opposition will vote against the second reading of this legislation. If, unfortunately, it is passed, throughout the Committee stage we shall be endeavouring to ameliorate as far as possible the very large number of objectionable features of it. Senator MACKLIN(Queensland)(9.11) —I wish to speak only briefly at this stage on a point with regard to the way in which the Trade Practices Revision Bill 1986 has been handled. The Bill is the same as the Trade Practices Amendment Bill 1985, with the omission of that section that we have already dealt with in another Bill-section 50 (2C). This particular Bill was passed by the House of Representatives on 20 March, and a message from the Governor-General was announced recommending an appropriation of revenue for the purposes of the this Bill. That is the part to which I wish to refer-message 125 from the Governor-General. In passing, I comment that I find it rather odd. Presumably we are not paying the Governor-General enough, because he is not provided with any letterhead paper any longer; it is simply a sheet of ordinary paper. It says: In accordance with the requirements of section 56 of the Constitution, the Governor-General recommends to the House of Representatives that an appropriation of revenue be made for the purposes of a Bill for an Act to make various amendments of the law relating to trade practices. 20th March 1986. It should be observed in passing that the prohibition contained in the first paragraph of section 53 of the Constitution is: Proposed laws appropriating revenue or moneys, or imposing taxation, shall not originate in the Senate- and that those requirements which are contained in section 56 are: . . . appropriation of revenue or moneys shall not be passed unless the purpose of the appropriation has in the same session been recommended by message of the Governor-General to the House in which the proposal originated- These are not justifiable but are matters, basically, for the Houses of Parliament and for the Governor-General. The claim that the Bill which we are debating, the Trade Practices Revision Bill 1986, is a money Bill-that is, that it appropriates revenues or moneys-is clearly false and, I believe, must have been known to be false when the people who engaged in that exercise made such a claim and so recommended to the Governor-General. It appears to be based on the assertion that any Bill which in order to appropriate might require an appropriation or an increase in appropriation is itself an appropriation Bill. This is so clearly contrary to the language of the Constitution and to the plain meaning of the legislation that I do not believe that it could be believed by those who were asserting it. If one looks at section 53 of the Consti- tution-there are some remarks of High Court judges with regard to this particular section when it came before them in other ways-one sees that the relevant paragraph says that the Senate `may at any stage' return a Bill to the House of Representatives with requests, and this, indeed, is what has been involved in the exercise that we have been going through. If we look at that particular exercise, we see that `at any stage' can be interpreted as meaning at any stage in the Senate's initial consideration of the Bill the Senate could press a request-as it has, indeed, successfully done in the past-and, if it wanted to, could so rearrange its own Standing Orders in such a way as to have many stages of a Bill, and hence have innumerable opportunities to press requests by simply constructing it in such a way. I refer also to the fact that at the Consti- tutional Convention an amendment to insert the word `once' in the relevant paragraph of section 53 was defeated. Hence, I believe that there was an understanding of what was going on and what could possibly go on at a later stage. Delegates to the Constitutional Convention, including Sir Edmund Barton, indicated in their remarks that the difference between an amendment and a request would be one of procedure only, and that obviously has turned out to be the case, the rationale for the difference being to preserve the right of the House of Representatives to make in a Bill any amendments involving additional appropriation or taxation. The money required for the operation of the provisions of this particular Act is appropriated by the annual Appropriation Bill, as is indicated by the explanatory notes on the Estimates provided by the Attorney-General's Department. Therefore, the claim that the Trade Practices Revision Bill is a money Bill is transparently incorrect. I believe that here we are looking at advice which was given. In our early views with regard to this Bill we were looking at a division of these Bills for tactical purposes, as the Government has also done. At that stage, I understand that the Government was given some advice that it was not able to do so in the Senate because it was a money Bill. Of course, neither of those reasons stands up. The Senate is quite able to divide Bills if it wishes to do so, whether they be money Bills or not. Section 56 of the Constitution provides: A . . . proposed law for the appropriation of revenue or moneys shall not be passed unless the purpose of the appropriation has in the same session been recommended by message of the Governor-General in the House in which the proposal originated. Presumably, it was in following that section that that particular message from the Governor-General was delivered. I think it can be seen that section 53 and section 56 are expressed in similar terms, and that a Bill which could not be introduced into the Senate because it would appropriate revenue or moneys would require a Governor-General's message to the House of Representatives recommending the purpose of the appropriation. It is fairly obvious to me that this misleading advice has been given purely for the purpose of obstructing senators and the Senate in the performance of their legislative activities. This is an incredibly serious situation. It is one which has bedevilled relationships between this House and the House of Representatives for some considerable time and one which was eventually resolved with regard to the annual services of government provisions and the way in which they should operate. That has operated fairly successfully over the years since that pact was made. I suspect in particular that this operation was aimed at the Australian Democrats because of our commitment not to block Supply. If the claim were carried to its logical conclusion, it would mean that virtually every Bill introduced into the Parliament would be held to be a money Bill. It would also mean that every amendment moved in the Senate would be regarded as affecting some appropriation and thereby falling under the prohibition contained in the third paragraph of section 53, which provides that the Senate may not amend any Bill `so as to increase any proposed charge or burden on the people'. Government advisers are clearly trying to steer members of parliament into an acceptance of what can only be called bizarre interpretations in order to prevent and hinder what they regard as troublesome interference on the part of the operation of the Senate with regard to its correct legislative role. I believe that the Government, in terms of its operation in this chamber, should not go down this path but should follow the procedures which have been used successfully since the compact was decided and agreed upon. I am also particularly disturbed at the strategy which is involved here and which, of course, involves the Governor-General's message. It seems to me that the message in this case is being used for a partisan purpose in this chamber. I think considerable difficulties would arise in future if this strategy were pursued as a tactic. I would be very interested to hear the Minister explain, at an appropriate stage of the Bill, why it has occurred and why it has occurred in this way. If the Minister maintains that this is a money Bill, I would like him to point to the specific clauses of the Bill that he believes support his case. Presumably he is not going to refer to legal aid which is not dealt with in this Bill and which at one stage was one of the reasons trotted out by various people why this is in fact a money Bill. Senator SHORT(Victoria)(9.22) —Tonight we are debating part of what was the former Trade Practices Amendment Bill. This Bill, which I understand technically still resides in the Senate, has been overtaken by and split into two separate Bills. The Trade Practices Amendment Bill has become the Trade Practices (Transfer of Market Dominance) Amendment Bill and the Trade Practices Revision Bill. The Trade Practices (Transfer of Market Dominance) Amendment Bill has been passed by both Houses with no major disagreements. The Bill now before the Senate, the Trade Practices Revision Bill, contains several elements, as did the earlier Trade Practices Amendment Bill, to which the Opposition is very strongly opposed. The reasons for our opposition have, I believe, been made clear by Senator Durack this evening and by other speakers, including Senator Durack and me, in the earlier debate on the fuller Trade Practices Amendment Bill. Our opposition to the various areas and elements of the Bill before us at the moment-the Trade Practices Revision Bill-will be spelt out in greater detail during the Committee stage of the debate. I would like briefly tonight and in relatively broad terms to reiterate our main problems with this Bill. The first problem is that the original Bill, along with many other pieces of legislation, was steamrolled and forced through the House of Representatives in a totally undemocratic fashion late last year, at the end of the last session. In fact, so eager was the Government to get that Bill through the House last year that it was circulating amendments to its own proposals on the very day that the Bill was debated and passed through the House of Representatives. What a mockery that makes of the democratic parliamentary processes. Senator Gareth Evans —Consultation at work. Senator SHORT —Consultation at work. Par excellence, Senator Evans. The Minister has put it in a nutshell. This very full piece of legislation was very important to the whole of the business community of Australia. It was important not only to large business but also, more importantly, to small business. The Government forced that Bill through the House of Representatives in an unseemly hasty manner a very few weeks after the closing date for submissions the Government had asked for in relation to an exposure draft. Quite obviously, the legislation was introduced at a speed which made it impossible for the Government to take into account the very real and very serious objections that the business community put to it. I put it to the Government as a general proposition that, if we are to have responsible and serious government in this country, a much greater regard must be paid to the due processes of the consideration of the important issues of the day that affect us as a community or as important sections of the community. I believe that we do ourselves and the democratic process a very serious disservice by treating important legislation in the way that we so frequently do. As parliamentarians we have a responsibility to say to governments of whatever political persuasion: `Let us have a proper look at what we are doing because if we do not we will get bad government, bad laws and we will rightly deserve, as parliamentarians, the opprobrium of the community'. I believe that we, and particularly the Government, are running that risk in respect of the Bill now before the Senate, and deservedly so. The Opposition's second reason for opposing this Bill is that it is anti-business. It is anti-business because it seeks to impose yet another layer of unwarranted, unnecessary and undesirable regulation on the business sector. The Bill seeks to enforce the entrenched ideology of the Hawke Government by being anti-business. Despite the protestations to the contrary in the second reading speech of the Minister for Industry, Technology and Commerce (Senator Button) and in some contributions made in the Senate and the House of Representatives in respect of the earlier Bills, this Bill is not only anti-business but it is anti-consumer because it has very significant cost implications of a negative nature for the consumer. The cost of additional regulation has to be passed on and in the end it is the consumer who pays. This is an anti-business and anti-consumer piece of legislation because it is extremely costly to the consumer and extremely regulatory to business as a whole. We do not have an exact costing of the legislation but it has been estimated that the direct cost to the business community will be of the order of $50m annually and could be considerably higher. If that cost is multiplied throughout the community, the costs to the community will be very considerable indeed. We have in this Bill a repeat of the old Australian Labor Party socialist philosophy that industry and the community can be improved by more and more regulation and involvement by government in telling sections of the community what to do and what is in their best interests. This Bill flies in the face of the Government's professed concern over the last couple of years to reduce business regulation. The Prime Minister (Mr Hawke) in his 1984 election speech only 18 months ago said: Over the next term of Parliament we will remove legislation and regulation which is damaging to business and employment expansion and which is not justified as an efficient means of promoting economic and social objectives. That is a direct quote from the Prime Minister's 1984 election policy speech. Yet in mid-1985, the Government, to its credit, set up a business regulation review unit to apply a cost-benefit approach to new regulatory proposals and to seek out existing regulations which might be eliminated. Not one of those objectives leading to the establishment of the business regulation review unit appears to have been met in the Bill now before the Senate. The first report of the business regulation review unit was released only a couple of months ago. Amongst other things the report said that the unit had found that more than 30,000 Commonwealth public servants had been employed in administering business regulations at an annual cost to the taxpayer of $1.4 billion. Coincidentally, $1.4 billion per year happens to be the amount of money that the Government is trying to chop off its expenditure commitments for this forthcoming year. So we are not talking about chicken feed; we are talking about very significant amounts of money. We have the Government's own regulatory review unit saying that we have 30,000 Commonwealth public servants employed in administering business regulations-let alone all the other regulations that government gets involved with-at an annual cost to the taxpayer of $1.4 billion. That is an estimate for the Commonwealth Public Service alone. The Secretary of the Confederation of Australian Industry, Mr Overland, is reported as saying that for every officer employed by the Commonwealth there is at least another employed in the private sector. That would add another $1.4 billion to the cost to the community. Mr Overland is also reported as saying that if we add State and local government regulation, the cost can be quadrupled. On that basis, the total annual cost to the community of the regulation of business in Australia could well exceed $10,000m per year. That is about $600 for every man, woman and child in this country per year. Even if that is an over-estimate a substantial discounting of that figure would still lead to the inevitable conclusion that the community faces an enormous cost through business regulation. It is an enormous drag on business activity. No wonder that we are rapidly falling behind as a nation in terms of our international cost competitiveness. We need to get off the back of business, not to strangle it with an ever-increasing burden of regulation. That is not to say that regulation from time to time is not appropriate or desirable. But what it does mean is that before we impose more and more regulation on business it must be given the fullest scrutiny and it must be given the fullest justification. We have neither of those criteria filled in this particular case. I will reserve detailed comments on the provisions of the Bill until the Committee stage, but I foreshadow that there are several issues that concern me very much and, as has been outlined earlier by Senator Durack, that concern the Opposition. The proposed changes to section 46 are an obvious example of that. Without making a final judgment on section 46 I am extremely concerned that organisations like the Business Council of Australia and the Law Council of Australia which have considered these matters and provisions very carefully have come to the conclusions that they have. I quote, for example, from a letter to the Attorney-General (Mr Lionel Bowen) from the Business Council. It states: The cumulative effect of the changes to Section 46, as they now stand, means that the primary thrust of the Act will be directed towards damage to individual competitors rather than damage to competition itself. It goes on to state: If we are to ensure the maintenance of a vigorous, efficient and internationally competitive Australian industry, we believe there is an urgent need for the Government to remove unnecessary uncertainties and confusion which currently exist in the proposed amendments to section 46. The thing that I find interesting and very surprising, and most of all very disappointing, is that despite those comments that have been given to the Government quite some time ago, and despite the debates that we have had in this chamber and in the other chamber on the Trade Practices Amendment Bill, the Government appears to have taken not one whit of notice about the expressions of concern that have been voiced from such wide-ranging and very important sections of the community. If the business groups in this country are saying the type of thing that I have just given as an example, surely it is incumbent on the Government at least to give those claims the closest scrutiny and consider- ation. There is no evidence whatsoever, as I have said, that the Government has done that. Section 46 is a matter of major concern, so are other provisions in the Bill, for example, the mandatory recall provisions in the legislation. Several well researched submissions have been made to Government on the matter of recall procedures. Even though it is a reserve power that is being proposed there are various matters for concern in that. For example, as I understand it, the reserve power does not contain a requirement that before a mandatory control power is used a product must first of all have been banned from sale. The issue of the reserve power to recall products is not, as I understand it, subject to independent administrative law review. In terms of the mandatory provisions there is the whole question of the role of administrative decisions and administrative law, vis-a-vis the common law processes of this nation. That is another area that certainly concerns the Opposition. Beyond these two and other specific provisions in the Bill I believe that there is-I am not suggesting that it can necessarily be done in the context of this Bill-a very urgent need to look more closely at the whole philosophy behind the Trade Practices Act. The history of this Act goes back a long way. Consideration of it goes back to the days of the Menzies Government. We then had the impact on it of the Whitlam Government's ideology and policies. Then we went through the Fraser period and now we are in the Hawke Government period. I have very considerable doubts as to whether any of us have looked sufficiently at the Trade Practices Act as it now stands to see whether it is an internally consistent document in terms of its philosophy and its spirit. I believe that we have not looked at it to that extent and that it is not such a document at the moment. I do not believe that it is internally consistent and I do not believe that it has the overall interests of what we need in this country in terms of growth and vitality and the encouragement of individual incentive, entrepreneurship and enterprise. We need to look at the relevance of the Trade Practices Act to the needs of Australia in the 1980s. We talk about the need for rationalisation. We talk about the need for restructuring. All that is very desirable, but we have Acts of Parliament with provisions that are contrary to the encouragement of some of those processes and to the encouragement of greater competition and the international competitiveness on which this nation will depend for the future living standards of all Australians. There are some very considerable issues at stake here. I hope that the Trade Practices Act-and I said this in the earlier debate on the Trade Practices Amendment Bill-is something that this Government will look at. Certainly, we on this side of the Senate will be doing so. I believe that the Trade Practices Act is in the wrong portfolio. Essentially, it is a piece of business legislation. Sure, it is a piece of law, but in my view the Trade Practices Act should be within the portfolio of a Minister with specific economic and business responsibilities. The way that this Act is framed and administered is, as I said before, of vital importance to the whole operation of the private sector. It is for that reason that I believe its carriage ought to be with a Minister with specific economic or business responsibilities. I appreciate that this is not a matter for debate in the context of this present Bill, but it is a matter that I believe we as a Parliament will need to consider and should be considering, in the not too distant future. I have very grave reservations about this Bill. The Bill that we have is designed to split the earlier piece of legislation that we debated a month or so ago. The reason for the split was occasioned by the attempted takeover by Bell Resources Ltd of Broken Hill Proprietary Co. Ltd. It was a piece of expediency on the Government's part to split the legislation. The split in no way removes-indeed, it heightens to some extent-the concerns we had about the earlier piece of legislation. We on this side of the chamber certainly will be seeking from the Government in the remainder of this debate, particularly in the Committee stage, a much greater explanation of the reasons for some of its proposals. We will be continuing, as we did with the earlier legislation, to oppose those proposals very strongly indeed because we on this side of the chamber want a healthy, dynamic and growing private and business sector in this country, which is in obvious contrast to a government which produces the sort of legislation we have before us in this Bill. Senator HAINES(South Australia)(9.41) —The Trade Practices Revision Bill 1986 which is before us tonight is the remaining nine-tenths of the old Trade Practices Amendment Bill that was split into two following problems that the Government faced with regard to Broken Hill Proprietary Co. Ltd and its attempted takeover by Bell Resources Ltd which caused the Government to separate the amendment to section 50 of the Trade Practices Act with regard to mergers. We dealt with that last week. It was an interesting manoeuvre by the Government, which was aware of the fact that, while the Opposition was supportive of the changes to section 50 that were proposed in the original Trade Practices Amendment Bill, that was about the only section of the legislation that the Opposition was in fact supporting, whereas the Australian Democrats were far more supportive of the remainder of the original legislation which dealt with consumer protection. Senator Short talked about the fact that the Bill before us tonight is anti-business legislation. I suggest that it is anti-bad business legislation and I remind him that the majority of the pieces of legislation which come before this place deal not with the 90 per cent of people or organisations that behave in an ethical or moral way but with the 10 per cent of those that do not. It is an attempt, in one form or another, to protect the potential victims of those people. That is as true of State legislation as it is of Federal legislation. After all, we would not need most Acts of Parliament if people behaved in the manner in which a lot of us would like to see. This piece of legislation, in effect, is aimed at protecting consumers against organisations in the community far more powerful than those individual consumers-that is, businesses that engage in one form or another of restrictive trade practices and anti-competitive actions or businesses which misuse their market power generally. The legislation is aimed at protecting consumers-I am including in that term not just individuals in the community but also small businesses which are equally vulnerable to the predatory behaviour of some large and powerful organisations in the community-from businesses which are cavalier in their behaviour as far as measures such as recalling unsafe products are concerned, businesses which make misleading statements and businesses which in one way or another indulge themselves in unconscionable conduct of sorts, including charging small businesses for unsolicited advertising. As I said a moment ago, this legislation is aimed at protecting individual consumers and small business consumers from the anti-social behaviour of a minority of larger, more powerful organisations. If, as Senator Short said, this is costly to the community, I suppose that is rather unfortunate but it is an inevitable consequence of a government attempting to do the socially appropriate thing, and that is to keep costs to individual consumers and small businesses to a minimum when those people are at the mercy of some unconscionable business conduct. I remind Senator Short and others that, after all, the Trade Practices Act was originally the brainchild of the Fraser Government. That Government can hardly be called the most socialist of governments that we have had in this country. The important thing to remember about this legislation is that it is, in effect, putting into practice recommendations that have come from the Green Paper. Senator Short also said that the legislation had been rushed through the lower House. I am surprised that he did not add `in the small hours of the morning', which people usually dredge up to imply that something sinister has happened, instead of simply saying that the House of Representatives sits rather stupid hours. The legislation may have been pushed through the House of Representatives. That does not alter the fact that it has had some two years of community debate because it is two years since the Green Paper was brought out by the Government on the need to revise the Trade Practices Act for various reasons, including not only the fact that judges have an unfortunate habit of seeing things in black and white instead of paying more stringent attention to general reasonable interpretations of the law, but also the fact that things have been shown through business practices to have been omitted from the legislation. The legislation does not, to our mind, go far enough. It does not, for example, pick up the recommendations made by the Green Paper about section 49. As I indicated in my speech in the second reading debate when the legislation was first introduced in February in this place, I will move amendments in some of those areas. One area that I did not raise in the speech in February was the question of amending section 74 to add an additional section with regard to the recall of dud or lemon cars. This amendment is more or less identical to the terms of the private member's Bill which I introduced on behalf of the Australian Democrats some years ago and which Senator Gareth Evans assured me the Government would not support at that time because the Trade Practices Act as a whole was being thoroughly investigated at that stage and no doubt this issue would be picked up then. Not surprisingly, however, I do not notice in the Bill any attention being paid to that extremely irritating and expensive problem that occurs to a number of consumers annually-that is, being sold a new car which, in effect, is a dud or a lemon because it presents its owners with persistent and recurring problems of one sort or another and they are unable to get any satisfaction from the dealer, the manufacturer or anyone else. The legislation is based on similar legislation in the United States of America and I hope that the Government, or maybe even the Department which tells the Government what to do, will give it more sympathetic attention than it received that last time. I am not going to hold my breath waiting, however. I somehow suspect that this is too radical a reform to the Trade Practices Act even for the current Labor Government, given the current Attorney-General (Mr Lionel Bowen). It is remotely possible that it would have received more sympathetic attention under the previous Attorney-General, but we will never know. It is interesting, therefore, to reflect on the fact that it is the changes that are being made in this legislation to section 74 that are causing the most heartache to some sections of the community. Since the Bill was held over from February while we debated whether Bell Resources Limited, John Elliott via the Elders organisation or anybody else should take over BHP, we have been inundated with letters of complaint from various organisations about section 74, some of which make the most extraordinary suggestions about the likely effect, including the fact that if a doctor does not cure a patient he or she is likely to find himself or herself in the middle of litigation. If a lawyer does not get his or her client off whatever charge he or she is on, that lawyer will be subject to litigation. Presumably if the average infant school teacher does not get the entire class totally conversant with its two times table he is, somehow or other, held to ransom pour faveur section 74, that lists the proposed changes to section 74. Many of them, of course, quote litigation in the United States of America and the massive pay outs and the problems with personal liability, insurance and so on. But to the best of my knowledge not even in that most litigious country has failure to cure somebody or win a case of itself been the cause of litigation and/or huge pay outs. As far as the massive premiums for personal liability insurance are concerned, I suggest that the professional groups concerned take that matter up with the insurance companies, that most conservative of organisations which are, I suspect, putting up their premiums in fright rather than on any actuarial basis. One of the most intriguing letters that I had on this whole question of section 74 was a multi-page letter which set out what it said were the errors in basic assumptions, the fundamental inconsistencies and the discriminatory effect of section 74. In part, it had this to say: The first basic assumption is that the amendment to section 74 will simply re-state the common law. The duties imposed on a professional by the common law are clearly stated in Section 1 of this submission. I do not intend to go into that at the moment. The important sentences follow: If section 74 were to apply to professionals there would be an implied term that the services rendered by them would be done with due care and skill . . . Senator Gareth Evans —That is a pretty shocking prospect. Senator HAINES —Yes, I thought that. For a moment when I first read the letter I thought perhaps I had misread it and that I had omitted something but, no, it states: If section 74 were to apply to professionals there would be an implied term that the services rendered by them would be done with due care and skill . . . That is something which I would have thought was devoutly to be wished anyway, but apparently, according to the writer of this submission, has never operated in the past and ought not happen in the future. He points-it is a he; I am not making that assumption-specifically to sub-section 74 (1) and goes on to say: . . . and that where a client expresses an implication makes known to the professional any particular purposes for which the services are required or a result that he desires the services to achieve there is an implied warranty that those services will be reasonably fit for that purpose or are of a nature and quality that might be reasonably expected to achieve that result. Senator Gareth Evans —Outrageous. Senator HAINES —Senator Gareth Evans suggests that that is outrageous. That is certainly the suggestion that is being made by the writer of this letter when he states: . . . there is an implied warranty that those services will be reasonably fit for that purpose or are of a nature and quality that might be reasonably expected to achieve that result. So presumably if a client or a patient goes to a professional and requests a service which is unreasonable there is no obligation, one assumes, under the proposed changes to section 74, that the professional providing the service will be able to fulfil the request from the client. The letter goes on at some length in addition to that. It states: This approach conflicts with the common law in two respects:- (i) the test of care and skill- I presume that the writer means due care and skill since that is what was used in an earlier paragraph- is a higher duty than reasonable care and skill because under the common law the professional is not required to bring to the performance of his or her duty an extraordinary degree of care but only a reasonable and ordinary proportion of it; and (ii) to imply a term that the services will achieve a desired result is beyond the common law position under which for example an attorney does not undertake that in all events you shall win your case and a surgeon does not undertake that he will perform a cure or an accountant that a business proposal will be acceptable. I was not aware, apart from the strange reading that this person has made of the proposal, that the changes of the Act were going to somehow magically produce that end result. The letter continues: The second basic assumption which is in error is that all professional advice guarantees the success of a venture or undertaking. I have not been aware in the past that that, in fact, pertains. Doctors do not guarantee success of a venture or undertaking. Lawyers do not guarantee to get a person off whatever particular charge he is on; they simply undertake to do the best that due care and skill, reasonable care and skill, will produce. After all, the question is not whether a patient is successfully treated or whether a person successfully got off his case, but whether the person providing the service has provided a service which is fit for the purpose for which it was undertaken. So doctors are not encouraged to take off the wrong leg. They have always found themselves faced with litigation if they make a mistake of that sort in surgery. If a lawyer is blatantly negligent in a case he, too, can expect to find himself subject to even the common law. I was intrigued to read an article in the Advertiser recently with regard to a custody matter. The father, who was seeking overnight access, and unsupervised access at that, was suspected of sexual abuse. According to the report the Queen Elizabeth Hospital written report was presented to the court. It clearly suggested that sexual abuse had taken place. However, because the mother's solicitor failed to appear at the hearing, the court was not told of an additional report that was available, which was still being prepared by the hospital and which could well have influenced the court in its decision. Assuming that the mother's solicitor failed to appear for some unsatisfactory reason, I would have thought that under common law that solicitor would have found himself or herself in some trouble. It appears to me that the changes to this legislation are not going to affect significantly the behaviour of reputable professionals, those who provide services that are fit for the purpose or those who apply due care and skill to the advice they give, to the submissions they prepare for clients or to the treatment they give their patients. So all in all, as far as the Australian Democrats are concerned, this legislation is a piece of pro-consumer legislation. If it is anti-business at all, it is anti-bad business. It sets out to give additional protection to vulnerable members of the community. It is not draconian in any way at all although, as I said earlier, it does not go far enough. We will be moving amendments that attempt to strengthen it. The Government has already picked up a number of our amendments and, indeed, picked up a number of amendments suggested by the Law Council of Australia. So the Government has not been totally derelict in its legislative duty. It has paid attention to those groups, including members of parliament, which have gone to it with reasonable suggestions for improving the legislation. I hope this legislation will be passed speedily in order to extend, as it should be extended, the sort of protection to consumers that they need. Senator MICHAEL BAUME(New South Wales)(10.00) —I seem consistently to be following Senator Haines as trade practices Bills, or sections of them, come up for repeated debate in the Senate-a level of debate which, unfortunately, was not allowed by the Government to take place in the House of Representatives. Senator Haines has some fixation about the early hours of the morning which escapes me but in fact the Government, with unseemly haste, required this Trade Practices Revision Bill to be rushed through the House of Representatives in such a way that proper detailed examination could not take place-before, in fact, the Government's amendments to the Bill, which it had in place at that time, were put into the Bill. That was clearly a gross discourtesy to the House of Representatives. In fact, I think it was a gross distortion of the proper way in which any responsible government should conduct itself when introducing a Bill of such significance. The Trade Practices Revision Bill is a Bill of enormous significance. It is not every day that we deal with Bills which are described by a Senate committee as `trespassing unduly on personal rights and liberties'. This description of this Bill was made by the Senate Standing Committee for the Scrutiny of Bills. This Bill involves reverse onuses of proof; one is guilty until one is proved innocent. Apart from things like that, I suppose it could be held by some people, including the Australian Democrats, that it is a charming Bill which does not go far enough. Maybe they want more reverse onuses. Maybe they want more trespassing on individual rights and liberties. I must say that I find this Bill to be monumentally offensive to some basic principles. What is even more offensive is that the Government has determined deliberately not to respond to some major objections from organisations such as the Law Council of Australia, let alone from the Opposition, which it treats with contempt in matters like this. One would have thought that the Law Council of Australia would be a body worthy of more consideration than it has been given. It is true that when a Trade Practices Bill was last before us some amendments recommended by the Law Council were presented by the Opposition. In not every instance did the Government find them totally offensive; it objected just to the major ones and to most of them. I stress that some of the matters that Senator Haines raised appear to suggest there is no such thing as common law in Australia. For her to talk about the gross negligence of a lawyer and how this sort of legislation is clearly needed in these sorts of matters is arrant nonsense. The fact is that the common law provides for penalties and awards damages against people who behave in this way. Although I did not want to be distracted into going into the individual elements of the Bill again, now that Senator Haines has mentioned the question of proposed new section 84, which relates to the relationships between professional persons and their clients, I want to say that it is incredibly boring to hear, over and over again in this chamber, people saying: `Well, it is true that there is a common law which does in fact provide opportunities for damages and so on, but we think that something should be done in this Bill for the sake of consumers. This is a piece of consumer legislation'. I am one of those people who take the view that consumers should be within the embrace of the rule of law and that they have every right to take actions for damages, particularly as we have such a substantial system of legal aid for those who cannot afford to take such actions. If we follow the course that Senator Haines and the Labor Government want-namely, to impose this kind of consumer law on the community; that means on the business community and thereby on the whole community because the cost of this kind of thing gets passed on in higher prices-I hope that the Opposition's strong objection will receive sympathetic support within the community. Let us look at the question of professional persons and their clients. The Law Council quite clearly says: The amendment would impose on engineers, accountants, architects, lawyers, doctors, dentists and many other professions (the vast majority of whom are in the small business sector) a statutory warranty that their services will achieve whatever result the client desires. The Law Council continues: This is tantamount to a warranty by the doctor that the patient will be cured or by an architect that an innovative design will work. Although the Act would not affect all professional services provided on a personal basis within a State, the Act would apply to incorporated professional practices in the States and to those and individual practices in the Territories. As I have already mentioned, the Law Council states: The common law requires that a professional will use due care and skill and that, if negligent, a professional can be sued for damages. Quite frankly, in my view, if the Government wants to impose itself in this area there are far better ways of doing that than having this kind of law. I suggest that if it wants to run consumer claim bureaus, let it do so. Doing it this way seems to me to impose quite intolerable burdens on professionals, who, generally, as I say, are small businesses in effect. Apart from anything else there is the real threat that the imposition of this kind of warranty-this is a point that the Law Council makes-would tend to stifle innovation. People would not be prepared to take the risks involved in falling foul of the warranty required in this legislation. Innovation, in particular in medicine, architecture, engineering and other professions, would clearly be stifled. I cannot see the demand for the proposed change. I cannot understand why it should proceed. I am overjoyed that in the Committee stage the Opposition will be moving amendments that deal with that section. I wish to deal with another couple of points Senator Haines made. She said: `Look, there has been plenty of debate on this measure because there were two years of community debate'. That is all very well. There may have been two years of community debate, but what about some answers to the specific points that have been raised repeatedly in this chamber in this debate? Of course, there was no opportunity for much debate in the House of Representatives, but here in the Senate one would hope to get some response to these matters of principle. Just to add to the point-I mentioned this in the professional context-as to whether this is really a Bill that small business embraces totally to its heart, obviously professionals in small business do not do so because in recent times we have been inundated with correspondence from people from the professions outlining to us their real concerns about section 84 about which I have just spoken. On top of that, Mr D. M. Gibbons, the Executive Director of COSBOA, the Council of Small Business Organisations of Australia, has noted in respect of one clause-I think it is clause 35-that: . . . the proposal to give the Minister power to order a mandatory product recall in certain circumstances goes a little too far I feel, and could result in unnecessary and very costly and distortive decisions arising from interest group pressure rather than technical facts, for example. Let us not get carried away with the idea that small business is united behind the Australian Democrats' united stand-it is unusual that they are united on this matter; this is one of the few matters on which they appear to be united-because the reality is that while some elements of the Bill certainly appeal to some sections of small business, other sections of the Bill do not appeal to other sections of small business. So let us get this in perspective. This is not, frankly, a Bill that suits all small businesses. It is a Bill that is oppressive to the great bulk of businesses in Australia, including many small businesses. As Mr Gibbons says, it is a Bill that could result in unnecessary, very costly and distortive decisions arising from interest group pressures. The reality is that this Bill, like so many consumerist Bills, provides an excessive level of power to a developing group in this community which enjoys nothing more than being, if one likes, the Australian representatives of the Naderist movement in America. Many of these consumer groups consist of people whose bona fides I suggest, are not outstanding, people who do not have a genuine interest in the consumer but who have a consuming interest in getting stuck into business of any kind. It disappoints me that in many ways government grants through various bodies appear to have been given to a whole group of these consumer bodies, some of which appear to be no more than fronts for some individual unions, particularly in Victoria. It is extraordinary to recognise that the office addresses of quite a group of Victorian consumerist organisations appear to be the same as those of the metal workers union. Perhaps that is not a matter to be developed at great length at the moment. But it does seem to me that this consumer movement has been misused quite disgracefully in some areas-I am not saying everywhere-by people whose motives have absolutely nothing to do with the best interests of consumers and who have an industrial or political motive which appears to me to be far more disruptive and hostile to the business environment, and certainly very additive to the costs of items produced in Australia, than it is of looking after the interests of consumers. Let me deal further with another problem about this Bill which relates to a basic principle which concerns me immensely. I refer to reversing the onus of proof. The late Senator Alan Missen was a member of the Standing Committee for the Scrutiny of Bills when the question of the onus of proof in this matter was raised. I mention his name because, of course, he was a champion, as are many on both sides of the House, of that principle, particularly when it involved matters of as serious a nature as this, in which the penalties can be severe. It interests me that in justifying this reverse onus of proof the Attorney-General (Mr Lionel Bowen) stated: . . . where a matter is peculiarly within the knowledge of the defendant, or, alternatively, the Crown would have great expense or difficulty in establishing the issue which could readily and cheaply be proved by the defendant, a reversal of the persuasive onus is permissible. This is justifying the reverse onus involved in this matter, to which the Law Council, of course, has quite properly and sensibly objected. The reversal of the onus of proof is in relation to representations made by a company and the consequences flowing from a representation that is deemed to be misleading when it relates to a forecast for the future. The Attorney-General, in responding to concerns by the Scrutiny of Bills Committee, said that in Thompson v. Master touch TV Services (1977), Franki J. held that: . . . a prediction or statement as to the future is not false within the words of section 59 (1) if it proves to be incorrect, unless it is a false statement as to an existing or past fact which may include the state of mind of the person making the statement or of a person whose state of mind may be imputed to the person making the statement. The Attorney-General continued: His Honour also held that a promoter's promise or prediction about the future performance or profitability of a business opportunity is not caught by section 59 (1) unless it can be shown that the defendant `did not believe that the forecast or prediction would be satisfied or was recklessly indifferent concerning the forecast or prediction. The problem, as I see it, is that the Attorney-General continues: It is virtually impossible in most cases to obtain conclusive proof of lack of belief or recklessness from surrounding circumstances and without an admission of guilt from the defendant. This would suggest that one cannot get any successes in this area. I am not convinced, I must say, at this stage that that is so. The Attorney-General states: This is because the circumstances surrounding the prediction or forecast (ie. the grounds on which the defendant makes the statement) are matters peculiarly within the knowledge of the defendant. In the Mastertouch case, the information was dismissed because the informant had not satisfied the Court that the defendant did not believe the forecast or prediction was true. The defendant did not go into evidence, so there was no evidence as to the state of mind of its manager. If it is impossible or virtually impossible to get such successful prosecutions, I must admit I am intrigued by the number of cases that I have here that indicated findings that involve successful prosecutions. It may well be that in some of those cases the finding emerged from an admission of guilt by the defendant. But let us return to the Mastertouch situation. The Attorney-General says: In the Mastertouch case, the information was dismissed because the informant had not satisfied the Court that the defendant did not believe the forecast or prediction was true. The extract from the case that I have here deals with it as follows: An operator of a business which involved the arranging for portraits to be painted in Taiwan from photographs advertised for an agent in Canberra to serve as retail outlets for the paintings. The advertisement suggested that the agent should earn a minimum of $400 per week. In fact the purchasers of agencies only earned $45 in seven months. The Commission was unsuccessful in proceedings under s. 59 because the section relates to businesses carried on at a person's home whereas the agency in question in this case related to a business to be carried on from a person's home . . . Perhaps the Minister for Resources and Energy (Senator Gareth Evans) who represents the Attorney-General can explain to me which of these two versions of the Mastertouch case is correct-whether it is because the informant had not satisfied the court that the defendant did not believe the forecast, or whether it is because of that technical difference between `at' a person's home and `from' a person's home. I would be interested to find out whether this summary from a highly reputable organisation which provides information in these matters is correct. Let us look at some other cases in which this matter has been successfully prosecuted. Another one is Wilde v. Menville Pty. Ltd. in 1981-which is well after 1977, of course-in which a secondhand truck dealer who sold trucks by falsely representing to purchasers that they could obtain employment from nominated sources if they bought a truck from the defendant was found to have breached section 59 (2). Fines totalling $105,500 were imposed. In another case, Ducret v. Colourshot Pty Ltd. in 1981, a company which advertised for sale franchises for collection agents for film to be processed by the company, and which included in its advertisements reference to potential weekly earnings which were grossly in excess of the actual earning rate, was found to have breached section 59 (2). Fines totalling $130,000 were imposed. In Walter v. Viney, 1982, in an action for damages for breach of section 59 (2), the applicant alleged that he was induced to lease a concrete truck and purchase of franchise from the company with which the defendants were associated by statements made by the defendant about the company's business and the income a franchise could expect to earn. The court held that on the evidence no statements had been made which were false or misleading in the material case. That is another strike against the existing legislation. On the other hand, in Reardon v. Aquajet Holdings (SA) Pty Ltd, 1982, a manufacturer of carpet cleaning machines which sold the machines to persons answering employment advertisements for cleaners which stated that the position offered a return of approximately $400 to $800 a week was found to have breached section 59 when the earnings of those persons who purchased the machines proved to be substantially less than the advertised figures. Fines totalling $51,000 were imposed. I have instanced those cases to suggest that on the face of it-and there may be a better explanation-there appear to have been some successful prosecutions, perhaps in a couple of instances as I have suggested, involving admissions by the defendants. The Attorney-General says that it is virtually impossible to obtain successful prosecutions in this matter where one must depend on conclusive proof of lack of belief or recklessness, but there seem to be occasions where there has been success. I raised this matter with the Senate Standing Committee for the Scrutiny of Bills and the legal adviser to that Committee said that in each case, however, it was clear that there was a necessity for predictions which were alleged to contravene section 59 of the Act to be made either recklessly or without belief that they would ultimately be satisfied. Quite frankly I do not find it offensive that we should require the prosecution to establish that the acts were committed recklessly or without belief that they would ultimately be satisfied. In fact one can achieve some success in this matter because it seems to me that the cost of doing it the other way round, of putting the onus on the company, involves reversal of the onus of proof in a matter of grave seriousness, which to me is totally improper. The Scrutiny of Bills Committee took a particular view and I quote from its report of 4 December 1985 in which it said: . . . while the Committee is prepared to concede that in some instances the reversal of the persuasive onus of proof may be justified by the particular circumstances of the case . . . the Committee does not believe that this is such a case. It is, of course, referring to this legislation. The Committee goes on: In most criminal proceedings the prosecution is required to prove the state of mind of the accused and it is difficult to see why belief as to the correctness of promises or predictions should be in any different position. In this particular case the Committee makes a suggestion about the position which exists if, in fact, the Attorney-General is correct in saying that it was impossible for the prosecution to prove its case-for example, in the Mastertouch case-and that it is virtually impossible to establish this situation which, however, seems to be capable of being established in normal criminal matters. I do not know why it cannot be established in these matters. Perhaps that is a quirk of the law which I, as a non-lawyer, do not understand. If that principle exists so comfortably in criminal law, why can it not exist in such matters as these? In any event, if there is a real problem the Committee has suggested that in this case a reasonable balance would be struck by placing on the defendant an evidential burden, since the basis on which it makes its predictions is peculiarly within its knowledge, but then requiring the prosecution to rebut the evidence that has been so advanced. I do not know whether the Minister for Resources and Energy feels like responding to that, but it seems to me that we face the problem that if we resolve the matter which the Attorney-General has alleged-that it is virtually impossible to get prosecutions-by reversing the onus of proof, we are doing more damage than we are correcting. There must always be a clear version of cost and benefit in this matter. This requirement of imposing a persuasive onus of proof on the defendant trespasses unduly on personal rights and liberties. In this matter I agree with the Scrutiny of Bills Committee, of which I am a member. If we are to have legislation which we are happy to see in this Senate, which imposes on personal rights and liberties, which reverses the onus of proof and which interferes significantly with the existing relationship between professional people and their clients involving a curious warranty which does some extraordinary things about the recall of a product without having to seek a court order, about which the Small Business Association made mention, if this Bill is to do all these things, it seems to merit some reasonable responses from the Government. The fact that the Law Council of Australia is still very concerned about this Bill in its present state, despite the flood of proposed and possible amendments, seems to be a very sound case for its being looked at much more thoroughly by the Senate. I would certainly welcome the opportunity in the Committee stage to support the many amendments that Senator Durack will move. I urge the Senate, and the Australian Democrats in particular, to recognise the dangers existing in this Bill at present and to support the Opposition in its attitude to the Bill. Senator GARETH EVANS(Victoria-Minister for Resources and Energy)(10.27) —in reply-The nature of the Trade Practices Revision Bill 1986 was best summarised by Senator Haines, who said at one point in her speech that it was not anti-business, it was anti-bad business. That is perfectly correct. The Bill is designed to and does promote good, efficient business and discourages anti-competitive, stultifying, stodgy, bad business. The Government does not believe that the Bill embodies any obsessive preoccupation with business regulation for its own sake or business regulation that operates in some counterproductive way to the interests of our national economy any more than we believe those allegations are true of the parent Act which this amending Bill is designed to streamline and attend to in various ways in the light of accumulated experience of recent years. Those matters about claims of an excessively regulatory character are dealt with, as are most of the other points made by Senator Short, Senator Durack and Senator Michael Baume, in my second reading reply on the first round of this debate on 11 February. I do not want to bore the Senate by repeating what I then said, but I note that other senators have not felt so constrained. I simply refer to pages 71 to 73 passim of my speech in Hansard on 11 February 1986. A number of other matters of detail, including the onus of proof issues raised by Senator Michael Baume, are more appropriately dealt with at the Committee stage and I will reserve more detailed remarks for that occasion. There were a couple of matters raised in the course of the debate which I do think need some attention, however. One was Senator Short's assertion that the Bill was steamrollered through the House of Representatives-a familiar theme with other speakers; and the other point which needs attention is slightly more detailed and that is Senator Macklin's argument that this Bill, in terms of its presentation to the Parliament on this occasion, represents a culmination of some elaborate conspiracy theory on the part of the Government, designed to deny the Senate its proper rights. In the minute or so available to me, I am happy to assure Senator Macklin that there is no foundation whatsoever for his concerns. The treatment of the Bill as a money Bill, in relation to which a message from the Governor-General has been received, characterises it as an appropriation Bill which accordingly can only be introduced in the House of Representatives. The reason for that is simply an abundance of caution on the part of the Parliamentary Counsel about the way in which a Bill of this kind should be treated when it contains a clause, as this one does, by the amendment to section 170 of the existing Act, which in effect appropriates money for legal aid or financial assistance to litigants. Debate interrupted. The DEPUTY PRESIDENT —Order! It being 10.30 p.m., pursuant to Sessional Order, I put the question: That the Senate do now adjourn. Senator BJELKE-PETERSEN(Queensland)(10.30) —The matter I wish to raise this evening concerns the decision of the Government to take dilantin, the drug used by epileptics, off the list of drugs which are available at a nominal cost. I have been approached by Jennifer Lucas, who suffers from epilepsy and is very concerned about the Government's decision regarding dilantin. She informed me that dilantin is the No. 1 anti-spasmodic drug which most epileptics use. In the Queensland Daily Sun newspaper recently, Mr Mike Cavanagh, the Secretary of the Epilepsy Association, was reported as saying that during World Health Week epilepsy sufferers would seek public support for their protest about the increased cost of dilantin, the drug on which all epilepsy sufferers rely. Mr Cavanagh pointed out that dilantin is a drug which epilepsy sufferers usually take for life and it is very important that they continue to take it. On 1 April the cost of dilantin went up by $1.57 a prescription. It was one of the three drugs affected by legislation passed last year which allowed a part charge on prescriptions when the Government and the manufacturer could not agree on the price of the drug. About 350,000 people suffer from epilepsy in Australia, with 314,000 prescriptions for dilantin being issued annually. Epilepsy sufferers say that they need these tablets to keep them alive, but most certainly to stop them from having seizures. The Hawke Labor Government repeatedly claims that it is concerned for the disadvantaged and chronically ill, but this action of increasing the cost of dilantin, which is used by people with epilepsy, is most unreasonable and does not show care and concern for epileptics. Epilepsy is a chronic condition and many people for whom dilantin is prescribed are unable to work. I believe that it is unreasonable to ask those people to pay more. I have raised this matter to draw the Government's attention to this problem. I hope that it will see its way clear to put dilantin back on the list of drugs which are available at a nominal cost. I am sure that the many people who suffer from epilepsy would be grateful if that action were taken. Senator VANSTONE(South Australia)(10.33) —The matter I raise tonight concerns the Law Reform Commission report No. 30 on domestic violence. I understand from having read the report-albeit not every word, but close thereto-that it relates particularly to the law in the Australian Capital Territory. Nonetheless, the report makes some comments that are useful and of interest to people in the States who are concerned with this growing problem, or the growing awareness of the problem, in our community. The first point I make is that this report is one of the few I have read which acknowledge that in this field there are competing interests and principles; firstly, that we should be free from violent attacks and, secondly, that the privacy of our homes should be protected from the intrusion of police officers, social welfare workers and the like. It is a pleasure, in an odd sort of way, to read a report on such an unfortunate issue which acknowledges that all is not black and white, that there are some grey areas and that we need to work in a bipartisan way to address the problems created which are in these grey areas. One example of a grey area is dealt with on pages 18, 19, 20 and following with respect to arrest. The report of the Law Reform Commission states that it is concerned to see that arrest is not seen as a penalty. I have a concern that law enforcement procedures are not unwittingly misused-I stress `unwittingly'-as welfare procedures. I acknowledge that the boundaries of the two areas-namely, the powers that the police need to keep the peace and the welfare needs of the community-overlap. This is one of the grey areas in which we should tread with some caution when the civil liberties of the alleged offender are at risk. I do not mean to take up the cause of wife bashers around Australia, but simply to flag that it is a grey area where we should not let our zeal to attack the truly violent in the community interfere with our long held beliefs on protecting the innocent. I noticed that mention was made in the report that the expense of handling the variety of orders one can get in the Australian States to protect victims, in particular women, from domestic violence, is necessarily lower in the magistrates courts than in other courts. That is true, but I remind my colleagues that the victims of domestic violence are not always people whose income or assets is so limited that they cannot get legal aid. As often as not, they are women whose income or assets excludes them from getting legal aid and who for a whole variety of reasons, some of which are not necessarily acceptable, would not go to welfare agencies for assistance. Those women have to fund a prosecution for protection themselves. In South Australia a guilty plea on a drink driving offence, which is basically five minutes work for a solicitor, costs $160, so a run of hearings on a protection order would cost substantially more than that. I simply wave a flag of caution in saying that it is simply not good enough to say that the expense of going to a lower court is less, without acknowledging that the expense for a private citizen to pursue such an action is quite prohibitive. I did not notice in the report any reference to the administrative procedures under which these actions are pursued. The report mentions the situation in South Australia, where there are three circumstances under which one might appear before a court. Firstly, there is the hearing for a preliminary temporary order, at which the alleged offender does not have to be present-in other words, the court can proceed ex parte. A couple of weeks after that there is a hearing for a confirmation of the preliminary order. At that time or at a later stage there is another hearing for a variation of the original or confirmed order. A problem is created by the administrative procedures because the second and third hearings must be heard before the same person who heard the first one, so the rostering of magistrates can result in extensive delays. For the private person or the taxpayer who is funding these actions, this can prove an exorbitant cost because the solicitor does not say: `Never mind, that, I have wasted another morning; we cannot get on before the same magistrate and I cannot get paid'. The solicitor is paid. The victim of domestic violence or the Legal Services Commission has to find the money-approximately 80c in the dollar-to fund this lousy administration. While administration of these matters is not an exciting area of law reform for people to pursue, in a practical way it affects the people who are trying to protect their own safety by taking out these sorts of orders. Accordingly, I ask any honourable senators who have even a passing interest in this matter to make some time to cast their eyes over this report and to come to some conclusions about the matters raised therein. Question resolved in the affirmative. Senate adjourned at 10.40 p.m. The following papers were tabled: Fisheries Act- Fisheries Notices- No. 164-Prohibition relating to the taking of Pink Snapper off Shark Bay, dated 1 April 1986. No. 165-Amendment of Fisheries Notice No. 163-Prohibition on the taking of Shark, dated 1 April 1986. Plan of Management No. 4-Northern Prawn Fishery Management Plan (Amendment), dated 2 April 1986. Public Service Act-Determination 1986 No. 19. Telecommunications Act-By-laws- Telecommunications (Charging Zones and Charging Districts) Amendment No. 65. Telecommunications (Community Calls) Amendment No. 42. Telecommunications (General) Amendment No. 48.