Wednesday, 7 May 1986 The PRESIDENT (Senator the Hon. Douglas McClelland) took the chair at 10 a.m., and read prayers. The Clerk —Petitions have been lodged for presentation as follows: To the Honourable President and members of the Senate in Parliament assembled: The petition of the undersigned shows: (1) The Agreement between the United States of America and Australia concerning the Joint Defence Space Research Facility at Pine Gap can be terminated from 19 October 1986. (2) In the event of war between the United States and the Soviet Union, access by the United States to Pine Gap's facilities makes it a probable nuclear target. (3) Access by all nations to Pine Gap's capacity to monitor and verify compliance with existing and future nuclear limitations treaties could contribute to world peace and security. (4) The people of Australia are entitled to be consulted, through their representatives in Parliament, on any extension or modification of the Agreement affecting their lives, security and welfare. And your petitioners humbly pray that: (1) Notice be given by 19 October 1986 that the Agreement between the United States and Australia concerning the Joint Defence Space Research Facility at Pine Gap be terminated by October 1987. (2) Public discussion and inquiry be instituted into the feasiblity of negotiating a new agreement with the United Nations during the International Year of Peace offering the verification facilities of the Pine Gap base to all nations. (3) Any agreement concerning the future use of Pine Gap be referred to Parliament for ratification. And your petitioners as in duty bound will ever pray. by Senator Hamer (from 11 citizens). To the Honourable the President and members of the Senate in Parliament assembled. The petition of the undersigned shows: That we urge you to oppose the Australian Bill of Rights because: The Bill does not guarantee vital rights such as: The right to own your own home and other property and not to be deprived of it without just compensation. The right to insulate our children from radical forms of education and the right to choice of schools. The right to a referendum for constitutional amendments. The right to true freedom of speech. The Bill gives dangerous, unlimited powers to an unelected Human Rights Commission with no appeal, no legal representation and closed hearings. Your petitioners ask that the Senate, in Parliament assembled, should vote to reject the Bill, believing that such a Bill should only be determined by the people at a referendum. And your petitioners as in duty bound will ever pray. by Senator Michael Baume (from 71 citizens). To the Honourable the President and members of the Senate in Parliament assembled: The humble petition of the undersigned citizens of Australia, respectfully showeth: That the proposed Australian Bill of Rights Bill 1985 will endanger the Federal system in Australia, the State and Federal criminal justice systems, the State and Federal Police Force, the State and Federal education systems, the independence of the churches and religious associations, marriage and the family, children, the unborn, the handicapped, the aged and the infirm, employer and employee relationships and Australian society generally. Your petitioners therefore humbly pray: That your Honourable House defer debate on the Bill for twelve months and circulate the Bill for twelve months for the widest possible debate, scrutiny and discussion. And your petitioners as in duty bound will ever pray. by Senator Brownhill (from 29 citizens). To the Honourable the President and members of the Senate in Parliament assembled. The petition of the undersigned shows: Graduated family allowances are of important assistance to families with more than one child. All family allowances, whether for one, two, three, or more children, have not kept pace with inflation. There are suggestions that all family allowances should be paid at the one flat rate. This would severely disadvantage families with more than one child. Your petitioners therefore pray that the Senate, in Parliament assembled, should reject any suggestion that family allowances be paid at a flat rate and instead should ask the Federal Government to increase the value of existing payments. And your petitioners as in duty bound will ever pray. by Senator Reid (from 241 citizens). To the Honourable the President and members of the Senate in the Parliament assembled. The petition of the undersigned citizens of Australia respectfully showeth: That the Australian Bill of Rights Bill is a harmful, dangerous and divisive proposal, the provisions of which are authoritarian and anti-democratic. Your petitioners therefore pray: That the Senate rejects this Bill. And your petitioners as in duty bound will ever pray. by Senators Knowles (from 25 citizens) and Parer (from 28 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. 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 distributors 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 129 citizens). To the Honourable the President and members of the Senate in Parliament assembled. Your petitioners most humbly pray: (i) that the Hawke Labor Government pass on the full benefits of lower international oil prices on March 1st, 1986; and (ii) that the Hawke Labor Government does not increase or extend fuel taxes And your petitioners as in duty bound will ever pray. by Senator Parer (from 392 citizens). To the Honourable the President and members of the Senate in Parliament assembled. The petition of the undersigned citizens of Australia shows that: We are opposed to the Parliament imposing a Bill of Rights on the people of Australia and we ask that the Senate reject the Bill entirely. Your petitioners humbly pray: That should the Honourable House decide to pass the Bill in amended form it will retain the amendment applying the legislation to trade unions. And your petitioners as in duty bound will ever pray. by Senator Archer (from 13 citizens). To the Honourable the President and members of the Senate in the Parliament assembled. The petition of the undersigned respectfully showeth: That certain trade unions are currently forcing employers and employees to join union-controlled superannuation schemes through industrial blackmail, thereby extending the unions' economic power and at the same time infringing individual rights. Your petitioners therefore humbly pray that the Government: (i) Guarantee that occupational superannuation is a matter of individual choice (ii) Declare illegal industrial standover tactics which force people to join superannuation schemes controlled by, or sponsored by, trade unions. (iii) Protect those companies and their employees who establish their own superannuation arrangements at the enterprise level. (iv) Ensure that union or industry-based schemes are not disguised pay rises by providing that employees must also make contributions. (v) Provide that control of the funds of such schemes is vested in the elected representative of the contributors to those schemes. (vi) Oppose any backdoor attempts at achieving compulsory unionism. And your petitioners as in duty bound will ever pray. by Senator Parer (from 101 citizens). To the Honourable the President and members of the Senate in Parliament assembled. The petition of the undersigned respectfully showeth: Introduction of any additional capital gains taxes, wealth taxes or death duties is opposed on the grounds that: they adversely affect the small and medium size businesses in Australia, destroying incentive and discouraging investment in this important area of the economy; the Australian economy, and employment in particular, is heavily reliant on growth in small businesses; any capital gains that might result when owners of small businesses finally sell the business are not ``windfall gains'' but the result of many hard years of work and sacrifice, with very little being taken out of the business by way of salaries so that the maximum amount of money can be ploughed back into the business to create growth and jobs; Your petitioners request that the Senate, in Parliament assembled, will protect the rights of private enterprise and reject any inequitable additional taxes. And your petitioners as in duty bound will ever pray. by Senator Brownhill (from 17 citizens). Senator BOSWELL(Queensland) —by leave-I present to the Senate the following petition, from 5,652 citizens, which is not in conformity with the Standing Orders as it is not in the correct form and does not contain a prayer at the end thereof, supporting Sea World in its bid to retain the right to exhibit live mammals such as dolphins and whales: You will see nothing but love and affection for our marine cousins at Sea World. If you agree with us that we need this animal contact to preserve the species in the wild, you can help convince our legislators by filling in and signing the attached form. Thank you for helping. TO SEA WORLD, THE SPIT, MAIN BEACH, QUEENSLAND, 4215, AUSTRALIA. I support Sea World in its bid to retain the right to exhibit live mammals such as dolphins and whales. I also support the view that only by exhibition of mammals in a caring environment will humans learn to admire, respect and care for the animals of our oceans. Senator PUPLICK(New South Wales) —by leave-I present to the Senate the following petition from 25 citizens, which is not in conformity with Standing Orders because it contains signatures that have been photocopied, requesting that there be a public inquiry into the rights of Ion Chirita and family: To the Honourable the President and Members of the Senate in Parliament. The Petition of the undersigned shows: Your petitioners, as in duty bound will humbly pray. That a public inquiry be conducted for the migration of the Chirita family (father) Marin Chirita and (fiance) Marc Codruta to be allowed into Australia and that the rights of Ion Chirita be recognised in Queensland. Senator PARER(Queensland) —by leave- I present to the Senate the following petitioning letter bearing eight signatures and requesting that the Australian Bill of Rights 1985 be rejected: Senator W. Parer...9 Exhibition Pde Parliament House...Mt Pritchard 2170. Canberra...24th March 1986 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. Your sincerely, Petitions received. Senator GRIMES(Tasmania-Minister for Community Services) —On behalf of Senator Button, I give notice that, on the next day of sitting, he will move: That leave be given to introduce a Bill for an Act relating to financial assistance by the Commonwealth for certain research and development. Senator VALLENTINE(Western Australia) —I give notice that, on the next day of sitting, I shall move: That the Senate- (a) notes the arrest of 15 bike riders at the Nurrungar joint defence space communications station in South Australia on 30 April 1986, who have since been charged with trespassing on prohibited land and were held in jail until 12 May 1986; (b) views with disquiet the fact that, according to a recent poll referred to in a paper commissioned by the Australian National University Peace Research Centre, only one per cent of Australians could even name the joint facility at Nurrungar; (c) recognises that in the event of the implementation of the Strategic Defence Initiative (SDI) popularly known as Star Wars, the Nurrungar facility will provide full-time surveillance of Soviet missile launch areas which is essential for the program and is therefore contrary to the Federal Government's commitment to nuclear deterrence rather than an offensive nuclear capability; and (d) calls on the Government to recognise the bike riders' justifiable demand that the Nurrungar facility be closed down with one year's notice in the light of the Government's well-known criticism of the SDI. 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. Telecom Australia (International) Ltd-text of a statement by the Minister for Communications. 2. Federal water assistance program-documents relating to the provision of financial assistance to Victoria, Queensland and Tasmania-pursuant to section 6 of the National Water Resources (Financial Assistance) Act 1978. Senator RYAN(Australian Capital Territory-Minister for Education) —by leave-I am pleased to announce that the first set of Resource Agreements in the field of education between the Commonwealth, all the States and non-government school system authorities has now been successfully concluded to the satisfaction of all concerned. These Resource Agreements represent a major Commonwealth initiative in funding for schools. In the first major policy statement on education after we came to office-the funding guidelines issued to the Commonwealth Schools Commission in July 1983-I declared that the Commonwealth in future would be determined to establish firm education objectives, to set clear priorities and to focus on the achievement of educational outcomes. We are committed to concentrating our funding and our policies on the key goals of improving outcomes, enhancing performance and raising quality. To this end, the Government requested studies by the Schools Commission and by the Quality of Education Review Committee to review existing Commonwealth funding arrangements. These studies have dealt with arrangements for general resources funding, new non-government schools funding policies, enhanced accountability arrangements and a comprehensive review of the Commonwealth's specific purpose programs for schools. In August 1984 I announced the Government's new eight-year general recurrent funding scheme. That scheme provided significant increases in financial resources for government and non-government schools, giving all school systems a stable basis on which to plan and ending the unduly divisive and unduly prolonged debate over State aid. At the same time, I indicated that the additional funds to be allocated to schools by the Commonwealth would be provided on the basis of resource agreements which would in turn be negotiated with the States and non-government school authorities. These agreements are an essential mechanism in the achievement of our goals to set national objectives and improve educational outcomes. The Government set four basic priorities for funding under the resource agreements. They concern: the importance of primary education, and particularly junior primary, as a foundation for future learning; the need to raise participation in years 11 and 12 by disadvantaged groups; the importance of expanding representation and attainment of girls in major subject areas; and assistance for teachers to bring about the necessary improvements. The Commonwealth Government does not directly supervise school administration, except in the Australian Capital Territory. Detailed administrative arrangements for balancing and implementing change in our priority areas have therefore been left to the school systems themselves. When the concept of resource agreements was first mooted, it was feared in some quarters that the Commonwealth would intrude on the constitutional rights of the States and the autonomy of non-government school systems. Those fears have proved groundless. All States and systems have signed agreements. Genuine co-operation has been achieved, with State and non-government school system authorities proposing general activities for inclusion in the agreements which are consistent with Commonwealth priority areas as well as addressing specific problems in local systems within the priorities set by us. Initiatives costing $37m will be covered by the resource agreements for 1986. The money spent-taxpayers' money-will be better directed and better accounted for. All of us will gain from our decisions to target resources and set priorities. For example, a number of school systems are using resource agreement funds to improve the teaching of literacy in the early school years by maximising access of junior primary school teachers to the early literacy in-service course, which helps them develop the necessary attitudes, knowledge and skills. Another approach has been to improve number and language skills amongst primary and secondary students through the use of consultants to assist schools in following up diagnostic testing in these areas. These initiatives are consistent with the Government's view, based on advice from QERC, that real improvements in the quality of educational outcomes depend in the long run on ensuring that students move into secondary school having already achieved a high level of proficiency in the basic competences. Another system is improving the general competence-and hence participation-amongst disadvantaged groups through specialised support for intellectually handicapped students, focusing on behavioural adjustment, appropriate work experience and integration into normal settings to ensure that competences are developed as a normal part of daily living; support for an Aboriginal education unit to provide more relevant experience in schools for Aboriginal students; enhancing relevant, direct learning experiences for isolated rural students through projects within the satellite communication trials; and supporting the role of the equal opportunities officer. This, of course, is also of special importance in promoting more equal representation and attainment of girls in major subject areas. We are encouraging all systems to concentrate on improving outcomes, not just to demand more inputs into the education systems, whether those inputs take the form of more staff, more money or more specific purpose programs. For instance, one school authority has identified as an area for action the lack of assistance for teachers encountering students who are not learning satisfactorily and who sometimes show behavioural problems as well. This lack of assistance has been most evident in primary schools serving areas with high concentrations of children from deprived socio-economic backgrounds, backgrounds where English is not the first language, or from Aboriginal families. This school authority has decided to use funds made available under the resource agreement to provide additional guidance officers to identify the extent of each referred child's difficulties, and to work with the child, teachers and parents in devising a management strategy. Outcomes anticipated by the system include improvements in the general competences amongst referred children; improved student behaviour resulting in reduced absenteeism and less need for serious disciplinary action; and, in the longer term, increased post-compulsory school participation by members of disadvantaged groups. The authority will monitor these outcomes in order to assess the effectiveness of the initiative. This authority will also be using some resource agreement funds specifically to develop broadly based indicators of system effectiveness. The Government welcomes this approach. Commonwealth funding has been targeted in such a way that relatively small sums can make a significant contribution to improved educational outcomes in the longer term. Further, the desired outcomes have been made explicit. This, if after an appropriate time the desired improvements are not evident, the system is in a good position to vary its policy response to the original problem. In other words, under the outcomes approach, we can no longer accept on faith that increased resources lead automatically to better educational outcomes. Nor can anyone sit back complacently and assume that because additional money has been spent, an identified problem will now go away. We can now account for the money we spend and monitor progress towards the goals we seek in the context of strict restraint on expenditures. We must insist that our education spending be fully disciplined, tightly managed, and directed to our wider national objectives. A major policy objective of the Government is the pursuit of more equal group outcomes of education. For the first time, the Commonwealth will have access to information on the extent to which this goal is being achieved. As part of the resource agreements, all States and non-government school systems have agreed to provide to the Commonwealth information to allow it to monitor trends within each system in post-compulsory school retention by groups who have traditionally been disadvantaged in education. These include those of low socio-economic status, those of non-English speaking background, rural students and Aboriginals. School authorities will also provide to the Commonwealth information on post-compulsory subject choice by girls as well as available information on student attainment in relevant areas. Once again, our plans to increase equity and efficiency are being developed congruently and systematically. All students will benefit from this approach. I move: That the Senate take note of the statement. Senator PETER BAUME(New South Wales)(10.15) —The ministerial statement which has been brought down by the Minister for Education (Senator Ryan) is apparently a statement about resource agreements. It is, in fact, much more than that. It is a statement which has to do with the proper distribution of power between the Commonwealth and the States. It is a paper that has to do with ideology in education and it is a paper that has to do with control over educational activity in Australia by a level of government which lacks the constitutional power properly to exercise that control. Senator Robertson —What a load of codswallop! Senator PETER BAUME —It is absolutely correct. The Government has a lot of interest in a style of government. We operate under a constitution which apportions power and functions between different levels of government. The educational function in this country is only a Commonwealth function insofar as it refers to benefits for students. That is the only legitimate power which the Commonwealth has. Education is otherwise a function which is part of the remaining residual plenary power of the States of Australia. There is no doubt, when one looks at this document, that the Government is moving to intrude further and further into a control over education by the States and within the States. These resource agreements represent one stage in that movement. The Government makes no secret of its intention to use the power of the purse to control education and educational activity in Australia. I remind honourable senators, if they have forgotten, that Senator Boswell asked the Minister, Senator Ryan, a question on 9 April, about one month ago. I will read the question and part of the answer given by Senator Ryan because the answer indicates quite clearly the extent to which this Government is prepared to go in threatening educational institutions and in laying down the extent to which it expects educationalists in Australia to be responsive not only to what they see as academically necessary but also to what they see as the policy of the Government. The question asked by Senator Boswell was part of a series of questions about certain research into the Star Wars or strategic defence initiative of the United States of America. Senator Boswell asked: Will the Minister give a guarantee that the Government will not seek to prevent universities and other tertiary institutions from becoming involved in aspects of the SDI program? That was a perfectly simple question. Senator Ryan, in her answer, said that some of the features had been outlined already by other Ministers, but she then went on to say: As far as we are aware no universities are engaging directly in SDI research and as universities operate within government policy we do not expect that they will. That is what she said. It was not an assertion about the administrative function of universities. Senator Ryan was asserting that, because the Commonwealth funds the universities, they operate within government policy and that there should follow some limitation on the exercise of academic freedom or the freedom to take up or not take up any kind of academic pursuit which is seen to be appropriate. We think that answer by Senator Ryan was not only a disgraceful answer and a disgraceful intrusion into the freedom which should apply to tertiary institutions in Australia but also a clear indication of the road which this Government is travelling and of which this statement today is one part. It has to do with a style of government, it has to do with the ideology behind the Government's activities and it has to do with the desire of this Labor Government, which is in so much trouble in many ways, to bring increasing centralisation of power into education. We know that already in other areas. We have seen the effective centralisation of power within the Commonwealth Tertiary Education Commission. We have seen that the power now rests firmly in the hands of the Chairman of the Commonwealth Tertiary Education Commission. We have seen the abolition of much of the advisory apparatus that operated so well for a number of years. We are concerned that what is being presented to the Parliament today in the guise of agreed resource agreements represents one more stage-- Senator Macklin —You voted against our amendment on that. Senator PETER BAUME —We voted on that legislation on the totality of our consideration, but we were very much aware of what Senator Ryan was attempting to do to centralise power. We agreed with Senator Macklin in his concern. I come back to what the Minister's statement is trying to lay down. The States have had to agree to do certain things if they wish to continue to receive Commonwealth money in an area which is constitutionally theirs and not the Commonwealth's. People should be aware that there is increasing intrusion by the Hawke Labor Government into educational activities which are properly those of the States. We agree with the Minister that certain outcomes of education need to be improved. I agree with the rhetoric in her statement in which she referred to the need for approved outcomes. We do not agree that the pursuit of better educational outcomes should necessarily involve equality of outcomes. Once again the Minister was talking about equality of group outcomes. We must produce generally better outcomes and improve the resources available to disadvantaged groups to improve equality of opportunity in education. This is one of the value questions which will continue to be asked. We are concerned too about the misstatement of facts which continues to be part of the rhetoric of this Government and which annoys people who are taking part in education and contributing so much to it. The Minister talks about the `historic settlement' on non-government schools. She was able to end the basic grants that have been available to every Australian child so that today some children in schools receive no Commonwealth support whereas previously every child received some. That is one of Senator Ryan's educational achievements. An historic settlement! An historic settlement indeed! That settlement will exclude some children. We now have a rigid policy which restricts the emergence of new schools and the approval for new schools to obtain Commonwealth funding. The accountability provisions, whatever their merits, are the thin end of the wedge of increasing Commonwealth control. About the time the Minister brought down the States grants Bills in November 1985 the list of new schools approved for funding was made public. The first problem was that many of the new schools were not new. We were concerned that many schools which had existed for years were forced to go through the new schools assessment procedure merely because they had relocated to a new campus, perhaps only a few doors away, or had extended their range of offerings by increasing their classes from, for example, year 6 to year 10 or 12. One wonders how Radford College in the Australian Capital Territory will end up. If a school had gone from being a single sex to a co-educational school it had to go through the new school procedure. Instead of making it easy for those who wish to offer education to get support, the Minister has done all she can to make it difficult. Senator Ryan —Responsible. Senator PETER BAUME —The Minister says that that is responsible. I say she is making it more difficult. We are aware of many schools which have established themselves and set up a campus and have then been told by the Labor Government that they will not receive any funding. The Minister has set out to entrench educational monopoly whether it be the monopoly of existing government schools or of existing government and non-government schools. The Minister has laid down that one of the factors which should diminish the right of a new school to funding is if there is already adequate provision in a region. We say: So what? We believe that extra provision means extra choice. When the Minister brought down her list, we had the example of the Maronite Christian school in Parramatta, Our Lady of Lebanon at Harris Park. It wanted to extend its primary school into the secondary area so that Lebanese children who had been through the primary sector of that school could continue their secondary schooling there, but no extra recurrent funding funds were provided. Senator Ryan —Wrong. It has been approved. Senator PETER BAUME —Ah, the Minister was forced on appeal to reverse the decision. That is the other point. That school and the Armenian school in Terrey Hills were refused funding initially. Only when they appealed were they able to get funding. To make my point clear again, the Government is intent on making it more difficult for schools such as these to get recurrent funding to educate Australian children. We are concerned at what this Government has done and at the misstatements of fact which have characterised the Minister's public comments. She wrote a letter to the Bulletin magazine on 19 November 1985 in which she claimed: In fact, there has been no sudden change in our funding policies. I suppose it all depends on what one means by the word `sudden', but there certainly have been major changes in the Governments funding policies. I come back to providing a basic grant for every child in every school. Senator Ryan —That was never our policy. Senator PETER BAUME —There has been a sudden change in funding policies for Australian schools. The Minister now makes it clear that she says merely that she has not changed direction. I point out to the educational establishment that it knows that educational funding policy and direction have changed and that rights which it previously enjoyed have been removed under the stewardship of Senator Susan Ryan. The Minister went on to say that, far from feeling uncomfortable about the new funding mechanisms, they were welcomed by every major non-government school organisation. I read the statements from the major non-government school organisations. They were the most careful and lukewarm statements I have seen. From myriads of schools I have received howls of complaints that they have been treated unfairly. The Minister might as well know that many parents and schools believe that they are not getting a fair go. If these resource agreements are further evidence of the Government's moving in to control an area which it does not have constitutionally, to intrude further into an area properly under State authority, to make it more difficult for people to offer educational opportunities and to help their fellow citizens, we will have little of it. This resource agreements paper represents clear evidence of further Commonwealth intrusion into educational areas under State control. I have no doubt that the institutions signed because they were probably given the choice of signing or doing without the money. The Minister is succeeding in increasing Commonwealth power, ramming home her ideology and increasing her control. The answer the Minister gave to Senator Boswell made it clear that she expects universities, in choosing their research priorities, to regard themselves as being instruments of government policy. Let me state again what the Minister said: As universities operate within government policy, the Government does not expect that they will engage in any SDI research. That represents the gravest breach of and the gravest threat to academic freedom of anything I have heard over the last few years, even from this Minister. Senator MACKLIN(Queensland)(10.31) —The statement the Minister for Education (Senator Ryan) has put down refers to ongoing discussions between the Commonwealth and State governments over funding, particularly at the primary school level, but also in terms of a number of ongoing Commonwealth programs for the disadvantaged. I am tempted to respond to some of the points Senator Peter Baume made but I am not quite sure whether I should. The criticisms that I have of the Government go to the facts of the matter; that is, that this Government has abandoned its policy with regard to government and private school funding. In fact, private schools in Australia are now funded at a higher level than they have ever been funded under Liberal-National Party governments. That is my concern. When I look at the actual figures, not only in dollar terms but also in percentage terms, I find it passing strange that the decisions made by the Government, in terms of its eight-year commitment, to put money into the private school sector have corralled its ability to look at a diversity of educational possibilities. I go back even further. I remember that when Senator Baume was Minister for Education the comments he made in this chamber referred very clearly to the fact that there was only one educational cake, that there was a certain amount of money to go around and, really, the question was not how it was to be divided. Senator Baume would probably get very loud applause if he carefully chose his words and talked to the teachers unions, because the teachers unions are not very happy with the Government's policy either. But theirs is the opposite viewpoint: They see the government school sector being disadvantaged in the amounts of money which are going to private schools. I suppose that it depends very much on where one stands and that, in a political debate on education, one cannot expect that attention will necessarily be paid to facts. It is a pity, but that seems to be the case. I would like to refer to the points that the Minister has raised with regard to disadvantage in education in Australia. I feel coming through the Minister's statement an optimism that I do not share. I believe that it is misplaced optimism in terms of the ability of educational institutions to deal with disadvantage in Australia. It has been an acceptable part of the education wisdom of this country that somehow or another schools can be a major ingredient in overcoming dis- advantage. Unfortunately, educational research has never established that. In fact, educational research has established more and more that, to a very large extent, schools have a peripheral effect on disadvantage within our society. That is to be expected. At one stage schools were almost the entire source of information for young people entering society. They are no longer the entire source of information; in fact they are a very small source. They also have a very minor effect on the way in which young people act and think. The role that the school once had has been taken over, irrevocably, by the operation of various forms of media, by media promoted or advertisement induced youth movements of one kind or another. The education system is battling on all fronts to try to do the work that it is served up by the community. When young people are drowned or killed on the roads or they take drugs we hear constantly that the solution to the problem is to do something about it in the schools. This is a major Australian cop-out. These problems are supposed to have nothing to do with parents, the media, or society in general. There is no way in the world that schools can cope with the type of societal changes that they are supposed to be able to cope with. They are struggling merely to cope with the basic educational tasks in the modern world-to address themselves to the basic operations of knowledge and understanding. It would be a refreshing change if, in the general media-society organisational structures that we have, a few other groups took responsibility for the induction of our young people into society. I express support for what the Minister said on page 5 of the statement that she has put down: For the first time, the Commonwealth will have access to information on the extent to which this goal is being achieved. I find it passing strange that Senator Baume should have criticised that notion. I would have thought that it is not a matter for criticism to attempt to make decisions based on information. One of the matters on which the Australian Democrats were unable to get Liberal-National Party support was precisely the matter of information regarding the Commonwealth Tertiary Education Commission. We were arguing that the Tertiary Education Commission could give certain advice to the Government. We believed that, in that way, the Government would have a larger data base. We certainly support State governments, in a co-operative arrangement with the Commonwealth Government, having agreed to provide the Commonwealth Government with information so that the Commonwealth Government, in tailoring its economic program, its expenditure, will have access to information which it previously did not have. Senator Baume said that this is an inducement by way of the power of the purse. I am not at all sure that many Commonwealth governments have been reticent about using the power of the purse in a whole range of policy areas. After all, that is precisely where the power of this chamber comes from. Indeed, it is a fact that he or she who controls the purse strings will control the final outcome of policy. The Commonwealth Government, through its revenue-raising operations, obviously has a role to play. We may decry that in a theoretical sense with regard to the Federation structure, but surely we must accept the realities of the matter. The political realities of the matter are that the Commonwealth Government has the money and it determines, very largely, what goes on. If it is to provide money for special programs for the disadvantaged, I would have thought that, in any situation, it ought to know what happens as a result of the expenditure of that money. Let me outline what follows from the agreements made between State and Commonwealth authorities, particularly with regard to four major areas. I refer, firstly, to the importance of primary education, particularly junior primary, as a foundation for future learning. In the past five or six years all State government departments have structured primary education programs and all the non-government school authorities have done likewise. What the Commonwealth Government is doing is merely coming in behind something which was already under way in the States and in the private school sector. It has been a move not so much of educational philosophy but a move on the part of the various systems to acknowledge the primacy of that foundation and the necessity for a good foundation at the primary school level. Hence one finds, for example, that State authorities have slightly raised or strengthened the conditions regarding early entrance into primary school. Almost universally throughout Australia now, it is no longer possible to get a child into primary school unless he or she is five years old, or six years old in some States. That is a direct acknowledgment of what we have discovered from educational research; that is, that earlier inducement to primary education as a system is not a good educational practice. It has been linked with the increasing development of the pre-school sector, and that has been a totally different type of educational approach, educational philosophy and educational activity. It is seen that the pre-school sector is a far better way of dealing with younger children than the more formal operations of the primary school sector. That development has been undertaken by the States in the last 10 years, and again, the move by the Commonwealth is not a move, as it were, up front; it is a move coming in behind. I believe that it is useful that the Commonwealth has come in behind on this factor, and that is one of the reasons why State governments were quite happy to sign most of these agreements. They were already expending money in this area, they were already heavily committed in this area, and they welcomed the infusion of extra funds from the Commonwealth. There was really very little haggling with regard to that aspect. The second aspect - the need to raise participation in years 11 and 12 by disadvantaged groups - again met with no resistance by State governments. Every State government - including my State Government in Queensland - has already put in place specific programs with regard to the retention of disadvantaged students in the higher school sector. Again, State governments welcomed the availability of additional funds to allow those programs to be extended. The next point mentioned by the Minister was the importance of expanding representation and attainment of girls in major subject areas. Again, every State government has a specific unit within its State education system and its State education departments dealing with the specific educational problem of girls. Every State already has in motion certain programs-which in some States, admittedly, are not very extensive in this area-and again, every State found it easy to accept additional money from the Commonwealth in order to enable it to expand and enable the promotion of educational opportunities for girls. So there was no problem on the part of the States in signing those agreements. The last matter raised-assistance for teachers-is not only not new but also has hairs on it. Every State government has had professional development programs. The major problem with those has been the cutback in moneys provided by the Commonwealth. The Commonwealth is now seeking to reverse this trend by specifically trying to tie professional development to the attainment of certain educational goals. It seems an excellent development. It is one which the States are very happy to pick up, and again there is no problem with it. There was no problem on the part of the States in signing the resource agreements. The States did not have to be induced, hit over the head with a large stick or pulled or pushed in any way. They were already involved and all they were looking for was extra funds. They were happy to share with the Commonwealth the outcome of those programs because they saw that by doing so they might get further funds down the line to enable them to develop and pursue those programs. This statement is a very good example of Federal co-operation. The fact that this was able to be achieved in such a short time, in spite of the diversity of political parties in government in the States, illustrates the fact that there has been very little heartache over this exercise. When Federal governments undertake exercises such as this that are acceptable to State governments, they should be commended rather than attacked. I would have thought that the whole notion of federalism is that when there is a co-operative arrangement we should say `Good'. Where there is an imposed arrangement, the problem of federalism arises. There is no imposed arrangement with any State government and in this operation I have sought to explain why State governments were quite happy with it. I conclude by returning to my original point, which was concerned with equality and disadvantage within our society. I would hope that in future educational debates we will have more time to expand on this subject. However, we must be clear, we have to make it very clear in the wider community, that equalities in our society which exhibit themselves in the educational sphere are not educationally induced; they are societally structured and systematically related to various income levels, race, and the sex of the individuals concerned. We know that from social science research and educational research. We have to acknowledge that the relationship between those factors and the parents or home environment is incredibly strong. The health of our society depends on the degree to which all young people in Australia are treated equally. It is an essential ingredient of a democracy that that be so. We should not only treat people equally but also valued people equally. Therefore, it is only when all Australians, not just those in government and not just those who are teaching in schools, accept the responsibility to eliminate racial practices, sexist practices and other practices which bring about disadvantage to specific groups and undertake to change their attitudes with regard to these matters, both individually and collectively by talking and discussing them with their friends, that any real advance will be made to overcome educational disadvantage. It cannot be overcome by schools on their own; it can be overcome only by everybody in society, including all those in positions of responsibility, tackling the societal sources of disadvantage. Debate (on motion by Senator Robertson) adjourned. Motion (by Senator Macklin) agreed to: That leave be given to introduce a Bill for an Act to amend the World Heritage Properties Conservation Act 1983 to make more effectual provision for proper protection and conservation of property to which the Act applies. Bill presented by Senator Macklin, and read a first time. Senator MACKLIN(Queensland)(10.50) —by leave-I move: That the Bill be now read a second time. I seek leave to have the second reading speech incorporated in Hansard. Leave granted. The speech read as follows- The convention for the protection of the World Cultural and Natural Heritage of which Australia is a signatory, imposes an obligation on the signatories to identify cultural and natural heritage of ``outstanding universal value'' and to protect that heritage. The Australian Government has sought to fulfil its obligations under the Convention through the enactment in 1983 of the World Heritage Properties Conservation Act. The Act provides in the first instance for the identification of World Heritage Property, and secondly for the protection of that property following proclamation. Whilst identification is a condition of protection, identification of property as World Heritage Property does not in itself provide protection. That is a distinction worth noting, given recent statements by the Minister for the Environment suggesting the contrary. Where the Governor-General is satisfied that any identified World Heritage Property is being or is likely to be damaged or destroyed the Governor-General may, I repeat may, by proclamation bring into force the protective provisions of sections 9, 10 and 11. Sections 9, 10 and 11 state that it will be unlawful except with the express permission of the Minister for a person to do any one of a comprehensive list of acts including excavation, drilling, use explosives, construct a road, damage trees, erect or destroy buildings. Section 9, which relies on the foreign affairs power, and section 11, which relies on the Races power were held invalid in a number of respects by the High Court in the Dams case. As the Government has not however chosen to amend the Principal Act to take the High Court ruling into account this Bill amends sections 9, 10 and 11 only insofar as is necessary to achieve the purpose of removing the requirement for proclamation before the protective provisions apply to identified World Heritage Property. Section 6 of this Bill provides that all World Heritage Property will be immediately protected. If the Government could be trusted to proclaim any World Heritage Property immediately upon threat of damage or destruction to that Property this Bill might not have been necessary. That is obviously not the case. This Government cannot even be trusted to nominate for World Heritage Listing property which has been unambiguously identified by world experts to be worthy of nomination. The Australian Heritage Commission for instance commissioned a report on the Queensland Wet Tropics rainforests. That report, delivered in June 1984, unequivocally recommended World Heritage Listing. The Government, for two years, has failed to act on that obligation. The failure is attributable, not to any doubt as to the international importance of the wet tropic rainforest, but to a lack of political will. While this Bill will not compel nomination of World Heritage quality property it will make protection of listed property mandatory. As important, once protection is mandatory environment organisations will, under ss. 13 and 14, automatically have standing to seek an injunction or prerogative writ. At present such groups have standing under ss. 13 (5) and 14 of the World Heritage Properties Conservation Act only after the relevant property has been proclaimed. Such groups cannot, in the absence of proclamation, seek a writ of mandamus to have a court order the performance of a public duty or exercise of a discretion according to law by a public official as in the absence of proclamation there is no obligation on or capability of the Minister or his or her delegates to make a decision under ss. 9 or 10. Nor can such groups seek a declaration or injunction as the Act does not confer public rights. In a situation where property has not been proclaimed and acts are being done which damage or destroy that property such groups are powerless under the Act. If all the identified properties were protected on identification and the property is being damaged or destroyed and where a Minister does not act to prevent or cease the damage then such groups may seek a writ of mandamus to compel a decision to be made and once a decision has been made the group may have standing as an aggrieved party under ss. 13 (5), (6), for the purposes of the Administrative Decisions (Judicial Review) Act 1977 and/or seek an injunction under s. 14 to restrain the unlawful acts. If this Bill becomes law, environment organisations such as the Australian Conservation Foundation, and the Queensland Wildlife Preservation Society will have the right to go to the Federal Court to compel the Government to prevent a development such as that proposed by East West Airlines for Lindeman Island proceeding. That would be a massive step forward in environmental law. Debate (on motion by Senator Robertson) adjourned. Bill received from the House of Representatives. Ordered that the Bill may be taken through all its stages without delay. Bill (on motion by Senator Grimes) read a first time. Senator GRIMES(Tasmania-Minister for Community Services)(10.51) —I move: That the Bill be now read a second time. I seek leave to have the second reading speech incorporated in Hansard. Leave granted. The speech read as follows- The purpose of this Bill is to amend several acts relating to aspects of the wheat industry and which will further improve the ability of the Australian Wheat Board to meet the increasingly difficult world trading environment it faces. The Bill is consistent with the Government's Policy Statement ``Reform of Commonwealth Primary Industry Statutory Marketing Authorities'' released as a White Paper on 29 January 1986. A greater level of responsibility has been placed on the members of the Australian Wheat Board both individually and collectively, but with this, the Board has been given more autonomy to act in an independent commercial way than previously; there will be less direct ministerial involvement in the Board's operations; and there will be a greater level of formal accountability by the Board to industry. The bulk of the changes relate to the Wheat Marketing Act 1984, and are contained in Part II of the Bill. This Bill provides explicit power for the Board to set up or take an equity interest in subsidiary companies if this will assist it to perform its functions more efficiently. It will be necessary for the Minister to approve the Board exercising its powers in this regard, with or without conditions. There will be the opportunity for public scrutiny of any approvals given by the Minister as the notice of approval is to be tabled in both Houses of Parliament. The Board is to be given the power to trade in additional types of contracts in order to hedge the wheat crop. It already has the power to engage in a number of different hedging activities, but in order to protect returns to growers from sudden adverse movements in international wheat prices and exchange rates, the Board must be able to utilize the range of hedging instruments available to other commercial international marketing organisations. Because new instruments are continuously becoming available, the Minister is to be given a power to approve other hedging instruments should this be necessary. The Bill provides a clearer statement of the Board's relationship with the Minister than previously. For example, the Minister's power of direction over the Board is to be amended so that it will now only be able to be exercised in exceptional circumstances where there is a conflict with major government policies. A consultative procedure is set down to ensure that the Board has had an opportunity to put its views to the Minister, and the direction will be open to public scrutiny. Another aspect of the changing relationship of the Board with the Minister, and which will ensure that the Board carries out its functions in a business-like manner, is contained in clause 27 of the Bill. This clause provides for the Board to develop corporate and operational plans. Corporate plans will be developed each year for a three, four or five year period, as appropriate, which will define the principal objectives of the Board and outline its intended strategies. In the development of the corporate plan, it is expected that the Board will consult with the industry to ensure that the industry's needs and priorities are taken into account. An annual operational plan will set out, for each successive one year period, the particulars of the strategies to be pursued by the Board in giving effect to the corporate plan over that year. Both the corporate plans and annual operational plans are to be submitted to the Minister for Primary Industry for approval. In this way, accountability arrangements focus on the strategies and longer term performance of the Board and free it from the need for constant reference to the Minister for detailed approval of each major activity. While it would be expected that key parts of the Board's corporate plans may be made widely known to industry, the Board may wish to keep certain elements confidential for commercial reasons. The Board's relationship with industry is also to change. It will become more accountable through the requirement, detailed in clause 11 of the Bill. For a meeting to be held, at least annually but more often if the Board considers it appropriate, with the members of the executive of the Australian Wheatgrowers' Federation. This meeting is to provide the opportunity for industry representatives to receive an address by the Chairperson on the Board's most recent annual report, and on the performance of the Board during that year and for industry representatives to question Board members concerning any aspect of its activities. Because of this increased level of accountability to industry, it is not appropriate for the President or the members of the executive of the Australian Wheatgrowers' Federation to be members of the Board. Clause 17 of the Bill provides accordingly. Other significant reforms which give the Board increased authority to perform in a commercial manner, but which place a commensurate responsibility on it to do so within a properly accountable framework are contained in clauses 26, 32 and 33 of the Bill. Clause 26 removes the requirement for the terms and conditions on which officers of the Board are appointed to be approved by the Public Service Board. This will mean that the Board will now have the total responsibility for the management of its relations with its staff. Clauses 32 and 33 will enable the Board to appoint a company auditor to audit its accounts. This is consistent with the greater level of accountability by the Board to the industry through the requirement for an annual meeting at which the annual report is formally presented. Should the Board seek to use a commercial auditor, appointment is to be by the Minister for Primary Industry, subject to the agreement of the Auditor-General that the auditor is suitable and the agreement of the Joint Committee of Public Accounts to the appointment. The efficient functioning of the Australian Wheat Board as a corporate Board is crucial to ensuring that wheat growers continue to get the best possible returns for their wheat. In addition to the major restructuring of the Board which the Government put into effect last year, there are several clauses of the Bill which bear directly on matters at the Board level. For example, clause 18 provides for a new position of Deputy Chairperson on the Board, to be appointed by the Minister for Primary Industry after consulting with the Chairperson and the Presiding Member of the Selection Committee. The Deputy Chairperson will take over all the responsibilities of the Chairperson at any time the latter is unavailable. Also, clause 20 amends the term of office of members from a fixed three year term to a period of up to three years. This will enable, for example, members to be appointed for staggered terms to provide for greater continuity of membership and for casual vacancies to be filled for specified terms when a three year appointment may not be considered desirable. Because one aspect of the Tasmanian wheat freight arrangements was identified as being constitutionally vulnerable, clause 16 of the Bill provides for an amendment to the Wheat Marketing Act to remove this difficulty. Parts III and IV of the Bill make amendments to the Rural Industries Research Act 1985 and the Rural Industries Research (Transitional Provisions and Consequential Amendments) Act 1985 to correct an omission that occurred when those Acts were prepared, thus including the Wheat Tax (Permit) Act 1984 in the scheme provided by those Acts for rural industries research funds. Part VI of the Bill alters the effect of the Rural Industries Research Regulations to ensure that the research component of the levy imposed by the Wheat Tax (Permit) Act 1984 is included in the Wheat Research Trust Fund. The passage of this Bill will involve no cost to the Commonwealth. On the contrary, it will enable the Australian Wheat Board to repay to the Commonwealth moneys expended during 1985 on the selection process for new grower and specialist members of the Board. I commend the Bill to honourable senators. Debate (on motion by Senator Reid) adjourned. Bills received from the House of Representatives. Motion (by Senator Grimes) agreed to: That so much of the Standing Orders be suspended as would prevent the Questions with regard to the several stages for the passage through the Senate of the Bills being put in one motion at each stage, and the consideration of such Bills together in the Committee of the Whole. Ordered that the Bills may be taken through all their stages without delay. Bills (on motion by Senator Grimes) read a first time. Second Readings Senator GRIMES(Tasmania-Minister for Community Services)(10.52) —I move: That the Bills be now read a second time. I seek leave to have the second reading speeches incorporated in Hansard. Leave granted. The speeches read as follows- FUTURES INDUSTRY BILL 1986 The Bill that I am introducing today represents an important step in the process of bringing the futures industry within the ambit of the co-operative companies and securities scheme. I am introducing this Bill pursuant to the Commonwealth's obligations under the co-operative companies and securities scheme. A detailed description of the provisions of the Bill is contained in the explanatory memorandum which has been circulated. Co-operative Companies and Securities Scheme The Formal Agreement executed by the Commonwealth and all the States on 22 December 1978 provides the framework for a co-operative Commonwealth/State scheme for a uniform system of law and administration regulating companies and the securities industry. The scheme covers the relevant law operating in the six States and the Australian Capital Territory. The Northern Territory Government has now joined the co-operative scheme and has introduced legislation to apply Commonwealth companies and securities legislation in the Territory. The parties to the Formal Agreement have agreed that the co-operative scheme should be extended to cover the regulation of the futures industry and franchising. The necessary amendments to the Formal Agreement have been approved by each participating Government and the Amending Agreement is presently in the process of being signed by each of the parties. In accordance with that Amending Agreement, the proposed futures legislation has been agreed to unanimously by the Ministerial Council for Companies and Securities. In the coming months, the other parties to the Formal Agreement will be introducing legislation that will apply the Commonwealth legislation throughout Australia. Background Futures trading basically involves entering into agreements on a futures exchange to deliver or make delivery of a commodity at an agreed price at some time in the future. Futures trading in Australia has developed from a specialised market of interest mainly to wool producers, into a market in which producers, consumers and participants in the financial system seek to redistribute economic risks or secure a speculative profit. In the last decade, the major growth area in the futures industry has been in financial futures markets. Financial futures enable business risks, such as changing exchange rates, interest rates and share prices, to be protected. The need to have a uniform regulatory system governing the futures industry in Australia was recognised by the Campbell Committee and has been endorsed by the Sydney Futures Exchange. The Campbell Committee stated that ``there should be a national approach to the regulation of futures exchanges'' and that the same co-regulatory approach that is adopted in relation to stock exchanges should apply to futures exchanges. At present the only legislation in Australia that specifically deals with the futures industry is the New South Wales Futures Markets Act. Experience with the administration of this Act, the manner in which some non-members of the Sydney Futures Exchange have promoted and conducted their business and the failure of a number of futures brokers have clearly indicated the need for Australia-wide legislation in this area. Exposure drafts of the proposed legislation dealing with the futures industry were released for public comment on two occasions, in October 1984 and November 1985. This consultative process has been invaluable in shaping the legislation to the needs of the industry and the protection of the public who invest in the futures markets. Outline of Proposals The Futures Industry Bill will establish a framework applying prudential controls to participants in the futures industry. Briefly, the Bill will: (a) require futures brokers and advisers to be licensed; (b) establish a system for the approval of futures exchanges and clearing houses; (c) require futures exchanges and futures associations to establish a fidelity fund for the protection of clients; (d) provide criminal sanctions for manipulative and fraudulent practices; and (e) require futures brokers to maintain adequate records and separate client funds from their own funds. Much of the public debate about the Bill has concerned the definition of futures contract and hence the reach of the legislation. I would draw your attention to paragraphs 29 to 34 of the explanatory memorandum. The definition aims at ensuring that it is sufficiently wide to include all contracts generally considered to be futures contracts, whether traded on or off market, so as to overcome any avoidance techniques (denying clients the benefits of the protections in the Bill). At the same time, the definition provides for the exclusion of legitimate commercial arrangements that clearly should not be subject to the legislation. Paragraph 10 of the Explanatory Memorandum sets out the regime that will apply in relation to the futures industry and the securities industry. At this stage, it is not proposed that the futures industry legislation should cover deliverable commodity options that are not traded on a futures exchange: if it becomes apparent that these or related arrangements are being used to circumvent the purpose and spirit of the legislation then the Ministerial Council will consider extending the scope of the legislation. Financial and Regulatory Impact Statement These proposals will involve the Commonwealth in funding half the cost of several additional staff for the National Companies and Securities Commission. The Futures Industry Bill will impose costs on people involved in the futures industry: licensing, record-keeping and segregation of client funds are examples of prudential requirements that will increase cost. This must be compared to the cost that many clients of failed futures brokers have had to bear in recent years. Although the cost to participants (brokers, exchanges and clearing houses) is not possible to quantify, the Government believes that the legislation is justifiable: it will ensure confidence in the futures markets and will assist futures exchanges in this country to compete successfully in attracting international business. The Government commends this Bill to the Senate. FUTURES INDUSTRY (FEES) BILL 1986 The Futures Industry (Fees) Bill is the second Bill in the legislative package dealing with the futures industry. I am introducing this Bill pursuant to the Commonwealth's obligations under the co-operative companies and securities scheme. A description of the provisions of the Bill is contained in the explanatory memorandum which has been circulated. The Futures Industry (Fees) Bill provides for fees payable under the Futures Industry Bill. The fees payable under this Bill impose costs on participants in the industry that relate to administrative matters (lodgement of documents etc.) handled by State and Territory Corporate Affairs Commissions. The Government commends this Bill to the Senate. COMPANIES AND SECURITIES LEGISLATION AMENDMENT (FUTURES INDUSTRY) BILL 1986 The Companies and Securities Legislation Amendment (Futures Industry) Bill is the third Bill in the legislative package dealing with the futures industry. I am introducing this Bill pursuant to the Commonwealth's obligations under the co-operative companies and securities scheme. A description of the provisions of the Bill is contained in the explanatory memorandum which has been circulated. The Bill contains several consequential amendments to companies and securities legislation. The only one that I would specifically draw to your attention is that providing that a dealing in a futures contract will not be a dealing in securities for the purposes of the Securities Industry Act. This will ensure there is no unnecessary regulatory overlap between the futures and securities industry legislation. The financial and regulatory impact of the package of Bills dealing with the futures industry is discussed in my second reading speech on the Futures Industry Bill. The Government commends this Bill to the Senate. Debate (on motion by Senator Messner) adjourned. Debate resumed from 6 May, on motion by Senator Gietzelt: That the Bill be now read a second time. Senator MESSNER(South Australia)(10.54) —The Appropriation Bills before the Senate represent an opportunity for the Opposition to examine the performance of the Hawke Government in its economic management of the country. Quite clearly, as everybody in Australia knows, the Hawke Government in the three years it has been in power has been an extra- ordinarily lucky Government in terms of economic management. It came into power with the breaking of the drought of 1982-the longest and worst drought that we had seen for some 70 years. There has been some economic recovery since 1982, when there was a considerable downturn in the world economy which had a significant effect on the economic fortunes of this country. Of course, at the same time the stimulatory Budget of the Fraser Government in 1982, which sought to set the scene to lift the economy from the recession of that year, had very significant impacts upon the performance of this Government in later years. What did this Government do when it came to power? We are now facing the real test of the Government's mettle in terms of its economic management. Quite clearly, there are big question marks about that. Let us just test one or two things, for a start, in relation to the Government's direct financial management. For instance, if we look at how expenditures are running, as administered by this Government, we find that public debt interest rose 38 per cent in the first six months of this financial year compared with the same period last year. More of that later, because I would like to go to the root causes of that. In the area of Medicare-a significant and flagship policy of this Labor Government-we find that there was an increase for the six months to the end of December of 18.8 per cent on the same period last financial year. That is running ahead of the Budget estimate of 11.4 per cent. Expenditure on other pharmaceutical services and benefits is running 16.4 per cent above the level for the same period last year, and of course the Budget allowed for an increase of only 71/2 per cent. Health services in the Australian Capital Territory are running 37.9 per cent above the same period last year, while the Budget allowed for an increase of only 11.6 per cent. The Australian Broadcasting Corporation's expenditure is 18.6 per cent ahead of last year, while the Budget provided for an increase of only 13.8 per cent. The Australian bicentennial road development program, incredibly, is up by 48.2 per cent over the same period last year, while the Budget allowed, would you believe, for an increase of 5.5 per cent. Does this demonstrate competent economic and financial management? One has to have very serious doubts about that. As I mentioned earlier, the real tests for this Government are yet to come. It has been living since 1983 on a program of increasing its overseas borrowings and of course keeping a high interest rate policy, which is damaging business, farms and the housing sector, in order to attract private and government capital into Australia to make up for its huge foreign account deficit. Every month we fall back; our deficit, our fo-reign debt, rises by some $1 billion or more. It is expected that this year we will have a record current account deficit, to the tune of maybe $13,500m, which will bring the aggregate debt in this country to a level of about $80,000m. That has occurred at a time when one would have expected that there was a fair degree of prosperity, when from all the trumpetings of the Government one would have expected marvellous opportunities for this Government, with proper management, to reduce debt, not increase it. Yet the opposite has happened. In 1983, when this Government came to power, our foreign debt was of the order of $35,000m. By the end of June it will be $80,000m -a fantastic increase in just three years. It reminds me very much of the two-income family which, by virtue of the two incomes, has a fair degree of security and a standard of living which is above the average. Then, suddenly, one of the partners loses his or her job. As a result there is only one breadwinner, one income, but the family strives to maintain its standard of living by raising its borrowings-by borrowing by way of personal loans from its bank, by increasing its bank overdraft or by buying a new car on some other kind of finance when it might otherwise have paid cash. In those ways a continuing level of debt is built up until the point is reached where the income is not large enough to service that debt and to meet repayments of capital and interest. The family then finds itself having to borrow in order to make such repayments. Under this Government, this country is rapidly heading towards such situations, with the increasing debts at a massive level, which in the longer run, must have a dramatic impact on our living standards as we repay them. I have already drawn attention to the fact that repayment of public debt, including our foreign debt, is up 38 per cent compared with the figure last year. This arises directly because of our commitment and the need to service the huge burden of debt imposed on the Australian people by this Government. People in the community generally have been complaining bitterly about the level of interest rates, which are killing investment and the housing industry. Yet very little is done by this Government to redress that problem. The level of interest rates has a direct relationship to the economic management of this Government, because the level of debt only increases the level at which interest rates have to be set by the Government to attract foreign capital to ensure that we can meet our overseas problem. That is a continuing difficulty which this Government must face. Apparently it will not face up to the basic reasons why this is occurring. We all know that the basic problem lies in the question of what it intends to do about wages policy. That is the big no-no for this Government. It is forced to deal with its own constituency in the trade union movement and, as the tool of that movement, it is not able to negotiate a proper arrangement on behalf of the Australian people. Rather, it will always first take into account its political interests rather than the true welfare of the Australian people. I mentioned earlier that the overseas debt is placing a greater and greater burden on the Australian people. That can be seen no more clearly than by the fact that of every export dollar we gain by selling our coal, wool, wheat and other produce on world markets, 40c is now going to service the cost of our foreign debt. In other words, 40c of our exports are mortgaged to repay the debt which has been swallowed up in consumption in the last three years. There is no doubt that this Government is the highest taxing, highest borrowing, highest spending Government Australia has ever seen. For that reason it deserves to consider the alternatives being put by the Opposition, which I shall come to in terms of the amendment we shall propose to the second reading motion. I turn to some of the broken promises that have been a factor of this Government's life since it came to power three years ago. First of all, there was the magnificent promise-this happened even in 1984, in the election campaign of that year-that there would be a reduction in interest rates. What has happened? We have seen interest rates go in exactly the opposite direction, to the highest levels they have been in real terms since the 1930s. There was a promise to bring down inflation below 5 per cent. The latest figures show that inflation is of the order of 9.2 per cent at current levels. The level of inflation is running twice as high as the level among our trading partners in the Organisation for Economic Co-operation and Development. But that is without taking into account the fact that because of the huge fall in the oil price, countries that are energy deficient, such as Germany, Japan and the USA, now have negative rates of inflation. This is happening because the cost of living is falling rather than rising. Yet we have a cost of living rising at 9.2 per cent when our major trading partners have lowering inflation rates. Those countries have a negative inflation rate and a cost of living that is actually falling, whereas in Australia it is rising. That is not encouraging for our potential. The tax package was introduced six or eight months ago, and I will deal more fully with that topic a little later, but one of the most fundamental promises that was broken following the introduction of that package concerns the capital gains tax. The Prime Minister (Mr Hawke) in his Sydney Opera House policy speech, which we remember so well, made it quite clear that there would be no such tax. However, immediately after this Government was re-elected came the capital gains tax. It was very like the promises made by Senator Grimes at the economic summit back in 1983 that there would be no assets on pensions, that there would be no lump sum superannuation tax-only to be overturned later by a decision of the Government, when there was a total breaking of the promises to the Australian people that that would not occur. I turn to some of the details of the tax package. First, we have before us-we have only just seen it-legislation in respect of the abolition of negative gearing in property development. We are also seeing legislation for the infamous and iniquitous fringe benefits tax. The Government has sought to make something of the point that the Opposition will be opposing those two pieces of legislation and that somehow this will undermine the Government's capacity to deliver its tax cuts, which it has promised by September 1986. The first thing that must be said is: Who can believe any promise from this Government about reducing taxation? All the Government has done since coming to power is to impose more taxes. One needs only to ask the pensioners and retired people to appreciate what happened with the assets test on pensions, the lump sum superannuation tax, the income test for people over 70. They know that this Government cannot be trusted. How can the rest of the work force of Australia feel that they can trust this Government on statements about tax cuts? The fact is that they cannot. If we examine the promises made on tax cuts, we can see quite clearly what the Government is on about in trying to besmirch and scapegoat the Opposition as being the Party that will bring some collapse of its policy in reducing taxation. Let us get one or two simple statistics in our minds. First, for the next two years this Government promised taxation cuts totalling $4.5 billion. The Government, by its own admission, back in September last year made clear that the maximum amount of money that can be raised to fund the tax cuts is $1.5 billion. That leaves a $3 billion overhang that this Government has to find from some other source. It can find it by imposing other taxes, or by relying on inflation-which it is doing a great job in helping to keep high-and in that way pay for future tax cuts. It can rely on growth in the economy, but all economists are suggesting that in the next few years the rate of growth in the economy will fall from levels around 5 per cent to levels around 3 per cent. That gives the lie to the Government's claim that somehow the taxation policies on fringe benefits tax, negative gearing and so on are basic to the Government's capacity to deliver the tax cuts. That is a nonsense. It is time that people heard the truth, that this Government is gambling the future of the Australian people by using and mortgaging $3 billion worth of inflation in the next two years to fund the tax cuts it intends to deliver in the next year. Let us look at the Government's record on the question of raising taxation. Already there have been announcements-thank God-that there will be no action to disallow the quaranti-ning of farm losses. We are not quite sure whether we have the whole story on this matter because the Government has not yet told us-nor has the Minister for Finance, Senator Walsh-what it intends to do to raise funds to offset that loss. Senator Walsh seems quite adamant in this place every day that there will be no other imposts on farmers to offset the withdrawal of the quarantining of farm losses proposal. There is the question of the Australia Card. This proposal was designed to raise in a few years time some $300m or $400m. Yet the Government is in internal turmoil over the question of whether it intends to introduce the card. Quite clearly, those two factors alone will have significant effects on the Government's so-called capacity to deliver the tax cuts. Another issue is the rather silly, petty approach to the abolition of the tax deduction for entertainment expenses. That proposal was put through the Parliament back in November last year. We recall that the Government boasted that this proposal was to save some $300m in taxation. The truth is that business and those who claim entertainment expenses merely have shifted their expenditure from what are now illegal areas of expenditure, on entertainment, to other promotional expenses which are tax deductible. So how can the Government say that it will obtain greater sums from that source? I would be very surprised if the revenue increased at all as a result of that measure. Let us consider what the fringe benefits tax will do to the car industry. The industry estimates indicate that this measure will have a devastating effect on the industry. There is a possibility that 10,000 jobs will be lost in the motor car industry as a result of the fringe benefits tax. It is not just the Opposition that is telling the Government these things. It is the Government's Party. The Labor Premier in South Australia, whom the Government propped up before the last State election by not telling the truth about interest rates, is now pleading with the Government to face the truth and realise that its tax policy is wrong and that it will destroy jobs in South Australia and other States. Regional centres such as Bendigo, Ballarat and areas of Adelaide will be subject to enormous pressure as a result of this measure. Senator Newman —And Repco in Tasmania. Senator MESSNER —And in Tasmania, as Senator Newman points out, particularly around Launceston. Senator Grimes's solution is to build more restaurants to replace the lost jobs in the car industry. He believes that can be done by wiping out tax deductions for entertainment. I guess that shows us the level of the Government's thinking in relation to job creation. I mentioned that Mr Bannon, the South Australian Premier, is fighting the Government on this issue. Senator Button has now joined us in the chamber. If he were of a mind he could get up and tell us of his real thoughts on the fringe benefits tax and its impact on the car industry. It is widely reported that he has been undertaking continual debate within the Caucus and Cabinet on this very issue, seeking to get the Government to see sense. We congratulate Senator Button on his efforts but we are worried. We believe that he is not fit for office because he has failed, very clearly, to deliver the goods in this most important area. Senator Button does not have to believe us. He has only to believe his own Party's Premier in South Australia. He has only to believe the Vehicle Builders Employees Federation of Australia. He has only to believe the backbench members of his own Party who, hopefully, will cross the floor and vote against the fringe benefits tax. Senator Crowley —Oh, Senator Messner, you are a laugh. Senator MESSNER —Senator Crowley, of course, will not do anything to support her State. We know about Senator Crowley. If the Government has the real interests of South Australia at heart it will face up to its obligations in this regard. Let us consider the proposal to abolish negative gearing which is also before the Parliament at present for debate. Apparently, this measure is designed to get rid of another tax rort. It is nothing of the sort. It is not a tax rort to negatively gear a property development. With interest rates at their present level, it is practically an impossibility not to negatively gear property developments these days unless they are almost 100 per cent injected with equity capital. Any amount of borrowing bears such high interest rates these days that it is very difficult to get enough income from a property to be able to repay the interest. That is the fundamental point which this Government fails to realise. The Government assumes that there is no economic value from the development of property. We say that there is economic value in making sure that housing developments and rental housing are provided by the free enterprise sector, the private sector, as opposed to the public sector because that takes the load off the taxpayer. But this Government has exactly the opposite view. It seeks to develop public housing as against private rental housing and so has taken this step to put the pressure on the public sector. This move comes at a time when, during the three years of this Government's occupation of the treasury benches, the waiting lists in the States for public housing provided by the housing commissions in various States-for example, New South Wales and Victoria-and by the Housing Trust in South Australia, have grown by nearly 30 per cent. Yet the Government seeks to impose a further imposition on the taxpayer which will reduce the capacity of the Australian private enterprise sector to deliver rental housing to people in need. As I said, there has been a 30 per cent increase in the waiting list for public housing. The Government cannot service that requirement now, yet it seeks to put more people on the public sector waiting lists by destroying the opportunities of the private industries to provide housing for private renters. Clearly, I have a very great concern about this Government's sanity, not only in regard to housing but in particular to what it is doing to jobs in the car industry, which is becoming more and more of a problem and which must be faced in the weeks and months ahead. Quite apart from the points that have been made in relation to what these new taxes are all about, the red tape that is resulting from the introduction of these new taxes will place enormous burdens on business and private taxpayers. As we said right from the outset when the `Reform of the Australian Taxation System' proposals were announced by Mr Keating in September last year, this legislation is for the benefit of accountants and lawyers. Today in the Australian Financial Review an advertisement appeared by Coopers and Lybrand, the famous chartered accounting firm. The advertisement advertises a vehicle logbook which one can buy for $3.50 in order to keep all the records one must keep to determine one's tax deduction for motor vehicle use. Coopers and Lybrand say in the advertisement: Here at last, the book Paul Keating's been raving about. We can see the job opportunities in the accounting profession as a result of this Government's measure. Yet the further impositions on people to keep detailed records will achieve very little in terms of increasing Commonwealth revenue. Another advertisement appeared in today's Financial Review, also by a firm of chartered accountants, Arthur Young, which states: Fringe Benefits. Will you get stuck with the Bill? Indeed, they said that taxpayers will be left in a very sticky situation. They are producing tax reports to help people to understand what this tax legislation is all about. People will need an enormous amount of help. I notice that Senator Crowley has not opened a page of the fringe benefits tax Bill. If she were to, I believe she would be absolutely horrified. Senator Crowley —Mr Acting Deputy President, on a point of order: I do not think I can stand here and take that gross slur against my character with a claim from the honourable senator about which he has no knowledge. The ACTING DEPUTY PRESIDENT(Senator Jessop) —Order! There is no point of order. Senator MESSNER —I notice that Senator Crowley did not deny the point. The fact is that, if she did open the Bill and look at it, she would find the task of understanding it as difficult as when she studied for her medical degree at some earlier stage. One probably needs to have a law degree to understand what the fringe benefits tax legislation will impose on people. There are some 30 pages of definitions in the Bill, defining practically every word that is set out in the parts of the Bill. It is incredible. I challenge Senator Crowley to look at it and to give us a detailed analysis of what it is all about. The legislation will have an enormous impact on small business. It will have an enormous impact on ordinary taxpayers who will have to employ accountants and lawyers. Obviously, this represents a red tape led recovery in order to put more cash in the hands of accountants and lawyers. It is really an accountants and lawyers benefit Bill. That is what it is all about. Of course, there is more to come. We have not yet seen the capital gains tax proposal, which will clearly add to the burdens on small businesses, farmers and ordinary taxpayers and take away from them the incentive to develop their own investments in order to build up a nest egg for retirement. The issue of a gold tax still hangs over us. Western Australians are very interested in whether there will be a gold tax. Senator Crowley would not know this but many South Australians are very interested in the issue also. Companies operating in South Australia-such as Western Mining Corporation Ltd at Roxby Downs and, of course, Poseidon Ltd-have very substantial investments in the gold industry. They are very interested in this Government's intentions with a gold tax. The Liberal and National parties are opposed to a gold tax, but this Government appears to be on the road towards instituting one. We want to know why it wants a gold tax and when we will hear about it. Now that the Western Australian election is out of the way, we feel it is appropriate for the Government to come clean and tell us properly what it intends to do. I notice that the Government is silent on this, so clearly it is considering the matter very deeply at the moment. I conclude merely by pointing out that it is time that the Australian people learned the truth about the Government's problems in managing the economy. The economy is in the hands of the Government and the problems are home grown. The ACTING DEPUTY PRESIDENT(Senator Jessop) —Order! The honourable senator's time has expired. Senator CROWLEY(South Australia)(11.24) —Well, well, well, I am delighted to have been edified by that remarkable half-hour contribution from Senator Messner. I particularly want to make the comment that he seems to be very clear about what I do not know. For a start, seeing as he seems to require me to deny categorically his claim, I will tell him for his edification, knowing that he will take not the slightest notice of it, that I serve on the Standing Committee for the Scrutiny of Bills. That Committee is required to examine all legislation coming into this place so, for his edification, yes, I have looked at that legislation. But whether I know about the fringe benefits tax legislation matters much less to the Australian population than whether people of this country know what the Opposition proposes to do. Senator Messner said that he would tell us what the Opposition would do, but he proceeded to tell us nothing of what it would do except that, believe it or not, the Opposition is opposed to a gold tax. I had to wait through half an hour of that unmitigated piffle to hear that the Opposition is opposed to a gold tax. Is the Opposition opposed to a fringe benefits tax? Would it remove such a tax if it ever came to government? Why did Senator Messner not say so if that is the case? Is the Opposition opposed to a capital gains tax? Will that be taken away if the Opposition ever gets back on to the Treasury bench? My goodness, why does not Senator Messner go around and tell people the answers to those sorts of questions instead of serving up to the community of Australia rubbish and nonsense about whether I read Bills, which is monumentally irrelevant. What this Government has done it stands by and is unashamed of. What the Opposition proposes is totally unclear. Inasmuch as the Opposition makes statements about anything, there are statements on the left hand and statements on the right hand. Mr N. A. Brown may say one thing and Mr Howard may say something else. The Opposition is divided and confused. It has no policies. No wonder all that Opposition members can do is to carp at and criticise the Government. They have nothing to say on their own behalf. I would like to be much clearer about what the Opposition proposes on these matters. I love the way that the Opposition is able to furphy around with the facts. Fancy suggesting that this Government has not had any successful achievements! This Government, in its three and a bit years, has actually presided over the creation of more than 600,000 jobs. Yes, it has reduced inflation. Yes, it has reduced unemployment dramatically. Yes, we acknowledge that on any hard evidence interest rates rose last year. But Senator Messner was not prepared to tell the people of Australia over the air today that interest rates have fallen considerably in the last few months. I refer Senator Messner to a question from Senator Cook that Senator Walsh answered one day. When asked whether interest rates had fallen, the answer was yes. Certainly, they are matters of grave concern to the Government; but if Senator Messner wishes to give the facts he should give them all and not just a few here and there in order to make his grubby little argument in this debate on the Appropriation (Parliamentary Departments) Bill (No. 2) 1985-86, Appropriation Bill (No. 3) 1985-86 and Appropriation Bill (No. 4) 1985-86. I do not really want to spend very much time going over what Senator Messner had to say because by and large it is not worth the time. I rose to speak on the appropriations to address some points that emerged from the sittings of Estimates Committee B. These are of considerable interest and I want to take them up today in the second reading debate on these Bills. The first area to which I refer is that of child care. In Estimates Committee B, during examination of the estimates for the Department of Community Services, questions were asked about the provision of child care. These questions seemed to focus more on problems or difficulties in the child care area. While the Minister for Community Services, Senator Grimes, who has never been one to shy away from the hard facts on any matter-this can be said of all Ministers in this Government-acknowledges the need for continuing discussion and negotiation with the few centres not yet open, the estimates did not do justice to the Government's achievements in the child care area. Therefore, I take the opportunity to mention these. I notice that Senator Messner has left the chamber. I do not suppose he wanted to stay around for any list of the successes of the three years of Labor Government. One of the things that has happened over the last three and a half years has been the dramatic increase in the number of child care places funded by the Commonwealth. The figures show an increase in costs. The expenditure on child care in 1981-82 was $47.4m and in 1984-85 it was $122.7m. That represents a very great increase in an area that may not grab Senator Messner as being critical to the scheme of things, but anybody with an interest in creating work opportunities, particularly for those in the community with child care responsibilities-which of course largely means women-will know that this achievement by government is of great importance, not only to the provision of child care but also to the provision of the opportunity for increased productivity in this country. Over the same period the number of full time child care places has risen from 37,580 in June 1982 to 63,129 in 1985. It is important to make comment about those full time places. Perhaps the words `full time' should be in inverted commas as, whilst the figures do refer only to full time places, many more children will be catered for. The Government estimates that the figure for full time places represents about 60 per cent of the number of children who will have access. However, that is still a rough estimate at this stage; we cannot be absolutely sure of that. It is important to understand that the figures include not just centre-based child care provision but also family day care provision, both of which take considerable funding from the Commonwealth Government. Points were raised in discussion during the Estimates Committee about some difficulties in the delay in opening of centres. In relation to a question from Senator Peter Baume as to whether any centres have closed, any places have been lost or any of the anticipated hardships have come to pass, I refer to Senator Grimes's answer as reported at page 304 of the Estimates Committee B Hansard of 15 April 1986, in which he said that he would ask Ms Murnane to answer further, but that no centres have had to close. Senator Grimes said that the difficulty goes to centres that have not opened; that no places have been lost, just a delay in establishing the new places; and that the hardships anticipated by certain centres and certain workers involved in centres have not in fact come to pass. The problem has been localised to centres in Victoria-although there are a few isolated instances in other places-which have had difficulty in being ready to open under the new arrangements. It is important to acknowledge that no centres currently operating were required to close or did close; there was no loss of existing places; and the delay in the provision of new places was consequent upon the delay in opening of some centres. It is my understanding that some of these centres have already come to arrangements so that they are now comfortable and agreeable with the provisions and able to open. A few more centres in Victoria are still negotiating with the Government about conditions, et cetera, and are not yet open. In the scheme of things, the enormous increase in places and the enormous achievements in child care provision around this country are matters of great success and deserving of great praise. Certainly it was not, as I understand it, Senator Peter Baume's intention in questioning on the Estimates to make any carping criticism about this matter; rather, that Senator Baume was looking for information. I believe that the child care area, while there are difficulties, as there always are, with the introduction of new provisions or arrangements, is deserving of nothing but considerable congratulations because of the commitment to increase places and because that commitment has been achieved to a large extent. The second point I turn to is something that also emerged from the Estimates Committee. I suppose it could be said that it emerges from all Estimates Committees on which I have sat, because either I or some other honourable senator has asked about the matter of repetitive strain injury. I found it quite interesting to observe that the Additional Estimates reported quite remarkable differences in the response to questions about RSI. I refer honourable senators to page 327 of the Estimates Committee B Hansard, where it will be seen that Mr Harris from the Department of Immigration and Ethnic Affairs was able to explain that there has been a significant reduction in the number of people suffering from or becoming afflicted with RSI in that Department. That is most satisfactory, because in the recent past that Department was very concerned about the considerable number of people with repetitive strain injury in the Department. It is interesting to note that the Department has had considerable success in the reduction of cases. It is very difficult to say precisely what may be the reason for that reduction, partly because in tackling the problems various departments have taken on a number of areas of concern, such as the description of jobs, the provision of work in stages, free time for resting up from the use of machines, changes in furniture, more comprehensive occupational health and safety programs, negotiations with unions, and so on; so it is difficult to say that one specific item contributed to the reduction of RSI cases in the Department. The most important thing is that while we do not know the reason, we know the outcome, and that outcome is satisfactory. If we turn to page 340 of the same Estimates Committee Hansard, we find a quite different response to the question of the importance of RSI. I quote from a question by Senator Peter Baume, where he asked: RSI has been blamed for a delay in the processing of pharmaceutical scripts in the Pharmpay system. Is that correct? Mr McKay, from the Department of Health, said: That is correct. What is not clear to me-Senator Baume did not seek further clarification-is whether the claim for blame is correct or whether the RSI being blamed is correct. At the moment I presume that it is the claim that is correct. Senator Withers —Smarten up, Baume. Senator CROWLEY —That may be a piece of pedantry that will wake up Senator Withers, but it is an important distinction that needs to be drawn. The Department is saying that people with RSI in the Department have been of such concern that the Department has blamed, at least in large part, the RSI problem for the delay in the processing of pharmaceutical benefits. I quote from the report of Estimates Committee B to the Senate, which states: Evidence presented by the Department of Health indicated however that RSI has been partly responsible for a substantial delay (of approximately 51 million items, representing a backlog of about 5 months pro-cessing time) in the processing of pharmaceutical scripts in the `Pharmpay' system. It appears that a combination of automatic direct entry of claims, together with the introduction of new furniture and equipment for ope-rators, is reducing the incidence of RSI. We go on to say that Estimates Committee B will seek further evidence on what does happen, both with the delay in the payment of pharmaceutical benefits and with the reduction of RSI in the Department of Health. It is important to note, firstly, that there is a problem of RSI, although the Department of Health notes that it is falling, but the Department wants to attribute RSI as being considerably causal to the difficulties it has in the Pharmpay system. Secondly, there is the importance of that delay and how it is being reduced or solved. Finally, Estimates Committee B wanted to say in its report that it was a bit concerned that a department could blame something like RSI for the difficulty, yet not convey to us assurances that the arrangements put in place to accommodate that kind of difficulty were sufficient to maintain an adequate service in that section of the Department. That is, any administrative procedures ought to take account of whatever difficulties may emerge from time to time. In any large department there are bound to be those sorts of difficulties from time to time. In this case the repetitive strain injury problem contri-buted enormously to a delay and to a building up of a considerable backlog, but I would like the Department to clarify the matter and confirm that it was not attributing all of its admi-nistrative difficulties to RSI or, better still, that it had some fall-back procedures or mechanisms to cope with that difficulty or any other. The final comment I have on RSI is that one way or another we have had evidence to the Estimates Committee that the number of people with RSI, either being initially diagnosed or being under continuing treatment or compensation, has levelled out and in some departments has fallen. I take great heart from that because there has been a series of difficulties associated with repe-titive strain injury, not the least being the claim by many people that it does not exist at all, or that whatever it is it is all in the mind. I do not think that that approach was at all helpful. In fact, it was while that approach existed that we saw a considerable increase in the number of cases of repetitive strain injury. It would certainly be interesting to correlate the fall in the number of cases with the different attitude by those in charge who actually took a decision to take this condition seriously, to put in place change in work patterns, perhaps change in furniture, and change in the encouragement of people who felt pain in their arms or shoulders to feel free to report it, in the knowledge that they would not be regarded as neurotic or fakers, but that they would be taken seriously and assisted. It is interesting that with all those changes-as I said earlier, we cannot say which one if any was causal in the fall-there has been a turnaround and a reduction in the incidence of repetitive strain injury. It should be an edifying lesson that before we start accusing people of being liars, cheats or fakers perhaps we should take seriously what they are presenting by way of complaint and try to address it. It certainly seems that since the problem has been addressed it has been resolved or the numbers have continued to fall. I think that it has been very fortunate that we have had a condition called repetitive strain injury in the world over the last few years. It seems to me that it has been blamed for everything, and it is almost in danger of replacing mothers as responsible for everything evil and a cause for concern in this world. I say that with heavy irony. Senator Mason —It has something of a reputation. Senator CROWLEY —I agree. Senator Peter Baume —Is there any pathology yet agreed on what underlies it? Senator CROWLEY —I am not sure that we should debate the pathology underlying this, but my understanding is that yes, there is in some areas quite observable pathology; but on the whole we are not in the business of cutting out chunks of muscle in people who have sore arms, so it is not an area which has been comprehensively examined from pathological terms. To presume that everybody who complains of pain in the wrist, neck and shoulders is forthwith to be regarded as a poseur, is not a constructive way of behaving. The other thing that has made it difficult for society is that this condition tended to emerge amongst women mainly because the people processing information on word processors were women. It was a humble, lowly paid task and, therefore, it was the area of work that was filled by women, not because they lacked the skills but because they tended to find themselves in lower paid jobs which are more repetitive and boring. Of course, they were the people more likely to get repetitive strain injury. It was then regarded as a sort of middle class, feminist, rat-bag disease, to quote some of my honourable National Party colleagues from that other place. They have lines like that for when women get anything, particularly RSI. `They were all in it madly for the compensation', they said. The full payout for RSI goes all the way to $36,000. One could get very rich on $36,000, particularly if one is totally and permanently incapacitated and in one's twenties. For the honourable senators opposite I note that that was a piece of very heavy irony. Another thing that is said is that compensation premiums have dramatically risen both within the Commonwealth Public Service and in private insurance companies. A piece in the Australian Financial Review of, I think, a couple of days ago talked about proposals for a 70 per cent increase in compensation premiums throughout New South Wales, which is very interesting and very difficult to account for. Why have compensation premiums so dramatically risen in the last few years? There are some quarters that would say that it is all due to RSI. Blessed be RSI because, while we have that, it saves us from looking, in much harder detail, at what, in fact, contributes to the compensation premium increases, or what are the other criteria that insurance companies have to take into account, or do take into account. I am not sure whether it all can be attributed to RSI. Even when people with RSI do seek common law judgments on their conditions they do not draw the very large sums that we sometimes read about a judge awarding. The RSI area is very interesting. It tends to get tucked away in the Estimates, but I think it has very much more significant ramifications in our society than perhaps we are aware of. I am very interested to draw the attention of the Senate to them today. The final comment I wish to make relates to another question I raised in the Estimates Committee hearings. The question of Filipino brides and the difficulties that they have experienced was brought to my attention by a number of people in South Australia. The people who raised this matter with me worked with a variety of women's services around South Australia and were very concerned about the problem of Filipino brides. They were also concerned to know how big was the problem and, certainly, so was I. If one meets three Filipino brides who have come under the so-called Filipino brides arrangement, been involved in domestic violence situations and finish up in the women's shelters movement, one may have an impression that that is what happens to all Filipino brides. So I was interested to seek from the Department of Immigration and Ethnic Affairs information, if it had any, about the whole question-the numbers of Filipino brides arriving in this country, the categories of Filipino brides, how they get to meet their Australian husbands and what is the outcome. I congratulate the Department on its comprehensive answer. It is quite clear from the answer that the Department is well aware of the Filipino brides arriving in this country, has a very good understanding of the outcome of some of those marriages-some are a success-and has a considerable understanding of the problems that arise from some of those marriages. The Department has given me considerable information about steps it is taking in conjunction with other community groups to address the difficulties and provide support for the Filipino brides in particular, but also anybody involved in those marital breakdowns-the Australian men occasionally, and certainly the children of such marriages. It seems that there are any number of committees and support groups throughout Australia. There are grant-in-aid workers in New South Wales, Victoria and Queensland. Not only does Queensland have a half time grant-in-aid worker in Brisbane but the Catholic family care service in Cairns has a grant-in-aid worker specifically for the Filipino community. There is a further grant-in-aid worker at Mount Isa Ethnic Community Council who works extensively with the Filipino women there. South Australia has a grant-in-aid worker half time and as well there is assistance from the Salisbury migrant resource centre. In Western Australian the Anglican Church Care Centre has grant-in-aid assistance, as does the Young Women's Christian Association at Karratha in north-west Australia. In Tasmania there seems to be no formal Filipino welfare organisations, but the Department tells us that there are relatively few Filipinos in that State, at least to this point. In the Northern Territory one of the two grant-in-aid workers at the Darwin migrant resource centre is specifically working with Filipino women. In the Australian Capital Territory the Canberra migrant resource centre has a grant-in-aid worker with some Filipino clients, and other welfare groups assist in the Filipino women's problems. The Department tells me that in 1984-85 approximately 2,000 women arrived in this category-that is, sponsored spouses or fiances-from Asia, 1,600 of whom were Filipinos. The latter figure is increasing and it is estimated that there will be a 10 to 15 per cent growth in 1986. It is estimated that about 30 to 40 per cent of couples meet through introduction agencies, and many of the Australians involved-I guess honourable senators might have noticed that when I listed where the grant-in-aid workers were working-lived in isolated areas, including mining towns and rural properties. It is interesting that that is where a number of the Filipino brides are coming to Australia to live-in Mount Isa, Karratha and on stations far out from large urban areas-and it seems from the Department's figures that those are the partnerships that are more vulnerable to breakdown and give rise to concerns to both the Philippine and Australian governments. It is estimated that 30 to 40 per cent of Filipino brides meet their spouses through introduction agencies, 45 per cent through friends and relatives while 15 per cent or so begin their relationship on meeting in the Philippines. The number of relationships being instigated through personal introduction, that is through family and friends, is rising. This presumably is because of the number of successful Australian-Filipino marriages and introductions of Australian men to Filipino women through the friendship or family contact rather than through the introduction agencies. Many Filipino women who have met their problems through introduction agencies claim that they were unaware, for example, that their husbands had criminal records or histories of domestic violence, mental illness or previous failed marriages. I guess what that means is that the examination of the cases coming before either the Department of Social Security or the Department of Community Welfare shows that that is the history of some of those Australian men seeking Filipino brides. It is also to be noticed that some Filipino women marry for economic reasons and that they perhaps have put an overrated value on what they see as the Australian man's income or monetary value. Australian husbands are perceived as tending to marry Filipino women for company, sex or child care. I do not quite know where they get the children. The report does not list that, but presumably that happens too. The interesting thing is that Australian men are perhaps not aware that Filipino women are not just compliant and passive; in fact, they are very often of much higher educational and social standing than the men anticipated and sometimes that is judged to be the cause of the conflict that then arises. The problem, of course, for many is that the marriage will come to a stage of domestic violence and almost invariably it is the Filipino bride who is the victim of that violence. Nobody can give precise figures on the number of breakdowns, but it is to be noticed that one-third of those women who avail themselves of Darwin's only women's refuge are Filipino women. Nearly all are married to Australian-born males. It seems from these figures that there is quite clearly an area of grave concern. I think the Department has already acknowledged that by the number of grant-in-aid workers it has supported and the number of agencies around the country it is working with to try to address the problem and provide more data as well as the important support. It is also to be noticed that the age of Filipino brides is rising and the age of Australian men seeking Filipino brides is falling. Perhaps this is due to the changing nature of the way these people originally meet. It is to be hoped that the problem, now that it is very well acknowledged, will be more satisfactorily dealt with, particularly in the provision of satisfactory support for those women who perhaps live in isolated areas of Australia. I again commend the Department for the very comprehensive information it provided on that question. Senator MASON(New South Wales)(11.54) —The Australian Democrats note the second reading amendment proposed by the Liberal-National Party Opposition to the motion for the second reading of Appropriation Bill (No. 3) 1985-86. We do not agree with everything in that Bill-for instance, the decision not to introduce a capital gains tax. I make the point briefly at this stage that that tax, which would have borne much more severely on the Australian business community and the community at large had it not been for Democrat intervention, was because of our intervention very much ameliorated. I will not go into this in detail but the fact that the Bill is entirely prospective and that it is indexed for inflation so that, indeed, it represents little more than income and should be taxed as such, has been due to the intervention of the Democrats. These matters will be dealt with later in this debate by Senator Siddons and we will indicate our justification for other amendments to the Liberal amendment which has already been circulated in the Senate. I rise to speak particularly to Appropriation Bill (No. 3) 1985-86 and I am especially interested in that part of the Estimates for the Department of Resources and Energy, division 523, the Australian Atomic Energy Commission, $753,000 for running expenses under the Atomic Energy Act 1953. This expenditure permits the continuance of experiments in the nuclear power and weapons field being carried out at the Commission's establishment at Lucas Heights. I refer in particular to the experiment in centrifuge enrichment which I understand is being run down but I have not had any definite undertaking from the Minister for Resources and Energy (Senator Gareth Evans) on its determination. That experiment, among other things, led to a dangerous leakage of uranium hexafluoride gas at Lucas Heights in 1984. Australia ought not to be meddling in this dangerous technology. Enrichment for nuclear power reactor fuel is the same as for nuclear bomb fuel. It is only a matter of how high a proportion of U235 the material contains, and that is only a matter of how many times the gas is passed through the centrifuge cascades. I also raise again, as my colleagues Senator Chipp and Senator Sanders have done in recent days, the question of the safety of the Commission's HIFAR reactor at Lucas Heights. That reactor is now quite old and on a number of occasions scientists at the establishment have questioned its safety if it is kept in continued use. Although it is a small reactor, I was not altogether reassured by the Minister's response to my question to him last week about the possible effects of an accident there. The Lucas Heights reactor is not graphite moderated, it is true, but it does contain significant amounts of flammable graphite in its construction, just as the Chernobyl reactor did. My main purpose in entering this debate is to plead with the Government to discontinue these areas of expenditure, to get right out of all aspects of the nuclear industry, especially to legislate as soon as possible to stop all uranium mining and exporting from Australia, and to reverse its stand on the Roxby Downs uranium field in South Australia. From what we gather, there are no customers available for Roxby Downs uranium anyway, and I would expect that after the Chernobyl disaster that will continue for a long time into the future. It is ridiculous that this Government and the South Australian Government should be contemplating huge areas of public expenditure backing a furphy, something which is not going to be of any value to anybody but which is going to be a great danger to many people. In the Government's assessment of this very important matter it may be helped to a decision-the Democrats want a decision from the Government-by the latest assessment of the Chernobyl disaster since what actually happened there and its effects are today a lot clearer than they were even a day or two ago. The radioactive cloud from Chernobyl has extended 3,500 kilometres west to include all of Europe, including Spain. It has extended eastwards to 12,000 kilometres so that this week radioactive rain fell on Japan, on the other side of the world from Chernobyl. While the Japanese authorities said the levels were not high, they advised people not to drink that water. In several European countries children are not being allowed to drink milk. There was a run on chemist's shops all over Europe to buy iodine for children so that the radioactive iodine 131, which has now permeated all of Europe, will not enter their systems and create the inevitable thyroid cancer. Senator Peter Baume —Inevitable thyroid cancer? Come on, speak accurately. Senator MASON —Does Senator Peter Baume dispute that there is a risk of thyroid cancer after exposure to iodine 131? What technical expertise-- Senator Peter Baume —You said `inevitable'. That is absolute nonsense. It is a risk. Senator MASON —Since Senator Peter Baume is a doctor, I take his words on board. I will say that there is a very strong likelihood of cancer of the thyroid. I am sure that Senator Peter Baume, as a doctor, will agree with that. I note from his silence that he does agree. In Italy, fresh vegetables are being thrown away. Some 100 British students who have been in Kiev and Minsk have been told that while their radiation counts of up to 50 times more than normal are not dangerous, they all risk incurring cancer at some time later in their lives. Dr Otto Huber, head of the Swiss radioactivity monitoring commission, said that nobody had expected such high levels of radioactivity in Europe. Swedish figures quoted in the Sydney Morning Herald today suggest that Chernobyl will cause between 80 and 8,000 additional cancers in Western Europe over the next 40 years. I stress the words `Western Europe' because that does not, of course, concern itself with areas closer to the explosion, which I intend to deal with a little later. Austria has banned the sale of leaf vegetables, cauliflowers, beans, peas and tomatoes, and barred their import from Italy and the Eastern bloc. Some Finnish scientists have reportedly advised against conceiving children during the next few weeks. It has actually reached that stage. At its peak, according to Swedish figures, Swedes were exposed to about two millirems an hour, some 1,000 times the normal area of radiation in the community. Householders in Scotland, north Wales and the north of England only today have been told not to drink fresh rainwater, and tests on water, milk and vegetables have been stepped up in Britain. The National Radiological Protection Board in Britain said today that radiation levels could rise with more rain. It said that Britain was not yet over the worst. While the iodine 131 contamination will be relatively shortlived, it is still very dangerous and has been for the last week or more. The caesium contamination is much more serious since the half-life of caesium is some 30 years. That means that in 30 years time it will be half as dangerous as it is now. Hence, that contamination will be significant for at least half a century, and probably longer. These things are happening very long distances from Chernobyl. What is happening around Chernobyl? That region, I understand, is quite highly settled. It includes an industrial city, Pripyat, of 25,000 people, which Pravda has described today as a ghost town. That city has had to be evacuated. There are other areas of dense population close by. As the days go on, more and more significant admissions about what happened are coming from the Russians. One of the more significant was made in Hamburg by a senior Soviet official, Mr Boris Yeltsin, who said that 50,000 people had been evacuated from their homes. He also said that the radiation levels were still so high around the Chernobyl plant that it could not be approached. According to Mr Yeltsin, on that basis it was still not possible to know exactly what had happened. Taken together these statements represent a very serious situation indeed. Later information indicates that most of the people who were evacuated from the area were not evacuated until at least 40 hours after the accident. In other words, they were obviously exposed to very high and dangerous levels of radiation for 48 hours and possibly longer. It is not good enough just to remove people from a contamination area and try to treat them afterwards. Once they have been exposed to that radiation the damage has been done. The nature of radiation is such that 50,000 people evacuated from a high radiation area cannot in any way be considered to be safe. On the contrary, they are all at serious risk of developing radiation sickness over the next week or two. Many of them will already have shown initial symptoms and of these many will die. The degree of the danger has been indicated by the unprecedented steps taken by the Soviet Union. It has asked the Americans to send their experts on bone marrow transfusions. Such transfusions would be a last desperate measure to save people who have acute radiation sickness. It is not known how successful that method will be. On only a few occasions in the past has the technique been tried. It is also notable that the Russians have asked hospitals outside the Soviet Union for assistance in treating radiation sickness. Plainly, the situation in the Ukraine is one which the world has not experienced before and which is of enormous importance not only to the people there but to everybody on the face of the planet, particularly to countries such as ours which are in the uranium business up to their necks. My purpose in speaking in the debate today is to seek a reconsideration of this country's trafficking in uranium. The view of the Russian experience is confirmed by the apprehension expressed by a Japanese expert on radiation, Mr Ryushi Achikawa who, after analysing food and soil samples sent to him by the Japanese Embassy in Moscow, said: I am seriously concerned that pollution in areas within several miles from the scene may be serious. Meanwhile, four Japanese engineers who returned from Mogilev, 300 kilometres north of Chernobyl, were found to have been exposed to low level radioactivity. Over the last week or so the Russians have been doing their level best to subdue and conceal facts which are quite appalling and harrowing and which are of deep significance to the rest of the world, including Australia. I will not pull any punches in speaking about those consequences. Much of what I have to say will be unpleasant and alarming, but it is no answer to pretend that something which is happening has not happened, especially since there is a lesson in this for every human being. What is happening at Chernobyl is of the utmost importance to every man, woman and child in Australia, even though Chernobyl seems far away. I am speaking not of what happened when the reactor exploded or burnt but of what is happening now. At the moment in and around Chernobyl and at emergency hospitals in the Ukraine people will be dying in abject and agonising pain. That is absolutely predictable. Their hair is falling out. They vomit continually, cataracts are forming in their eyes. Wounds that will not heal are draining their life blood. Behind all this is the deadly attack of gamma radiation on their bone marrow, slowly destroying their immune system so that those people will succumb eventually to a host of infections which will prevail because of the failure of the immune system. Those of us who do not like those facts will be aware, or I hope we are, that they are thoroughly scientifically substantiated. This has happened before. It is an immense tragedy that it has happened again. Pregnant women in that region face the appalling prospect of giving birth to babies which are virtual monsters, with gross physical deformities, serious brain damage and latent cancer. The numbers of human beings involved in this cruel fate will not be small. On any reasonable view of the facts those numbers must already run into hundreds, and with the known, demonstrated and researched progress of radiation sickness, the numbers must grow to thousands over the next weeks and months. Very many of these people will die quietly and in obscurity. The Soviet Union will see to that. But they will die nonetheless, and they will die in their thousands because of the failure of a single machine whose only merit was to produce electric power and plutonium to be used to make nuclear bombs. The basic point for urgent consideration is our direct implication as a nation. We are conniving in these matters. We actively promote and participate in the nuclear power industry. We mine and sell uranium. We pretend to have safeguards but they are not worth the paper on which they are written. Time and again it has been demonstrated, especially since the notorious agreement on reprocessing which the Fraser Government perpetrated and the present Government has continued, that it is not possible to trace where Australian uranium goes. It is beyond doubt that, probably through Finnish reprocessing, Australian uranium is being included in Soviet nuclear weapons. If we want that sort of thing to happen we are absolutely crazy-quite insane. We try to absolve ourselves with the excuse that if we do not sell uranium somebody else will. How can that be the answer to any kind of problem? What if everyone said: `We will have an opium industry. Why shouldn't we all grow opium? Why shouldn't we flog off heroin around the world, as much as we can get, for whatever price we can get? If we don't do it somebody else will'? Where would the world be then? What sort of morality and justification is there in that? There is none at all. For eight years the Australian Democrats have been saying in this place that what happened at Chernobyl could happen. Every time we have said it people in this place and elsewhere have said: `No, it could never happen. You are whistling in the dark. You are intimidating the public'. We have been called wicked and malicious because we have said to the public things which might frighten them. I take it that those people would prefer us to leave the Australian public like sheep in a slaughter house, ignorant of the facts until the worst has happened. We do not propose to do that. It is important that the community knows what happens when there is a nuclear accident, and knows every unpleasant, bitter truth about it, so that it can consider its morality, its viewpoint and its part in it. I hope that I do not hear any honourable senator say again that we are excused and absolved because if we do not sell uranium somebody else will. We are one of the largest uranium producers in the world and our moral influence if we decided to cease this trafficking would be of crucial importance, especially now after the Chernobyl disaster when people who have done their homework know what is happening as those facts unfold. This is the time for the Australian Government to summon its courage, to put itself in a proper historical position, to become the Government which took an historical decision of importance and value for once and to say that we do not want to traffic in uranium any longer. We take no pleasure in the fact that the accident at Chernobyl happened, but it has happened and I suggest that it would be the utmost folly for the Government not to take pause at this stage, to duck out on this issue and to try to ignore what has gone on, to proceed with uranium mining and trafficking in uranium just as if nothing had happened. I suggest that that would be intolerable. We are involved as a senate, a parliament and a nation. It is within our power to take a leading role in an international campaign to rid the world of its nuclear reactors, to see humanity take the necessary step back from its current insanity, and to see that a major, international research and economic effort is put into alternatives which are now becoming increasingly viable. Those things exist. The year before last I was in Japan at the research centre of Sanyo, a large and respected company in Osaka. I was delighted and surprised at the enormous promise of current Japanese research into solar alternatives, which are already producing non-polluting, self-sustaining sources of power well up into the megawatt range. I am speaking, of course, of amorphous silicon photovoltaic cells, which are cheaper by far, especially when the economies of scale come into account, than the present silicon cells, which have to be sliced from a piece of silicon crystal grown in a laboratory or a factory. The process is now well past the research stage and is into the practical stage in Japan. To simplify it, one can spray a substance on to any substrate, plastic or metal, of any shape or size one likes, and when it is exposed to sunlight on one side it will provide electricity on the other. I was shown by the Sanyo scientists glass roof tiles made to the same size and dimensions of those currently used on Japanese houses. These tiles simply plug together on a roof and provide the houses in Tokyo with much of their electrical power-but not all of it. Natural gas will provide heating and cooking, but everything else can be got from the roof. This is not airy fairy stuff in the future. A major Japanese manufacturer of houses is already planning to put these tiles on every house he builds within the next three years. The technology is established; it exists. It is only a matter now of putting the money, the time and the effort into it to get it into vast mass production. Those people who look at their solar-powered calculators and watches will see the very beginning of that technology. I am talking about that little brown strip that creates solar electricity. That is now being done. It is at the stage where it creates massive amounts of electricity, up to the megawatt range. Senator MacGibbon —What happens when they get a couple of feet of snow on the tile roofs in winter? Senator MASON —Senator MacGibbon has asked me what happens when people in Tokyo get a couple of feet of snow on their tile roofs. It is a good question. It takes me right to the point I was next going to make. I could not thank Senator MacGibbon more for that interjection. This technology is such that it might do something which I will commend to Senator Button. I know that Senator Button is a visionary and that he has the future welfare of the world close to his heart; I give him that much credit. I see that Senator Button is smiling because he is pleased by my comment. Madam Acting Deputy President, through you, I take honourable senators to the problems of the Third World, which are relevant. Around the hottest, most desert-ridden areas on our planet we have a group of countries that we call the Third World countries, which have the most appalling economic problems. I think it is not too much to say that the world's major problem is to somehow fit the economies of the Third World into a logical and sensible world economy. I ask Senator Button to try this one on: What about the prospect of providing them with an industry which would be self-sustaining, which would give them a source of income and which would be ideally suited to the places where they live? In other words, it is not necessary-I give Senator MacGibbon the credit for knowing this-for solar energy to be delivered precisely in the place where it is generated. There are many means of transporting to other places. What I have in mind in this Third World proposal is using the vehicle of hydrogen, which can be broken down and reconstituted, as honourable senators know. This has already been established. In fact, research has been done on that point in Canberra and the Australian National University, and it has reached an advanced stage. Many other areas are being considered in that way. So we certainly have a situation where solar energy could be generated in the tropical areas of the world and it could be moved quite readily and quite easily to the areas that need it most. I think one thing is absolutely predictable. If anything like the amount of money is put into developing that technology as has been poured unsuccessfully into nuclear power, we would have no difficulty at all in establishing it as a viable alternative. After all, nuclear power is only a very small contributor to the world's energy requirements. In most parts of the world it would have no consequence at all. Unfortunately, firewood happens to be the major contributor to the world's energy needs, as statistics from the United Nations show. It is a gross indictment on the planet and everyone on it at this stage that that happens to be the case. In the United States of America the Californian Energy Commission is already building wind generators as fast as it can. They are not only competitive with nuclear power stations but also, on the latest figures I have had from the Energy Commission in that State, they are more than competitive-better than competitive-with nuclear powerhouses, and current Californian policy is being based on that assumption. My colleague Senator Macklin recently brought forward a notice of motion in this place which drew our attention to that. As I have said, there are alternatives; not one, but several. It is not good enough for us to say that we are going to go along with a dangerous, undeveloped technology, such as that of nuclear power, with all its problems and consequences-especially now, and I stress this again. We have had one lesson. How many more do we need? If we allow the Chernobyl disaster to pass without making that kind of effort, I suggest that we will go on accepting a series of reactor disasters. Every one of them will cause the kinds of consequences that I mentioned earlier. How many people do we want to go through their lives in terror of whether or not they will incur a cancer? How many people do we actually want to incur that cancer? How many stillborn children and how many spontaneous abortions do we want before we learn sense? I know that there are people who are opposed to my view and who say that we should go on and allow more nuclear disasters will come. But the disasters will come; we all know that. No technology is perfect, as Senator Sanders has said. Predictably, those disasters will come. One aspect which I think everbody should consider most carefully is that many of the isotopes released by these accidents cannot be cleaned up in three or four days or three or four weeks, or by a big effort 20 or 30 years, like that which dealt with London smog pollution. This is not so. Some of these isotopes have half-lives going up to thousands of years. Caesium alone has a half-life of 30 years, and we know that that represents pollution for a century. Every time there is another nuclear disaster the radiation level worldwide will go up. Every time the level goes up the danger will increase. Gradually, the world's background radiation will increase to an intolerable level, at which the health of all human beings will be in constant and permanent danger. To quote the poet T. S. Eliot, for whom I know Senator Button has considerable respect, `that would be the end . . .' I see that Senator Button is smiling again. I like to see Senator Button smiling. It does good things for me. Senator Button —I have been trying all along to understand what you are talking about. Senator MASON —Senator Button will understand T. S. Eliot's quotation. He will probably recall the quotation about the `end of the world, not with a bang but a whimper'. Senator Button —Eliot? Senator MASON —That is right; Eliot. I am saying that he could not have put it better. I think we must make our citizens aware of the terrible consequences of nuclear accidents and the dangers of this kind of technology. At all costs we ought not to try to cover up the facts. As I have said, we ought not to keep our people in ignorance as if they were sheep grazing peacefully in the paddock until the moment comes when they are in the slaughterhouse and it is too late for us to have any influence on events. Senator Button —You have never tried evangelising, have you? Senator MASON —I can see that I am getting through to Senator Button; I know him well enough to know that. That is good, because it reassures me. I believe that, underneath all that political cynicism, a heart of gold is beating away. It is good to know that. I will say this, finally, as I think it is an important point to leave in the honourable senator's mind. The degree of political cynicism and the total irresponsibility of any attitude to conceal or somehow play down the consequences of this disaster must be absolutely intolerable. My final words to Senator Button, to the Labor Government and to the Liberal and National parties are that the uranium debate is on again. It will now rise to a new level of urgency and importance. I implore any people listening to this parliamentary broadcast who have been concerned with that debate to take my words to heart. The time has come for them to make the biggest push that they can. If they do not do it nobody else will. I think people may have gathered from the interjections in this chamber that nobody in this place is particularly anxious to do it. It rests not in the hands of people in this place but in the hands of the people of Australia. Senator MacGIBBON(Queensland)(12.20) —The Senate is debating cognately the Appropriation (Parliamentary Departments) Bill (No. 2) 1985-86, Appropriation Bill (No. 3) 1985-86 and Appropriation Bill (No. 4) 1985-86. They broadly provide more money for parliamentary departments than was appropriated when the Budget was brought down in August. For the sake of brevity I wish to confine my speech to the Department of Defence. The original Budget that came down in August appropriated $6,535m and the additional appropriation lifts that amount to $6,702m. Last week I took the time to make a speech in the Senate about the apparent financial inability of this Government to meet the targets it has set with respect to forward funding of the Department of Defence. I think that this is a most serious problem. The Government did not inherit these targets; it set them and, having made them public, it is not showing that it has the ability to meet the expenditure in a planned way through the next part of the five-year plan. The target for the five-year defence plan announced by the Government included the expenditure of $3 billion for additional new equipment. That does not mean that we will buy $3 billion worth of new equipment over the next five years; it means that there was provision over and above the new equipment that we have recognised for the next five years to the extent of $3 billion. The plan is gaited over a five-year period of increasing expenditure because if all the equipment comes at once we could not afford it. The program called for the expenditure of $235m on additional new equipment for the financial year 1985-86. When the Budget came down we learnt that only $77m was allocated, which left a very serious shortfall with respect to the program set by the Government. The Government has embarked upon a policy of deferment. Two good examples of that are the purchase of the Seahawk helicopters for the Royal Australian Navy for the FFGs. The Government was a year late in making that decision so that put that expenditure into another financial year. A second example is the decision last week to buy the Blackhawks for the Royal Australian Air Force. I applaud this decision because I think it was by far the preferable choice of the two helicopters on the short list. Again that decision was a year behind schedule. So two big blocks of expenditure have been deferred a year. If this goes on we will reach a situation when all expenditure will come together and it will get quite out of hand. Another point I raised was how the proportion of expenditure on new capital equipment had risen within the annual Budget. It has climbed from 17.4 per cent in 1982-83 to 25.9 per cent in 1985-86. The consequence of this is that there has been a rundown in capability and a rundown in the number of people in the Defence Force. This financial year alone, from a very meagre base we have reduced the defence forces by 1,049 service men and women. However, most importantly, we have cut back on our training capability, our operational readiness. This theory is fine if it is only for a finite period-if it will be for only three or four years. However, I suspect that it is a long term program and we simply do not have enough money in the defence vote to do the things that this Government has said are necessary. The last five-year defence plan that the Fraser Government brought in was structured around a 6.3 per cent annual real growth in the defence vote. When this Government came into power it reduced that 6.3 per cent to 4.5 per cent annually and in May 1985 that 4.5 per cent was further cut to 3.1 per cent. Then without any fanfare the Department lifted its estimates at the end of last year to 3.75 per cent real growth, which is a blatant admission that the Department of Defence was able to convince Treasury that the 3.1 per cent of planned real growth was absolutely unrealistic. This Government has claimed that on average it is increasing the defence vote by 3.3 per cent per annum. It is giving itself a big pat on the back for being so generous to the Department of Defence. However, I would argue that that amount is not enough and that the growth has not been a planned growth by this Government; it has come about accidentally because some of the new equipment programs that the Government is contracted to have resulted in equipment being supplied ahead of time. In the first year of this Government $80m of foreign military sales of defence equipment were delivered ahead of time and brought into the first financial year of this Government. Last year $62m of foreign military sales equipment under contract came ahead of its delivery time and it had to be paid for. Those two forward deliveries enabled the Government to reach the figure of 3.3 per cent. I suspect that the Department knows this very well. One of the underlying reasons why the Dibb review was set up was to give the Government a shelter to hide behind. It could say that the report from Mr Dibb recommended certain capabilities had to be cut. Everyone on this side of the Senate would have no difficulty in supporting the proposition that the capabilities we have at present are inadequate and that further cuts just could not be tolerated. It is interesting to look at the remit from the Minister for Defence (Mr Beazley) directing Mr Dibb to undertake his review. The first requirement was for him to undertake a review of the content, priorities and rationale of Defence forward planning in the light of the strategic and financial planning guidance endorsed by the Government. The financial planning guidance endorsed by the Government is the key part in that statement. It is the only hard condition there because strategic planning is a nebulous concept, which everyone knows. The strategic assessment that the Government gets is tailored to the views of the government of the day and it is a movable feast. However, financial planning guidance is 3 per cent of gross domestic product. It has been made very clear by the Minister for Defence that while the Australian Labor Party is in power there will never be any increase on this 3 per cent. Quite clearly, 3 per cent will not buy the ability to maintain the capabilities we have at present, let alone reach the level that we need. The Parliament has not seen the Dibb report although the Minister and the Cabinet have been sitting on it probably for over a month or six weeks. The Australian public and those interested in defence are being conditioned by a propaganda effort coming from the Government. It started last year after the exercises at Shoalwater Bay. One correspondent wrote a big article which stated that the Leopard tanks and the armoured corps would disappear when the Dibb report came out. Since then we have had a planned campaign of conditioning the Australian public towards new concepts in defence. Proposals are being presented as new, relevant and important. In reality, it is the incorporation of long term Labor defence policies and beliefs. I think it is a matter of great regret that this Parliament will not see the Dibb report at a time when it can debate it. Presumably the report will come down in the closing stages of this session of the Parliament-when the Parliament has no opportunity to debate it when everyone is interested in it-or, more likely, Mr Hawke or Mr Beazley will release it after the Parliament rises. When the Government releases it there will be a public outcry against it but the Parliament will be hamstrung and unable to deal with it because it will be during the parliamentary winter recess. We will not be sitting through June, July and August. By the time we come back we will be in the high drama of a Budget which will be presented on the first sitting day of the new session and the Dibb report will pass by default. I believe that the propaganda campaign that is being run to condition the Australian public does reflect what the report will state. Obviously it will give defence a low priority. This will be garnished with the no-threat doctrine and the claim that we have 10 years to prepare for any threat. The report will clearly incorporate the Fortress Australia concept but the Minister for Defence and the Prime Minister will swear on a stack of Bibles that it does not incorporate the Fortress Australia concept. However, it will be that in reality because the Labor Party has a great xenophobia. It does not like people from other countries. There is nothing racist about that; it dislikes the Americans as much as it dislikes the Indonesians. The Labor Party is also isolationist. It would love to be non-aligned and not tied up with any alliances in any form with any other country. Insofar as the Government leans over backwards to have a defence force structure that is demonstrably not a threat to anyone, it ends up with a totally ineffectual defence force. Unfortunately the Labor Party believes in the crocodile theory. It thinks in relation to foreign affairs that if it feeds the crocodile, it will be the last to be eaten. It does not see the relevance of providing our defence forces with a strong deterrence posture. The importance of the Dibb report should not be underestimated. We are told repeatedly that the Government will implement the Dibb report. This report is from one man who has no detailed knowledge of defence at all. He has never been in any of the Services; he has never had any involvement with defence planning, defence organisation or defence doctrine. He has a long history of strategic analysis, but that is a rather genteel game of sitting around tables and assessing options and things like that. I was horrified to learn, from unimpeachable sources, that in September last year Mr Dibb had been up to Darwin for the first time. I said: `You don't mean that, do you?', to which I received the reply: `Oh yes, we took Mr Dibb up to Darwin; he was up there for a day then we spent two days coming down in a Caribou from Darwin to Alice Springs'. If we accept the Fortress Australia doctrine, the defence of Australia will be based in the nor'-western part of the continent. To have writing a prescription for that area someone who went up there only after he got the commission to write the report is absolutely incredible. The effect of the climate, the distances to be travelled and the logistics problems are enormous and dictate the sort of structure we have to have. Here we have someone who was raised in the gentle fields of England, where in any part of the country a pub is literally within walking distance down a leafy lane, going up to Darwin for the first time and writing a prescription for Australia's defence. The third factor we have to look at in regard to the importance of the Dibb report is that it will be accepted by a Caucus that simply has no interest in let alone any knowledge of defence and approved by a Cabinet which again has neither interest in nor knowledge of the subject. If the conditioning is accurate, and I believe it is, we will have a very serious problem downstream. Mr Beazley has promised that the Labor Government will implement this report. If it implements this report it will create a completely inappropriate force structure for the Australian defence forces, and the consequence of that would be that any future Australian Government will find it difficult to turn it around in the short term. Most importantly, in the exercise of powers by the Government in looking after our national interests in foreign affairs and defence, the range of options open to us will be almost zero. We would cut off any effective international role for Australia if the Dibb report were introduced. I would now like to develop a few points in a little more detail. I shall deal first with the no-threat doctrine. The no-threat doctrine has always been very dear to the Australian Labor Party. It is based in part on the naive belief that if we are no problem for anyone, no one will ever be a problem for us. That simply does not apply. We find that doctrine enshrined in Hansard. If we look in the library we find that only six months before the outbreak of the Second War in September 1939 Mr Curtin was saying on the record, in Hansard, that Australia and the world had no threats at all. Yet a few months later we were involved in the biggest conflict of arms the world has seen. That view was revived under Mr Whitlam, because Mr Whitlam, with his grandiose vision of the world, could see no threat either, and of course it has come back stronger than ever under the Hawke regime. Tied in with the no-threat doctrine is the implicit belief that someone will ring a bell, send us a letter by registered mail, telling us in 10 years time that we will have a defence crisis on our hands. We do not have knowledge of what will happen ahead, and the history of the human race shows that 90 per cent of wars have broken out without warning to the participants beforehand. In a modern age, with the technology involved in weapons, the lead time to acquire them and to train people means that we simply do not have time to prepare. A country will finish a war with the resources it had when the war started, or a little less. I do not know what we can do to persuade the Labor Party. All I can say is that the Liberal and National parties believe in prevention. We believe we should be strong enough so that people can see that we can look after our essential interests. We will not have a bar of any no-threat doctrine. We believe that we have to be prepared to go at any time. The majority of wars start over small issues-border issues, trade routes and things like that. We are not necessarily looking at a World War III situation. As the recent Indonesian events have shown, things can happen overnight. It is interesting to look at the region in which the Labor Party sees no threat. Just look up to the north-east, at New Caledonia. The decolonisation program there is being handled with the usual incompetence and intransigence of the French Government. It is repeating all the mistakes it made in Algeria and before that in Vietnam. One just cannot foresee what will happen in New Caledonia. We could see the separatist movement being cultivated and supported by a Soviet group, and we could see it being successful. If that happens we could have a Soviet naval base-a cherished goal of the Soviet strategic analysts-in the South Pacific. We could have an air base there. The problems that would bring for Australia are enormous. What can we do about it? Could we support the French authorities or a legitimate group in New Caledonia? Of course we could not at present because we do not have any way of getting there, of deploying air power or putting in a naval force. I would like to look at the Fortress Australia concept because it is central to the Labor Party. It seems to believe that if we mind our own business no one will ever worry us. Of course, that does not extend to foreign affairs. The Labor Party goes around South East Asia making a damned nuisance of itself, telling every other country how to run its internal affairs. Senator Robertson —That is not how they see it. Senator MacGIBBON —The problems with Indonesia are a part of that. Senator Robertson is very keen to tell the Indonesians what they might do with East Timor. He would be very upset if the Indonesians came in and made some suggestions about how Premier Wran should run New South Wales. Fortress Australia is rooted in part on this isolationist theory of the Labor Party. It is all very well to be self-reliant and self-sufficient, and I believe that that is a primary condition bearing upon us. But we see the Minister for Defence in interview after interview talking about the great moat that surrounds Australia, as though no one can overcome it. He tells us how the Japanese could not get here in 1942 and 1944. That was a different time, a different age and different technology. The geographic isolation of Australia is an advantage but it is not an insuperable barrier to anyone who wants to come here. The point is that we cannot be a fortress. We cannot lock ourselves up, close the door on the castle and live inside. It is not true to say that we can feed ourselves and clothe ourselves so the rest of the world can go to blazes. We have to be able to move through the region; we have to know what is going on there. At the end of the day, no isolated fortress in the history of mankind has survived. We cannot isolate ourselves from the world. That leads me to the fundamental difference between the Liberal and National parties and the Labor Party. We do not believe that we can go it alone. We do not believe in this myth of self-sufficiency. Again the Minister, in relation to part of the Dibb report, says that we are technologically superior to other counties and we are one of the few countries in the world to which the United States will sell the latest mark 48 torpedo and Harpoon missile. That is perfectly true. Then the Minister goes on to say, however, that as soon as we become self-sufficient we will cut the links with the United States, ignoring completely the fact that technology goes on and on. While the mark 48 torpedo and the Harpoon might be the latest weapons at present, in five years time there will be another generation which Australian industry will not have developed. Above all, Australia needs to recognise that its defence turns on a recognition of the fact that we are part of the region. There is not much point in going on with the sort of foreign affairs that this Government has practised of alienating everyone in the region. We want to build links and be friendly with the nations in the region. We must have alliances. We must support the United States through the ANZUS alliance, and I believe that that alliance puts a duty on us to perform. It is not only a guarantee that if things go bad the United States will come to help us. It is an alliance that puts an obligation on Australia to play its part in the security of the region. That regional security is determined not by the numbers of men or women in uniform in Australia. It turns on having good relationships and the ability to deploy Australian forces as required, either as single services or as joint services, to help countries in the South East Asia region when they ask us for help, so that through the whole of the island barrier north of Australia we set up a net of friendly, co-operative powers. If that happens our security will be ensured. Turning to the consequences of the Dibb report in detail, I advert first to the way in which the Government has handled the morale of the Services. In my life I have never known a time when the Australian Defence Force was in worse shape from a morale point of view than it is at present. One can see that in the resignation rates, which have gone to record levels. The Government's policy makes it very clear to every serviceman and servicewoman: `We don't want you and we are not interested in your problems'. The advertisement published in all the major Australian dailies on 2 April with the slogan `Thank you gentlemen, your services are no longer required' in reference to an article on defence in the Bulletin struck a responsive chord with every serviceman and servicewoman in Australia. They knew that was where they stood with this Labor Government. They see no point in being in the Services when they do not know where they are going. To deal with a few more detailed points in the Dibb report, I have every sympathy with the Navy and for the Chief of Naval Staff. This year marks the seventy-fifth anniversary of the Royal Australian Navy. Admiral Hudson will be the first Chief of Naval Staff to preside over the castration of the Australian Navy. The Navy has a bunch of old surface ships that it will not be allowed to replace. Despite what the Minister might say about having the technological edge in the region, Australia is outclassed by the Indonesians in surface ship capability. We are overwhelmed by the Soviets. Do honourable senators realise that the Soviet Pacific naval fleet is the largest of all the Soviet navies? In a few years time, in 1990, we will see the deployment of the 70,000-tonne nuclear powered conventional aircraft carrier and a Soviet carrier battle group in the Pacific region. They are not there for tourism, or to get leis around their neck when they go to Fiji. What do we find from Mr Dibb? Mr Dibb, who has spent the short while he has been in Australia ridiculing and deriding the growing influence of the Soviet Navy in the Pacific region, is hardly likely now to admit that he has made a mistake and say: `We cannot run down the Navy'. Of course, we shall cut it down. We shall make it just a brown water fleet, fit for harbour protection duty with a submarine force so small that it will be ineffectual. The Navy must be able to protect surface shipping; it must be able to project power. We need a new generation of surface ships capable of giving ASW support to other ships, which means that they have to embark ASW helicopters. We do not have the ability in Australia today to get one of our Sea King anti-submarine helicopters to sea. If we cannot do that we cannot have an effective anti-submarine capability. We have no helicopter lift capability to put a force ashore. We have no air superiority since the carrier has been abandoned. I was opposed to buying the Invincible-not because it was a carrier, but because it was equipped with the Sea Harrier. I do not view the Sea Harrier as an adequate aircraft for air superiority. I seek leave to continue my remarks later. Leave granted; debate adjourned. Sitting suspended from 12.45 to 2 p.m. Senator CHANEY —My question is addressed to the Minister representing the Prime Minister. I remind the Minister that on Monday the Opposition put to the Prime Minister that the appropriate course of action was for Mr Justice Murphy to resign and that, failing that, a judicial inquiry be established. In view of the extraordinary developments since and the pressure these developments have placed on those who have sought to do their duty and on the very institution of the High Court of Australia, will the Government now do its duty, address itself to the gravity of the situation and implement the recommendation that was put to the Prime Minister by the Opposition at the beginning of the week by immediately establishing an inquiry into all outstanding issues relating to Mr Justice Murphy? Senator BUTTON —I understand the question based on the saga of events which has taken place in the last week. The Attorney-General will be making a statement about this matter to the House of Representatives in the next few minutes, to which I have nothing to add. Senator CHANEY —Mr President, I ask a supplementary question. Given that the Attorney-General is to make a statement and given the importance of this matter, will the Minister representing the Prime Minister or the Minister representing the Attorney-General also make that statement in this place? Senator BUTTON —The statement which will be made by the Attorney-General in the other place is as follows: I wish to advise the House that the Government intends to place before the House a Bill to establish a parliamentary commission of inquiry into various matters relating to the alleged conduct of Mr Justice Murphy. The inquiry, which would be conducted by three judges and be provided with the necessary powers for the conduct of the inquiry, would report to the Parliament so that proper consideration may be given by the Parliament to the question of possible misbehaviour under section 72 of the Constitution. In reaching this decision it has had full regard to the necessity of the standing and integrity of the High Court to be properly protected. The Government will proceed with this matter as expeditiously as the constraints of legislative drafting and parliamentary process allow. Senator BLACK —Has the attention of the Minister representing the Treasurer been drawn to an article in yesterday's Courier-Mail in which Mr Don Cameron, the Liberal member for Moreton, is reported as claiming that the fringe benefits tax will cost a Brisbane charity $1,500 a year for a car used to help transport blind people? Can the Minister comment on the accuracy of Mr Cameron's claims? Senator WALSH —Based on the details contained in the article in question, there is no way that a fringe benefits tax of anything like $1,500 would be applied to the vehicle in question. The honourable member for Moreton said that the car was used mainly to ferry blind people from their homes to an activity therapy centre and back. In addition it was used for emergency work. Those activities would not be subject to the tax. The only part of vehicle usage to which the tax applies, be it a company car or whatever, is private usage. Going by the description contained in the article, there is very little, if any at all, private usage of that vehicle. In addition, as part of the agreement made with the Australian Democrats when they pledged to support the passage of the Government's tax package, if any charity is onerously affected by the imposition of the fringe benefits tax the Government will give special consideration to its case. Perhaps Mr Cameron might, out of his own pocket, give special consideration to this case, given that he picked up a lump sum of nearly $300,000 three years ago after having misled the members of the Parliamentary Retiring Allowances Trust about the possibility of his returning to Parliament. The PRESIDENT —Order! I think the Minister is exceeding the bounds of standing order 418 in making that imputation against a member of another House. I suggest that he withdraw it. Senator WALSH —I withdraw the reference to misleading. It is, however, a fact that the former member for Fadden picked up nearly that amount of money as a lump sum, virtually free of tax. If the honourable member for Moreton fails to understand a matter as simple as the facts concerning this charity and the use of a car, I suggest that members of the organisation of which he is President might do well to elect a president with a greater degree of comprehension and responsibility. Senator PUPLICK —My question also is directed to the Minister representing the Prime Minister. I note Senator Button's answer to the previous question about this matter. I refer to a report in today's Sydney Morning Herald that Senator Button and his Deputy Senator Grimes, went to see Mr Justice Murphy on Monday. I ask: Were Senator Button and Senator Grimes under instructions to suggest to the judge that he should resign? If not, what was the purpose of their visit? Senator BUTTON —It is, of course, true that-- Senator Chipp —Mr President, I take a point of order. I believe that urgent consideration ought to be given by you, Mr President, and by all political parties represented in this chamber to such questions being allowed to be asked at this stage. We have just heard an announcement by the Government on the gravest issue. I make no reflection on Senator Puplick for asking the question-obviously he had it prepared before the announcement was made-but, if between now and the termination of this inquiry both Houses of Parliament are to be allowed to be a playing ground of politicians to try to influence public opinion, will that be a healthy thing for the institution? Senator Lewis —Come off it, Don! Senator Chipp —I would have thought that Senator Lewis would have had his fair share of politicking on this. He has been given a fair go. Mr President, I ask you to rule on this matter. Senator Puplick —Mr President, on the point of order: I am conscious of the operation of the sub judice rule in terms of asking questions. But, if the Parliament is to be constrained in asking questions on the basis of Government announcements not yet acted upon by the Parliament, the Parliament becomes an absolutely irrelevant cipher. As presumably that is not the purport of Senator Chipp's point of order, I do not believe that it has any substance. Senator Chaney —On the point of order, Mr President, I simply say that I am sure that there is no formal reason why the question should not be asked. I am sure that Senator Button will be able to handle this matter in an appropriate way and in line with the announcement he has just made on behalf of the Government. I do not think there is any basis for ruling the question out of order. I think the Minister will be able to deal with it in a way which will avoid any conflict with the course of action the Government has proposed. The PRESIDENT —I will allow the question. When Senator Button made his statement in reply to Senator Chaney, I immediately became quite conscious of the type of problem that is posed by the point of order taken by Senator Chipp. However, it is not the Chair's desire to restrict Parliament's activities too unduly. Whilst I have taken on board the point that Senator Chipp has made, I intend to allow the question on the basis that the Minister will answer the question appropriately. However, any other questions related to this matter will be watched carefully by the Chair. Senator BUTTON —I am not able to accede to Senator Puplick's request that I answer the question, without inducing some degree of conflict. Senator Grimes and I did go to see Mr Justice Murphy on Monday. If I had not been brought up in the way I was-I hope, as a gentleman of some sort or another-I would say to Senator Puplick `Mind your own business' about what took place in the course of that discussion. I do not intend to do that. I say only that I am not prepared to reveal the discussions which took place. Senator COLSTON —I direct a question to the Minister for Education. My question relates to the editorial in the March 1986 newsletter of the Queensland branch of the Australian Medical Association, a copy of which I have passed to the Minister. The editorial refers to the Regional Convention on the Recognition of Studies, Diplomas and Degrees in Higher Education in Asia and the Pacific. Disregarding the poor attempts at sarcasm in the editorial, will the Minister advise whether `a flood of overseas doctors' is likely to occur, as suggested in the editorial? Will the Minister advise the Senate of the way in which it is expected that the Regional Convention will operate? Senator RYAN —There is no reason whatsoever to believe that a flood of overseas doctors will occur as suggested in the editorial of the Newsletter. There is no requirement under the Convention for Australia to be forced to accept overseas qualifications as equivalent to our own simply because they have the same name. They must first be assessed by the appropriate assessing authorities in Australia as being of equal value. The United Nations Educational, Scientific and Cultural Organisation Convention is designed to encourage the evaluation by contracting states of higher education qualifications earned in other countries. The purpose of this Convention and the other UNESCO regional conventions is the praiseworthy one of facilitating the international movement of research workers, students and people working in the professions by removing any unnecessary barriers to the acceptance of their qualifications. The appropriate assessing authorities in Australia were referred to in the statement made by Australia at the time of accession to the UNESCO Convention. That statement was quoted in the newspaper article. It refers directly to professional bodies such as the Australian Medical Association and their responsibility for determining the recognition to be given to qualifications whether obtained in Australia or overseas for the purposes of registration or permission to practise a profession. National legislation was not considered a necessary requirement of Australian accession to the Convention. Australia already has in existence national bodies, in particular the Committee on Overseas Professional Qualifications and the Australian Council on Tertiary Awards, to assist the Commonwealth in transmitting the text of the Convention to the institutions and the authorities concerned and in using its best endeavours to obtain their co-operation. Australian accession to the Convention can be of direct benefit to Australia as well as encouraging international co-operation. Some countries do not accept qualifications from some or all Australian tertiary institutions. In these cases such decisions may be based on nothing more than a lack of information about the courses offered by the relevant Australian institution. The Convention may be seen as an umbrella under which this situation can be overcome through more informed and therefore better assessment of tertiary qualifications. Senator HAINES —My question is directed to the Minister representing the Attorney-General. Is the Minister aware of an item on this morning's Australian Broadcasting Corporation radio news that the Attorney-General's Department has prepared a report the conclusion of which is that the Commonwealth Government has constitutional power to control logging operations? As the extent of Commonwealth power to control logging operations has arisen as a central issue in the Tasmanian woodchip licence renewals, particularly in relation to the Commonwealth's power to regulate logging on the National Estate, will the Minister inform the Senate, firstly, whether any report or opinion on the Commonwealth's power to control or regulate logging was prepared by the Attorney- General? Secondly, if such a document was prepared, what was the date of its preparation, what was its conclusion and when was it forwarded to the Minister for Primary Industry and the Minister for Arts, Heritage and Environment? Thirdly, what action, if any, will the Ministers concerned take as a consequence of the advice contained in the report? Senator GARETH EVANS —I have sought a brief on this matter from the Attorney-General but am afraid it is not yet to hand. I hope that I may be in a position to answer before the end of Question Time; otherwise I will do so as soon as possible. Senator MORRIS —I direct my question to the Minister representing the Attorney-General. Has the Minister seen the article in today's Sydney Morning Herald which alleges that four or five judges of the High Court of Australia were prepared to strike should Justice Murphy return to the Bench? Can the Minister confirm this report? If such a strike were to take place, can the Minister explain the position of those judges under the Constitution and indicate in particular whether such action would constitute misbehaviour? Senator GARETH EVANS —That is a question without notice. I am not in a position to answer it, and I will refer it to the Attorney-General for his further consideration. Senator REID —My question is directed to the Minister representing the Minister for Local Government and Administrative Services. Has the Minister seen the article in today's Canberra Times detailing apparent deficiencies in the Cameron Offices complex in Belconnen which have led to 177 water leaks being identified in the nine buildings of the complex, 47 of which leaks are said to be jeopardising the personal safety of occupants? Is the Minister aware that the article has been based on the reports of five inquiries commissioned by government departments? The Minister's reply of 17 April referring to those offices stated: The Department of Housing and Construction has advised that the building is now safe and no restrictions need be placed on its use and occupancy. In the light of that reply, does the Minister agree that his previous answer was incorrect, that workers are sheltering under massive plastic sheets and that the building is not safe or healthy for the staff who are working there? Senator GIETZELT —Yes, I am aware of the article that appeared in the Canberra Times and which highlights major water penetration problems and structural deficiencies at the Cameron Offices in Belconnen. I am advised by the Minister that discussions have been held between the Department of Local Government and Administrative Services, the Department of Territories and the Department of Housing and Construction, that the Department of Housing and Construction will carry out an extensive program of remedial work at the Cameron Offices, and that funding for the work has been sought in the context of the 1986-87 Budget. Senator CHILDS —My question is directed to the Minister for Resources and Energy. Is the Minister aware that a month ago in Sydney the price of petrol was 57.5c a litre? Two weeks ago it was possible to buy petrol at 39.8c a litre. Last Sunday morning one garage in the inner city was selling petrol at 46.9c a litre. Two and a half hours later the same garage was selling petrol at 49.9c a litre. Can the Minister explain why the prices fluctuate so much within very short periods? What do the price levels and the price fluctuations say about the profit level of the petrol companies, regardless of the level of government excise? In view of the impact on the consumer price index, should there not be a public inquiry into the profit margins of petrol companies? Senator GARETH EVANS —It ought to be said at the outset that price discounting in fact may indicate very little about the profit levels of petrol companies as all these companies, importers, distributors and/or retail outlets, may decide to trade at minimal profit or at a loss in order to retain their market share. The phenomenon of the major refining and distribution companies making substantial losses has not been unknown in recent years. Nonetheless it must be said that some of the discounting that have been going on in recent months, in circumstances in which there have not always been shipments of imported product by independents to explain the market going down, sits rather oddly with some of the claims that have been made by refining companies about the extreme financial stress that they have been put under as a result of stock losses attributable to the decline in petroleum prices. That having been said, it has to be acknowledged that all these companies operate in a highly competitive environment and one in which very substantial concessions are often made by the refiners to retailers in order to maintain market share as well as, of course, by the retailers themselves where that is possible. All of this is essentially beyond the capacity of the Commonwealth to control by its legislative authority. That authority lies essentially with the States, as I have had to say on numerous previous occasions. The Prices Surveillance Authority does not exercise mandatory controls but only recommendatory ones. In any event it deals only with wholesale price levels, rather than retail levels. There have been a number of inquiries in recent years into the petroleum industry and the phenomenom of discounting, particularly as it has occurred in highly competitive metropolitan markets. As well as the regular price assessments by the PSA and its predecessors, the Prices Justification Tribunal and the Petroleum Products Pricing Authority, there have been a number of wide-ranging inquiries by these and other bodies. It is unlikely-this has been the Government's position on this matter-that anything constructive would be achieved by setting up yet another inquiry into petrol prices, although I do take very much on board the concerns that have been expressed by Senator Childs which reflect widespread concern in the community as to just what on earth is going on. Senator LEWIS —Is the Minister for Community Services aware that the home nursing service in the Australian Capital Territory has closed its books to all new patients because of excessive work loads and has announced that those books will remain closed to all new cases, even the most desperate cases? I ask the Minister whether this is happening all around Australia as a result of excessive work loads in the home nursing service. How does the Minister justify his answer of 20 February this year that the Commonwealth is `presently taking all action possible to achieve improvements in the provision of domiciliary care services'? Senator GRIMES —I saw the report in the newspaper this morning concerning the home nursing services in the Australian Capital Territory. I have asked for a report on this, even though it is not directly my responsibility. Certainly when I get that report I will reply to Senator Lewis. No, this is not happening all around Australia. In fact, although there were incidents in New South Wales the year before last of the New South Wales Government restricting the capacity of people to get assistance under the home nursing service, it has not happened since. My answer in February holds and will continue to hold. We have developed a home and community care program in conjunction with the State governments. As a result of this program more Commonwealth money has gone into home and community care, including domiciliary nursing. In other words, there is more money going into that area than there was before this Government introduced that program, and we will continue to combine with the States to provide improvements in all sorts of domiciliary services, including nursing care. Of course, the development of such a program takes time, but in the short time that we have been working in conjunction with the States there has been considerable addition to and improvement of existing domiciliary services. I know that we will be able to continue to do that as the years pass, so that we can get more people cared for at home and have fewer people in institutions. Senator LEWIS —I have a supplementary question arising out of that answer. If it is not happening in the States, why should it be happening in the Australian Capital Territory, where the Commonwealth has the sole responsibility? Senator GRIMES —As I said to Senator Lewis, I noted the report in the newspaper this morning. I have asked for a report on this, even though it is not my direct responsibility. When I get a report I will respond to Senator Lewis and I hope that is very soon. Senator FOREMAN —Did the Minister representing the Minister for Primary Industry see the report in yesterday's Australian entitled `Rural gloom prophecy has provoked crisis'? In that report it was suggested that the rural task force set up by the Government has found that rural organisations have made bleak prophecies which are responsible for the poor price of land. Can the Minister confirm that in his view the gloomy predictions of some rural organisations and the Opposition are one of the major causes of the drop in farm prices? Senator WALSH —I do not think I saw the specific report to which Senator Foreman referred, but I am aware of statements some time ago by Mr Kerin pointing out that the descriptions such as `rural disaster' frequently used by the President of the National Farmers Federation to describe the present agricultural downturn are helping to fulfil the very predictions Mr McLachlan makes; that is, that there will be a fall in land prices to an unsustainably low level from a previously unsustainably high level. Mr McLachlan is certainly not doing the people he purports to represent any service in pursuing his own political obsessions or political egomania in the way he has been doing. I have noted also some very sensible comments from the honourable member for McMillan, Barry Cunningham, who is the chairman of the Government backbench rural task force, very similar to those made by Mr Kerin. In conclusion, it needs to be stated again that people such as Ian McLachlan are doing a disservice to the people they purport to represent in pushing land prices down to levels much lower than they ought to be. One can only speculate on whether Mr McLachlan's behaviour should be attributed to culpable ignorance or a desire to push land prices down so that he can gobble up a bit more. Senator MESSNER —My question is addressed to the Minister for Finance. Is it a fact that there are approximately 94,000 outstanding appeals against taxation assessments? Has the Commissioner of Taxation recently been calling in hundreds of taxpayers with disputed assessments seeking compromise settlements? Does this indicate a massive attempt to clean up the list of outstanding appeals before the introduction of a new system of appeals under the control of the legalistic Administrative Appeals Tribunal which will limit the rights of taxpayers to appeal against assessments? Senator WALSH —The figure of 94,000, from memory, if it is not correct, approximates the figure I have seen recently, but this qualification should be added: A large number of those cases would be cleaned up almost immediately once a test case had been determined. Therefore, the backlog is not nearly so formidable as it would appear to be just looking at the numbers. As to whether the Commissioner has been calling in hundreds of taxpayers to reach compromise settlements recently, I do not know. I will ask the Treasurer to get a response from the Commissioner. Senator GILES —My question is directed to the Minister for Education and Minister Assisting the Prime Minister on the Status of Women and arises from the results of a Federal Bureau of Labour Market Research study of 3,000 young out of work Australians reported in today's Canberra Times. There being few surprises among the findings of this survey, what measures are being taken by the Government to redress and, if possible, eliminate the psychological trauma of unemployment which the survey identified, especially among young women? Senator RYAN —I am aware of the survey showing the extent of unemployment, particularly among young women. Obviously, although the Government is pleased that progress has been made in this area, there is no doubt that significant problems remain. Since March 1983 when the Labor Government came to power the unemployment rates for young women in the 15 to 19 and 20 to 24 years age groups have steadily decreased. In March 1983 the unemployment rate for young women aged 15 to 19 was 25.6 per cent; by February 1986 it had decreased to 22.7 per cent. For young women aged 20 to 24 the rate of unemployment has decreased from 12.5 per cent in March 1983 to 11.2 per cent in February this year. Over the past year over half of the increase in employment has been in women's employment, half of which has been in full time jobs. An additional 25,000 young women aged 20 to 24 were employed in February 1986 compared with March 1985. The Government has demonstrated its concern about unemployment among young women by taking a number of steps to achieve the improvements I have described and with the intention of further improving the employment prospects of young women. Within the community employment program the Government has achieved its target of 50 per cent employment of women, many of whom are young women. The Government's affirmative action legislation, requiring all higher education institutions and private sector employers of more than 100 persons to report annually on plans for providing equality of opportunity, will improve opportunities for women of all ages, including those under 25. The Government's traineeship scheme for young people is based on equity principles and young women are expected to take up approximately 60 per cent of the places. The Commonwealth provides funds for technical and further education initiatives to increase young women's access to trade and other types of training where women are underrepresented. The youth affairs conference has recently established a working party on young women on which the Commonwealth is represented. The working party will address issues related to the employment prospects of young women and will advise the Youth Ministers Council on priorities and courses of action. There are other measures with which no doubt Senator Giles is familiar, but all in all the significant progress that has been made in addressing these problems will be accelerated by the measures I have just described. Senator MASON —I direct my question to the Minister representing the Minister for Foreign Affairs. I know the Government is concerned about our relations with Indonesia and I hesitate somewhat to raise the matter of General Dharsono and Mr Adnam Buyung Nasution. However, the matter raises issues of human rights so important that I feel it ought to be considered. Is it true, as detailed in a recent edition of the Australian Broadcasting Corporation radio program Indian Pacific, General Dharsono, a former Secretary-General of the Association of South East Asian Nations and a widely respected person internationally, raised in a White Paper the grievances of Moslem leaders following the actions of the Indonesian army in putting down Moslem riots in Jakarta in 1984? Has the General been convicted, in an apparently politicised trial, of subversion and sentenced to 10 years gaol because he wrote that White Paper, which sought to establish the facts of what happened? Is it true that because of his normal and reasonable professional efforts to defend General Dharsono, one of the best known lawyers in Indonesia, Mr Adnam Buyung Nasution, a human rights activist and founder of the Legal Aid Institute in Jakarta, was castigated by the judge and is now under threat of being disbarred? Will the Government ask the Indonesian Government to consider the human rights issues involved in this matter and consider a retrial of General Dharsono and a reassessment of the position of Mr Nasution? Senator GARETH EVANS —Retired Lieutenant-General Dharsono was a signatory to a White Paper which raised a number of grievances about the actions of the Indonesian Army in its handling of the Tandjung Priok riots. Lieutenant-General Dharsono was convicted on charges of subversion on 8 January this year and was sentenced to 10 years gaol, minus 14 months detention. Dharsono has appealed against that decision. During the reading of the decision against Dharsono, it is the case that his defence lawyer, Buyung Nasution, made a vocal protest against the presence in the court of a policeman. As a result of this protest the Central Djakarta District Court which heard the Dharsono case wrote to the Minister of Justice recommending the revocation of Mr Nasution's licence to practice. No decision has yet been announced by the Minister of Justice. The concern of the Australian Government for the promotion of the protection of human rights internationally, including in Indonesia, is well known to the Indonesian authorities. The Government has not hesitated to express its concern about individual cases where this has been warranted. I note that Lieutenant-General Dharsono has been tried and convicted under due process of Indonesian law and that an appeal is pending. No decision has yet been taken, as I have said, to revoke Mr Nasution's licence. While the Government is not in a position to judge whether Mr Nasution gave due respect to the court, it is aware of his reputation as a human rights advocate and certainly hopes that he will be able to continue to practise. Senator ELSTOB —Can the Minister representing the Minister for Local Government and Administrative Services tell me what has been the response of local government to announcements by the Minister on future arrangements for Commonwealth general purpose financial assistance for local government? Senator GIETZELT —Senator Elstob has asked me a question about the reaction of local government to the Government's proposals for grants to that important third arm of government. There has been a very positive reaction, and my colleague the Minister for Local Government and Administrative Services has already received congratulatory statements from the Australian Council of Local Government Associations, the Local Government and Shires Association of New South Wales, the Metropolitan Municipal Association of Victoria, and from numerous mayors, presidents, town clerks and elected representatives of local government authorities throughout Australia. I particularly want to draw attention to a letter received by the Minister on 15 April 1986. The President of the Australian Council of Local Government Associations sent the Minister a copy of a letter he wrote to the Prime Minister, Mr Hawke. Amongst other things it says: The ALGA wishes to place on record local government's appreciation of the Government's decision to accept the broad thrust of the report of the National Inquiry into Local Government Finance and to provide a real terms minimum guarantee in respect of funding for the next 2 years. Your decision on the funding level is especially welcome given the widespread recognition of the fact that the 1986-87 Budget is being framed in a difficult economic climate. The Government's decision is to continue untied funding to local government and to ensure that funding is at least equivalent to that for the States in the long term. There is a guarantee that for the next two years local government will not receive less than last year in real terms, and in subsequent years local government will be receiving the same treatment as the States. The Government has accepted the majority decision of the report of the National Inquiry into Local Government Finance and the letters from the President of the Australian Council of Local Government Associations recognises this. I am quite sure that when members of parliament make contact with the local government authorities in their electorates-whether they be senators or members of the House of Representatives-they will find great support for this Government's proposed Local Government Financial Assistance Act. Senator BOSWELL —Is the Minister representing the Minister for Primary Industry aware of the statement made in today's Courier-Mail that the Leader of the Queensland Opposition, Mr Warburton, told cane growers yesterday in Nambour that he was not happy with the Federal Government's performance on the sugar issue and that the Hawke Government should stop arguing with the State Government and give the sugar industry the money it had been promised. In the light of the Queensland Opposition Leader's recognition that the Federal Government has made a firm promise for price support for the sugar industry, will the Government reconsider its threat to withdraw any offer of support to the industry unless the Queensland Government accepts it on the Federal Government terms of a floor price of $230 a tonne for the 1985 crop, when the industry continues to seek a guaranteed floor price of $240 a tonne on the 1985 crop? Senator WALSH —I am not aware of any such statement having been made by Mr Warburton. I am, however, aware of a report in today's Courier-Mail which states: Innisfail canegrowers have accused the Premier, Sir Joh Bjelke-Petersen, of being out of touch with the reality of the local sugar industry. Grower leaders from Goondi and South Johnstone mill areas yesterday slammed a proposal by the Premier to divide the Goondi cane supply principally between Babinda co-operative and Howard Smith's Mourilyan mill. The report goes on in a similar vein. I am not aware of any report in the Courier-Mail about Mr Warburton. I am, however, aware of the fact that Mr Warburton made a comment this morning in which he drew attention to the fact that the most recent opinion poll in Queensland shows that the Queensland electorate now is ready to tip out the Bjelke-Petersen Government and either elect a Labor government or some sort of coalition government. Either way, it will see an end to the 20-year reign of misrule in Queensland under the Bjelke-Petersen regime. Senator Boswell mentioned $240 a tonne. I am aware that in his irresponsible spending spree tour through north Queensland a couple of weeks ago, the Leader of the Opposition promised to underwrite a price of $240 a tonne. That would cost an additional $30m-additional to the undertaking this Government has given, subject to the Queensland Government doing its bit and pulling its weight, which is $30m additional to the $1.5 billion which the Leader of the Opposition has already promised as he sprays his promises and rhetoric around Australia, thereby confirming as Opposition Leader the record he established as Treasurer, that is, the most fiscally irresponsible Treasurer the country has ever seen. Senator COATES —Has the Minister representing the Treasurer seen claims repeatedly made by members of the new Right that the economic policies of the Government favour big business and organised labour, but leave small businesses and self-employed people out in the cold? Is there any factual basis for the assertions that the self-employed in the non-farm sector of the economy have failed to share in the benefits provided by the economic policies of the Government? Senator WALSH —There is certainly no evidence to support that assertion, but there is some evidence to the contrary. Between 1981-82 and 1982-83 the number of self-employed persons in the non-farm sector of the Australian economy shrank. The average real incomes of the non-farm self-employed fell by 8 per cent. In making these sorts of comparisons it is, of course, prudent to isolate the farm sector, the incomes of which fluctuate quite widely for seasonal reasons, among others, from the rest of the self-employed sector. In the period since the present Government came to office the number of persons in self-employment in the non-farm sector has expanded and is now at an all time high level. If one looks at the incomes of the non-farm self-employed sector one sees that between 1982-83 and 1984-85 the average incomes of Australia's non-farm self-employed rose by over 16 per cent nominal or 2 per cent real. It is worth noting that over the same period the average incomes of non-farm wage and salary earners, measured on the same national accounts basis, rose by 12 per cent-that is, at the same time that the non-farm wage and salary earners experienced a decline in real incomes of 2 per cent, the non-farm self-employed had real income increases of the same magnitude. So the economic policies of the present Government are providing benefits for all Australian workers, employees and self-employed alike, and from those figures the self-employed have been beneficiaries to a greater extent than the employed, although, of course, it is possible that they came from a very low base to which they had been driven by the irresponsible former Treasurer in the Fraser Government. If people like Katharine West, for example, and others among the ever growing number of what Ross Gittins described the other day as the extra-parliamentary pretenders to the leadership of the Liberal Party of Australia did a bit of economic homework instead of relying on empty and inflammatory rhetoric they would know that it was the years when Mr Howard was Treasurer which were a disaster for Australia's self- employed and that there has been a significant recovery from that low point that the self-employed people in Australia reached during Mr Howard's treasurership. I have previously referred to Katharine West's profound ignorance of Australian economic history in the more distant sense. It would appear that her ignorance of more recent Australian economic history is equally profound. Senator SHORT —Is the Minister representing the Minister for Employment and Industrial Relations aware that at the Collinsville coal mine in Queensland, which is operated by Mount Isa Mines Ltd, three Clydesdale horses are still employed, two of them underground, and that the company claims that the retention in employment of these equines is no longer necessary and can no longer be justified given the advent of more modern methods of production? Is the Minister also aware that the miners union in Queensland is objecting to the retrenchment of the Clydesdales, is threatening to take strike action, and that already three court hearings have been held over the issue and a fourth is scheduled for 11 June? Will the Minister give an assurance that he will not say `neigh' to having the Government do what it can to assist settlement of this incredible dispute? More seriously, is this not an example of the type of industrial disputation that is totally contrary to the interests of this nation? Senator WALSH —I did not know all those things. If they are all true I would say that it seems to me that the Queensland National Party does not have a monopoly of idiocy in Queensland. Senator RICHARDSON —My question is directed to the Minister for Veterans' Affairs. I refer to reports of a case before the New South Wales Industrial Commission regarding two male employees of the St George Building Society Ltd who are being forced to retire at age 60. Is it true that these men are being forced to retire prematurely because it is believed that, as veterans who served in a theatre of war, they are eligible for the service pension at age 60? If so, what is his attitude to this practice? Senator GIETZELT —A number of questions have been asked of me in recent times about the attitude taken by companies in respect of persons who are veterans and have reached the age of 60. In respect of the matters raised by Senator Richardson, I deplore the decision taken by the St George Building Society on its early retirement policy which discriminates against veterans. It is my understanding that these two men, Barry Morris and Dom Arrivolo, who are both employees of the St George Building Society, are being forced against their will into premature retirement because management believes they would be entitled to the service pension at the age of 60. I believe that these men have taken their case to the New South Wales Industrial Commission. Mr Morris has also written to me to alert me to what he believes-I totally agree with him-to be a case of discrimination against veterans. This is not the first case that has come to my attention. In 1983 Senator Colston asked me about a similar case that took place in Queensland. I should add that offending employers in this regard have come from both the public and the private sectors. I regard this practice as wrong and discriminatory on two grounds. Firstly, it discriminates against war veterans because if they do not have war service they would not be eligible for the pension at age 60 and therefore would not be forced into early retirement. They could have been members of the Defence Force but they might not have had active war service. Secondly, the companies engaging in this practice are, in effect, throwing the burden on to the Commonwealth-that is, the taxpayer-to meet the costs of their labour-shedding practices when these costs should be met from their own resources. The injustice is compounded in the case of Mr Morris and Mr Arrivolo because, as I understand it, one of them would qualify for only a small part of the service pension at age 60 due to his wife's casual earnings, while the other does not have the necessary overseas service to qualify for the service pension. The St George Building Society is well known, Mr President. It operates very extensively in the area where we both live. It is trying to project a caring public image in its attitude to upward pressures on home loan interest rates, but this image sits poorly with its approach to staff relations and particularly on the issue of forced early retirement. I can only say that perhaps the ex-service community should in future weigh its decisions as to whether to continue to patronise the St George Building Society rather less on its public image and rather more on its attitudes to veterans on its own staff. I would not go so far as to suggest a boycott, but it is a very unsatisfactory attitude that has been taken by the Building Society to long-standing members of its staff, and it is an attitude which the Government thoroughly deplores. Senator PARER —My question is directed to the Leader of the Government in the Senate. I refer the Minister to a statement made by the Prime Minister last week that the delay in reaching a decision on the so-called productivity claim now before the Australian Conciliation and Arbitration Commission would act as a `circuit breaker' on the wage inflation spiral. Does the Minister agree that the delay in reaching the decision is helpful in reducing inflation? If so, would he agree that the longer the delay the better? Would he also agree that the abandonment of the claim altogether is the best option if the aim is to reduce inflation? Senator BUTTON —I am sorry that I do not have the figures here. I suppose what ultimately sticks in the craw of Opposition members about all of this is that, having been the singularly most unsuccessful government in terms of restraining wages in 1981 and 1982, if they study the figures and the economic quarterly reports they will see, I think, that in every quarter since mid-1983 there has been a significant drop in real unit labour costs in Australia and that did not happen for the years in which they were in government. I think they should look at those figures. I am quite happy to bring them in tomorrow. If Senator Parer were to consult them, it might help him in a general education sense. Senator Parer should not get up to ask a supplementary question; I am still here. I will now come to the important part of his question. I simply make the point again that, because delays have arisen in the national wage case and for other reasons, there will be only one significant wage increase this financial year. That is extraordinary. Overall economic management in a difficult situation, particularly with the Australian trade balance and so on, seems to be desirable and to have certain benefits. The honourable senator invites me-with mischievous intent-to extend my intellectual charity in going thus far to launch forth upon a much wider proposition which is singularly insupportable, having regard to the number of factors which have to be managed to secure wage restraint and a better wage outcome. I remind the honourable senator that, as I said at the beginning of my answer, it is sometimes said that nothing succeeds like success. In the case of this Opposition, nothing hurts like success-and we have had it. Senator TATE —The Minister representing the Minister for Foreign Affairs will be aware of calls at the Tokyo summit for an effective international arrangement to respond urgently to nuclear accidents, particularly when these accidents have an effect beyond the borders of any one nation. Is it a fact that whilst the International Atomic Energy Agency has strict safety standards for the nuclear industry, these standards are not mandatory and are often not observed in the Union of Soviet Socialist Republics? Has the Chernobyl disaster revealed both the need for a mandatory international nuclear safety standard and also the inadequacy of emergency relief procedures, including the release of information? Can the Minister indicate what steps the Australian Government is taking to establish international arrangements that will ensure a co-ordinated international response in the case of any emergency? Senator GARETH EVANS —The Internat- ional Atomic Energy Agency has done a vast amount of work over the last 25 years in developing detailed guidelines on nuclear safety and they provide the basis of the safety standards in Australia and other Western countries. But those guidelines are not internationally binding and, to put it mildly, I understand that they are not regarded as binding in the Soviet Union. The Chernobyl accident has clearly demonstrated the need for an early warning and notification system and for international agreements for emergency assistance in the event of nuclear accidents, as I have said in answers to questions and in debates in the last few days. Australia has supported such measures in the past but previous efforts have not received the necessary level of international support. We support the call by the Tokyo summit for effective international arrangements. Nuclear safety standards are also an important area for international action. The Government is in close contact with a range of countries on these matters and with the Director-General of the Atomic Energy Agency, Dr Blix. We are developing a comprehensive approach to early international action. The nuclear energy agency of the Organisation for Economic Co-operation and Development will hold a special meeting on 9 May, at which Australia will be represented. The first opportunity for a broad, multilateral discussion will be at the June meeting of the IAEA board of governors, of which Australia is a member. We shall be consulting other members of the board over coming weeks to ensure that action is taken at that meeting to set in train the necessary machinery to establish an international convention dealing with nuclear accidents. I have also mentioned in this place that I have had discussions on this subject with one of my Japanese counterparts in the last few days with a view to getting support from that country for an initiative of this kind. Senator BROWNHILL —I ask the Minister representing the Minister for Primary Industry whether, in the light of his answer to a previous question asked by Senator Foreman earlier today and in the light of Mr Kerin's statement of 21 April that it was `hogwash' to assert that Australia was witnessing the demise of the family farm, the Minister is aware of the Bureau of Agricultural Economics figures published in the Sydney Morning Herald this morning of a predicted 18 per cent fall of net farm produce in 1986-87 on top of the 31 per cent fall this year. If he is aware of that-and I doubt it-how does he reconcile those answers? Senator WALSH —I do not see any problem. But before going to the substance of the question, the 18 per cent figure reflects anticipated volume changes as well as prices. As I noted in a completely different answer, changes in farm incomes from year to year do not reliably reflect the underlying economic position of agriculture because they are subject to seasonal factors. As for Mr Kerin's statement that those who were predicting the demise of the family farm were mouthing hogwash, I entirely endorse that. I do not believe that the family farm is finished. If Senator Brownhill and his National Party colleagues believe that it is, they should say so and say that, therefore, every family farmer should sell up quickly while he can get any price above zero dollars for the farm and get out. I notice that those opposite are not saying that, so they do not believe that statement either. In the same comment by Mr Kerin, incidentally, he put to rest a number of other quite false or ill-informed assertions that are being made about agriculture. It is unfortunate that the comment was reported grossly out of context and in a typically unprofessional manner by the Australian Broadcasting Corporation and mindlessly repeated in other sections of the Press. Concerning the reference to my earlier answer, the assertion which is being made by Mr McLachlan and by most of Senator Brownhill's colleagues, if not by Senator Brownhill, is that because land prices have fallen-and some fall in land prices was necessary from the previously unsustainably high speculative levels-the equity which many farmers hold in their farms has reached the point where they are no longer viable. That is highly challengeable because what determines whether farmers are viable is the ability of the farm to generate income rather than its equity level. If a farmer has high equity, he may have the capacity to borrow more funds but the real determinant of viability is whether the farm has the income-generating potential to service existing financial and other obligations. That having been identified as a problem by some people, it follows axiomatically that statements by Senator Brownhill and his colleagues, people who say that the demise of the family farm is imminent-which Mr Kerin has quite rightly denied-are exacerbating the problem. Just as over-optimistic predictions talk land prices up, Senator Brownhill and his colleagues are now engaged in talking land prices down. They have talked them up to unsustainably high levels and are now trying to talk them down to unsustainably low levels. One wonders whether some of the big land-holders in the National Country Party and one or two other organisations are doing this quite maliciously and consciously because they want to grab and gobble up a few more thousand acres at bargain prices to add to the millions that they already own. That question should be asked seriously. The effects of that sort of talking down of expectations about agriculture may spill beyond agriculture. They spill into the industries which supply farm machinery. Today's West Australian says that Mr Sandy Lewis-who, incidentally, is a Liberal Party member of the Legislative Council in Western Australia and who doubles as the Secretary of the Western Australian and Australian Farm Machinery Dealers Association-had stated that industry problems had been compounded because they had been `talked down' too far. I suggest to Senator Brownhill, his National Party colleagues, Ian McLachlan and anybody else who is doing this, that if they really want to do something for the people they purport to represent, they should cease using inflammatory and exaggerated rhetoric, cease asserting that the demise of the family farm is imminent, cease talking down land prices, and cease talking down expectations about agriculture's future, as they have been doing-and, in so doing, helping to exacerbate what they say is the problem. Senator BROWNHILL —Mr President, I ask a supplementary question. Do I take it from the Minister's answer that he says that there is no rural crisis? Senator WALSH —If I recall correctly, crisis, by definition, is the point immediately preceding the point of change. I do not know whether we are now in that period immediately preceding the point of change. I would have thought actually that it is probably a year or two away before the well-known, though not regular, cyclical pattern of fluctuation in agriculture turns around. On that definition I do not think there is a crisis. There is certainly a quite serious downturn in farm incomes, as there has been on a number of occasions before. The most recent and very serious one was in 1969, 1970 and 1971, when a Liberal-National Party coalition government was in power incidentally, when precisely the same sort of dismal predictions were being made by precisely the same sort of people who are still making them. They were wrong then; they are wrong again. But if they are determined to try to convince family farmers around Australia that there is no future for the family farm, that they should get out and sacrifice the farm for any price above zero, let that be on their own heads. Senator BUTTON —Earlier today in Question Time Senator Parer asked me a question about labour costs. In connection with the answer I gave I refer him to pages 12 and 13 of the Treasury Round-up for April 1986. The graph on page 12 indicates what has happened to labour costs under this Government. If the honourable senator looks at page 13 he will find that real unit labour costs have reduced each quarter, as I indicated in my answer to his question, varying in reductions between minus 0.1 per cent and minus 4.5 per cent. Senator GARETH EVANS —Earlier today Senator Haines asked me a question about logging operations. I have received the following advice from the Attorney-General (Mr Lionel Bowen). He is aware of advice having been prepared by his Department in relation to the constitutional power of the Commonwealth to control logging operations but does not propose to disclose the contents of that advice. Senator GIETZELT —Last month Senator Coates asked me about the proposed change of name for Trans Australia Airlines. The Minister for Aviation (Mr Peter Morris) has provided me with the following answer. The Chairman of the Australian National Airlines Commission informed the Minister on 21 March 1986 of the Commission's decision that the trading name of Trans Australia Airlines should be changed to Australian Airlines. The Commission regarded this major step as an important ingredient in a series of strategies to project the airline as being aggressive, competitive and commercial. It saw this change as being a very public statement that the airline is owned by the people of Australia. The Commission proposed that the name change occur in July 1986, to coincide with the arrival of the first of the new Boeing 737-300 aircraft. Expenditure to be incurred will be minimised by painting all new aircraft in the new livery, but altering others progressively. While TAA is a Commonwealth owned statutory authority, the Government has encouraged it to operate on a more commercial basis. The Government has therefore accepted the decision taken by the Commission on the basis of its commercial judgment. Senator CHANEY(Western Australia-Leader of the Opposition) —I seek leave to move a motion relating to the statement made by the Leader of the Government in the Senate (Senator Button) with respect to the position of Mr Justice Murphy. Leave granted. Senator CHANEY —I move: That the Senate take note of the answer given by the Leader of the Government (Senator Button) to a Question without Notice asked by Senator Chaney this day relating to the proposed inquiry into the allegations concerning Mr Justice Murphy. I seek leave to continue my remarks later. Leave granted; debate adjourned. The PRESIDENT —I have received a letter from Senator Messner proposing that a matter of public importance be submitted to the Senate for discussion, namely: The Hawke Labor Government's destructive tax package which imposes enormous administrative burdens on small business and other taxpayers. I call upon those senators who approve of the proposed discussion to rise in their places. More than the number of senators required by the Standing Orders having risen in their places- Senator MESSNER(South Australia)(3.05) —Last July the Hawke Labor Government conducted its first and most disastrous National Taxation Summit. That was followed by the proposals for reform of the Australian taxation system, the so-called RATS proposals, that were put forward by the Treasurer, Mr Keating, in September. Those proposals were dazzling in their presentation and offered the allure of tax cuts to the Australian people. But what is becoming increasingly clear to Australians is that those tax cuts are really built upon very flimsy foundations. We are hearing more and more from the Government now of the other side of that tax package. At last, almost nine months since the original announcements, we are starting to see legislation come through which is imposing new taxes on Australians. This comes on top of the announcements of a new assets test on pensioners and lump sum superannuation taxes and introduces a whole range of new tax measures which are designed to raise more tax from the Australian people. First and foremost, the fringe benefits tax legislation has been introduced in the last day or so. The Opposition has been pointing out that this is a destructive measure and part of an overall destructive tax package because it seeks to destroy jobs in the Australian community. It will destroy jobs, as has already been demonstrated, in the motor vehicle industry. Even the Australian Democrats have taken flight and are raising alarm about this matter. We have heard from the trade union movement, as expressed in this place by the former South Australian Secretary of the Vehicle Builders Employees Federation of Australia, Senator Foreman, that there could be upwards of 10,000 jobs lost in Australia as a result of the introduction of the fringe benefits tax. Even the Labor Premier of South Australia, Mr John Bannon, is lobbying the Federal Government heavily to try to ameliorate that problem. This comes on top of the denial of tax deductions for legitimate business expenses in the entertainment area which was legislated for last November and coupled with very onerous provisions for the substantiation of certain other expenses before tax deductions could be claimed. I would like to return to that matter a little later. The fringe benefits tax and the other measures that have been taken are further impositions upon business and employers and are in the nature of a payroll tax. We have already seen the destructive effect of payroll tax in the States. Small businessmen, their representative organisations, farmers and others who employ people are constantly railing against the payroll taxes levied by the State governments, as they destroy people's incentive to be employed in industry. Surely the measures that have been announced by the Government are in the same category. They are just other types of payroll taxes imposed by the Federal Government rather than by the States. The destruction of investment incentive-what people might invest to create more jobs for Australians-follows automatically from that. There is a somewhat significant threshold beyond which wages must go before the imposition of a State payroll tax. In other words, there is an exemption for a certain sized business. There is no such exemption for small business from the fringe benefits tax. We believe that that is a direct attack on small business. Certainly, it is ill-considered in terms of this Government's overall position versus the development of incentive for investment in this country. I also look at the abolition of negative gearing for the purposes of property development. What will happen in this area is that people who may be trying to do small real estate projects on the side, so that they can build up their capital and provide for their retirement and not become a burden on the social security system, will now find themselves unable to save out of their incomes. Any excess interest that they will need to pay will be subject to taxation at the highest marginal rate upon which they earn their income. As a result the opportunity they would have had to save, to develop a capital item which would provide some income in their retirement, is lost. Not only is this poor thinking on the part of the Government but clearly it will lead to a drying up of the rental housing available in the market-place. This will automatically lead to higher rents, and this is already happening in Sydney and Melbourne. Consequently, people at the lower end of the income scale will be forced to pay higher and higher rents for properties. In turn that will put more pressure on the public housing system, which is already under strain in various States. As we can see from the statistics, since the Hawke Labor Government came to power in 1983 the number of people on waiting lists for houses to be provided by State housing commissions-this applies to the South Australian Housing Trust in my State-has gone up by about 30 per cent. This is during the whole period of the Labor Government. Yet this Government takes measures which are directly opposed to providing cheaper housing. It is trying to reduce the stock of available rental housing in the country which could be made available to low income earners. A final point needs to be made and that is the utter stupidity of trying to examine and define such an abstract principle as negative gearing at a time when interest rates are the highest they have been for 50 years. Clearly, hardly anybody these days can enter into a real estate project and expect to be able to earn enough from it to pay the fantastically high interest rates which this Government has forced people in the community to pay. By the Government's definition today any project is automatically negatively geared. Other matters are included in the legislation that is coming before us in dribs and drabs, nine months after it was originally announced. It is becoming increasingly clear that the measures are very burdensome and onerous for the businessmen and ordinary taxpayers who will be forced to comply with them. For instance, if a self-employed person seeks to claim his expenses for running a motor vehicle for his own business purposes, he will be forced to keep a log book in such minute detail, we are led to believe, as to be absolutely incredible. Already chartered accountants are making money out of selling log books to their clients to make it easy for them to keep proper records. The whole tax package really is an accountants and lawyers benefits Act. More and more people will be forced to use the services of such practitioners in order to keep the records they will be forced to keep under the new legislation. In a country that strives to be modern and technologically proficient, we find, when looking at motor vehicle expenses for instance, that in order to substantiate that one has spent money on petrol or parts for one's motor vehicle, one needs to have a signed receipt for every transaction. This is in the days when the computer is striving to take us into the twenty-first century and develop our economy in a technologically proficient way. Yet we are going back to the Dark Ages by requiring people to have signed receipts. They do not mean a thing, of course; they could be signed by anybody. Clearly it is not proper evidence of expenditure. The fringe benefits tax introduces a whole new range of similar impositions upon the business community. Employers will be required to pay tax on behalf of their employees when vehicles are provided for employees to take home. There will have to be the minutest recording processes in those individual companies so that the one dozen forms taxpayers will be required to submit each quarter to the Government, together with their cheque for the tax, can be completed. For instance, it will be necessary to keep separate records of the petrol used by each vehicle. That is just fine if there are 100 vehicles in a fleet! Just imagine the recording problems that will cause in a small business. I refer not only to those expenses but also to individual registration records, and on top of that individual mileage records for each vehicle and so on. It is absolutely inconceivable that a government living in the twentieth century and seeking to take us further into the technologically advanced age, seeks to impose such harsh and very expensive systems upon the business community. It must destroy jobs. Any cost that is imposed upon employers that leads to less investment and less job creation can mean only that in the long run there will be a further destruction of jobs. These burdens come on top of a further major change that is now being initiated in the legislation before the Parliament in respect of negative gearing. Hidden away in the back of that legislation are some very major changes to the way in which the Government will assess taxpayers each time it issues assessments. In the present situation, generally speaking, where a taxpayer has been quite honest and has made a full, clear and true disclosure of all the material facts affecting his tax return he can expect, having received an assessment from the Commissioner of Taxation and having paid it, that he will no longer have any problems with the Tax Commissioner. But that will all change under the proposed legislation. It hands over automatically to the Tax Commissioner the right to amend assessments as he sees fit in any circumstances. So if the law changes, which may occur through legislation in the Parliament or alternatively by a decision of a court, a Board of Review or the Administrative Appeals Tribunal, a new assessment can be issued years after the event so as to change the impact of taxation. If as a result of that assessment the amount of tax payable is increased, interest will be charged to the taxpayer at 14 per cent. The rub really comes when it is found that that interest is not tax deductible in any way by the taxpayer. Yet if the Commissioner makes a mistake and corrects an assessment in favour of the taxpayer and has to pay interest to him, that interest is assessable. This is totally unfair and unreasonable and it ought to be reconsidered by this Government. That is one of the reasons why I hope that the Australian Democrats will join the Opposition on this matter and refer the whole Bill to the Senate Standing Committee on Finance and Government Operations to investigate the area of self-assessment and to examine assessments generally and the way in which they impact upon Australians. A major change is being proposed on this matter and it will cause vast concern to Australians. It is being hidden in the back of a major Bill and Australians are not able to examine it fully. We will ensure that they can examine it via the Senate Standing Committee on Finance and Government Operations. I would like to refer to one other matter in respect of the administrative burden that is now occurring. Every taxpayer who lodges a return clearly has an opportunity to challenge the assessment made by the Tax Commissioner. The problem that quite often arises-we have seen it many times-is that sometimes taxpayers are in the twilight zone, if you like, in that they claim deductions which they may not know are incorrect or which through accident, misadventure or inadvertence may be incorrect. We are now being threatened not only with a change to the assessment procedure, which I have just outlined, but also with a change to the boards of appeal, which apparently are up for destruction as well. We will see vast changes to the rights of taxpayers. I asked the Minister for Finance, Senator Walsh, at Question Time what he was going to do about the 94,000 outstanding cases. He gave us no indication at all as to whether or not the Government had in mind changing the system, yet we know that deputy commissioners of taxation in the various States are this very day interviewing taxpayers, trying to make settlements on various outstanding cases in order to push as many cases through the system as possible because a decision of this Government is pending which will change the whole situation from 1 July. That is something about which we know nothing, and again I hope that the Democrats are listening so that these matters can be exposed in a proper inquiry conducted by the Senate Standing Committee on Finance and Government Operations into the Commissioner's administration of the tax law. There is considerable concern in the community. There is a growing groundswell of opinion amongst practitioners and certainly on the part of taxpayer representative organisations about the way in which the Commissioner is conducting his affairs at the moment. Indeed, the Government seems to be going right along with that without providing proper information to the Parliament. On that very point I would like to make public an experience we have suffered in the last few days. We have a considerable number of amendments before us in respect of the fringe benefits tax and negative gearing adjustments, but as we understand the situation the Treasurer has refused the Opposition any briefings on those matters from departmental officers. It is outrageous that the Opposition has no access to departmental officers on some of the most complex legislation that has ever been brought before this Parliament in order to determine what will be the true impact and effects of that legislation on the people of Australia. In other words, the Government is trying to push this legislation through to ensure that it has very little coverage in the Press and is not properly exposed to the Australian people. The other point I want to cover is this: We are now witnessing an attempt by this Government, by Senator Walsh and the Prime Minister (Mr Hawke), to blame the Opposition in advance for the possible removal of the commitment to give tax cuts next September. This is despicable. It is quite clearly wrong, because the Government knows that, whereas it has promised total tax cuts of $4.5 billion over the next two years, it has new tax revenues of only $1.5 billion coming to it by way of the taxes it has already imposed or is about to impose. In other words, $3 billion is to be paid for out of inflation. Of course, under this Government this country has the highest rate of inflation that it has seen for many years. So the situation is that this Government is relying on inflation to pay that tax and is not relying on any tax imposed by it in other ways. In that case, if the Opposition chooses to oppose and defeat legislation which is as iniquitous as the fringe benefits tax, it is fully justified in so doing. It will not be blackmailed by this Government or anybody else. It will stand up properly on issues which are of the greatest concern to Australians. Senator MAGUIRE(South Australia)(3.25) —This afternoon the Senate is debating as a matter of public importance raised by Senator Messner the alleged destructive tax package which has been introduced by this Government and the alleged administrative problems for small business and other taxpayers in Australia. The Opposition is just not credible on taxation. I regret to say that it destroyed its credibility last November and December by its attitude to the legislation this Government introduced to disallow tax allowances in regard to lunches. The Opposition destroyed its credibility at that time with claims of many thousands of job losses as a result of the disallowance of that tax privilege, enjoyed by very few taxpayers. Senator Messner has used the word `destructive' in his matter of public importance, but the question that has to be asked by all persons in regard to this matter is: Destructive of what, destructive of whom? Is the tax package destructive of low income families? It certainly is not, when one looks at the figures. It is certainly not destructive of the average taxpayer and it is certainly not destructive of the vast majority of honest taxpayers in this country. It is the Government's intention-I support it wholeheartedly-that this package be destructive of tax avoiders, and rightly so. It is destructive of tax avoiders. Senator Messner addressed this chamber for 20 minutes but in his speech he made no reference at all to tax avoidance-not one reference in 20 minutes, in the lead speech on this matter of public importance. That is yet another reason why the Opposition has absolutely no credibility in Australia on the matter of taxation and tax reform. The Government's tax measures constitute a package. It is a package which redistributes the tax burden throughout Australia but does not lift it overall. In that way it is consistent with the nine principles of taxation reform put forward by the Prime Minister (Mr Hawke), one of which was that there should be no increase in the overall tax burden as a result of tax reform. As all these measures are a package, individual measures should not be seen in isolation. They should be seen as part of a comprehensive package of reform. Unfortunately the Opposition simply sees the individual tax measures as separate items and not part of an overall plan, an overall strategy, of tax reform in Australia. The tax package introduced by the Treasurer, Mr Keating, aims for a more equitable Australia and a more efficient Australian economy. In fact, taxation will be reduced for many Australian taxpayers as a result of this package. They will have greater disposable income; that is, more money in their pockets after taxation. They will be able to finance greater levels of expenditure from that income so that particular areas of the economy responsive to changes in incomes, such as consumer durables-cars, for example-and travel, will benefit in this way from the tax package brought down by this Government. As a result of having greater disposable income there will be greater expenditure on those items by those taxpayers who have received the tax cuts. The Liberal Party's whole attitude to tax reform in this country, its whole attitude to the Government's tax package, has completely ignored the effects of greater expenditure by some taxpayers as a result of the tax cuts they will be receiving from this Government. Because there will be no overall lift in the tax burden in Australia as a result of this package, there should be no net effect on employment. There should be no net job losses in Australia because, as I have indicated, the overall tax burden will not rise as a result of tax reform. So it is not a destructive package when one looks at employment. As I have indicated earlier, this Opposition's predictions about the impact of tax measures on the Australian economy simply cannot be believed. Let us look in some detail at predictions made by members of the Opposition in this place last November and December, when the Hawke Labor Government was proposing to remove the tax subsidy on business lunches. I would like to go through some of the dire predictions made by members of the Opposition on that legislation just to demonstrate to people present today and to those listening at home that this Opposition has absolutely no credibility on the effect of taxation on the Australian economy. I refer first to Senator Messner, who led the debate this afternoon. He is a shadow Minister in the Howard Opposition, and on 3 December he predicted that the taxation measures to remove subsidies for business lunches would cost 18,400 jobs. A range of other predictions were made which demonstrate the sheer division and lack of unity in the Opposition as to policy measures. For example, Senator Boswell on 4 December, the very next day, said that 11,000 jobs would be lost as a result of the ending of the tax subsidies on business lunches. But he went further and said that by February or March 1986 there would be a massive fall in the numbers involved in the restaurant industry. What a categorical prediction. We are into May of this year and the industry seems to be flourishing. Senator Short, who from time to time is a Liberal Party spokesman on tax measures and the economy, told the Senate that 20,000 could be out of work as a result of the disallowance of the tax subsidies on business lunches. That was yet another prediction by this raggle-taggle Opposition that cannot even get right its attitude to tax reform. There was also a statement by Senator Michael Baume, who will be taking part in this afternoon's debate. The honourable senator, who used to be an adviser to Mr Howard, the former Treasurer, said that many thousands of jobs in the Australian restaurant industry would be at risk as a result of the Government's tax package. That was yet another figure put forward by an Opposition spokesman on taxation, yet another demonstration of the lack of credibility and consistency by the Opposition on tax reform. The plum came from Mr Hodgman, a Liberal member from Tasmania, who told the House of Representatives that some 80,000 jobs could be lost in the Australian restaurant industry as a result of the Government's tax reform package. So we have a range of five or six different estimates of the impact of one particular tax measure-just one of the measures, not the overall tax package and, with a categoric statement by one Opposition spokesman that the industry would be facing a massive fall by February and March this year. Let us look at the facts in the restaurant industry by examining job vacancies, an objective measure of trends in the industry. The Commonwealth Employment Service has published figures relating to the restaurant and hotel industries. Despite the predictions of doom and gloom by Opposition spokespersons and conflicting claims by Opposition members, it is interesting to note that there has been a pronounced rise in the number of job vacancies in the restaurant and entertainment industries. In the quarter to December 1984, 15,996 new job vacancies were advertised in the restaurant and entertainment industries. By the quarter to December of 1985-three months after the Government's tax package was announced-a massive 20,730 jobs were advertised in the restaurant and hospitality industries. In one period of 12 months, a period in which the Government had announced a major package of tax reform, there was a 29.6 per cent increase in the number of new job vacancies advertised for those industries. That is a tremendous growth rate. It is a sign of confidence in the industry and indicates that the Government's disallowance of tax subsidies on free lunches for businessmen is not impacting hard on that industry. I am pleased that South Australia led the way during that period with a 72 per cent increase in the number of new job vacancies advertised with the Commonwealth Employment Service for work in the restaurant and hospitality industries. These, then, are some of the claims made by Opposition spokespersons about that tax measure-clearly refuted by the facts as now on the public record. The fact is that the free lunch or tax subsidised lunch was a grossly inequitable arrangement in Australian society. While most Australian workers took their lunches to work, a very few taxpayers dined in luxury at taxpayers' expense. The figures made available by the Australian Bureau of Statistics are very clear on this matter. For example, across the board only 4.3 per cent of all Australian workers received an entertainment allowance, but 17.8 per cent in the highest income bracket-that is, over $600 a week, received such an allowance. Therefore, that allowance went disproportionately to the most well-off taxpayers in our society, who did very well at the expense of the rest of the community. Overall, the current position in the restaurant industry, as I have demonstrated, indicates clearly that one cannot believe Opposition claims about the impact on the economy of the rest of this tax package. One cannot believe the Opposition's figures. I have indicated the range of different predictions made by Opposition spokespersons on this tax measure, and I am afraid that in regard to the rest of the tax package Opposition claims must be taken with a grain of salt, and this matter of public importance is seriously compromised as a result. There will be significant benefits to small businesses and to other taxpayers as a result of the Government's taxation reform package. Those benefits will be available if the Opposition and the Democrats do not combine to block the Government's remaining tax Bills, thus reducing the amount of revenue available to government with which to finance the various taxation reductions we are proposing. Of course, there will be large benefits to the small businessman as a result of the tax package. For example, the top personal income tax rate in Australia will be reduced from 60c in the dollar, which was the figure when Mr Howard was Treasurer, down to 55c in the dollar in September this year under the Labor Government, and to 49c in the dollar from July next year. There are to be significant reductions in personal income tax rates. For those in the top income bracket, above $35,000 a year, there will be very large reductions in such rates which will greatly benefit small business people. The current tax rate of 46c in the dollar-a bracket in which there are many taxpayers indeed, the people earning between $19,000 and $28,000 a year-will be reduced to 43c in the dollar in September and will fall to 40c from July next year. Those are worthwhile reductions in marginal tax rates and will greatly benefit taxpayers. The Opposition should stop criticising the Government's tax package and openly welcome these reductions. Opposition members should tell small business people that a reduction in the top marginal tax rate from 60c to 49c in the dollar is a welcome move indeed. With a top marginal tax rate of 49c, in future no taxpayer will have to pay more than half of any extra income in tax. That is a breakthrough and will be a boon to small businesses. The Liberal Party taxed small businessmen at 60c in the dollar. Labor will be taxing them at 49c in the dollar. It is important to appreciate that the tax package also lowers the bottom marginal tax rate, and I am very pleased that that is so. Under the Hawke Government the lowest income tax rate will be reduced to 24c in the dollar. Senator Peter Baume —When we see it. Senator MAGUIRE —That will be next year. If the Opposition does not block the Government's tax legislation, we will have the revenue with which to fund those reductions. We are waiting to learn the Opposition's position on this topic. Naturally, we are hoping that Senator Peter Baume and his colleagues will do the right thing by the taxpayer and ensure that marginal tax rates are lowered right across the board. As I said, under the Hawke Government the lowest marginal tax rate will be 24c in the dollar. The best the present Opposition Leader, Mr Howard, could do when he was Treasurer-we cannot forget that he was the Treasurer of Australia for five years-was 30c in the dollar. Our bottom tax rate is 24c in the dollar; Mr Howard's bottom tax rate, when he was Treasurer, was 30c in the dollar. Clearly, on that basis and judged by that criterion the Australian Labor Party is the low tax party of Australia. That makes this matter of public importance an absolute nonsense and a farce. As a result of the Government's tax package the tax free threshold, that is, the first amount of income which is exempt from taxation, will be raised. Currently it is $4,595 a year. It will be increased to $5,100. That will bring significant benefits not only for low income taxpayers but for all Australian taxpayers. The higher tax free threshold combined with the lower personal income tax rates, which I have mentioned this afternoon, will provide very significant income tax cuts for average Australian workers. In fact, for a person on average income the tax cut as a result of those two measures will be around $6 a week. That will be on top of the $7.60 a week tax reduction which occurred from November 1984. That is a very good record by this Government-two major rounds of personal income tax cuts in approximately 2 1/2 years. Certainly, for the average Australian taxpayer this Government and this tax package have not been destructive. A key area in the Government's tax package is the treatment of company dividends. Senator Messner has claimed that the package is destructive for small business and business generally. But this Government has ended the so-called double taxation of company dividends. That is a very big step forward. From now on there will be only one level of taxation on company income. That will occur from July next year as a result of the imputation system for company taxation which has been introduced by the Hawke Labor Government. This is a tremendous advantage for business. It took a Labor Government of Australia to end the double taxation of company dividends. It was not the Liberals or the National Party but the Labor Government which benefited business by ending the double taxation of company dividends. One of the important things that will do is to make investment in company shares and securities much more attractive to investors. It will mean that instead of industry being starved of funds and capital there will be a greater flow of funds into company shares and they will be a much more favoured investment for Australian investors. As I have indicated, the tax package will not hit employment across the board. The tax package is consistent with the nine principles of taxation reform of the Prime Minister one of those principles being that there shall be no overall rise in tax levels. As a result there should be no overall effect on employment or destructive impact on the economy, as Senator Messner would have us believe. There certainly will be higher after tax incomes for many Australian taxpayers. They will have greater disposable incomes and will be able to undertake greater expenditures on the products of the Australian economy. As a result of our policies the lowest income tax rate will be reduced to 24c in the dollar compared with the 30c in the dollar rate under the Liberals. The top rates of tax will be reduced from 60c in the dollar to 49c in the dollar. So clearly this Government, through its tax package, is not attacking small business. It is not hitting investment. It certainly offers a simpler, fairer and more efficient tax system. Senator SIDDONS(Victoria)(3.45) —The Australian Democrats do not support this matter of public importance because, once again, the Opposition has failed to get the balance right. We agree that administrative burdens and additional costs will be imposed on business as a result of this package. We have never been happy about that aspect of the total tax package. We have criticised the Government loudly and clearly for it. We have adopted the attitude of negotiating with the Government in an attempt to lessen the more severe impacts of the package on the business sector. What has the Opposition done? It has stood flat-footed. It has said: `We oppose the tax package absolutely. There is nothing good in the tax package. We call on the Democrats also to oppose it flat-footedly'. Senator Michael Baume —Hear, hear! Senator SIDDONS —Senator, let us think for a moment about what would happen if the Democrats were to join with the Opposition and oppose this tax package flat-footedly. It would give the Government the perfect opportunity to renege on its tax cuts but, more importantly, it would give the Government the perfect opportunity to call a double dissolution and fight an election on the tax package. Senator Childs —What a good idea. Senator SIDDONS —It is a magnificent idea for the Government, I suggest. Does the Opposition seriously want us to join it in opposing this tax package outright so that the Government can go to the people? Does the Opposition think that the Liberal Party of Australia and the National Party of Australia are in any shape to fight a double dissolution now? Senator Peter Baume —Yes, and we would win. Senator SIDDONS —They are brave words but if one looks at the opinion polls one will find that it is a rolled gold certainty that an election now would give the Australian Labor Party control of both Houses of Parliament. There is no shadow of doubt about that. Is that what the Opposition wants? From the very beginning the Opposition adopted the weak-kneed attitude of boycotting the National Taxation Summit. It has provided no input whatsoever. It has left the entire burden of negotiating with the Government, of trying to get reforms in this tax package, to the Democrats. I believe that we have made significant advances in this area. Let us consider the record. Before the tax package saw the light of day we negotiated with the Government on the capital gains aspect. Any reasonable Australian must admit that unless we have a capital gains tax there is no way tax avoidance can be cracked down on. Some sort of capital gains tax has to be imposed. We were at pains to make sure that the capital gains tax was in a mild and fair form. We were successful in getting the family home exempt from the tax. Taxes are levied only on the realisation of capital gains and not on notional capital gains. The capital gains tax is indexed for inflation. Losses are to be offset against capital gains. Most importantly, there is no retrospective element to the capital gains tax. All in all, if one considers the tax carefully, one will find that we have one of the mildest capital gains taxes in the Western world. If anyone were prepared to go through the arithmetic with me I would be delighted to show him the truth of that statement. After the Government announced the details of its tax package we again negotiated with the Government. As a result of our efforts goodwill now will be allowed as a deduction for small businesses and farmers. We pushed the Government as hard as we possibly could to eliminate the quarantining of farm losses proposal from the package. We succeeded in getting the Government half-way along the road. We reduced the impact of quarantining by about half. When the Government said `we cannot go any further or else the whole tax package will be thrown out' we said `okay, we will have to leave it at that'. But we continued to pressure the Government on its unfair treatment of farmers and small business, as opposed to the fact that it was not prepared to worry about negative gearing by large, multinational corporations. I believe that pressure finally hit home. The Government has called it a day. There will now be no quarantining of farm losses-a very big victory which never would have occurred if we had adopted a flat-footed approach of blocking the whole package. Senator Michael Baume —And without our support. Senator SIDDONS —I have not seen too much of that support. Going through the list of concessions, the Government conceded to about 80 per cent of the things we negotiated with it. Retained earnings were a problem. They were to be taxed twice under the imputation system. That anomaly was overcome. Under the Government's original proposals employee share ownership would have been discouraged in a very large way. That has been overcome. We were successful in getting the Government to see our point of view on averaging. Small businesses would have been very severely hit if they had been taxed at the full capital gains tax rate in the year of the sale of their business. It is now to be averaged over a five-year period. So these were very substantial gains. While we are not happy with the additional burden on small business, we believe that overall, taking all things into account, it is the best package that can be negotiated in this Parliament. I stress that it is a government initiative and not an Australian Democrats initiative. We would have gone about this in an entirely different way; I will explain later the sorts of things that we would have done. But we are not the Government. The Government is elected and it has introduced this package. We are in a position where we can only amend it or block it. We will not block it; we have done our best to amend it. Let us look at the tax cuts, which are a very big incentive to Australians. This is the first real reform of the marginal rates of taxation for many years. In September of this year $2 billion will be foregone to revenue in order to implement the cuts in the marginal rates of tax. The 48 per cent marginal rate will drop to 46 per cent and the 60 per cent rate will drop to 55 per cent. The tax cuts will cost $2 billion. The Government will fund that $2 billion-this is a very interesting point-by $800m worth of tax reform, that is, additional revenue. But $1.2 billion of that $2 billion will be financed through inflation and growth in the economy. Senator Messner very carefully did not mention the issue of growth in the economy. But I suggest that this is a vital part of the Government's proposals. If we do not get growth in the economy, the Government will be in all kinds of very deep trouble. The further cuts in marginal rates of tax which have been promised in July 1987 amount to $4.5 billion of revenue forgone. The top rate of tax will drop to 49 per cent in July 1987. Of that $4.5 billion of revenue that the Government is forgoing, $3 billion will be financed out of growth and inflation and $1.5 billion out of additional revenue through tax reform. So the big burden for the revenue will rest on growth in the economy and inflation. Therefore, it is very important for the Government to be able to keep the economy moving at its projected rate. Will it be able to do that? The Democrats have grave reservations that the Government will be able to do it. Our fundamental criticism is of the way the Government is managing the economy overall. We are not carping about the minor points of the tax package. We are concerned about the fundamental approach to the management of the economy. On this point the Opposition is remarkably silent, and for a very good reason. It is silent because both major political parties are pursuing free market policies; they are sacrificing Australia on the altar of laissez-faire economic theory. If we continue on this course, there is no doubt that Australia will sooner or later become bankrupt. The control of our economy is being surrendered to international financial interests. In simple terms, Australia is living beyond its means. We are in fact renting our country just as a family rents its home. If, in addition to paying the rent, a family continues to buy goods on credit and has massive time payments that it cannot afford, that family soon becomes destitute-and so too will our country unless we change the fundamental course of economic management. We have to do something about the enormous quantities of borrowed money flowing into the country and going into protecting companies such as Broken Hill Proprietary Co. Ltd and Elders IXL from raiders. Over $3 billion has been spent on stock exchanges in that one instance alone without one iota of added productive capacity to the country. We are whistling by the grave if we think that with a balance of payments deficit, and 30 per cent of incoming money going to pay interest commitments on money we have already borrowed, we can allow this money to flow in at its present rate purely for speculation on the stock exchange. We will very quickly face the day of reckoning. The Democrats believe that there have to be controls on money flowing into and out of the country. We believe that the Government has to direct its attentions to industries that have export potential. It has to consider all industries. Those that are assessed as having such potential is where Government funds should be directed. It should encourage those export-oriented industries, and do so quickly to earn foreign exchange. We believe that there have to be changes to stock market regulations to stop the takeover racket. I was delighted to see in the paper this morning that at least some Government back benchers are trying to force the Treasurer (Mr Keating) to do something about it. So far he has refused to act. I just hope that they are successful because the position is desperate. Where is the Treasury's long awaited report on reform of the corporation tax legislation? I understand it will be introduced in about a week and then there will be a further committee to investigate it. But we have waited far too long and we are right now at the eleventh hour. I do not have time to dwell on the other fundamental issues, but one fundamental of economic management that should be addressed is keeping in Australia more of the money from our superannuation savings. Fifty per cent of the money invested in the stock exchange comes from our superannuation funds. A large percentage of that superannuation money right now is being invested not in Australia but overseas. That is because the funds can get a marginally better rate of return from investing it overseas than from investing it in Australian industry. There are no regulations; it is a laissez-faire, let her rip approach; they invest in Saudi Arabia, the United Kingdom, South America or anywhere they think they will get a better return. That is the approach of the institutions at the moment. I suggest that our savings, which is what superannuation funds essentially are, should be subject to some sorts of guidelines so that at least the bulk of that money can be reinvested in the country to create jobs. If we could stimulate our manufacturing industry and create the jobs that we need, the Government's economic problems would be solved overnight. For instance, there are now 583,000 people unemployed. Dole payments alone cost us $2.7 billion. If those people were put to work and earned the average wage of $320 a week, the Government would receive another $1.8 billion from income tax-a total of $4.5 billion just by attacking unemployment. In conclusion, I simply say that the Government's tax package is far from perfect. It imposes additional burdens on small business in particular and business in general. But we must have tax reform. It is the first reform that we have had in 40 years. The Democrats, unlike the Opposition, are not prepared to stand flat-footed and reject the whole package. Senator RICHARDSON(New South Wales)(3.59) —Before beginning my remarks on this matter of public importance, I thank Senator Michael Baume for allowing me to swap with him on the speakers list. I have a pair and will be leaving for Sydney shortly; that is why there will be two Opposition speakers in a row after me. I thank Senator Baume for his indulgence. However, after I have spoken, perhaps neither of the next two Opposition speakers will wish to speak and the debate will conclude early. Only a couple of weeks ago I heard Mick Young in the House of Representatives refer to the Opposition as `thick headed'. I thought we ought to change our attention from the head and look at the hide. When it comes to hide and the thickness of it, given the record of the Opposition during its years in government from 1975 to 1983, I find it extraordinary that even Senator Messner should use the words `imposing enormous administrative burdens on taxpayers'. He has come up with some pretty extraordinary things in the past, but this just about tops the list. This Opposition mentions imposing tax burdens in a Senate which witnessed its sad and sorry record over these years, and witnessed it run our taxation system completely into the ground. With the system being run into the ground, we had to witness average weekly earners and pay as you earn taxpayers being run into the ground with it. The Opposition showed no concern then. Now, late in the day, it rises to tell us of this sudden infusion of concern that was obviously lacking for so many years. Let us go through some of that record. For five years of the Opposition's reign we witnessed the most blatant tax scandals in modern history-so much so that Costigan was moved to remark that as an industry tax avoidance had a rate of growth that could be compared only with the heady days of the Victorian gold rush. That is what the Opposition presided over. It ran down the taxation administration so that when we came to office there were not even enough employees in the Australian Taxation Office to deal with the scandal the Opposition had created. It failed to address the basic failings of the system. Let us not forget, as the Opposition so often attempts to do, that it broke a succession of promises on tax, one after the other, almost from the first day it got into government. I do not have to remind honourable senators about our fantastic fistful of dollars election back in 1977. We all remember being shown that fistful of dollars, a fist crammed full of green notes, and told that if the Liberal Party of Australia was re-elected those notes would somehow find their way into the electors' pockets. The reality is that they did not, because the tax cuts that that fistful of dollars heralded were taken away as soon as the election was completed. Despite the promise to reduce the burden for ordinary taxpayers, that Government had the distinction of being the highest taxing Government in our history. If honourable senators will bear with me for a few moments, I will produce some figures that show just what these taxing policies of the Liberal and National parties did to cripple wage and salary earners in this country. In the year 1982-83, we were seeing almost 1,000 people go out of work every day, and the activities of Malcolm Fraser and, more importantly, John Howard as the Treasurer of the day, were really biting. After seven years of their policies everything was in a nose-dive and the country was in strife. In 1982-83 46.1 per cent of total tax revenue was being paid by pay as you earn taxpayers, yet in 1975 when the coalition Government first came to office that figure was 41.7 per cent. So we witnessed a gradual rise, over every single year that John Howard presided over the economy in the amount of the tax burden shouldered by ordinary Australian families. When we contrast that with what happened with the figures for corporations and non-pay as you earn taxpayers, the real truth emerges. In 1975-76, 24 per cent of total taxation came from non-pay as you earn taxpayers and corporations. By the time the Australian people had the good sense to throw out that Government in 1982-83, it had dropped to 18 per cent. It had dropped that low because the Opposition had presided over and encouraged tax avoidance to a degree that this nation had never seen before. Tax avoidance was the only thing that grew under that Government. Everything else in the economy collapsed. No, I am wrong. I have made a mistake-unemployment grew at a phenomenal rate, and inflation also grew, because when the Opposition left office inflation had hit 11 per cent. Let us look at the proportion of gross domestic product paid in tax. When the Opposition came to office in 1975 it was 23.3 per cent and by 1984 it was 24.7 per cent. The reality once again was that the Opposition presided over the increase, even excluding Medicare. Contrast that enormous rise in taxation with the wording of the matter of public importance-and the Opposition has the hide to refer to the increasing burden on taxpayers! Let us look at average weekly earnings. They grew by 113 per cent during the years the Opposition was in government from 1975 to the end of 1982, but tax increases for average weekly earners rose by 122 per cent and for a person with a spouse and two children they rose by 150 per cent. Along every step of the way, the Liberal-National Party Government chose to kick ordinary Australians where it hurts. Since this Government has been in office we have chosen exactly the opposite path. In contrast to the pathetic record of the Liberal- National Party Government, as soon as this Government came to office it instituted a vigorous campaign to close these tax loopholes. It was difficult to get all of that legislation through the Senate, and because some of it was not passed hundreds of millions of dollars in ill-gotten gains have escaped the net. Even so, this Government by its legislation on superannuation lump sums, income splitting, the abuse of unit trusts, leverage leasing, prescribed payments and sales tax avoidance-the whole gamut-was the first government in decades to do anything about it. This Government was the first to recognise that far too much of the taxation burden was being shifted to ordinary Australians and that we had to provide some sort of relief and release. So we set about invigorating our taxation administration and gave the Taxation Office major additions to its resources, as well as a massive overhaul of penalty and compliance provisions. Today we have a Taxation Office whose morale is high and which has people out there in the market-place working night and day to stop the rorts that were allowed to grow under the Liberal Party. Our overhaul of the taxation system is the most comprehensive overhaul since the system was introduced. Let us look at some of the things the Government has done. We have closed loopholes in the area of fringe benefits. Today we have heard more on the issue of fringe benefits. As I said in a speech on a matter of public importance last week, the reality is that if we have a commitment to equity in a tax system we cannot allow a system whereby the free lunch and free car are enjoyed by the few at the expense of the many. That is what has happened. Over time the use of all these tax shelters had grown, and was growing, by the end of the Liberal Party reign by 25 per cent a year. No self-respecting government could stand by and let that continue; something had to be done. So we have closed many of these loopholes. We have looked at capital gains. Australia struggled on for many decades as the only Organisation for Economic Co-operation and Development country without a capital gains tax and finally it has been introduced. The outcries and riots in the streets that we were promised just have not occurred. The reality is that in order to shift the burden away from ordinary Australian families, those are the sorts of measures the Government has to have the courage to take. The largest tax cuts in Australian history were introduced under our tax overhaul, so that the maximum rate of taxation is now 49c in the dollar. If it is the case that the Liberal-National Opposition is really about protecting its base, one wonders what it did for small businessmen when they found themselves paying the 60c taxation rate. The answer, as usual, is nothing. While on the subject of small business, which is mentioned in the matter of public importance today, let us not forget the real threat to small business that this Liberal Opposition poses. When the crunch comes small business will never be able to withstand this crazy policy of deregulation of the labour market which is being espoused by the likes of John Howard and Neil Brown. If that comes about, what will happen is that big unions will break out with big increases and those increases will flow through to small businessmen. The very people whom the Opposition says it is trying to protect will be crushed under the weight of that burden. I wonder when we will hear what the Opposition intends to do about it. The reality is that it intends to do nothing. With this Liberal Opposition, it is all done with mirrors. The problem is that when that policy was exposed in 1981 and 1982 we had rises in average weekly earnings of 14 per cent and 17 per cent respectively. Consequently the economy went into a downward spiral, and that is what will happen again if ever we allow it. It is a crazy policy and we have to do all we can to expose it to the Australian people. After looking at the polls I might say that we do not have too big a job to do; the Australian people have already woken up. Let us look at the burden that is allegedly being placed on small businesses. A significant proportion of small businesses do not pay fringe benefits tax, therefore, there will be no administrative burden for them. They will have absolutely no more money to pay in tax. The taxpayers likely to bear the most are the very large taxpayers, the very big companies and the corporations. They are the ones which will be hit most by this new tax. If one looks at the record, at the figures that I have just quoted, one will see the total amount that companies and corporations have paid as a percentage of total tax revenue. The facts are that this sort of policy will start to put them back where they were 10 years ago-paying their fair share. It will start to reduce the burden on ordinary Australian families, and that is what we are about. The decision of the Government to impose a fringe benefits tax and levy the tax on the employer is obviously the most simple administrative way. It is the only way to clear the clog that occurs when we try to impose these sorts of obligations on too many people. By imposing these obligations on an individual employer rather than on a host of individual employees there is no doubt that we have a system that is harder to abuse and easier to administer; it is also cheaper to administer. No self-respecting government could have gone any other way. Given that the Government has decided to introduce a fringe benefits tax, the most sensible and the least burdensome way to do that is to do it exactly the way we have proposed. Let us look at a capital tax on assets. The tax is on assets acquired in the future, not existing assets, because we recognise the enormous logistical problems that would have been involved in getting valuations for all the property involved. Also we do not seek to penalise people for the actions that they may have taken in the past. We have not sought to penalise them for the way in which they managed their affairs prior to the decision being taken. What we are saying is that from now on they will have to pay tax. We have made it clear what the tax is. It has been clear for a year. The whole of Australia knows what to expect. Contrast that with anybody in the public trying to find out what the Opposition's policies are, not only on taxation but on anything else. Over the last 12 months, despite repeated calls from the Government benches, but more importantly from their rather spectacular misadventures with the Business Council of Australia and with the Confederation of Australian Industry, no section of the community is able to find out just what the Opposition is about. So what we are faced with on this side of the chamber is a lot of individuals on the other side saying what they are about. The problem is that the individual voices never match, the disarray grows and the Australian people get more confused. That is why, when the next election comes, they will stick with the Government that delivers the goods. Senator MICHAEL BAUME(New South Wales)(4.13) —I agree with Senator Richardson on one point. After listening to him, yes, the Australian people would be more confused. In the first place they would wonder what this matter of public importance was all about. It is a very simple proposition: That the Hawke Labor Government's destructive tax package imposes enormous administrative burdens on small businesses and other taxpayers. Senator Richardson spent a great deal of his time trying to rewrite history, saying, for example, that his is the first government to do anything about dealing with tax avoidance. That is total bunkum. He knows it is bunkum. But he enjoys rewriting history because it is a way of trying once again to confuse the Australian people. He has successfully done so for two consecutive elections, and I hope that the third will prove that one cannot fool all of the people all of the time. Let us deal with the reality rather than the fiction. The reality is seen, by the way, in the annual report of the Commissioner of Taxation for 1983, which says that in fact the previous Government brought to an end the paper schemes which were the burden of the tax avoidance industry, that that tax avoidance industry was wiped out by the previous Government's activity. An enormous amount of legislation was passed to wipe out tax avoidance under the previous Government. That tax avoidance had only developed because of some curious decisions-as the Opposition knows-by the legal system which, in general, have now been reversed, so rendering absolutely obsolete and unnecessary the great bulk of the legislation that was passed during the previous Government's period to wipe out individual tax avoidance practices. That is by the way. I just wanted to correct Senator Richardson's pretty incompetent attempt to rewrite history to the extent that the previous government was criticised for being too tough in the matter of blocking tax avoidance. In fact, on the bottom of the harbour scheme we were accused of introducing retrospective legislation of an unfair nature. The Government cannot have it both ways. The worst element of this package is, strangely enough, not so much the package itself, which is appalling, but the disgraceful standover tactics this Government is endeavouring to apply to this chamber and, in fact, to the Parliament. The Canberra Times of 5 May states: The Prime Minister, Mr Hawke, warned yesterday that the tax cuts could be in jeopardy if the Government was denied substantial revenue from its tax reform package. Following the line recently put by the Minister for Finance, Senator Walsh, Mr Hawke said the Opposition and the Democrats must recognise that any such move `has implications for the Government in terms of capacity to deliver the tax cuts'. Senator Reid —That is blackmail. Senator MICHAEL BAUME —That is not only blackmail; it is monumentally dishonest blackmail. Of course one would expect that, when one looks at what Senator Walsh had to say in this chamber on 2 May. He said: Let it be known if the taxation package is sabotaged by the Opposition in the Senate to the point where it is impossible to deliver the income tax cuts which the Government has promised the responsibility for that will rest fairly and squarely with members of the Liberal Party of Australia, the National Party of Australia and the Australian Democrats. Let me say, for the benefit of the Senate and certainly for the benefit of those members of the Australian Labor Party who obviously are prepared to be led by the nose because they cannot think for themselves, that only $1 in every $6 of tax cuts promised for this year-I stress, only $1 in $6-will come from the fringe benefits tax. It is absolutely absurd for any member of the Labor Party, from the Prime Minister (Mr Hawke) down, to come into this place, as the Minister for Finance (Senator Walsh) does, and falsely claim that they will not have the capacity to provide tax cuts when in fact only $1 in every $6 of those promised tax cuts will emerge from this fringe benefits tax. The figures are clear. Next year, of the $2,000m promised tax cuts only $330m is to come from the fringe benefits tax. Here we have an attempt to deceive the people of Australia, an attempt to confuse this Senate, a deliberate attempt to mislead the Senate and, more significantly, an attempt to blackmail and stand over this place to try to force through some legislation which is a mixture of incompetence and savagery. It is severe in its impact on small business in particular but, as I have said, the manner in which it is being held over the Senate-like the sword of Damocles-to try to force the legislation through is to be condemned. Of course the Australian Democrats have been dumb enough to fall for it. We heard Senator Siddons today saying: `We have to do it. After all, they won't have the revenue for their tax cuts otherwise'. Cannot Senator Siddons add up? Do not the Australian Democrats understand that the removal of $1 in every $6 can in no way justify the removal of $5 in every $6? The reality is that this Government went into the promise of a tax cut knowing full well that it did not have the capacity to meet that promise. The $6.4 billion forward estimate of the deficit for next year which has been leaked already clearly shows what sort of terrible trouble the Government is in. It seems to me that the Government's statement that the tax cut is in jeopardy if this legislation does not go through is a clear precursor to an attempt to withdraw from that promise. I would not be surprised if in fact the Government would not mind if this legislation were defeated. It would provide it with an excuse to escape from the $5 out of every $6 obligation which bears no relationship to this legislation and which it is simply using as an excuse. It is further suggested that the Government wants to see some hostile approach to this legislation. It is further suggested by its refusal-as far as I know, it is an unprecedented refusal-to provide the Opposition with bureaucratic advice on what are the meanings and implications of some of the clauses in this legislation. To my knowledge, when we were in government, on no occasion in tax matters did we ever refuse access by the Opposition to the public servants involved. It is a disgrace, it is unprecedented,and it is an indication not only of the arrogance of this Government but also, I suggest, clearly, that it is part of a tactic of generating and reinforcing opposition to this legislation on the basis of lack of understanding. We have already heard Senator Richardson say that there is confusion. If the Government genuinely wanted to get rid of the area of confusion it would provide the advice and assistance that we in government always provided to the Opposition, but which this Government is too arrogant and too offensive to provide to this Opposition. As I said, it is absolutely unpre- cedented. This is particularly disgraceful when it relates to legislation that in many instances has been in operation, through this package, since September last year but which is only just now seeing the light of day. Of course, in the capital gains tax area it is still to see the light of day. By the time the legislation comes through, people will have had to operate under it for the greater part of a year without knowing what on earth it is they are operating under. All they had was an outline or statement given on 19 September when this legislation was announced but not introduced. Of course, it has changed quite a bit since those original announcements. The fact that it has changed, the fact that no one knows what is in it anyway, and the fact that it need not necessarily coincide with the initial statement does not bother the strongly moral members of the Government here because they do not care about the fact that small business, in particular, has had to operate under tax laws which do not yet exist but which will bind them. This is intolerable. We have already seen one example where the Government has been approached, because of a degree of confusion, in relation to what the deductibility entitlements for depreciation really are. That confusion will, in fact, cost people a large amount of money when they have acted in a way that they believed would fit in with the statement but which now appears not to fit in with the ultimate legislation. It is an immoral and improper procedure to operate this way, to have legislation start from a particular date but not be introduced until almost nine months later. It is all very well for the Government to say that the Opposition did that when it was in power in relation to tax avoidance practices. That is quite right; we did. We would make a statement saying: `This particular practice gets around an existing law; in other words, it is a practice which is a dishonest and dishonourable one because it gets around a law clearly endeavouring to prohibit that practice'. What we would say was: `That practice is prohibited and we will introduce the legislation as soon as possible'. In many instances it did take a while to get that legislation through, but the fact is that those instances related to clear breaches of existing laws or the avoidance of existing laws and were not the introduction of a whole new approach-a whole new set of tax laws-called quaintly by this Government, `reform'. Whenever this Government changes anything, it is never just a change, it is a reform. It can be a reform for the worse, but it is still called a reform. This Goebbels technique of colouring one's activities with an appropriate word to give the appearance that it is something good when, in fact, in most instances this tax `reform' package has disastrous consequences for many people in business, is a hoax and a clear indication of Goebbels-type technique. Let us have a look at the question of the impact of this legislation. On 30 April in the Sydney Morning Herald there appeared a report showing that Senator Button had again claimed that the car industry would be adversely affected by the fringe benefits tax. On top of that, of course, motor vehicle registration figures released then showed that sales in March were only three quarters of those recorded in the corresponding period last year. The important thing which that article stated is this: Senator Button told the Senate: ``I have always felt that [the tax] would have some adverse effect, but there are a variety of factors which will adversely affect the production of motor vehicles in 1986. ``The precise effect of the fringe benefits tax on cars cannot be assessed, although added to other factors the effect is likely to be adverse.'' Here we have the Minister in charge of this industry saying that the precise effects of the fringe benefits tax on cars cannot be assessed. I can cheer him up by telling him that the industry certainly claims it can assess the impact. It says that the fringe benefits tax will mean that 30,000 fewer cars will be produced this year, costing 10,000 jobs and threatening the Government's car plan. It is an open secret that Senator Button and Mr Mick Young, two Ministers in this Government, were rolled on this matter within the Cabinet. Last night Mr John Bannon, the Premier of South Australia, made a stinging attack on this Government's lack of intelligence in this matter at a dinner at the Australian National University, which unfortunately was not reported. His attack on this Government was based not only on the fact that what it was doing was destructive of jobs and the industry but also that it did not know the consequences of its actions. This, of course, is probably one of the most disturbing elements. Senator Walsh says that it is just scaremongering to talk in this way. Earlier today he referred to the fact that there had not been any falls in employment in the restaurant industry. His figures were deceptive and misleading. He took only the December figures from a new set of statistics and he failed to mention that some other statistics which go to February show, in fact, a fall in the number of people employed in the restaurant, hotel and club industry, and that that fall is significant because the figures he quoted clearly did not take into account in any way the seasonal factors involved in the Christmas trade in that industry. His figures also included personal services, whereas the later figures I quoted, which did not include personal services, show a fall from 230,600 in the November statistics to 229,800 in the February statistics. Senator Walsh simply was misleading this chamber. The ACTING DEPUTY PRESIDENT(Senator Coleman) —Order! The honourable senator's time has expired. Senator WATSON(Tasmania)(4.28) —The Senate is debating a matter of public importance raised by Senator Messner on behalf of the Liberal Party of Australia expressing concern that the Labor Government's destructive tax package imposes enormous administrative burdens on small business and other taxpayers. I not only wish to endorse that remark but also I wish to add a new dimension to that matter of public importance. I believe, arising from this particular tax package, that the aged, the infirm, the unemployed, small businessmen and farmers will emerge as a new underprivileged class. This is a tax package which is heavily impregnated with the Government's ideological preconceptions and it is a package which reflects an ideology of union bosses who seek to gain short term benefits for their members to the detriment of the competitiveness of Australian industry and others outside the immediate interests of the Trade union movement. I believe that such policies will further erode standards of living because they add nothing to productivity as such, but simply add costs to inputs and administrative structures and destroy both incentive and initiative across the board. As the Government members across the way have said, this package is not intent on increasing taxes per se. It is interested in redistributing the tax burden. It is interested in redistributing wealth across the country. The Government is, therefore, pursuing a policy that runs counter to that adopted by all our major trading nations-all the countries around the Pacific basin area. This package is redistributing the tax burden by redistributing it to the middle income earners. It is not attacking the tall poppies as was traditionally a Labor Party exercise. Let us look at the environment in which this tax package has been set. We should note the comments of Robin Speed of Sydney, who recently advised us that 300 years ago Daniel Defoe said that there was nothing as certain as death and taxes. Today, nothing is as uncertain as taxes, particularly under this Labor Party Administration, because never before have our tax laws been so complex and uncertain in their application. It is against this kind of complex and uncertain background that the Government is introducing a new range of income taxes-capital gains taxes, fringe benefits taxes, entertainment taxes and so on. On top of this, it is introducing a new concept of assessment called self-assessment. In theory it is fine but it will transfer the burden of uncertainty to ordinary taxpayers. This legislation has been introduced against the background of government refusal to make taxation officers available to the Opposition. This is unprecedented. When the Liberal Party was in government we always made tax officers available to Opposition committees and the shadow Minister. What has the Government to hide under these circumstances? An important canon of taxation is the element of certainty. A new concept of uncertainty has now been introduced. If this happens, there must also be other consequential changes which I call upon the Government to implement. For example, until now the Australian Taxation Office has not given advice on the outcome of certain proposals put before it. Because of this new self-assessment system it is now up to the Government to change this philosophy. If it is to be three or four years before a taxpayer will be visited by a taxation officer to reappraise and assess a return, he needs advice from the Taxation Office on the outcome of an action. It is necessary for the Taxation office to implement and publish a taxation public information bulletin to advise taxpayers about procedures, rights and obligations consequential upon a visit by the so-called taxation auditors. Let us consider the economic environment in which this range of new income taxes has been introduced. For example, we have a current account deficit of $1 billion a month with hardly a cent going into investment. Our foreign debt burden is approaching $80 billion. We have a high inflation rate, particularly when we compare it with that of our trading partners. In the United States of America it is 3.8 per cent, West Germany 1.3 per cent and Japan 1.8 per cent, against our rate of approximately 9.2 per cent. We have a rising level of imports and decreases in exports-in fact, they were down about $8m in March. This situation is leading to an ever-worsening balance of payments problem. The Government has adopted a so-called J curve philosophy on the basis that things might be a little difficult in the short term but there is a long road upwards to recovery. I submit that the J curve theory can be likened to a slippery slide with the Government coming down at an accelerating rate and the recovery being very short term and short lived. We also have unacceptably high interest rates which are having a bad effect on long term investment. There is a decline of 20 per cent in rural export earnings, low prices for our commodities, reduced employment and investment opportunity, an uncompetitive manufacturing sector, unreal wage expectations and high costs to business because of indirect costs such as workers compensation. Our capacity to service our debt is becoming an increasingly great problem. Much depends on the performance of the export sector. The Government has placed too much reliance on the primary sector. The continuing neglect of the manufacturing sector is to be deplored. There has been no real effort to reduce the level of government spending. This is the problem. The Government must reduce its level of spending. It must change its level of priorities. There is a need to reduce government expenditure, to reassess the entire spending program, to cut out waste and inefficiency and the unnecessary advertising and self-promotion of Labor Party leaders to ensure that spending priorities reflect the real needs and aspirations of the community. Unfortunately, the cost of government at all levels has increased fivefold in the last 10 years-a dramatic increase. This is the first problem that must be addressed in any realistic examination of taxation reform. For example, in 1973-74 government expenditure was 31 per cent of gross domestic product. In 1983-84 it had risen to 42 per cent, an increase in real terms of 70 per cent, far outstripping the economy, which grew at only 28 per cent. Middle income earners will foot most of the bills run up by this Government. The Government talks about tax reform redistributing the burden. Four years ago average wage earners paid 30c in the dollar in tax. They now pay 46c in the dollar. The number of people who pay this high rate of tax will increase by one million in the next few years if inflation continues at the present level. Bracket creep has always been welcomed by Commonwealth governments because it enables them to become increasingly extravagant. This is the only way-by bracket creep or increasing the deficit-that the Government can ever hope to pay for this taxation package and provide some personal income reductions. What will be the consequences of this bracket creep in a few years? People who hope to receive a reduction in their taxation burden will soon find themselves in a very much higher bracket. Unfortunately, there is no commitment to indexing income tax scales to inflation. This would be a positive step by the Government. It has refused to do so. More and more people will be caught up in the so-called bracket creep. Let us look at the contributions by some of the other speakers in the debate. The flaw in Senator Maguire's contribution was that he compared the Fraser Government's approach with what the Labor Party hopes to achieve in the future. The likelihood of it being able to bring forward tax cuts is very remote. If it does, that will be achieved only at the expense of higher inflation and higher Budget deficits. Senator Siddons berated the Liberal Party for not attending the National Taxation Summit. Surely he has become aware that many of the businessmen who did attend that charade now regret doing so because they are annoyed at the way they were used and abused. The Government has now found that it is impossible to squeeze any extra income tax from primary producers, whose income is less than the dole. What is it doing? The Government is imposing a capital gains tax on these people. It has found that it is impossible to squeeze any more money from the mining industry. Who is left? The manufacturing sector, the small businessman and the individual taxpayer. Instead of treating the business community as an economic partner responsible for the generation of wealth, the Government has attacked and hammered it and squeezed it dry. What has the package done for these people? First and foremost is the tax on motor vehicles. We all acknowledge that fringe benefits must be subject to some taxation-my word we do! The fringe benefits tax proposed by the Labor Party departs from the basic principle of taxation which requires employers, rather than employees, to shoulder the burden of taxation. We do not see this anywhere else in the world apart from a proposal put forward in New Zealand. It will cause tremendous problems in the motor car industry. We have heard of predictions of a loss of up to 10,000 jobs and further losses of up to 25,000 jobs overall when we take into account the side effects. In Tasmania, industry has already suffered in the last month from a 27 per cent drop in sales. There will be an estimated cut in the production of 6-cylinder cars by something like 35,000 vehicles. The fringe benefits tax paid by employers will impose very heavy costs on the private sector, but at the same time it will leave government undertakings virtually unscathed. It is not surprising that, under this sort of environment, the business sector is not investing at present. Even Simon Crean of the Australian Council of Trade Unions has said that business in Australia has gone on strike. Who are some of the other people who have been disadvantaged as a result of this package? Charitable organisations will suffer. Up until now these organisations have been exempt from this tax. Families will suffer. The Australian Family Association claims that the Government's tax package will cost families $1 billion by 1988. Certain classes of pensioners will suffer. In fact a research paper of the Department of Social Security suggested that capital gains taxes associated with the assets test could disadvantage certain classes of pensioners and Senator Grimes would be well aware of that. Other nasties in this tax package include the capital gains tax. The move to introduce a capital gains tax and to impose a foreign tax credits system can only militate against productive investment and thus reduce employment opportunities. There might be a case for a capital gains tax on short term speculative gains, but I believe that the imposition of a capital gains tax on long term, risky investments should be opposed. We are opposing these taxes on the grounds that it is unfair to impose a penalty on long term, often low return investments, such as farming. The DEPUTY PRESIDENT —Order! The honourable senator's time has expired. Senator CHILDS(New South Wales)(4.43) —We are discussing a matter of public importance introduced by Senator Messner which has just been supported by two Liberal senators. As usual the Liberal Party is leading with its chin. We have just heard two Liberal senators talk about confusion and uncertainty. They have congenital confusion. They have a fixation in time in the past and they have failed to see what has happened in Australia. Senator Watson, who has just spoken, invoked, as the Liberal Party always does, certain respectable segments of our community. For example, the matter of public importance has been brought forward in the name of concern about small business. Senator Watson spoke about other sections of our community. I point out to him that we had a Tax Summit in this country and, contrary to what he said, many Australians-wage and salary earners, small business owners, pensioners and families-all reflected at that Summit their belief that we were being ripped off by wealthy people-by people who were not paying their fair share of tax. The failure of the speakers here today and the failure of the Liberal Party is that they stick to the old formulas that have been rejected by Australians. People, particularly pay as you earn taxpayers, knew that they were paying more than their fair share of tax. The Fraser-Howard Government favoured the rich and powerful people in this community, particularly the big corporations, when it was in power. Now, of course, the Liberal Party disowns them. It talks about small business. It does not mention big business now-those people to whom it is beholden-but we remember because we now know that there are 25,000 millionaires in Australia. When we look back we realise that, when the Liberal Party and the National Party of Australia were in power, they listened to the voices of those 25,000 millionaires. When we came to power and we had the Tax Summit we knew that we had a crisis of confidence in the taxation system. It became a priority of this Government to turn that around, and that is what we have done. I was shocked to hear Senator Messner today talk about the legislation as requiring a great number of accountants and lawyers to deal with when, under the previous Government, the tax avoidance industry was a growth industry. There was a retinue of lawyers and accountants advising those people who could afford to pay for the advice to not pay at all. It is nit-picking of the Opposition to be introducing this matter of public importance and talking about administrative burdens-very few specific burdens have been referred to today. Members of the Opposition have referred to minor matters and ignored the total picture. Of course, that is a very Barwick-like approach that once again seems to be an old-fashioned style of dealing with things. For example, Senator Michael Baume talked about the $5 out of $6 that are not covered by a particular tax. What members of the Opposition have failed to realise is that the Australian people demand an equit- able system. I believe that the overall conditions of small business are most important. I disagree with Senator Siddons, and I think I have to answer the points he made by giving a few simple facts about the economy at this moment. Firstly, let us look at the decline in the number of bankruptcies, because if there is one barometer for small business it is the number of bankruptcies. The facts are that in 1982-83, the final year of the Fraser-Howard Government's disastrous economic regime, there were 6,035 bankruptcies. In 1984-85 the number of bankruptcies had declined by nearly 25 per cent to 4,661. Secondly, the most important factor to small business is the inflation rate, and that is down. The constructive actions of this Government have reduced the inflation rate, both in relation to our major trading partners and in relation to the high levels experienced under the Howard years of management. In 1982-83 inflation was 11.5 per cent and in March 1986 it was 9.2 per cent. When Australia was suffering an 11.5 inflation rate under Mr Howard as Treasurer, our major trading partners had an inflation rate of 4.5 per cent; so Australia's rate was nearly 7 per cent higher. In March 1986, when our inflation rate was 9.2 per cent, our major trading partners' inflation rate was 5.4 per cent. My third point is that private demand-the most fundamentally important thing for small business-has improved spectacularly under our Government. In 1982-83 private demand was minus 2 per cent. In the last half of 1985-86 private demand was plus 3.5 per cent. So that general situation has to be looked at in any examination of the climate of small business in this country. These are some of the startling improvements we have had under this Government and the milieu in which small business has to operate. I suppose I should add that we have the most peaceful industrial relations environment since 1969-another factor in stability. The Government has set our to restore the revenue base in this stable economic environment. Senator Watson referred to the stability of death and taxes and things of that nature, but he failed to recognise that this Government has given just that stability. The Opposition is trying to destabilise people in the community. Senator Watson referred to the family being threatened, which is a favourite cry of the Opposition, when what we are doing with these taxes is ensuring that ordinary people will be suitably recompensed. I like the word `bludging' because it is a good Australian expression to describe the people who no longer will be able to eat and drink at the expense of ordinary Australians. The Opposition said that this was all to do with administration. Senator Watson is one of the few speakers who has dealt at all with some of the administrative problems. The fringe benefit tax, which is absolutely essential, is reasonable tax. If people are to have tax advantages surely they should account for them. Does the Liberal Party want to go back to the style of the years when it was in government, when people ate and drank at the expense of the taxpayer? What would occur if the Opposition had its way and the employee took responsibility? It is just a nonsense. First of all, if that occurred the employer would still have to do the paper work. Under the pay as you earn system the employer makes the deductions and keeps the records, so even if the Opposition's view were implemented there would be no lessening of the paper work that the employer would have to do. The other aspect of the argument which Senator Watson overlooked is the fact that the employer decides whether he will or will not offer a fringe benefit to his employee. So again the decision is up to the employer. If the administrative work of recording the details of fringe benefits is too difficult the employer can simply decide not to offer such a benefit to his employee. Another criticism by the Opposition concerns substantiation. It seems that this is a dirty word. I make this point knowing that soon parliamentarians will have the same problem. It will be a bit inconvenient, but we have to remember that now, if we have public money, people demand that we account for it. A one-person business keeps records of cars and other matters. Unfortunately, it will have to follow certain procedures. I remember an anonymous call, which I am sure was fairly accurate, from a person who complained that three people involved in a fruit shop all drove Mercedes cars. That is the sort of thing that is said in the community, and no doubt that situation exists. Fringe benefits and a whole range of benefits have got out of hand. There has to be an attempt to get some substantiation of both what people have and the expenses that they incur. We just cannot continue to allow a system whereby people do not have to keep reasonable records. In many cases reasonable records are already kept. I refer to some of the advantages that this Government has given to small business in particular, because one of the weaknesses of the Opposition's attack was not to refer to the measures that this Government has introduced for small business. For example, there is the foreign tax credit system. Senator Maguire referred to imputation, which will improve company arrangements. Most important of all, despite the Opposition's fear tactics, there has been the promised reduction in tax to all sections of the Australian community. Although the Small Business Council of Australia has reservations about the introduction of a capital gains tax, it has indicated that there is a desperate need to redefine the tax system. Contrary to the assertions of the Opposition, the tax package makes significant improvements to the administrative load of small business. Senator Watson did not refer to the elimination of Division 7 tax which means that small business has been relieved of distributing 20 per cent of its income-a matter which, year after year, was raised with the Liberal-National Government by small business, and to no effect. This Government introduced a quarterly provisional tax system which will be of enormous benefit to small business and will bring people who run their own business into a system that is similar to that of other people who pay tax. The Government has placed provisional taxpayers on a similar basis to that of PAYE taxpayers. The Government will assist in the reduction of seasonal liquidity fluctuations which have seriously affected small business in the past. Senator Watson also got very upset about self-assessment. This will lead to a massive reduction in the number of disputes. It will provide for much quicker assessments. Senator Watson seems to object to giving more power to people because finally people will have much more say and much more control. We will have many more inspectors to chase the tax avoiders that the Liberal Party seems to want to protect. We will have the inspectors chase the big fish and the people who want to take money from the system. Any honest small business person will know that the system gives him more control and allows inspectors to get the people who, at this moment, are defrauding every other taxpayer-the families, the pensioners and the very people to whom Senator Watson referred. Senator VIGOR(South Australia)(4.57) —Probably the only way to solve the tax problem is to introduce a whole new structure. The Government missed this opportunity at the National Taxation Summit last year. Our current tax system leaks so much that the Government spends a large proportion of our time in this place trying to plug the holes. This Government and its Liberal predecessors indulges in fiscal fiddles instead of fundamental reform. The Treasurer (Mr Keating) jumps to attention for his puppet masters-the Treasury-and introduces taxes which attack only the easy quarry, that is, the ordinary Australian. Who does the Treasury work for? Transfer pricing rips $1.2 billion off the ordinary people of Australia each year while we cosset the large companies and the mineral monopolies. Those who pay the bulk of the tax are ordinary Australians-people like us. The new poor are the people with large families and single earner families. A married man supporting a wife and six children pays the same tax as a single 18-year-old and almost all of his child endowment has been withdrawn by the Hawke Government. An international corporate raider pays relatively little or no tax. The tax system leaks like a running sore and we are patching it up with band-aid upon band-aid. The new entertainment tax is unworkable and unenforceable. It provides yet more loopholes for large corporations while taxing small exporters and small businesses which cannot afford to own their own company dining facilities. The proposed fringe benefits tax on tax exempt bodies will bear down heavily yet again on Australia's most disadvantaged people. Tax exempt bodies-that is, charities and government bodies-do not lightly provide fringe benefits as they are subject to very close public scrutiny. Councils in remote areas will now have to bear increased costs in employing professional help, as skilled, competent, energetic professionals tend to live in cities where there are much better educational and other facilities. We need to start anew with a completely different tax base, preferably one which taxes consumption on non-renewable resources rather than work and production. The Australian Democrats have just voted for this type of system. Such a change in the tax base would completely bypass all the hotch-potch constructs of the tax avoidance industry and bring the smelly card houses tumbling down with a breath of fresh air. Because of the fringe benefits tax, charities will find similar difficulties in attracting suitable people to work in deprived areas. While both Liberal and Labor governments give with one hand to large business, they take with the other from ordinary working people. The Income Tax Assessment Amendment Bill (No. 4) 1984 gave companies negative gearing benefits tax free. This group tax benefit allowed a company to offset interest paid in the purchase of a new company against the earnings of another company. This Bill was initiated by the Fraser Government and passed by the Hawke Government before I was elected to the Senate. Similarly, mining and oil exploration companies can deduct prospecting costs from income derived from any other source. Gold companies pay no tax at all, and one really has to ask why. We are prepared to give negative gearing to the Bonds, to the Holmes a Courts, to the Elliotts, to the Spalvins, to the Brierleys-to the corporate raiders for their rapacious takeovers-but not to the man in the street. The over-taxed junior public servant, the small entrepreneur, the small businessman and all the dedicated employees of small businessmen do not have a chance to get the types of benefits which come to the large multinational organisations and the corporate raiders. The sleazy world of corporate finance treats us as fools, by exploiting deductions and through new creative accounting techniques which involve extraordinary ways of avoiding tax. The criminals and the launderers of money go scot-free while ordinary people continue to pay tax. Immediately after giving the tax concession to groups of companies the Hawke Government hit at ordinary people who were investing for their retirement by building accommodation for others and so helping to keep down the cost of rental housing. They can no longer claim the interest costs of such investment. It cannot be offset against other earnings, but the corporate raiders continue to get negative gearing advantages since the passage of that Bill in 1984. Senator Messner spent a lot of time talking about the capital gains tax in its present form. I believe that it is an irrelevant tax because of the concessions obtained from the Government by the Australian Democrats during the initial negotiations. It will raise only $25m in five years time. At the same time, the people of Australia are being charged a massive $1.2 billion in hidden taxes, through the massive distortion which is caused through devaluation and the substantial inflation which in fact goes unnoticed and is cutting out the progressiveness in the current tax system. Even with the mooted tax cuts this will occur. Senator Watson —Will the Labor Party be satisfied with its current capital gains tax, or is it just one foot in the door? Senator VIGOR —I believe that the Labor Party will not be satisfied with its current capital gains tax, but I believe that by the time any great change is made to the level of capital gains tax the taxation system will have collapsed completely. The Government has distorted the consumer price index. It is no longer the same as it was when the whole of this process of observing the economy using the CPI was set up. The Fraser Government removed Medibank payments and thus a large part of health costs from the CPI. The distortion in relation to which Government charges go into the CPI has meant that it is now a meaningless index. It is a massive confidence trick to make ordinary people feel they are well off and to keep down wages while raising taxes, because some of these taxes and government charges are not taken into account. We have, unfortunately, the situation of a blind opposition letting a one-eyed government have a free rein. No tax measures can be popular with people who are taxed. However, some government measures are acceptable on the grounds of equity. But the thrust of this package disadvantages ordinary Australians while benefiting the large corporate raiders and multinational companies. This is an amazing situation when this package is being introduced by a Labor government that says it represents ordinary Australians. Every Australian must ask who the Government is working for, who Treasury is working for, and try to examine what we should do in a taxation package to produce a fair way of raising revenue for running this country. The DEPUTY PRESIDENT —Order! Time for consideration of the matter of public importance has expired. Senator FOREMAN(South Australia) —Mr Deputy President, I claim to have been misrepresented in the debate just concluded and I seek leave to make a short personal explanation. Leave granted. Senator FOREMAN —I claim to have been misrepresented by Senator Messner and I wish to make a short statement to set the record straight. Senator Messner stated in his speech that I, as a former Secretary of the Vehicle Builders Union in South Australia, have stated that up to 10,000 jobs could be lost in Australia as a result of the introduction of the fringe benefits tax. I have never made a statement either inside this place or outside to that effect. My position on the car tax was made very clear in several recent speeches. I have expressed reservations about the implementation of this tax, but I have fully supported the principles on which it is based. However, in no speech have I put any figure forward for job losses; nor would I at this stage venture one. Senator VIGOR(South Australia)(5.07) —I move: That the Senate take note of the paper. This very brief statement on the formation of a subsidiary company of Telecom Australia, to be called Telecom Australia (International) Ltd, is most welcome. At last we are looking at expanding the trade opportunities which our research and development in telecommunications can open up. For some time Australian personnel have worked on the setting up of microwave links in Indonesia, under the Colombo Plan. They have performed their task splendidly. They have shown their competence in all topographical environments and have turned their mastery of problems caused by geographical variations in Australia into a benefit for this country. The Indonesian telecommunications operator, Perushahaan Umum Telekomunikasi, or Perumtel for short, is about to upgrade a lot of its infrastructure in this area. Our proven record of good project management holds us in good stead for possible consultancy and associated work. In order to tender for the opportunities on offer in Indonesia, Telecom has sought approval to form a subsidiary company. The objects of that company focus on the provision of program management consultancy services to Perumtel in Indonesia. These objects can always be broadened if Telecom's contacts with authorities in South East Asia and the Middle East lead to further overseas opportunities. This is really exciting. This development shows that we are starting to look beyond our own shores in this area. Our research and development has been of outstanding quality, particularly in the burgeoning telecommunications area. However, we have fallen down in terms of market development. It is the commercial development of projects which has been our major problem. Time and again opportunities have been lost, and with those lost opportunities we have lost jobs. We have exported jobs. In the case of the digital radio concentrator, Telecom could not find an Australian manufacturer and had to turn to NEC, a Japanese company, for the advanced development and marketing of this project. It has recently signed contracts to sell the system to the People's Republic of China-a massive market. There will be further opportunities if we tap the regional potential for small digital exchanges and I believe that the company described in this report will be capable of it. But for all this to happen, some inbred attitudes have to give way to dynamic thought. In last year's Estimates committee proceedings, Telecom saw itself basically as a modifier or adapter of overseas work. That constitutes a tragic waste of the magnificent resourcefulness of Telecom's own research and development laboratories at Clayton, which I recently visited. It stifles our prospects of entering growth areas in technology and improving our job opportunities within Australia. However, the recent opening of the technical liaison office of Telecom heralds some hope for the future. That office is to keep companies abreast of Telecom's proposals and to keep in the limelight development of the many excellent ideas which emerge from Telecom. I hope for Australia's sake that smaller and medium sized companies will be encouraged to become more involved in projects with such long lead times. We are at the world's forefront in fibre optics technology; we have the opportunity of introducing optic logic into our telecommunication areas. I believe that it is important for the whole of Telecom research to be geared to an export market. Our market is 2 per cent of the world's market. If we could only raise that figure to 5 per cent of the world market by a dynamic export program, we would have a viable internal telecommunications industry. Our problems of isolation can be turned into export opportunities if we encourage our innovators. That is the only sensible way forward, and I shall certainly be monitoring the position. The DEPUTY PRESIDENT —Order! The honourable senator's time has expired. Question resolved in the affirmative. Debate resumed from 30 April, on motion by Senator Georges: That the Senate take note of the report. Senator MacGIBBON(Queensland)(5.13) —The report of the Senate Select Committee on Animal Welfare, `Dolphins and whales in captivity', is one of the worst reports we have ever had before this chamber. I am very surprised that somebody like Senator Georges could chair a committee that produced such a report, because he has produced some excellent reports in the past. The report on HMAS Tobruk, for example, was a classic. There are two problems with this report. The first relates to the recommendations, and secondly the longer term and wider implications of the report, which very greatly devalues the currency of the debate on animal husbandry. The report lacks objectivity and scholarship and is written in emotional terms. To see an example of the lack of objectivity, I invite members of the Senate to turn to chapter 6, which deals with the subject of the welfare of animals. A clear bias is demonstrated in the material between page 61 and the end of that chapter. I quote paragraph 6.1: Critics of oceanaria contend that the mental and physical welfare of cetacea suffers in captivity because their environment is so different. Paragraph 6.2 states: Some criticism of cetacean welfare centres on observations of the animal in the two different situations. Dr Sidney Holt believes that: One has only to see animals in the wild in comparison with the appearance of those that have been for any time in captivity to see vast differences in condition and behaviour. This lack of objectivity is very real. I have spent a large part of my life reading scientific papers and writing a few of them myself. This report deals with an important subject, but lacks the standard of scholarship that is required for a report of this nature. It would never get past the editorial committee or the board of referees on any respectable scientific journal. The report is quite emotional, and there is no place for emotion when dealing with a scientific topic. Emotion and reason are mutually exclusive. Emotion is linked with the belief that the animal concerned, the dolphin, has a very high IQ which the report almost puts at the level of human intelligence. Paragraph 1.11 on page 3 of the report states: There has also been much debate about the nature of cetacea. Available evidence points to the probability that cetacea have complex social behaviours and are highly intelligent. Then in paragraph 8.7 on page 95 we see the following passage: The Committee is of the opinion that evidence points to the probability that cetacea are highly intelligent animals with complex social behaviour. As the scientific community has not yet reached a full understanding of the nature of the animal, the Committee believes that it is important to give the animal the benefit in considerations on its future in captivity, especially where captivity has been shown to be mainly for the purposes of entertainment in Australian oceanaria. I suspect that the Committee got confused between complex social behaviour of an animal and the size of its brain and came up with the conclusion that, because it could be taught tricks, it was highly intelligent. Complex social behaviour is a property possessed by ants and bees, and their colonies demonstrate a highly involved, organised social pattern, but nobody would suggest that ants or bees were highly intelligent. Because the dolphin has a large brain that is no indication of a high IQ. The size of the cranial cavity cannot be equated with intelligence. There is no scientific opinion in zoological literature which supports the contention that the dolphin is a highly intelligent animal. Indeed, the Nobel laureate Professor Crick puts forward the theory in respect of echidnas and dolphins, both of which have large cranial cavities, that the size of their cranial cavities is not to be attributed to intellectual capability, but to their sleep patterns and their metabolic activities. It is certainly a highly responsive animal; it can learn routines which the oceanaria develop. But is there anyone in the Senate who really believes that a dolphin can be ranked in intelligence ahead of domestic animals such as cats, dogs or horses? I do not think that allegation can be sustained. Clearly, compared with the primates, it does not measure up in the animal kingdom. That argument is not tenable, yet it is the theme behind the whole report. It is the stuff of comic books and science fiction. Let me turn to the recommendations. The committee recommends: . . . that no further facilities for keeping captive cetacea be permitted to be established in Australia and that no further permits be issued for the capture of cetacea in Australian Commonwealth or State waters. It further recommends that importation of cetacea from overseas be banned. The report also states: The Committee also recommends that existing oceanaria be allowed to continue keeping cetacea for the time being but that the keeping of cetacea should eventually be phased out. Together, those recommendations mean that we will not be able to do any marine research at all in Australia. A great deal is to be learned from research with respect to the physiology of animals, parasitology and so on. Many factors about marine life can be learned only by keeping animals in captivity and studying them. Recommendation 8.12 requires that those institutions that have dolphins shall embark on research and educational roles. One cannot enforce a research capability on an unwilling organisation. Either the organisation has the will and the ability to do it, or it does not. If it does not have that capability and is in a purely commercial sphere, it cannot be asked to become a research body. Paragraph 8.13 refers to the abolition of any form of tricks being taught to dolphins kept in oceanaria, but no evidence is advanced as to why that should be done. Paragraph 8.15 recommends the drawing up of national standards for oceanaria, and we have no objection to that. In considering that recommendation I compliment the marine biologists in Australia and overseas on the very great strides they have made over the last 10 or 15 years in keeping animals in captivity. Paragraph 8.16 deals with a system of licensing for oceanaria. That may be just putting more bureaucracy into the system. Paragraph 8.21 recommends that all dolphins ultimately be returned to the wild. As I said in the introduction to my speech, this is a very poor report. In fact, is is quite a silly report. It lacks scholarship. It is utterly devoid of any scientific content. It does not conform with the very high standards we have come to expect from Senate committee reports. I believe that it is quite damaging to marine research in Australia and to the academic world in general. Insofar as it demeans the whole debate on animal welfare and animal husbandry in Australia it is a most unwelcome addition to Senate reports. Debate (on motion by Senator McIntosh) adjourned. Debate resumed from 28 November 1985, on motion by Senator Reid: That the Senate take note of the report. Senator MASON(New South Wales)(5.22) —This report by the Joint Standing Committee on the New Parliament House relates to estimates of appropriations allocated to aspects of the new Parliament House. I feel compelled to speak to the report because the time has come for those of us in this place and the other place to take a long and hard look at what this building is costing. I quote from page 16 of the assessor's report announcing the winning design for this structure in June 1980: The competition winner's cost estimate is generally credible and realistic and there will be no really significant increases upon the brief figure as the building proceeds. The figure for the design brief was $151m. If we consider what the amount should be in 1986 figures, allowing for inflation over the period, the cost of the new Parliament House should now be of the order of $325m. I particularly ask honourable senators to keep that figure in mind because it is important. I know that a smoke screen has been cast over this matter in the sense that the new Parliament House has its own private inflation frame. That is great. We could all have our own little private inflation frames. But I am talking about real inflation figures, figures in the real world in which we all live. On those figures, the price of the building should now be $325m. Somewhere we have lost something like two-thirds of a billion dollars. We are creating what I understand will be the world's first billion dollar building. I first raised this matter in the Senate in 1982. I predicted then, four years ago, that if the cost of this edifice continued to rise at the alarming rate at which it was already moving, the final cost of the building could exceed $1 billion by 1988, assuming that the building was finished by then. How well I recall Question Time in this place that day. I was howled down in a way in which I have never heard any honourable senator before or since. The ACTING DEPUTY PRESIDENT(Senator Coleman) —Senator Mason, might I point out to you that you are not speaking to the report that is now before the Parliament. Senator MASON —Madam Acting Deputy President, I feel quite sure that there is an earnest desire that I should not address the matters which I am addressing, but I plead with you-- The ACTING DEPUTY PRESIDENT-No, that is not the point I raised with you, Senator Mason. The point that I raised with you is that you are not debating the report that is before the Parliament at this stage. That report is on the precincts of the new Parliament House and that is not what you are speaking about. You are speaking about cost involvement, which has nothing to do with the report before the Parliament. Senator MASON —Madam Acting Deputy President, I take your ruling. I merely mention that I believe that whatever happens in the precincts of the new Parliament House is part of the total organisation. I might say, in making that point, that traditionally in this place we have had a fair amount of freedom in the latitude with which we can range in discussions of committee reports. That situation may well be different in the future. I do not know. Senator MacGibbon —Madam Acting Deputy President, I take a point of order. I ask you to apply standing order 397 which states: Order shall be maintained in the Senate by the President. The speaker is transgressing your ruling. The ACTING DEPUTY PRESIDENT —There is no point of order. Senator Mason used the word `precincts'. I am allowing him to develop his argument, but I will not allow that to proceed for more than the next 60 seconds. I ask Senator Mason to confine his remarks to the report which is at present before the chamber. Senator MASON —Madam Acting Deputy President, I will refer constantly to the precincts of the new Parliament House which I believe relate directly to what I am saying. I am sure that Senator Sir John Carrick, who was, in 1982, when I first raised this matter, the Minister responsible, had in mind all aspects of the building including the precincts of the new Parliament House when he said that the cost control situation was very good. He was obviously horrified that I should make such allegations about the precincts of the building, among other things. He was not the only one. At the same time, Mr Gordon Peatey, the executive officer of the New Parliament House Construction Authority, wrote a letter to the Canberra Times labelling my predicted cost figures of the building and its precincts, Madam Acting Deputy President, as inaccurate and misleading. He felt that his efforts towards cost management were being `constantly undermined by unrealistic estimates of the building cost' and `unsubstantiated claims' that the budget was being exceeded. The latest estimate of the Parliament House Construction Authority for the finished cost of the building, which naturally includes its precincts and matters of that kind-- Senator Reid —Madam Acting Deputy President, I take a point of order. The speaker is clearly still speaking about the building and not the subject of the report which is before us. To allow this to continue is not only unfair to the Parliament House Construction Authority but to any other honourable senator who may wish to answer the farrago of nonsense which we have heard so far which does not take into account anything like the increase in the number of parliamentarians to be housed. The ACTING DEPUTY PRESIDENT — Order! You are making a point of order, Senator Reid. Senator Reid —A number of factors would have to be taken into account if Senator Mason's argument were permitted to continue. The rest of us, I think, would feel constrained by the nature of the report not to raise them now. I support your ruling, Madam Acting Deputy President, that Senator Mason's speech ought to be on the precincts and not the cost of the building proper, which is what the honourable senator is attempting to address. Senator Sanders —On the point of order: My experience here is less than a year old, it is true, but I have found that in this place when a paper comes up for debate it has been the practice, as long as the speaker is within the bounds of the title of the paper or anywhere near it, he or she is allowed to speak. I remember that Senator Walters got up, did not even mention the title of the paper or anything about it, and launched into a tirade against me. She was allowed to continue. Perhaps these rules need to be spelt out more clearly but, on the past behaviour of this place, I certainly feel that my colleague is well within his rights to continue his discussion. Senator Messner —On the point of order, Madam Acting Deputy President: Both Senator Sanders and Senator Mason have been most disrespectful and discourteous to the Chair, in my opinion, in the way they have been flaunting your authority and ruling on this matter. We on this side of the chamber stand firmly in support of your ruling on the matter. Senator Mason —On the point of order: I reject totally Senator Messner's gratuitous and insulting remarks which he has made with no good reason. I have listened to your rulings most carefully, Madam Acting Deputy President. You instructed me to speak of the precincts of the building and I have done so. The ACTING DEPUTY PRESIDENT —But you have not abided by my ruling, which was why I called you to order the second time. A committee report on the precincts of the new Parliament House is before the chamber. It has nothing to do with the costing of the new Parliament House. It is totally to do with the precincts. If you care to continue your remarks for the next couple of minutes along that line, I am quite happy to allow you to continue. If you persist in what you have been doing, which is to speak on the costs of the new Parliament House, I will have you seated. Senator MASON —Madam Acting Deputy President, I can well understand the lack of desire for me to speak about the costs of the new Parliament House, and I accept your ruling in that spirit. The ACTING DEPUTY PRESIDENT —Senator Mason, that is a reflection on the Chair's ruling and I will not allow you to get away with it. I have requested that you speak to the Committee report which is before the chamber at the moment. If you fail to do that I will not permit you to speak any longer. Senator MASON —Madam Acting Deputy President, I feel that your interpretation of what I said may make an apology from me necessary. I merely meant that I understood your ruling. It is as simple as that. You must accept my assurance to that effect. I suggest to you that the discussion of the precincts must be associated with that of the building as a whole. Judgment on those precincts and the building as a whole will be made by the Australian public, and I suggest that it will be made along lines that I have outlined in this speech. The ACTING DEPUTY PRESIDENT —Order! The honourable senator's time has expired. Debate (on motion by Senator Reid) adjourned. Motion (by Senator Gietzelt) agreed to: That, unless otherwise ordered, General Business, Orders of the Day relating to the consideration of committee reports pursuant to sessional order be not further proceeded with this day. Senator FOREMAN(South Australia) —In accordance with the provisions of the Public Works Committee Act, I present the report relating to improvement of international terminal facilities at Sydney (Kingsford-Smith) Airport. Ordered that the report be printed. Senator FOREMAN —by leave-The recommendations and conclusions of the Committee's report are as follows: 1. Improvements are required to passenger processing and baggage facilities and public areas in the international terminal at Sydney (Kingsford-Smith) Airport to cater for increased passenger numbers during daily peak periods. 2. The Committee believes the proposed work will not alleviate congestion to a significant extent and at the end of the three-year construction period the problems now being experienced will be even more acute. 3. The Committee does not believe the proposed work at an estimated cost of $20m will be the most effective use of the money to be expended. 4. The Committee concludes that it is not expedient for the proposed work to proceed. 5. Planning for the provision of a new or substantially expanded international terminal building should commence immediately. 6. Improvements recommended to relieve present congestion at the international terminal are- (a) Commonwealth authorities should provide staff to process passengers at maximum attainable levels; and (b) the length of the curfew should be reduced by one hour in the morning. I thank the Senate. Senator McINTOSH(Western Australia) —On behalf of Senator Tate, I present the seventh report for 1986 of the Senate Standing Committee for the Scrutiny of Bills concerning the Excise Tariff Amendment Bill 1986. I also lay on the table the Scrutiny of Bills Alert Digest No. 7 dated 7 May 1986. Ordered that the report be printed. Senator GILES(Western Australia) —I table additional information received by Estimates Committee B and seek leave for it to be incorporated in the Hansard record of the Committee's proceedings. Leave granted. Senator CHILDS(New South Wales) —I table additional information received by Estimates Committee C and seek leave for it to be incorporated in the Hansard record of the Committee's proceedings. Leave granted. Senator REYNOLDS(Queensland) —I table additional information received by Estimates Committee D and seek leave for it to be incorporated in the Hansard record of the Committee's proceedings. Leave granted. Senator COATES(Tasmania) —On behalf of the Standing Committee on Finance and Government Operations I present a report on the Health Insurance Commission annual report for 1984-85. Ordered that the report be printed. Senator COATES(Tasmania)(5.35) —by leave-I move: That the Senate take note of the report. The Health Insurance Commission's financial statements in its annual report for 1984-85 were so qualified by the Auditor-General that the Committee on Finance and Government Operations, of which I am Chairman, decided to investigate the matter. I wrote to the Chairman of the Commission and received his reply. The short report I have just tabled results from this exchange of correspondence. The Committee is pleased to note that the Commission has taken steps to overcome the problems that led to the Commission's report being qualified and that the Commission has made it clear that it will comply with its statutory responsibilities in future. I seek leave to continue my remarks later. Leave granted; debate adjourned. Senator COATES(Tasmania) —On behalf of the Standing Committee on Finance and Government Operations I present a report on the Australian Capital Territory Registrar of Co-operative Societies annual report for 1983-84. Ordered that the report be printed. Senator COATES(Tasmania)(5.36) —by leave-I move: That the Senate take note of the report. The Australian Capital Territory Registrar of Co-operative Societies annual report for 1983-84 was not tabled until some 14 months after the end of the financial year the subject of the report. The Committee investigated the reasons for the delay and the Registrar's explanations are incorporated in the report that I have just tabled. In the course of our investigation we discovered that the general provision in section 34C of the Acts Interpretation Act, which requires the tabling of annual reports within six months, does not apply to statutory authorities set up by ordinances under section 12 of the Seat of Government Act. In our report we therefore recommend that the Government introduce amendments to the Australian Capital Territory Interpretation Ordinance to embody in that ordinance the same provisions as in section 34C of the Acts Interpretation Act. I urge the Government to act on this recommendation with some urgency so that Australian Capital Territory authorities do not continue to be treated differently in their accountability to Parliament as compared with other Commonwealth authorities. I seek leave to continue my remarks later. Leave granted; debate adjourned. Senator COATES(Tasmania) —by leave-As part of the general responsibility of the Standing Committee on Finance and Government Operations to monitor the activities and accountability of statutory authorities, we seek reasons for delays in the tabling of annual reports and for qualification of accounts. The two reports I have just tabled are examples of such investigations. The Committee usually receives good co-operation from Ministers and authorities when information is sought. However, I have to report that an unreasonable lack of response has resulted from my request for information from the Australian Capital Territory Parole Board. The Australian Capital Territory Parole Board annual report for 1983-84 has not yet been tabled. I repeat, in case anyone is incredulous, that I am talking about the 1983-84 report. It is now 22 months after the end of the relevant period. On 18 October last year, when the report was 15 months overdue, I wrote to the Chairman of the Parole Board seeking an explanation on behalf of the Parliament, to which the Board has some responsibility. Six to seven months later, no reply has been forthcoming-not even a formal acknowledgment. The Committee Secretary has been in telephone contact with the Secretary of the Board several times to remind the Board about the matter and to emphasise the need for a response. We have been told only that my letter is being considered by the Parole Board Chairman. The Finance and Government Operations Committee believes that this situation is so deplorable that it decided I should make this statement to draw the Senate's attention to this aspect of the Board's performance. I will send a copy of this statement to the Attorney-General (Mr Lionel Bowen) as the responsible Minister and to the Chairman of the Board, and will implore them to ensure an early response to the Finance and Government Operations Committee in our attempt to do our duty. I further hope that the still outstanding report will appear soon. I acknowledge, as I did in the statement I made on the report of the Registrar of Co-operative Societies, that there is not a legal obligation on Australian Capital Territory authorities to report within a six-month deadline, as we had thought, but in this case the delay is totally unreasonable. It is of crucial importance that annual reports be tabled promptly so that the information in them is of more than historical value. Senator JESSOP(South Australia) —I seek leave to table 237 letters from a variety of electors and organisations, all of whom have requested the Senate not to pass the Australian Bill of Rights Bill. Leave granted. Debate resumed. Senator MacGIBBON(Queensland)(5.41) —Before lunch, when I was speaking to the Appropriation (Parliamentary Departments) Bill (No. 2) 1985-86 and cognate Bills in respect of the Department of Defence, I said that I was opposed to the purchase of the HMS Invincible some years ago, not because it was a carrier but because it was a vertical or VSTOL carrier and it embarked the Sea Harrier which was quite inadequate as a fighter aircraft. Since that time, of course, the Americans have taken the Sea Harrier in hand and have made the AV8B by putting a new wing on it and cleaning up the aerodynamics. They have made a decent aeroplane out of it, but it is still only a strike aircraft; it is not a fighter aircraft in any sense at all. The simple solution for the Royal Australian Navy in providing air power at sea is for the Australian Government to approach the Americans to get one of their conventional smaller carriers out of the reserve fleet and for us to embark FA18s. At the end of the day we must have a navy and we cannot have a navy without air power. It must have air cover at sea if it is to survive. It is absolutely important for us to be able to work through the whole of the South Pacific, the Indian Ocean and the archipelagic regions to the north of Australia. Turning to the Army, unfortunately it has no role under the Australian Labor Party. It has two very crippling disabilities: It lacks mobility and fire power. I am pleased that the Government has moved to buy some new helicopters, but those helicopters have only a minor tactical role to play. They do not have the logistic ability to move large numbers of troops around this big continent. Even if we had a lot more helicopters, soldiers cannot fight from a helicopter; they have to get out, and when the soldiers get out they cannot fight wearing only a green shirt. This does not matter to the Labor Party because it has a grand doctrine of sinking ships as they are invading Australia with submarines or bombing the harbours, so we do not need an Army. Life is not like that and life will never be like that. When soldiers get out of the helicopters in the battlefield they need armour and the only thing we have to support them is the antique M113 armoured personnel carriers. The M113 APC is a first generation weapons system. It is 30 years old, totally inadequate and dangerous on the battlefield because with the smallest calibre arms available today, the light calibre ammunition, if it is hardened, will go right through them. The previous Government started the Waler program to develop an Australian APC that met modern conditions. This Government cancelled it, ignoring the experience of the Americans and the Germans with the Mander and the Bradley of building a new generation APC, because the present Minister for Defence (Mr Beazley) has a belief that the Australian Army has to go everywhere into action by air, flying in Ansett Airlines of Australia or Trans Australian Airlines DC9s. I turn to the Royal Australian Air Force. As an old airman I am very supportive of air power, but I am the first to recognise that it has limitations, that it is an inflexible weapon and it is also of a very transient nature. We cannot hold ground with an air force. I read in the Weekend Magazine of the Australian of 29-30 March that at a recent dinner party the Minister said: Australia possesses the capability to cripple the Soviet forces at Cam Ranh Bay by deployment of our F111s with accurate fast bombing and our submarine fleet which would torpedo Soviet ships. That statement was never retracted or corrected, so I presume that Mr Beazley said it. That is some of the most dangerous, hallucinating nonsense I have ever heard. It is the same as the claim that Singapore was impregnable, that generations of previous Australians were fed. In summary, I am speaking about this because no debate on defence or foreign affairs has ever been initiated by this Government since it came into power. The Senate is the home of foreign affairs and defence. The importance accorded this subject and the understanding of it by the Labor Government is demonstrated by the fact that it has never brought up the subject in the three years that it has been in government. The only time the subject has been brought up is when some of my colleagues or I have spoken on it or raised it as a matter of public importance. The isolationist, non-aligned, fortress Australia policies, with their associated myths of no threats, long lead time and self-sufficiency, have been allowed to run unchecked. The consequences of that are the Australian defence forces are being constructed and moved in a way which will deny any future government the necessary range of options. Senator MICHAEL BAUME(New South Wales)(5.46) —Later in this debate the Opposition will move an amendment in relation to the Appropriation Bill (No. 3). At this stage I foreshadow what the major amendment will be. It is that the Senate: (a) draws attention to the failure of the Government to fulfil its promises- (i) to reduce interest rates, (ii) to bring the rate of inflation down below 5 per cent, (iii) to hold taxation as a percentage of gross domestic product down at least to the level of the 1984-85 financial year, (iv) not to introduce a capital gains tax, (v) not to raise the interest rate ceiling on housing loans, and (vi) to bring about sustained reductions in unemployment, particularly youth unemployment. Of course, all those promises have been shattered. The amendment further states that the Senate: (b) notes the deterioration in the Australian economy as indicated by the continuing balance of payments crisis, an inflation rate twice that of our trading partners, excessively high interest rates, rising unemployment lagging private investment in new productive capacity and the severe downturn in the housing and motor industries; and (c) calls on the Government to arrest the alarming deterioration in the balance of payments and the threat of a further fall in the value of the Australian dollar and severe hardship for Australian families by taking urgent steps to- (i) introduce a mini-budget in May to reduce Government expenditures, to take effect from the beginning of the 1986-87 financial year- which is in a little over a month- and thereby reduce government borrowing, (ii) make an application to the Conciliation and Arbitration Commission to defer the productivity wage case and to discount fully the indexation of wages for the effects of the devaluation of the Australian dollar, (iii) withdraw the anti-business and anti-rural elements of the tax package of 19 September 1985, which has the effect of inhibiting investment and depressing economic activity, and (iv) significantly relax foreign investment controls to encourage job-creating equity investment in Australia. That not only is clear criticism of what the Government has done but also is a clear prescription for resolving the problems. It seems to me to be important that the Senate and the people of Australia should recognise just how we have gone wrong and how we can fix it up. Let us look at the first of the Government's failures; the failure to reduce interest rates. The Government, because it does not have an effective fiscal policy, or any economic policy other than the prices and incomes accord, has had to rely on a policy of deliberate record high interest rates. The Government's advisers have been recommending against this for months. I remember last November the Secretary of the Treasury made a very significant speech in Perth, saying that if this continued for too long the Government's economic recovery would be destroyed, as would the employment levels and the objectives that the Government claims it has. Yet that policy has persisted. We have also seen recently a major dispute that has developed between the Treasurer (Mr Keating) and the Reserve Bank of Australia over the outlook for inflation and this whole question of high interest rates. This dispute between this major adviser of the Government, the Reserve Bank, and the Treasurer clearly raises serious doubts about the manner in which the Government is handling the economic problems we face and certainly raises serious doubts about the validity of what passes for the Government's economic policy. This particular dispute is significant in that the Reserve Bank has given a warning. I quote from the Reserve Bank bulletin of April, which states: Australia's relative performance on inflation appears likely to worsen in the coming year. That warning is in total conflict with the Treasurer's repeated assurances that Australia's inflation rate has peaked and will now improve. We heard these assurances when we raised in the Senate and in the other place our concerns about this enormous increase in inflation to 9.2 per cent in the past 12 months. This was more than a doubling of the rate that existed in the previous 12 months. This was at a time when the rest of the world's inflation had been going down. Senator Messner —It was negative in many countries. Senator MICHAEL BAUME —As Senator Messner says, in many other nations of the world it is negative. The assertion by the Reserve Bank-and I support it because I think the Bank is totally right-is in conflict with the Treasurer's claims that there is no need for concern that Australia's inflation rate is now 2.4 times the OECD average-that is the average of the developed nations of the world-because Australia's inflation rate could not be related to those of other countries due to our devaluation. There are a couple of points to make about that claim. Firstly, the OECD average is artificially inflated by countries such as New Zealand and some other chaotic economies which have very high inflation rates. The inflation rates we should be looking at are much lower than the OECD average, because those we do most trade with these days, such as the United States and Britain, and so on, have an inflation rate far below the OECD average, and as Senator Messner said, some of those countries have negative inflation rates. But the Treasurer has said: `No, we cannot even relate our inflation rate to the OECD average because we have had a devaluation'. The simple reality is that the Statistician has put out statistics to indicate what the devaluation impact has been on Australia's inflation rate of 9.2 per cent. In fact, since the beginning of last year our inflation rate has gone up to something like 10.5 per cent, but about 2.5 per cent of it clearly relates to the impact of devaluation. So we still have 7 to 8 per cent of that inflation rate being due to local consequences-due, in large part, to the result of the Government's economic policies. Even if we take into account that devaluation, Australia's inflation rate is still just about double that which is expected for the OECD this year. The Reserve Bank's present concern over Australia's worsening relative inflation rate follows, as I was saying, very many months of repeated warnings from the Governor of the Reserve Bank and the Secretary to the Treasury over the consequences of the Government's continuing to rely on this high interest rate policy as the only way of managing the economy. The excessive use of this high interest rate monetary policy has resulted directly from the Government's continued refusal to take effective measures against rising government spending, for example, and, of course, rising labour costs, which are increasing mainly because of the Government's policy on wage indexation and on productivity claims. The Governor of the Reserve Bank warned only last week that `large current account deficits may be with us for some time' and that as a result `monetary policy may be called on to play a greater role than I consider to be desirable'. He added that the overall stance for economic policy would have to be tightened if the expected improvement in the current account was further delayed. Within the polite language of the bureaucracy, and certainly within the polite language of the Reserve Bank, which does not like to appear to be in conflict with the Treasurer, the fact that the Governor of the Reserve Bank would say that `monetary policy may be called on to play a greater role than I consider to be desirable' is very severe criticism of the Government's current economic policy. It seems to me disappointing that the Reserve Bank's comments that Australia's relative performance on inflation appears likely to worsen in the coming year-which is a matter of immense significance and a matter of concern to me-should have received so little attention in the media. Apart from the Australian Financial Review mentioning it in passing in two articles, this very significant rejection of the attitude, of the statements, of the Treasurer, this severe criticism of the Government's economic policy, has received very little media attention, although it has been raised by the Opposition in the other place. But as is typical, unfortunately, matters of serious moment like this do not receive media attention at a time when the media seems to be obsessed with matters which may be more sensational but are of far less significance to the good government of Australia and the consequences of that good government for the welfare of the people. It disappoints me, as an ex-financial journalist, as a former finance editor with the Bulletin for example, and also having been investment editor of the Australian Financial Review, that the present crop of journalists who are reporting this place did not find it sufficiently important to let the people of Australia know about this major conflict particularly in respect of the significance of Australia's worsening inflation rate. As I said, I exempt the Financial Review from that comment because the Financial Review this week wrote an excellent editorial on this matter. It states: When the latest inflation figures were released, the Treasurer, Mr Keating, tried to reassure us that the worst was now over. The fall in oil prices would result in an annual inflation rate of only 8 per cent, he stressed. That is compared to the 9.2 per cent that we have had in the latest quarter. The editorial goes on: However, he did not tell us that the oil price fall would have a greater effect on other economies rather than ours. It will only reduce our annual inflation rate by between a half and 1 per cent over coming quarters. Yet its effect on inflation rates in other countries is expected to be considerably higher. What really matters and what will always matter in an environment of floating exchange rates is our relative unit labour costs and inflation rates, not the fact that we might have achieved a lower rate of increase in either. That raises the next question-labour costs. Once we have indexation, we then clearly have a direct relationship between our inflation rate and what our labour costs are going to do. The Financial Review once again makes the very sound point that the government has been misleading us about this matter of labour costs. It states: The last three years have seen a moderation in labour cost increases but those who ascribe this purely to the existence of the magical accord-- I inserted the word `magical' there, I must admit- obscure two issues. The first is the fact that labour shedding in manufacturing would have produced a moderation in union demands, with or without the accord. The second is that although increases in our unit labour costs have moderated since 1983, they have still run well ahead of those experienced by other major economies. Indeed, they are now accelerating in relative terms. It is these relative terms, which the Treasurer does not like to use but which the Financial Review and the Governor of the Reserve Bank like to use, and which I think most responsible Australian commentators like to use, that indicate that we are continually getting worse, and will continue to get worse. As the Australian Financial Review states: We get excited because we have slowed our increases down. But in the United States, Japan and West Germany nominal unit labour costs have actually fallen. So, as a result: Not surprisingly, the gap between our inflation rate and that of the other major economies is also widening rapidly. The article goes on: While our unit labour costs are likely to increase by about 6.5 per cent this calendar year, unless the Arbitration Commission is hit with a thunderbolt of commonsense, those in the seven major industrial countries are expected to rise at an average rate of only 2.5 per cent. We will be increasing our labour costs almost three times as fast as those of our major industrial rivals. The article continues: In these circumstances, sizable devaluations of the $A have been the only way in which we have been able to maintain a semblance of competitiveness. In that context it is depressing to note that, at the AISEC Australia forecast for the Australian economy conference held last week, Professor Tom Valentine of the Macquarie University quite sensibly argued: The dollar is likely to fall 5 per cent a year against the US dollar over the next decade . . . The main reason is Australia's high inflation rate, which is 4 per cent higher than its major trading partners, the United States and Japan. A report of his comments goes on: ``If this adjustment is put off for a long time, it will occur over a short period as it did in February last year,'' Professor Valentine said. High interest rates were being used to keep the dollar at a level higher than its true value mainly because of the Government's faith in the J-curve theory. Any further depreciation would put pressure on the wages Accord. Professor Valentine said it was unlikely that the Government would continue to use high interest rates to support the dollar because they were slowing economic growth. ``This outcome is indicated by the slowing down of retail sales, the problems being experienced by the housing and retail industries,'' he said. ``Continued use of tight monetary policy could push the economy into recession.'' ``The only fully satisfactory answer to these problems is to attack them at their source-the wage-fixation process.'' That is exactly why the Opposition's policy on industrial relations is so important. That policy, of course, is to be released over the weekend. I am certain it will be one of the major elements in the policies that will bring the Opposition parties into power. There is no doubt when we look at what has happened-- Senator MacGibbon —Did you see the polls today? Senator MICHAEL BAUME —Indeed, the polls already indicate a great degree of concern by the man and woman in the street about the consequences of the policies this Government has maintained. There is no doubt that the Government appears to have got away with it. It is very difficult for people to recognise the direct consequences on them and on our nation of the policies the Government has introduced. I must say that I do not want the people of Australia to suffer as a result of these foolish policies the Government has maintained and is maintaining and to which so many commentators have pointed and the Opposition has pointed for a long time. But the fact is that unless people do suffer from these policies, they do not recognise their serious nature. I am afraid that suffering is soon to take place. Already, of course, those people in the motor industry are suffering from not only the specific anti-business policies relating to tax but also the impact of devaluation which has massively increased the costs of imported motor cars and the costs of components of motor vehicles made in Australia. There is no doubt that this magical J curve is not working. We all know what Senator Button has to say about that. We also know that some recent statistics demonstrate one of the major problems about the J curve. I have here the export price index, which is one indication of why devaluation will not be getting us out of trouble. The export price index, one would expect, would have benefited substantially from the 25 per cent fall in the value of the Australian dollar. In other words, the exports we sell would naturally be worth more in Australian dollars, even though they were worth the same amount in whatever currency we sell them for because, in fact, the Australian dollar is worth less as a result of devaluation. That 25 per cent increase that should have taken place since the beginning of last year has turned out to be only a 6 per cent increase for all groups in the export price index. That is a disaster. It means that people who export have, in effect, received an increase in their prices in Australian dollar terms of only 6 per cent, even though the value of the Australian dollar has fallen 25 per cent. That means that, while our costs of all imports have gone up by something like 25 per cent as a result of this devaluation, the benefits we get from our exports are up only 6 per cent-a disastrous relationship. More significant than that is the fact that in recent months there has been a significant fall. For example, from June of last year we have had something like a 3 1/2 per cent fall in the value of the export price index. That trend is even more serious in items such as crude materials, inedibles and so on, which are down 9 per cent. Mineral fuels are down 3 per cent since December last year and, of course, that group will suffer an enormous fall as a result of the fall in the oil price. Agricultural products-a disastrous result-have fallen 9.5 per cent since June last year in the export price index. Manufacturing is down about 8 per cent and mining is down about 4 per cent in the export price index. We have a serious problem. The J curve is not going to work, on the one hand, because our export prices will not be adequate and, on the other hand, because so many of the nations in the world to whom we export have imposed limits, bans and prohibitions on our products in order to satisfy their domestic problems. We have this problem, and Mr Hawke went overseas to seek earnestly and energetically to improve our trading relationships. The week he came back we found the Americans dumping grain in Yemen. We hope that Mr Hawke does not go overseas, because we keep on getting bad news whenever he comes back. We find that further markets have been closed to us. That is only part of the story. The other part of the story is what happens with imports. Theo- retically, when there is a devaluation, there should be a fall in imports. The Government kept talking about the J curve, how imports would fall and Australian products would fill that gap, how everything would be marvellous and how, to repeat what Mr Keating said, devaluation would be good for Australia because it would solve our problems. That shows what Mr Keating knows. As Senator Button, the Leader of the Government in the Senate, has repeated, the J curve is bunk; it does not work. The reality is that devaluation has basically tended to increase the costs in Australia. It has been a factor in our increased inflation rate because the Government appeared to forget that the great bulk of Australian imports go into items that are produced in Australia. They are factors of production. They are used in making other things. They are machine tools and equipment. The Government apparently forgot this. This means that the price of goods made in Australia is increased as a result of the devaluation. We have a devaluation which has resulted in only a minimal increase in nominal terms, in terms of the export price index-the price that exporters get-which is falling now. The trend is against us and at the same time our local costs are rising as a result of devaluation, which increases the cost of all imports that go into things that are made here and increases inflation. As a result of increasing inflation, it increases wages. As a result of wages increasing, our competitiveness decreases and as a result we lose all the benefits of the devaluation which have cost us so dearly. In the amendment we will move later we call on the Government to arrest the alarming deterioration in the balance of payments and the threat of a further fall in the value of the Australian dollar and severe hardships to Australian families. The Government, of course, will not do what we are asking, for a very simple reason. It will not introduce a mini-Budget this month simply because there is going to be an Australian Labor Party biannual conference next month, when naturally all the factions will be fighting with the Government about whether or not there should be a reduction in government spending. There is no way the Government will come out with a statement before the biannual convention because, as we all know, the Left and the Centre Left have the numbers over the Hawke right wing faction in the Labor Party. That biannual convention would simply not wear the sorts of things that have to be done in the coming Budget. As the result of a leak, we have already heard that the prospective deficit for next year, about which Senator Walsh keeps talking, will be $6.4 billion. That is appalling, and because of that Government Ministers have been directed by the Treasurer and the Minister for Finance (Senator Walsh) to cut $1.4 billion off expenditure. We have heard all that because it was leaked, presumably by the people who want the cutting to be done. The reality is that the spending Ministers involved do not want this. Senator Gietzelt, the Minister for Veterans' Affairs, has said in this chamber that he will not cut his Department's expenditure because it cannot be cut. According to the leak, his Department was listed for a cut of $100m. He stoutly refused to agree to that. Ministers in the other place have said that there is no way they will accept the sorts of cuts that are involved. Yet if we do not have these cuts in government spending more and more money will be needed, more and more money will be dragged from the economy, and we will have bigger and bigger deficits. This Government is perpetuating policies which will cause greater and greater inflation an even worse balance of payments problem, and increasing labour costs because of the problems under the accord. If this Government were sincere and had the stomach to face up to its constituents at the biannual conference, it would not be concerned about the politics of the matter, which it clearly is at the moment, and would introduce a May mini-Budget. Let us look at the consequences of its failure to make these cuts of $1.4m, and to make them now, so that they can operate from the beginning of this financial year. Even if these cuts go ahead, as no doubt the Treasurer hopes they will, they will not do so until after the Budget, towards the end of August. That means that if the Government is to cut the same amount of money over the whole year the cuts will have to be more severe than is already required. It is obvious that the Government has to do that, but it is unfortunate that because of the Government's fear of its supporters it will not do what it knows that it has to do. As a result, even more severe cuts in spending will be introduced which will have a tendency to be disruptive and will cause distress simply because the Government does not have the stomach to act now as it should. There is no doubt that the Government should also make an application to the Australian Conciliation and Arbitration Commission to defer the productivity wage case and to discount fully the indexation of wages to allow for the effects of the devaluation of the Australian dollar. We devalued our dollar because we were living beyond our means as a nation. The Government accepted that point in the last Budget when the Treasurer said he would agree that wages should be discounted because we should not reward people for living beyond their means and going into debt. That is simply what the devaluation meant. The Treasurer agreed at that time, but the Australian Council of Trade Unions had sufficient effect on this Government, as it always seems to have had, to force the Treasurer to change his mind, with the result that there is only partial discounting of wages in the current round, at least in the Government's view, to be totally offset by a $2,000m tax cut in September. I have already mentioned today that it is appalling that the Government seeks to blackmail this place into passing these fringe benefit taxes that are before us by saying that otherwise it will not have the money to grant the tax cuts when we all know that the fringe benefit tax will provide only $1 in every $6 of the tax cuts to come. Obviously, that blackmail is stupid apart from being offensive. We have a clear case, in the Australian Financial Review most commentators are pointing it out, that the Government's economic policies are causing the problems that are now before us, generating a situation in which inevitably we will have a worse inflation rate and worse interest rates, that the balance of payments will remain heavily in deficit, and where, as Professor Valentine said, the Australian dollar will inevitably decline by about 5 per cent a year against the United States dollar over the next decade. The DEPUTY PRESIDENT —Order! The honourable senator's time has expired. Senator PETER BAUME(New South Wales)(6.16) —I wish to use the occasion presented by the second reading debate on Appropriation Bill (No. 3) and Appropriation Bill (No. 4) to discuss some issues raised by the tabling last week of volume 1 of the report of the Stewart Royal Commission of Inquiry into Alleged Telephone Interceptions and by the questions relating to the Age tapes which were raised by that report. It is my understanding that volume 1 of the report was tabled but volume 2 was not tabled because it has been sent to the Director of Public Prosecutions and the material in that second volume may be germane to matters that the Director of Public Prosecutions will consider which may lead to charges being laid and to prosecutions. The issues raised by the Age tapes and their handling are issues that go to the probity of government, the probity of the police-particularly in my State of New South Wales-and the probity of the judiciary. There can be no more important issues than these for a community. It is suitable that we take this opportunity to review some of the matters which the tabling of volume 1 of the report raise and to review some of the history of the Age tapes and their reception. Mr Justice Stewart and his Royal Commission have authenticated the Age tapes. It is timely to review the systematic attempts made before the authentication to denigrate the tapes and particularly the attempts to denigrate the authenticity of the tapes. The Royal Commission was the culmination of a series of investigations into organised crime and drug trafficking which began probably in 1981 with the Stewart Royal Commission of Inquiry into Drug Trafficking which investigated the activities of Terrence John Clark, better know as Mr Asia, and the Mr Asia syndicate. This and succeeding royal commissions looked into the activities of organised crime, including the Nugan Hand Bank, as far back as the 1970s. The original Stewart Royal Commission when looking into the activities of Terrence John Clark also examined the activities of Robert Trimbole, who was active in the Clark organisation until late 1979. During those investigations the Royal Commission received evidence that Trimbole had been tipped off by police about the Royal Commission, causing him to flee overseas. This led to the Commission requesting from the New South Wales Police all the material it had on the activities and disappearance of Robert Trimbole. This in turn led to material about Trimbole being published in the National Times and in the Age newspaper. This in turn led to the disclosure piece by piece of the existence of certain tapes of conversations between people, some of whom were associated with the criminal underworld. This led to both the Commonwealth Government and the New South Wales Labor Government launching investigations into the origins and authenticity of the tapes. These investigations into the Age tapes came about only because of the demands by the Opposition and the free Press that such investigations take place. These investigations came about in the face of continued and determined resistance by the Hawke Government and the Wran Government in New South Wales. Those governments not only dragged their feet but also obstructed these investigations in every way. I am really understating the facts. Those Labor governments vigorously resisted any inquiry at all into the tapes, just as they have resisted over the years a series of calls for a number of inquiries into matters associated with corruption and crime, particularly in New South Wales, which we want to see brought to life. Eventually, because of the nature of the material that continued to emerge, the leaks and the public outcries absolutely forced the two Labor governments to undertake some investigations. Senator Grimes —Where was your voice when Askin was Premier? Senator Michael Baume —Where was your voice when-- Senator Grimes —You were right in it with Askin. At least he was not. Go on, get up. If you are offended by that you should get up and say why. The DEPUTY PRESIDENT —Order! The Minister will cease interjecting. Senator Peter Baume has the call. Senator Michael Baume —Mr President, I take a point of order now that the Minister is on record. I object strongly to that totally false accusation that I was in anything with Mr Askin. I do not know what the Minister was referring to anyway, but it is totally false. Senator Grimes —Mr Deputy President, on the point of order: I take great interest in that. I am happy to withdraw my remarks but I point out that at last someone in this place has admitted that Askin was a crook and that he does not want to be associated with Askin. But he was in the Liberal Party with Askin and he was associated with Askin. The DEPUTY PRESIDENT —Order! The Minister will resume his seat. The withdrawal must be unconditional. Senator PETER BAUME —We are sensitive, are we not? The Federal Government appointed Mr Temby as Special Prosecutor and the New South Wales Government had its Solicitor-General, Ms Mary Gaudron, investigate the origins and the authenticity of the Age tapes. After publication of further material in various newspapers, the Age tapes were investigated and referred to the Senate Select Committee on Allegations Concerning a Judge and the Senate Select Committee on the Conduct of a Judge. Eventually those tapes were investigated again by the original Stewart Royal Commission. Some tapes were available and some material was in transcript form. What is the Stewart Royal Commission's latest conclusion about the tapes? Let us take its conclusion first. I quote the words of the Stewart Royal Commission: The Commission accepts that the material appearing in verbatim form as a transcript of a telephone conversation has an acceptable degree of accuracy and probably fairly records that part of the conversation it purports to record. The Stewart Royal Commission has concluded that, where the material related to a verbatim account of a telephone conversation, it could be accepted as a reliable and fair record of that part of the conversation. Given this conclusion by Mr Justice Stewart, we should recall, once again, the desperate attempts by now discredited Labor Party politicians and by now discredited Labor Party governments and their political appointees to denigrate the Age tapes and to claim that they were either worthless or inaccurate and that they could not be relied upon. There is no difficulty at all in identifying the leader of the gang who has attacked the Age tapes. That person, of course, is the Federal President of the Australian Labor Party, the Premier of New South Wales, Mr Neville Wran-the leader of a very tired and discredited government which is lurching through its last year in office. He is the man who fought every attempt to investigate corruption. He is the man who resisted every call for an investigation every time a new allegation was made; for example, the allegation against Mr Farquhar, allegations against Mr Humphreys and allegations against people who have now been shown to have been engaged in criminal activity. This was Mr Wran. When one of his Ministers was included, he asserted time and again that the allegations were automatically false and that he would have no part of investigations. The DEPUTY PRESIDENT —Order! Before you go on, Senator Baume, you understand that it is against Standing Orders to impute improper motives to a State politician. You must confine yourself to factual evidence with no imputation of motive. Senator PETER BAUME —Mr Deputy President, I will try to confine myself to facts. The Premier of New South Wales had to be dragged screaming to set up inquiries. I have Press statements which confirm that he is a person who spent a lot of time casting aspersions and smears on those who brought forward the material, those who were brave enough to publish the tapes and those who raised genuine complaints and concerns about organised crime and corruption in New South Wales-crime and corruption which was running rampant and about which nothing was being done. Right from the start he tried to discredit the Age tapes. What are some of the things Mr Wran said? Mr Deputy Speaker, I will try not to discredit him or to impute improper motives; I will quote his words. What has he said about the Age tapes? He said on one occasion: They are variously described `the Age' tapes or the New South Wales Police tapes. They are neither. Indeed they are not even tapes. I might add just for those who may not realise it that they had to be published in the Age newspaper because no one in New South Wales was brave enough to publish them even though they related to events in New South Wales. We know today that, because of the publication of those tapes, a series of events has been set in train, a series of prosecutions has occurred and a series of further prosecutions is likely to occur. Senator Michael Baume —The Mackay murder had to be proceeded against in Victoria. Senator PETER BAUME —The murder of Donald Mackay had to be proceeded against in Victoria. We know that Mr Wran said: They are variously described `the Age' tapes or the NSW police tapes. They are neither. What else did Mr Wran say? On another occasion he said: The tapes are tapes of tapes of tapes, illegally obtained, edited, juggled, juxtaposed, transposed, illegally transcribed, falsified in their transcription, illegally divulged, illegally published, wilfully distorted in their publication, maliciously interpreted in their presentation . . . But what did Mr Justice Stewart say? He said that, where they recorded verbatim conversations they did so fairly. Who are we to believe? Are we to believe Mr Wran, that they were `wilfully distorted' or `maliciously interpreted', or are we to believe Mr Justice Stewart? On other occasions Mr Wran had declared the New South Wales police tapes to be `getting a bit mouldy'. He had denied that the Stewart Royal Commission had made a finding authenticating the police tapes. What do we find now that that finding has been tabled? They have been authenticated all right. Not only do they exist but also they can be relied on where they record verbatim conversations. Mr Wran suggested that there was `the very big question' of whether the New South Wales Police had secretly or illegally made the tapes. Now we know why. The late Mr Landa, the former New South Wales Attorney-General, told the New South Wales Parliament in August 1984 that the Crown Solicitor and the Solicitor-General had told him that further investigations into allegations of wrong-doing in the Cessna-Milner drug case in 1979 would be futile in the absence of the authentication of the telephone material. Of course, we have the authentication now, but in fact a Dennis Shanahan commented: The absence of authentication of the tapes was the Government's bulwark against consistent cries for investigation into the matters raised on the tapes. This is an important point. The New South Wales Government continued to refuse to investigate or to involve itself in the content of the tapes, reserving for its defence its view that the tapes were not authentic or that they were inaccurate. We now have Mr Justice Stewart telling us that, where they record verbatim conversations, they can be taken to have an acceptable degree of accuracy and probably record fairly that part of the conversation they purport to record. This claim by the late Attorney-General, Mr Landa, was all part of a massive effort to discredit the tapes because they exposed corruption associated with the New South Wales Labor Government and associated peripherally with the Labor Party in New South Wales. His New South Wales political cronies, his political colleagues, joined the push and the chorus. Particularly prominent was the person who had been appointed to the position of New South Wales Solicitor-General, Mary Gaudron. She produced a report that called into question the authenticity of the tapes. She said that without full technical assessment she could not rule out the possibility that the tapes had been edited or patched. But Mr Justice Stewart has said that he now has no doubt that the tapes do have an acceptable degree of accuracy and that they do fairly record that part of the conversations they purport to record. Mary Gaudron also suggested-here she drew a very long bow-that any disclosure of the material contained on the tapes, even in parliament, could constitute an offence under the Telecommunications (Interception) Act and also that the material could not be referred to in any special commission of inquiry or any similar judicial inquiry. Senator Gareth Evans, then Federal Attorney-General, led the campaign in the Senate to try to discredit the veracity of the Age tapes, to cast doubts upon their authenticity. Senator Evans, in defending his New South Wales colleague on one occasion, said: I simply make the point that there is, on the evidence now available to the Government, reason to question very seriously the authenticity even of the electronic tapes themselves. The tapes have been tested and they have now been judged to be authentic. If they had not been published, how much worse off would the public be? How much less information would it have about organised crime in New South Wales? What an attempt was made by a Labor government in New South Wales and a Labor government in Canberra to denounce the people who had had the courage to publish this material and to make sure that the public knew some of the things that were going on in the cesspit that is New South Wales and New South Wales politics today! Senator Evans further stated: My reaction now is really one of unadulterated anger at the way in which stuff as flimsy as that has been used . . . That was another attempt to suggest that the material was unimportant or flimsy. Senator Evans continued: I cannot emphasise too strongly the dubious status of the material. The tapes and transcripts given to me are clearly not original. The locations of the original tapes and transcripts are not known to the Government. Who took the copies from which the Age copies were derived is unknown completely to us. The material is therefore completely anonymous and completely unauthenticated. That is a fair enough statement. I simply say to Senator Evans, through you, Mr Deputy President: We can now say that Senator Evans's questions have been answered, certainly adequately. If the defence of the Labor Party has been that it wants to ignore the material contained in the tapes because it doubts their authenticity, that is no longer an excuse available to it whether or not it was valid in the past. Senator Evans said finally: We simply have no means and are unlikely in the future to have any means of being sure that we have a full, untampered-with, reliable account of the conversations that appear to have been intercepted. I could go on and on, but the fact is that Mr Justice Stewart has also answered that question for Senator Evans. We can now say with certainty that we have good grounds, on the basis of the Royal Commissioner's findings, for believing the verbatim transcripts of telephone conversations contained on those tapes. Of course, what is needed now is for the two governments, which have resisted for so long and so hard, to get to work and start to investigate with energy and dispatch the matters which have been raised on these tapes. My cousin Senator Michael Baume referred a moment ago to the case of Donald Mackay. Not only was he a Liberal candidate for parliament, he was a personal friend of mine. When I was engaged in my first Senate election campaign, we went to Griffith and the Mackay children baby-sat my children while Donald Mackay and I were campaigning. Honourable senators will remember that Donald Mackay was also an anti-drug campaigner who was murdered. Just a few weeks ago his children faced up the Premier of New South Wales to ask some questions concerning the unconscionable delays in dealing with matters associated with their father's death. Instead of getting sympathy and concern from the Premier of the State, they got a round of abuse. I must hand it to young Paul Mackay, who said: `Well, we just let him talk it out, and we were able to cope with that kind of thing'. Mr Justice Stewart and the National Crime Authority have exposed the fact that there is no longer any merit in suggesting that the tapes or conversations are not authentic, for they are. I believe that the Government of New South Wales has been badly damaged by the whole attitude that it has taken towards the Age tapes. The Labor Commonwealth Government and the former Attorney-General, Senator Evans, have been badly damaged by their slowness and reluctance to examine the matters contained in the tapes, depending, as they did for so long, on the fact that they wished to question the authenticity of the tapes. In New South Wales it does not matter all that much. People already have a perception of the Premier which will not change very much by this latest disclosure. But why has Labor generally engaged in a desperate cover-up and delay over the tapes? The only people who can benefit from delay in investigating organised crime are the criminals themselves. The delay and the cover-up has helped the drug pushers, the drug dealers, the mob, the Mafia, the Saffrons and the Trimboles, and it has helped undermine the values that a civilised society should attempt to uphold. The governments that have dragged their feet have played their part in making it more difficult in my State of New South Wales for the honest policeman to make his voice heard and for those who wish to clean up the State to get something done. The reason is that from many of the tapes, many of the stories and many of the events that have occurred over the last few years, the threads lead back again and again to the New South Wales Labor Party machine and to the corrupting influence it has had upon that Party and New South Wales. I recall setting out for the Senate the story of the Baldwin bashing, of the Balmain welding company, of the Labor Leichhardt Council, and of the Royal Commission's findings that the people associated with those events were probably criminals, of Wings Travel. We have had Murray Farquhar, Kevin Humphreys, and a series of events. At present we have a Minister of that Government who is awaiting his day in court on probably the most serious charges that a State Minister has ever faced. Time and again, the threads lead back to the Labor Party in New South Wales. Each time that allegations have been raised about one of these matters, those who have raised them have been abused and ridiculed and the Labor Government has done all that it can to avoid investigating serious matters. I remind honourable senators that when my friend and colleague John Dowd was Leader of my Parliamentary Party in New South Wales, he raised again and again the question of corruption in New South Wales and the reluctance of the Wran Government to act on matter after matter which he brought before the public and the Parliament of New South Wales. The Press at that stage went with the Premier and helped ridicule John Dowd. Today, matter after matter which John Dowd raised, and matter after matter about which he was ridiculed, has been shown to have substance, and he has been shown to have been right not once but in relation to most of the matters he raised and brought to the attention of the public of New South Wales. I do not know what will flow from the consideration of volume 2 of the Stewart Royal Commission. I do not know all the matters which are contained in volume 2. I read the newspapers, like anyone else, and am aware of several matters that are of current concern. I hope that if prosecutions are to be laid, they will be laid expeditiously. I say to the Government that, if in the course of those prosecutions they lead back once more to the Australian Labor Party, to its branches or to its members, it should not shrink from laying charges against whoever might be involved. I hope that when the Director of Public Prosecutions has finished his job, has laid the charges he wishes to lay and has made what use he wishes to make of this confidential material, and once the cases which arise from that are out of the way, volume 2 will be made public so that those of us who live in New South Wales and who have to endure the state of corrupt politics that passes for government in that State will have a chance to examine further the matters Mr Justice Stewart has reported on and to determine then, as citizens, what further steps we may wish to take. Senator NEWMAN(Tasmania)(6.42) —I wish to speak on these Appropriation Bills as a result of my experience as a new senator attending my first Estimates committee meetings. I must say at the outset that I wish that more members of the public were able to attend Estimates committee meetings. In a very real way the proper work of government can be seen to take place in these hearings. As a newcomer to this place, I have been most impressed with the amount of work a senator can do to find out what is happening behind the scenes in the departments of government. Senator Grimes —Do you know who set up the Estimates committees first? Senator NEWMAN —Would the Minister like me to continue so that he can learn a bit more about Estimates committees? Senator Grimes —Would you like to know who set them up? Senator NEWMAN —I would like to tell Senator Grimes about one thing that concerns me particularly about the Estimates committees with which I have been involved. As a member of Estimates Committee D and attending hearings of Estimates Committee E, I have been very concerned at the attitudes of some public servants attending those hearings. I have to say here that at least in the reports of those two committees serious criticism is made of the attitudes of some of the public servants attending those hearings. Senator Michael Baume —Encouraged by the Ministers involved. Senator NEWMAN —Senator Michael Baume says that they were encouraged by the Ministers involved. I would hate to think that that is the case but there seems to be some history of that in regard to some of the departments. The report of Estimates Committee D states: The Committee is concerned that this exchange reflected a not uncommon attitude among witnesses of providing unduly legalistic interpretations and answers to straightforward questions asked by members of the Committee. The Committee regards this practice as most unsatisfactory and expects direct and complete answers from all witnesses at all times. The Committee, in its report of May 1985, drew attention to the fact that it had commented previously on the obligation of departments to be specific when providing information to the Committee. I draw the Senate's attention to the fact that Estimates Committee E stated in its report: . . . the device of taking questions on notice, while invaluable to the Committee and Senators, does not make it possible for any follow-up examination to occur other than during the Appropriation debate itself . . . From their earliest days, Estimates Committees have voiced concern about insufficiently briefed officials accompanying the Minister. As I say, I attended hearings of both those committees, and the five departments which appeared before Estimates Committee D, I must say, in most cases, appeared to try to the best of their ability to answer the questions asked. They did take some questions on notice. I have to say here that I was extremely disappointed when listening to the officials and uniformed people from the Department of Defence. It seemed almost as if a decision were taken beforehand that as many questions as possible would be taken on notice. I can only imagine that that was so that a more refined answer could be produced that perhaps would be less embarrassing to the Department. I am afraid a number of answers the officers gave on the night were what I considered to be embarrassing to the Department and, as one who cares vitally for the men and women serving in our defence forces, I was saddened by the answers we were given at that hearing. Passing from that matter of procedure, I turn now to some substantive matters which particularly attracted my attention during those hearings. I refer first of all to the questions asked about the Australian Army Reserve. I quote again from the report of the Committee: The Committee was concerned to learn that, in spite of the expenditure of public funds on an unusual advertising campaign designed to increase numbers, the current figure for Army Reserve strength is now 23,175-that is 547 less than the figure at 30 June 1985. A figure of 26,500, a very modest increase of 2,778 over last year's strength figure, was the original target for 30 June 1986. Although in fact 4,897 persons were recruited, the wastage was 5,444, leaving the strength still 547 less than last year and 3,325 short of the original target . . . However, the fact remains that the significant wastage rate was recognised and the advertising campaign was designed both to reverse the decline and increase overall numbers by almost 3,000 personnel. In other words, taking into account the run-down trend, the real original target must have been in the order of almost 9,000 personnel. The Committee is concerned that in the $2.5m advertising campaign, which had apparently been tested in the community, the Australian public may not have received value for money. Moreover the Department's prior assessment of the campaign's potential impact has been far from accurate. The Committee has suggested in its report that a review and a re-examination should be made of the expenditure and the advertising strategy with regard to future Army Reserve recruiting. I find this a particularly sad and salutary matter. I know that in my home State of Tasmania a directive has gone out to the Army Reserve in recent days, as a result of this tremendous drop in figures, announcing that drastic changes will have to be made for the 1986-87 training year. Courses for recruits have been reduced from four to three, driving courses from five to two, and camp periods from five to three. There are to be no centralised weekends and payment for attendance at parades is not to be taken for granted. I draw the Senate's attention to that last point: Payment for attendance at parades is not to be taken for granted. The situation in Tasmania now is that people can attend a course for 16 days, only 12 of which the Government will pay for. We are raising a Dad's Army. I am very concerned that the money that has supposedly been spent to improve the situation for the Army Reserve has been wasted, and it is a sad state of affairs for the country to have people training themselves in their own time and using their own money. It is no wonder that morale in the Australian Army Reserve is now, as has been described to me, at rock bottom. This is an even more serious matter than just for the persons concerned. If the Dibb report that we await recommends a more self-reliant Australia, I wonder who the Government intends to defend us. The Government does not have a very large standing army these days. Although the figures are 23,000-odd, I am reliably informed that if a head count were taken of the units around Australia, the effective strength of our Australian Army Reserve today is more likely to be 18,000. Senator Peter Baume —And despair everywhere. Senator NEWMAN —Yes, despair everywhere. The situation in Tasmania is that unless such people go in their own time, the Army Reserve cannot afford even to go to the local shows to maintain the recruiting campaign they have traditionally done for years. The recruiting money was all spent on the Government jumping in and out of aeroplanes or helicopters or whatever and nothing is left for local recruitment. I turn to another matter that is of concern to me which I discovered through my exercises in the Estimates Committee hearings. I refer to the future of the Port Arthur project, which comes under the auspices of the Department of Arts, Heritage and Environment. A project which has been going for several years and which is of great benefit to my State and to the nation is about to come to a halt. After 30 June there will be no funding for the project unless the Minister announces something very fast. On 30 April in the House of Representatives the Minister for Arts, Heritage and Environment (Mr Cohen) said that his proudest achievement in three years as a Minister was the preservation of our heritage. I have news for the Minister. He will be known throughout Australia as the man who could not deliver on Port Arthur. He is the Minister directly responsible for the specialist team at Port Arthur being disbanded. He is the Minister directly responsible for correspondence sitting in his office unanswered for seven months-correspondence from the Tasmanian Government concerning the future of the project. Senator Grimes —That is outrageous and you know it. Senator NEWMAN —It is a fact and the evidence is contained in the Estimates Committee proceedings. On 9 April, a few days ago, the Minister finally got around to acknowledging formally that he had received correspondence and said that he would attend to the matter. Senator Grimes —Nonsense. Senator NEWMAN —Senator Grimes is supposed to be representing the interests of Tasmania in the Cabinet, and I would like him to be sure of his facts when he goes in to fight for the first time for Tasmania. Senator Grimes —I am sure of my facts. Senator NEWMAN —We have not seen much action from Senator Grimes in looking after his State. The people of Tasmania are very aware of the fact that Senator Grimes is not looking after Tasmania and he will see the results at the next election. During the hearing of Estimates Committee D the Heritage Commission acknowledged that it has recommended to the Government that the program be continued. The Heritage Commission considers that it is a vital project in Australian heritage terms, not just in Tasmania. In fact, the Commission has recommended to the Government that the program be expanded not only to focus on the Port Arthur site but also to pick up the Tasman Peninsula involving expansion of the program in terms of finance and time. The Tasmanian Government has already contributed to the program on a two-for-one basis, and this should be the basis of the continuation of the program. On 25 September last year the Tasmanian Government made a detailed proposal to the Federal Government on the future of the program. The Federal Government has made a formal acknowledgement but no substantive reply. A joint working party of State and Federal officers has recommended a further four-year extension of the program, but this Minister is unable even to give a public undertaking that the Commonwealth will continue its support. At least by such a declaration the drift of the specialist team could be halted and the State may be able to provide the Commonwealth with an overdraft to fund the work until funds become available in the next Budget. One watches with concern expenditure on the America's Cup. Could it be that the Government has taken the Minister's funds for next year and that he will have nothing left to draw on for Port Arthur? Certainly Fremantle is an historic city which deserves preservation, but the huge sums announced fill me with trepidation for the future of Port Arthur. Could it be that political rather than heritage considerations have prevailed? The Government seems to have plenty of money for one off projects like the Grand Prix and the America's Cup. I question its priorities when these funds are voted for sporting fixtures which can well attract non-government sponsorship, and in the case of the America's Cup is essentially a private sporting event. By comparison, the Port Arthur project is one of major moment for the nation. Its importance is not restricted to its heritage implications, great though they are. It is a major tourist attraction in Tasmania, and nearly half a million tourists visit Tasmania every year. It is an ongoing project with ongoing tourist implications. It is not once-off. The Port Arthur project has brought together experts in architecture, engineering, archaeology, history and conservation and their work is not yet finished. The State Government has offered $2.6m over four years, subject to the Commonwealth's agreement to provide a $2 for $1 matching grant. This program has seven major important goals. They are the conservation and preservation of the coal mines, which were a convict mining development; the conservation and interpretation of the model prison, which is a partially rebuilt ruin; the presentation to the public of Port Arthur and the coal mines as a bicentennial year feature; the development of visitor facilities at Port Arthur; the comprehensive research and conservation planning for all the National Estate elements of the Tasman Peninsula; the assessment and conservation of the Point Puer ruins, which is the site of the infamous boys' prison; and the expansion of the historic conservation area programs which provide assistance to owners of heritage sites. The completion of this work would see the peninsula's potential as a national resource made readily apparent to all who use it. Throughout the entire program, emphasis would be placed on the continued development of a national as well as an international profile for the peninsula's historic sites and their conservation. The work done to date has been the most complex historic conservation exercise yet undertaken in Australia. Its progress has attracted national and international attention. Yet we are still waiting for a substantive reply to the Tasmanian Government proposal of 25 September 1985. The men and women of the specialist team are already leaving the project because no official word has come from Canberra. It is nearly too late. Senator Grimes —They were offered funds and they refused them, and Senator Newman knows it. Senator NEWMAN —Senator Tate would like to see the money taken away and given to sporting facilities. He does not like to stick up for Tasmania in this place because he is a member of the Government. I am glad that the Minister for Arts, Heritage and Environment regards the preservation of our heritage as an important matter. So do I. But I warn the Minister that he will be judged by his actions, not by his words. Senator TATE(Tasmania) —Mr President, I wish to make a personal explanation. Senator Newman has just said that I would prefer to see the money that might have been allocated to Port Arthur's restoration and development dedicated to certain sporting facilities in Tasmania. My argument has been entirely contrary to that, namely, that when the Government of Tasmania was offered bicentennial funding, it chose to use it on sporting facilities rather than on the Port Arthur restoration project. This is a gross misrepresentation of my position and that of the Federal Government. Debate interrupted. The PRESIDENT —Order! It being near the hour of 7 p.m., under sessional order, I put the question: That the Senate do now adjourn. Senator SIBRAA(New South Wales)(7.00) —I wish to make some brief remarks about the situation that exists between Australia and Indonesia and the role played in this matter by the Sydney Morning Herald. The Prime Minister (Mr Hawke) said last week: The originating factor in this situation has been an article in the Sydney Morning Herald over which we, as a Government, not only have no control but no knowledge. I agree. The issue that intrigues me, however, is the timing of the article. Let me explain. On 9, 10 and 11 April the fourth Indonesian-Australian Conference was held in Jakarta. The Australia delegation included members from both sides of this Parliament, senior officials of the Department of Foreign Affairs from both Canberra and Jakarta, representatives of Australian business, academics, trade unions and, most importantly, representatives of the Australian media, representing some media outlets that are currently refused access to Indonesia. As the conference was held under Chatham House rules, I am constrained in what I can say. I will not name the participants as it would not be fair to them. However, one would not have to be a genius to realise that Australian-Indonesian relations were discussed both formally and informally during the conference and that the role of the media was an item of great interest. In the middle of the proceedings on 10 April the Sydney Morning Herald article was published. I therefore ask: Was it done deliberately or not? I find it hard to believe that the editor and/or the foreign editor of the Sydney Morning Herald did not know that the conference was taking place and what the repercussions would be. The Sydney Morning Herald might have thought that the story was of such interest it had to be printed as soon as possible. However, as nearly all the hard facts in the article had been in print in Australia previously, I find that very hard to believe. In fact, the article was described to me by a senior journalist in Australia as a scissors and paste job. Having said that, I believe that the Indonesians have been guilty of over-reaction and double standards in their handling of this issue. There has been no action by Indonesia against the United States, despite much stronger recent Press criticisms of the Indonesian Government by the Washington Post and the New York Times than any that occurred in the Sydney Morning Herald. These articles in the United States papers appeared late in April and as yet there has been no reaction by the Indonesians. I believe that the Prime Minister, Mr Hawke, was correct when he said that it was a paradox that Jakarta criticised the Australian Government for articles about the Suharto regime in a free, uncontrolled Press yet used its own media, an official army newspaper which is directly under the control of the army and senior members of the administration, to attack Australia. There are other examples of over-reaction which I do not have time to deal with now but which I will certainly deal with at some time in the future. This Government, the Prime Minister, the Minister for Foreign Affairs (Mr Hayden) and the Minister for Defence (Mr Beazley) have all gone to great lengths to improve our relations with Indonesia, as has our Ambassador in Jakarta, Bill Morrison. I find it appalling that apparently the relationship is so fragile that one newspaper article can totally disrupt three years good work, especially as the semi-official magazine Indonesia, available at the time of the conference, carried articles on the excellent relationship that existed between the two countries, including an article by Dr Mochtar, the Indonesian Foreign Minister, and photos of our Foreign Minister Hayden and Minister for Education, Senator Susan Ryan, during their recent visits to Jakarta. Having said that, I believe that the Sydney Morning Herald must have known that the initial reaction to the article was going to be hostile and that printing it when the conference was in session would have meant that any chances of future media access to Indonesia were going to be jeopardised. I am not saying that the article should not have been printed, just that the timing was disastrous. In the final wash-up it has probably given a boost to Australian relations with the United States as the `Comment' column in the Australian Financial Review states today. In conclusion, I believe that if the timing of the Sydney Morning Herald article was not deliberate, it was a bungle. I will certainly be interested in perusing future Sydney Morning Herald articles and editorials on Australian-Indonesian relations. Senator HILL(South Australia)(7.03) —I wish to speak on the same subject, Australian-Indonesian relations. I was also a member of the delegation which attended the last Australian-Indonesian conference in Jakarta, together with Senator Sibraa. I regret to say that, although I have great respect for Senator Sibraa, on this occasion I think that much of what he said tonight was somewhat unfair. The Sydney Morning Herald published an article which, it seems to me, was newsworthy. It is not surprising that comparisons were being drawn between the Indonesian situation and the situation in the Philippines subsequent to the Philippine elections. That has been shown by the fact that similar articles have now been published elsewhere in the world. I have no evidence to suggest that the article was deliberately timed, in effect, detrimentally to affect Australia's relations because it was published at the time the conference to which I referred took place, nor to believe that it was timed to have the unfortunate response which it did-the cancellation by Dr Habibie of his proposed visit to Australia. Unfortunately, I feel that articles such as that will never be published at the right time. I suppose it is a bit like politicians increasing their salaries. There will never be a right time. Looking back with hindsight, a criticism of that nature is somewhat unfair. I also think that Senator Sibraa has it wrong. Although the article may have caused the immediate response it did in relation to Dr Habibie, much of the deterioration of relations since then has occurred for other reasons which I very much attribute to the attitude of Prime Minister Hawke and his Minister for Foreign Affairs (Mr Hayden) since the unfortunate event relating to the Australians who arrived in Bali to find that visas were required. Let me expand this matter briefly because it is important. Under Liberal-National Party governments, Australia had an outstanding reputation in the international arena as a country which had always been sensitive to the realities of international politics and the players in the international fora. Yet, in the last few weeks since the visa incident, unfortunately the current Australian Government has driven Australia's foreign relations with our neighbour Indonesia into a most difficult and detrimental position. Unfortunately the Government has gone out of its way in the last two weeks to further the breakdown of Australian-Indonesian relations by simply dismissing Indonesia's reaction as a capricious response by an over-politically sensitive Third World country, without considering the repercussions it would have for Australia. Let me remind the Senate of a little of the history of this matter. The Government was clearly disappointed by the Indonesian reaction to the Sydney Morning Herald article-the cancellation of Dr Habibie's visit to which I have referred-because it had no control over the contents of the article or the fact that it was published. That is fair enough up to a point. In the last couple of years, I am happy to concede, the Government has been active in fostering a good relationship. But the Government balanced the Indonesian response against those efforts, which have been made only over the last few years. In other words, it balanced the response against short-term efforts, forgetting the damage that the Australian Labor Party has done to our relations with Indonesia over a long period. It may well be that the Indonesians would look at the changed attitude of the Australian Government in a longer term context. Nevertheless, the Government was disappointed. It was then enraged when Indonesia precipitately changed its policies with respect to visas and, as I mentioned, caused a planeload of Australians to be stranded. I suggest that was both clumsy and offensive. It aroused anger within Australia and the Government. That is not surprising. It clearly called for a strong protest. I suggest to the Senate that it was then that Prime Minister Hawke let his political perceptions of the value in responding to the domestic anger override what was in Australia's long term best interests and which culminated last Sunday in his offensive expression that Australia `would not grovel to Indonesia'. What an uncouth, limited and embarrassing way in which to conduct international relations! No sooner has the visa debacle come to light than the policy was changed, it is said by President Suharto himself. If ever there was a sign of wanting to end the derailing of relations that has occurred over the previous couple of weeks, I suggest that that was it. But Messrs Hayden and Hawke could not read the signs, or refused to read the signs. The Rambo factor, as it has been referred to in some of the media reports, had taken over. I suggest that rationality had suffered as a consequence. As honourable senators will recall, it was from Rome, when Mr Hawke was on his last trip, and after Indonesia has reinstated its no visa policy, that Mr Hawke still described the behaviour of Indonesia as capricious, even though the journalists gave him a chance to withdraw that description. We saw such headlines as: `Gloves are off'. Mr Hawke had decided that it was time to be tough. What did the Australian Government do in response to the next, and what I readily concede was an unsatisfactory development, which was the refusal of Indonesia to grant visas to the two Australian Broadcasting Corporation reporters to cover President Reagan's visit to Bali? It hauled in an Indonesian diplomat in the middle of the night to give him a lecture. I suggest that that sort of behaviour may be expected in some places in the world but not, I hope, in Australia. As well as Mr Hawke responding to what he obviously saw as domestic community anger over the visas issue, I have no doubt that his hard line was also necessary to pacify internal Party critics already angry at the change of policy that he had made in relation to East Timor. We find that that was reinforced only yesterday at the Caucus meeting. We read in this morning's Press that not only did Caucus members suggest to Mr Hawke that perhaps it was time to change the East Timor policy back to that which existed before but also Caucus members commended Mr Hawke on his get tough approach and for the way that he handled the interview last Sunday to which I have referred. A belligerent attitude towards Indonesia also would clearly be helpful for the forthcoming ALP national conference. If that is the way in which this Prime Minister is conducting foreign policy for this nation-if that is the way in which the ALP is governing this country-I suggest that it is most unsatisfactory. I suggest that, if that is the case, it is a damning indictment of this Labor Government. What did Prime Minister Hawke then do after last Sunday's embarrassment? He would have had a chance to set about to repair the damage, but no, the answer that he gave was simply that the relationship with Indonesia had been overstated. I quote from Hansard what he said in answer to a question on Monday: I was trying to indicate that in some quarters in Australia an absolute pre-eminence had been given to the relationship but, more importantly, that there was a feeling that perhaps more could be obtained from the relationship than the realities of our differing cultures and differing experiences would intrinsically allow to be extracted. Who then has overstated this relationship? We remember that it was Prime Minister Hawke who went to Jakarta after the 1983 election, although I accept that it was in the face of considerable criticism from within his Party. It was Prime Minister Hawke who supported the Minister for Defence (Mr Beazley) going to Indonesia, only a short time later, to give the Indonesians a rundown on the still confidential Dibb report on Australia's defence needs, which privilege is more than has been given to this Parliament, I might add. So who made the error? Who overstated the relationship such that it was necessary to give the Indonesians confidential information that the Australian Parliament has not even been given? Does Mr Hawke now say that he was in error or, as the relationship under his leadership has deteriorated so seriously, is he now saying that the relationship does not really matter, which allows him to get off the hook for his failures of the last fortnight; or does he by his statement on Monday wish to state that all the conciliatory gestures made towards Indonesia since 1983 were simply political expedient measures rather than genuine moves by a government pursuing a reasonable foreign policy which would benefit this country? It is open to interpretation. Whichever is the correct explanation, it is a serious indictment on a Prime Minister who in this issue has not served us well. It is not surprising that he is getting the wrong advice from the Foreign Minister on this matter. We would be well entitled to question Mr Hayden's judgment in analysing the needs of the region, particularly after his less than sensitive handling of Vietnam's occupation of Kampuchea. Honourable senators will recall that he was successful in alienating the countries of the Association of South East Asian Nations and it has taken great efforts by Australia's diplomats to mend that relationship since Mr Hayden's interference. It is necessary to get it straight, even if Mr Hawke is not prepared to say so. Good relations with Indonesia are vitally important for Australia. It is our nearest neighbour, with 165 million people. It is a leader of ASEAN and a leader within the region. It is obvious that it would be naive to suggest otherwise. In the case of Mr Hawke, is it politically opportunistic to suggest otherwise? If I had time, which I do not have, there are many important areas of that relationship that I could enumerate. The area of defence co-operation is obviously important for the information that we can get from Indonesia as to regional stability. One must also consider the importance of Indonesia in regional stability. In the area of joint exploration, honourable senators may know that the formalities for the joint exploration zone in the Timor Gap were near completion before this deterioration of relations and the talks have now been put off. That is a prospective area rich in oil and gas. Now the talks have been put off, which in no way can be to Australia's benefit. In the area of trade, although the trade figures have been disappointing, we know the opportunities that exist for the future if only a bit more imagination were shown, as was mentioned in a number of very worthwhile papers at the Australian-Indonesian conference to which I referred earlier. The hurdle that we will come across from time to time is clearly that there are different value systems in our two countries. Obviously, we must not modify our democracy, which is vital to us-freedom of the Press is an important part of the democratic principles that we hold dear-but we must recognise that Indonesia has different values. It is much more concerned about communal interest rather than individual interest. Respect for leadership and a reluctance to criticise leadership is part of that different cultural value system. Of course, that system is very different from Australia's. Obviously, on occasions, these value systems will clash. Human rights abuses in Indonesia will clash with our standards. Press criticism in Australia of Indonesian leadership will offend Indonesian standards. We must understand that. That does not mean that the Press must not publish but rather that in doing so it must be sensitive of the Indonesian value system. Above all, I suggest that we must work at what we have in common that can build a bridge between our two cultures. I have spoken in the past of expanding and advancing the people contact areas. Obviously, tourism is an area of people contact but, regrettably, nearly all of our tourists to Indonesia go only to Bali. It would be in our mutual interests if we could get them out of Bali and into other areas of Indonesia, and also get more Indonesian tourists into Australia. I mention the areas of cultural exchange and language training. It is pleasing that language opportunities in Indonesia and Australia are continually improving. Obviously, trade and aid projects are people contact areas that can help to bridge the cultural gap between our two countries. It can be done, but it will take time. It is a difficult enough challenge without having to overcome the errors of judgment of this Government. I cannot work out for certain whether Prime Minister Hawke simply has been short-sighted or there is developing within this Government a deliberate isolationist attitude. There is some evidence to support the latter view-the withdrawal from Butterworth and the Sinai, and what we read about the Dibb report and its isolationist approach-but I hope that is not the case. In any event, in either of those cases, it would not be in Australia's best interests. Let us stop blaming the Sydney Morning Herald for what has happened; it is what has happened since the publication of that article that should be requiring our much more valued attention. Senator TATE(Tasmania)(7.21) —I wish to briefly raise two matters for the consideration of the Senate. The first matter was brought to my attention by a constituent and relates to the fact that this constituent, who has been teaching at the University of Tasmania for some 12 years in a very senior position, requires a hearing aid which is absolutely essential to the discharge of his duties. Section 51 (1) of the Income Tax Assessment Act provides that all losses and outgoings incurred in gaining or producing assessable income are deductible. One would expect, as a lay person, that where one has to have a particular medical appliance-for example, if one were a quadriplegic using a wheelchair, or in this case where a senior lecturer with a severe hearing disability must use a hearing aid-the expense incurred in gaining such an aid would fall within section 51 (1). But the taxation authorities have consistently ruled that this particular type of appliance is merely obtained in order to overcome an unfortunate disability suffered by the taxpayer, even though there is no argument that the real purpose of obtaining the medical aid, amongst other things, is that a large proportion of the time for which the aid is used is spent in gaining assessable income or carrying on some sort of business. It seems to me that there is a case for the taxation authorities to review their interpret- ation of section 51 (1) or for the Government, if it is satisfied that the interpretation is legally correct, to undertake a review. At the moment, the expense is allowed as a concessional expenditure rebate, but unless a taxpayer's concessional expenditure exceeds $2,000 in any year, the fact that $900 has been spent on a particularly sensitive hearing aid will not entitle the taxpayer to a concessional rebate. It seems to me that there is a case for the review of this matter, particularly where it can be demonstrated quite honestly that the purchase of a particular medical aid or appliance is necessary for the taxpayer to continue in the work force earning income or conducting some sort of business. The second matter I raise refers to a report of the National Film and Sound Archive's advisory committee entitled `Time in Our Hands'. Page 111 of that very valuable document notes that the location of the Archive in Canberra, whilst it has certain promotional advantages, nevertheless does not deal with the simple fact that there is a demand for the sorts of services and materials which the Film and Sound Archive has in its possession and that they should be available to the many citizens of Australia, right around the country. A very clear case is made out in the advisory committee's report for maintaining officers throughout Australia so that they may develop liaison with local and State organisations which are endeavouring to preserve our sound and film heritage. Reading that report reminded me of the fact that in Tasmania Mrs Gwen D'Emden has done a tremendous job in establishing the Sound Preservation Association of Tasmania. Mrs D'Emden called on my office some week or two ago in order to bring to my attention the fact that this organisation has undertaken a tremendous job in preserving old wirelesses, gramophones, record cylinders, theatre programs and sheet music which incorporate so much of our heritage of true historical value. If the Government, in its Budget considerations, were minded to take up the advice of the advisory committee to establish outposts of the National Film and Sound Archive throughout the Commonwealth, I believe that the Sound Preservation Association of Tasmania would be a very able and willing partner in the project of preserving our heritage, which is not always thought of when people throw away old records, mantle wirelesses, gramophones and so on, some of which not only incorporate records of stage and screen but also, in an informal way, cover many of the gatherings in market-places, people singing in the streets, children at play, and the various other indications of our history. Senator GRIMES(Tasmania-Minister for Community Services)(7.27) —I have nothing to add to anything that the previous speakers have said. I would be very happy to join with Senator Tate in singing in the streets and all that sort of thing. I am tempted to send a cheerio to my Aunty May, but we are not on the air so I think it is about time we all went home. Question resolved in the affirmative. Senate adjourned at 7.28 p.m. The following paper was tabled: Australian Bureau of Statistics Act-Australian Bureau of Statistics-Proposal No. 4 of 1986-Survey of Transport and Storage Industries, 1984-85. The following answers to questions were circulated: (Question No. 537) Senator Reynolds asked the Minister representing the Minister for Health, upon notice, on 12 September 1985: (1) What is the progress of negotiations between the Federal and Queensland Governments regarding the implementation of nurse education initiatives. (2) When will a final program report be announced. (3) When will Queensland be in a position to implement the skills in demand retraining scheme on the same basis as in other States. Senator Grimes —The Minister for Health has provided the following answer to the honourable senator's question: (1) In response to the Commonwealth's recent offer of an additional $7.3 million to assist with the costs of transferring nurse education to the advanced education sector, the Queensland Government has reaffirmed that it will implement the transfer only on the basis of the Commonwealth meeting all costs. Nurse education and training in Australia has traditionally been an area of State responsibility; the Commonwealth has offered for educational and health reasons, to assist those States which wish to implement a transfer to advanced education. For States where nurse education has not been a high priority and the theory content of traditional hospital-based programs has been low, overall savings available to finance the transfer may be lower than for other States. The content and quality of those programs are however matters for each State Government and the Commonwealth is of the view that it should not compensate States for costs which are the consequence of the low priority given to nurse education by any State. (2) An announcement of a final program for the transfer of basic nurse education cannot be made until firm agreement has been reached with all States and Territories. (3) The Queensland Government has advised that it does not intend to lodge a proposal for funding under the $3.3 million Skills in Demand nurse retraining allocation. (This program has been subsumed within the broader based National Skills Shortage program, as from 1 January 1986). (Question No. 559) Senator Colston asked the Minister for Education, upon notice, on 19 September 1985: What are the latest figures available for each State and Territory and for Australia as a whole for per capita spending by the States and Territories for each of the following: pre-school education; primary education (a) Government, and (b) non-Government; secondary education (a) Government, and (b) non-Government; technical and further education; transport of school children. Senator Ryan —The answer to the honourable senator's question is as follows: While data on aggregate education expenditure by State and level for recent years is published by the Australian Bureau of Statistics in annual bulletin on Expenditure on Education, Cat. No. 5510.0, there are difficulties in providing recent and consistent data on per capita expenditure. The most recent data is, however, provided below: 1. Pre-School Education Per capita expenditure data is only available from individual State and Territory authorities. 2. Primary and Secondary Education (a) Government The following table shows the latest, comparable figures available for each State and Territory and Australia of recurrent per capita spending by the States and Territories, including spending from Commonwealth grants. RECURRENT EXPENDITURE PER STUDENT IN GOVERNMENT SCHOOLS ($ per student, est. December 1984 prices) NSW Vic. Qld WA SA Tas. Six States NT ACT Aust. Primary 1980-81... 1,720 1,936 1,813 2,241 1,916 1,986 1,868 3,392 2,062 1,890 1981-82... 1,800 2,040 1,833 2,191 1,948 n.a. (a)1,925 n.a. 2,271 n.a. Secondary 1980-81... 3,020 3,114 2,649 3,210 3,214 3,247 3,039 5,409 3,561 3,065 1981-82... 3,094 3,175 2,632 3,153 3,195 n.a. (a)3,075 n.a. 3,776 n.a. (a) Estimate based on movements in five States. n.a. Not available on a comparable basis. Figures for later years are not available as State Education Departments, through the Australian Education Council, are developing a new finance collection on expenditure on Government schools. The AEC has not yet agreed to the release of data for publication. (b) Non-Government The following table shows recurrent per capita spending by State Governments on non-Government schools in 1983 in each State and Territory. RECURRENT PER CAPITA SPENDING BY STATE AND TERRITORIAL GOVERNMENTS ON NON-GOVERNMENT SCHOOLS, 1983 ($ per student, est. December 1984 prices) NSW Vic. Qld WA SA Tas. NT ACT Aust. Primary-Catholic... 326 404 354 341 369 423 716 337 363 Primary-Other... 336 404 366 333 359 353 583 . . 361 Secondary-Catholic... 533 667 572 580 665 636 . . 534 596 Secondary-Other... 553 662 568 578 618 . . . . . . 594 Mixed Schools-Catholic... 495 575 484 487 555 571 . . 484 514 Mixed Schools-Other... 460 599 481 513 478 541 . . 447 528 3. Technical and Further Education The following table shows the recurrent per capita expenditure from Commonwealth and State Government sources. PER CAPITA(a) EXPENDITURE ON TAFE, BY STATE/TERRITORY FOR 1984 (Average 1984 cost levels) State/Territory Amount(b) $ New South Wales... 3,330 Victoria... 3,220 Queensland... 4,080 Western Australia... 4,000 South Australia... 5,230 Tasmania... 3,900 Northern Territory... 6,690 Australian Capital Territory... 4,560 AUSTRALIA... 3,650 (a) Based on annual student contact hours which have been converted to estimates of full-time equivalent students. (b) Recurrent expenditure from Commonwealth and State Government sources. Capital expenditure is not included. 4. Transport of School Children Expenditure on pre-school education and transport of school children is a matter for the State and Territory education authorities. (Question No. 632) Senator Archer asked the Minister representing the Special Minister of State, upon notice, on 17 October 1985: (1) How many police officers per capita are there in the Australian Capital Territory performing `normal police duties' as performed in other parts of Australia. (2) How does this compare with: (a) each other capital city; and (b) each State. Senator Gareth Evans —The Special Minister of State has provided the following answer to the honourable senator's question: (1) In its submission to the inquiry on Australian Capital Territory (ACT) Finances by the Commonwealth Grants Commission, the AFP identified within the ACT Command that 596 police officers were engaged on what was classified as direct community policing, and 135 officers were engaged on national policing functions. This number does not include police officers in AFP Headquarters areas which provide support services directly or indirectly to community police officers (in State Police Forces, police officers engaged in these support functions are included in the police to population ratios). Based on the above, there are a number of ways of considering the number of police officers per capita in the ACT performing `normal police duties'. Based on only the direct community policing numbers mentioned above, the number of police officers per capita would be 1:419. Based on the same direct community policing numbers with the addition of a nominal estimate of those police officers at AFP Headquarters who provide support to ACT police functions, the number of police officers per capita would be 1:375. Based on the total strength of the ACT Command, which is available to be redeployed to community policing requirements where operational needs arise (but not including the nominal estimate of support staff), the number of police officers per capita would be 1:342. Finally, if all three of the above possibilities are considered in conjunction, that is: direct community policing numbers, a nominal estimate of support staff, and the number of officers engaged on national policing functions, the number of police officers per capita would be 1:312. (2) Published figures on the per capita ratio to police officers in State Police Forces are as set out below. As far as it is known the number of police officers per capita in capital cities is not available. State/Territory Date of information Police per capita New South Wales ... 30.6.84 1:524 Victoria ... 30.6.84 1:515 Queensland ... 30.6.84 1:507 Western Australia ... 30.6.84 1:448 Tasmania ... 30.6.84 1:418 South Australia ... 30.6.84 1:353 Northern Territory ... 30.6.84 1:189 Source of data: Australian Bureau of Statistics (Question No. 883) Senator Reynolds asked the Minister representing the Minister for Defence, upon notice, on 12 February 1986: (1) Have service wives in Townsville been unable to open a child care centre at the beginning of 1986 as planned. (2) Can the Minister for Defence ensure that the formal transfer of property documents in Canberra is expedited as this departmental delay is frustrating an initiative which has received every support at the local level. Senator Gareth Evans —The Minister for Defence has provided the following answer to the honourable senator's question: (1) There has been some delay in opening a child care centre sponsored by Service wives in Townsville, however a play group has been established as an interim measure pending the acquisition or allocation of suitable long term accommodation for the child care centre. (2) The Department of Defence is examining a number of options by which suitable accommodation can be provided for the Vincent/Heatley child care centre. This involves negotiations with other Commonwealth Departments and with the Queensland Government. Although these matters are not usually the responsibility of the Department of Defence, the Department is doing everything it can to reach a prompt resolution. (Question No. 937) Senator Jones asked the Minister representing the Minister for Arts, Heritage and Environment, upon notice, on 11 March 1986: (1) Has the Government met its specific obligation under the `Agreement between the Government of Japan and the Government of Australia for the Protection of migratory birds and birds in danger of extinction and their environment' which requires that in the absence of a properly established management plan for North Keeling Island the taking of seabirds or their eggs is prohibited. (2) Which species of seabirds breed in significant numbers on North Keeling Island. (3) How many breeding pairs of each of those species bred on North Keeling Island during 1985. (4) How many birds and eggs of the above species approximately, were taken by the Islanders in 1985. (5) Does the number of birds and eggs taken exceed a safe harvesting level as would be acceptable under the Japan-Australia Agreement. Senator Ryan —The Minister for Arts, Heritage and Environment has provided the following answer to the honourable senator's question: (1) The Japan-Australia Migratory Birds Agreement prohibits the taking of migratory birds or their eggs except in some cases where taking of the birds or eggs may be permitted in accordance with the laws and regulations in force in each country. One of these exceptional cases is to allow the hunting and gathering of specified birds or their eggs by the inhabitants of certain regions who have traditionally carried on such activities for their own food, clothing or cultural purposes, provided that the population of each species is maintained in optimum numbers and that adequate preservation of the species is not prejudiced. There is no requirement in the agreement for a `properly established management plan' before such traditional hunting can be allowed. In the case of North Keeling Island, the Government is taking steps to ensure that the long term survival of the species involved is not affected. Following consultations with the Department of Territories, officers of the Australian National Parks and Wildlife Service (ANPWS) visited Cocos (Keeling) Islands in April, July and October 1985 and in February, March and April this year. During the visits, discussions were held with Administration officials, the Cocos Malay community and its leaders on the need for restraint and proper controls when hunting seabirds on North Keeling Island. Current data on the breeding population of the Red-footed Booby, the main species harvested, were obtained along with information on historical harvesting levels. The program is continuing and it is anticipated that an ANPWS conservation officer will be appointed in the new financial year. A Cocos Malay is undergoing training for conservation work. (2) North Keeling Island has significant colonies of- Red-footed Boobies-Sula sula Least Frigate Birds-Fregata ariel Great Frigate Birds-Fregata minor White Terns-Gygis alba Common Nobby-Anous stolidus Only two seabird species are harvested by the Cocos Malays. (3) Based on the 1985 surveys the number of breeding pairs of the two species harvested are conservatively estimated as: Red-footed Boobies-17,000 breeding pairs Least Frigate Birds-4,000 breeding pairs Figures for the other species which are not harvested are not known. (4) There has been no accurate observation or recording of harvesting levels. Estimates are made on the basis of anecdotal accounts. From this source, the estimate for 1985 ranges from 3,000 to 10,000 birds. A figure of approximately 6,000 would seem reasonable. Eggs are not taken. (5) Under the Japan-Australia Migratory Birds Agreement, a safe harvesting level is one that would ensure that adequate preservation of the species is not prejudiced. This level is currently being determined from data collected during the ANPWS surveys which commenced in 1985.