Thursday, 8 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 the President and members of the Senate, of the Parliament of Australia, assembled. We, the undersigned, plead that Parliament becomes aware that the public has no legal right to influence the setting of Standards for Television Programming, that we deplore the new Standards which came into force on 1st February, and that we call on Parliament to amend the Broadcasting and Television Act 1942, section 16 (2), so that the Australian Broadcasting Tribunal, when determining Television Standards, and screening hours, shall consult with the Australian people: because at present the Tribunal is compelled by law to consult only with television stations on these matters, because the new standards are a result of such consultations, and have already been implemented without public discussion, because the new Standards are ambiguous, and without definition, because the new Standards are composed of modifying terms which circumvent the proscriptions, because the media is only motivated by aspirations of pecuniary superiority, because, in contrast, the public is only motivated by their wish to exercise pastoral care over the nurturing home environment of their children, because we believe that the Standards wrongly ascribe extreme importance to `the storyline' of a film screened, because we believe that the Standards wrongly ascribe total unimportance to the effects of viewing, especially violent films, on the young, the impressionable, the immature, the unstable, or the socially disadvantaged, because we refuse to accept the media-imposed assessment of community standards, and because we wish to impart our demand to be consulted, our demand to have legal status in decision-making, and the right to counsel those whose decisions so deeply affect our homes. Your petitioners therefore humbly pray that you will give this matter your earnest attention. And your petitioners as in duty bound will ever pray. by Senator Cook (from 29 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 Senator Durack (from 17 citizens). To the Honourable the President and the members of the Senate in Parliament assembled. The petition of the undersigned citizens of Australia respectfully showeth: That the Australian Bill of Rights is a harmful, dangerous, divisive and unnecessary proposal, the provisions of which are dictatorial, harmful and against the true interest of the people of Australia. Your petitioners pray: that the Senate reject the Bill. And your petitioners as in duty bound will ever pray. by Senator Durack (from 118 citizens). To the Honourable the President and members of the House of Representatives in the Parliament assembled. The petition of the undersigned shows: That the Bill of Rights and the Human Rights and Equal Opportunity Bill 1. Offer nothing more than is already available under Common Law, 2. Deny some Human Rights and do not include others, 3. Give dangerously wide powers to an unelected body, and 4. Could cause far more damage than they could possibly cure. Your petitioners request that the House of Representatives should: Completely reject both the Bill of Rights and the Human Rights and Equal Opportunity Bill. And your petitioners as in duty bound will ever pray. by Senator Jessop (from 29 citizens). To the Honourable the President and members of the Senate in Parliament assembled. The petition of the undersigned citizens of Australia respectfully showeth: That the Australian Bill of Rights will do nothing to advance the rights of Australians, because it is dangerously ambiguous and will cause confusion within the legal system; it endangers our Federal system; and, it is to be administered in an authoritarian manner inconsistent with the present legal rights of all Australians. Your petitioners therefore pray: That the Senate rejects the Australian Bill of Rights Bill and all cognate Bills. And your petitioners as in duty bound will ever pray. by Senator Jessop (from 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 Bill because: We get no legally enforceable rights under the Bill. The Bill does not guarantee vital rights such as the right not to belong to a trade union, the right to own private property and not to be deprived of it without just compensation and the right of choice between Government and non-Government schools. The Bill gives Canberra extra powers to change our Federal system by the back door without a constitutional referendum. The Bill gives dangerous new powers to a Federal Government Commission. Your petitioners ask that the Senate, in Parliament assembled, should vote against the Bill of Rights, support Opposition amendments and seek a genuine public debate and a referendum on the Bill. And your petitioners as in duty bound will ever pray. by Senator Durack (from 45 citizens). To the Honourable the President and members of the Senate in Parliament assembled. The petition of the undersigned shows: That human embryos deserve legal protection to enable the development of their full human potential. Your petitioners request that the Senate should: Pass Senator Harradine's Bill to prohibit experiments involving the use of human embryos created by in vitro fertilisation. And your petitioners as in duty bound will ever pray. by Senator Jessop (from 24 citizens). Senator DURACK(Western Australia) —by leave-I present a petitioning letter bearing 32 signatures protesting against the Government's proposed taxation legislation reform package: C/- Box 17, Riley House, 20 Excelsior St., Shenton Park, W.A. 6008. 17 April, 1986 To:-Senator The Hon. P. D. Durack Q.C., Commonwealth Parliament Offices, 44 St. George's Tce., PERTH, W.A. 6000. Dear Sir, We, the undersigned, being residents of an Anglican Homes (Inc.) self-care complex, hereby register our protest against the proposed Taxation Reform Package insofar as it affects non-profit organisations providing housing and care for the aged and disabled. The voluntary, non-profit religious and other chari- table bodies perform a public service in caring for the elderly. The imposition of the proposed levies would limit the provision of necessary facilities and/or cause an additional financial burden on those whose sole, or the major part of whose, income is the Age Pension, namely, some 40% (forty per cent) of the population aged 60 or more. The long term result of the proposed impost would be to increase the demand for State Housing with a concomitant increased levy on tax-payers in general. The part of the Tax Reform Package applicable to charitable institutions is bad both in principle and in its potential effects. We, therefore, ask that you use all means at your disposal to block the passage of such legislation. Yours sincerely (Signatures below) Petitions received. Senator SANDERS(Tasmania) —I give notice that, on the next day of sitting, I shall move: That the Senate- (a) notes that the Hifar Nuclear Reactor at Lucas Heights near Sydney has a potential to cause a nuclear disaster affecting the lives of thousands of people; (b) notes that graphite was a contributing factor in the Windscale nuclear disaster of 1957 and in the recent Chernobyl tragedy, and that the Senior Vice-President of the US nuclear power plant firm Stone and Webster (Mr James Landis) stated that the Chernobyl accident is the worst kind of nuclear accident and that any reactor that uses or contains graphite is susceptible; and (c) urges that this Reactor should be immediately closed and dismantled because: (i) the 28 year-old Reactor is one of the oldest still operating anywhere in the world; (ii) the Reactor design is completely outdated; (iii) serious problems involving loss of cooling water have occurred in the past; and (iv) the Reactor is surrounded by a 2 foot thick blanket of graphite. Senator MICHAEL BAUME(New South Wales) —I give notice that, on the next day of sitting, I shall move: That the Senate- (a) notes with concern the incorrect claim by the Minister for Finance (Senator Walsh) to the Senate on 5 May 1986 that employment in the restaurant industry had increased despite the Federal Government's tax measures when, in fact, the latest official statistics show a clear and incontestable fall in such employment; (b) notes that the latest labour force figures for February 1986, which Senator Walsh deliberately ignored when referring only to statistics for December 1985, show a fall of 800 in employment in the category which includes not only the struggling restaurant industry, but also the rapidly expanding hotel and accommodation industry which is benefiting from the increase in foreign tourists that has resulted from the collapse of the Australian dollar; (c) notes that the December 1985 figures that Senator Walsh misused (and which the Commonwealth Statistician says are both lagged and not as reliable in the area of small business employment, such as restaurants, as with larger businesses), also include the expanding personal services category where employment has risen by 5,000 since August 1985, according to the latest labour force statistics; (d) regrets that the Minister failed to tell the Senate that the figures he misused included the normal seasonal increase for the Christmas period but were not seasonally adjusted and also omitted to mention that official labour force statistics for February 1986 for the restaurants, hotels and clubs category showed a more up-to-date trend that totally destroyed his argument; (e) notes that the February 1986 statistics (also not seasonally adjusted and including the expanding hotel sector) showed a slight fall in employment, clearly indicating a much larger drop in employment in restaurants as totally different jobs in hotels and accommodation increased within this category; and (f) calls on Senator Walsh to cease his constant practice of misleading the Senate by misusing and misrepresenting official statistics. Senator GRIMES(Tasmania-Minister for Community Services)(10.06) —I present the Government's response to the Senate Standing Committee on Education and the Arts report on assessment in secondary colleges in the Australian Capital Territory. I seek leave to make a statement relating thereto and to incorporate the statement in Hansard. Leave granted. The statement read as follows- DETAILED STATEMENT (See appendix for definitions) A. 1983-84 ANNUAL REPORT OF THE A.C.T. SCHOOLS AUTHORITY In its report (pp 3-6), the Senate Committee states that the ACT Schools Authority's Annual Report for 1983-84 was inadequate in its reporting on: (a) various matters of information, including office staff levels; (b) the activities of standing committees; (c) operational problems; and (d) matters of public interest. Ministerial responsibility for ACT government schools during 1983-84 rested with the Minister for Education. The Minister's publicly stated view was that the Federal Government was responsible principally for overall resourcing decisions vis-a-vis the ACT government school system, and that operational matters should be worked out between the statutory authority (the school system's governing body) and the ACT community. The Authority therefore adopted a stance of reporting in detail to its local community through published reports and policy statements, consultation with school communities (eg regional meetings of school boards) and other interested parties (eg school visits, standing committees), formal Authority meetings and through regularly scheduled media conferences. This reporting machinery is referred to in the Annual Report. The Authority's Annual Report for 1983-84 was prepared and presented within this framework and, in the circumstances, was thought to be appropriate. The Authority Council will take account of the Senate Committee's remarks in the preparation of future annual reports. B. EXTERNAL EXAMINATIONS, CONTINUOUS ASSESSMENT AND MAINTAINING STANDARDS A major concern expressed by the Senate Committee was the use of continuous, school-based assessment rather than external examinations. The Committee stated, ``Thus the real choice in the ACT is between retaining the present system, possibly with some refinements, and using a combination of continuous assessment and external examinations. On the basis of the evidence before it, the Committee would have a preference for the latter approach.'' (Senate p 40) The Committee, although indicating that current assessment procedures were generally supported by college staff and students, was of the opinion that external examinations would be seen to be a more objective, fairer method of assessing students' performances than continuous assessment. Generally external examinations were seen as providing motivation for teachers and pupils alike, and for providing a method of maintaining standards in both teaching and learning. In arriving at this recommendation to combine external examinations with school-based assessment, the Committee made comparisons with trends in other States and Territories, noting that only Queensland and the ACT have abolished external examinations at the Year 12 level. Basically the Committee seemed very concerned with maintaining and raising standards in the ACT secondary colleges. Although the importance of that concern cannot be denied, a number of possible avenues are available for achieving that aim. Whatever procedures are selected, they should be consistent with the general educational philosophy of school-based curriculum development that is adopted by the ACT Schools Authority. We regard it as most important that the educationally undesirable effects of external examinations, including a false view of standards, are avoided. (i) Validity and Reliability of Assessment The Committee recognized that because standardisation procedures are used with external examinations in Australia, examination results do not by themselves indicate a set level of student achievement. Present day criterion-referenced assessment techniques were accepted as being inadequate for use at Years 11 and 12. Unfortunately, while suggesting that external examinations be incorporated into continuous assessment, the Committee did not inquire whether external examinations measure student achievement more reliably or more validly that school-based assessment. As noted by Macintosh et. al. (p 3), one of the major problems of educational measurement is to obtain valid and reliable measurements. Validity, according to Rust (pp 85-86) relies heavily on the closest possible knowledge of the student's abilities: one of the advantages of school-based assessment. Macintosh describes the processes involved in assessment as determining the outcomes of learning from observing a student's performance of set tasks. Although recognising that because inferences are drawn from those observations and that those inferences cannot be drawn with absolute certainty, the teacher is nevertheless able to draw upon evidence collected from a number of tasks. It is the regular monitoring of performance through a variety of means which reassures a teacher that the intended outcomes of teaching have been achieved (Macintosh et. al. p 3). One of those means may be examinations if that form of assessment was approved during the accreditation process. But, in school-based assessment, the classroom teacher is intimately involved with all aspects of the development and implementation of the examination. Depending on the course, individual teachers or groups of teachers may develop the examination. School-based assessment does not preclude examinations but internal examinations have a greater potential for providing meaningful information about student performance levels than external examinations. As noted by the Senate Committee, in correspondence from Professor Power, there is no research evidence which proves that external examinations are better than school-based assessment. The evidence available points to the ACT type of school-based assessment being clearly superior to external examinations in terms of validity (assessing genuine attainment) and reliability (assessing consistency). (ii) Relating Assessment Practices to Curriculum Aims In arriving at its recommendation regarding external examinations, the Committee did not distinguish between (a) those attributes of student achievement which can reasonably be determined by external examinations and (b) those qualities which can be assessed under continuous assessment. Recognition was given in the Report to the inevitable consequences of an external examination impinging on the curriculum. External examinations can only assess a very limited range of competencies specified in a narrow set of objectives. Rust (p 79) has suggested that if assessment instruments are not consciously designed to meet our aims then we will be misled by the results. Consider, for example, the aims for one Geography course: 1. To develop a geographic viewpoint. 2. To develop an understanding of the concepts and methods used in geographic inquiry. Contrast those aims with the aims prepared for another Geography course: 1. Establish a comprehension of the major processes and patterns, their integration within and between the cultural and natural phenomena of the environment and their interaction through time. 2. Develop the ability to make personal and socially responsible decisions and to choose effectively between different courses of action with specific reference to spatial problems. 3. Create an atmosphere which provides opportunity for the formulation of attitudes and values contributing to personal development. 4. Develop skills in acquiring, understanding, communicating and applying knowledge. 5. Develop an awareness of and the abilities needed to cope with the dynamic nature of the environment. Some of the aims of the two courses are similar, but the second course contains a much broader set of aims to be achieved and hence assessed. An examination could assess achievement of the narrow range of knowledge and understanding required in the first statement of aims. On the other hand, the valid and reliable assessment of achievement in the second Geography course would be best achieved through school-based rather than external assessment. With school-based assessment, the college and teacher may start by first establishing the aims for the course and then determine how to appropriately assess achievement of those aims. This procedure avoids assessment dictating the aims to be achieved. In a system operating with school-based curriculum and assessment the ``tail does not wag the dog''. The ACT Schools Accrediting Agency has embarked on a major student assessment program which is heavily concerned with the quality of learning and at its October 1985 meeting a proposal was accepted that during Moderation Day 1986 teachers should determine the attributes for awarding grades in the accredited courses. In addition, some colleges have developed, over an extended period of time, their own college assessment policies. One secondary college has initiated an extensive staff development program in assessment. At its April 1986 meeting, the Accrediting Agency considered a moderation plan to enable teachers to more accurately and consistently assess their students in relation to students studying the same or similar courses at other colleges; a plan that builds on the guidance provided by the ASAT, bids staff to compare standards between colleges, and gives colleges with demonstrably stronger groups of students the ability to override the normal moderation procedures. Two other approaches are being developed to improve the validity and reliability of assessment practices. These will strengthen the relationship with stated aims. Both approaches, which are ``path-finding'' activities for the ACT secondary education system, will enable ACT teachers in public and private schools, to attest more readily and accurately to the quality of student levels of performance. During 1986 working parties in English, Mathematics, Science and French will investigate the use of the Structure of Observed Learning Outcomes (SOLO) Taxonomy (Biggs and Collis) which assesses one aspect of the quality of the response. That aspect is the structure or organization of the response. Also during 1986, other groups will develop what has become known as the ``Power Domains''. Those domains represent the ``integrated groupings of content, skill and process goals'' (Power p 9). The domains will be clusters of concepts and skills which Year 11 and 12 students can reasonably be expected to learn. Students will then be assessed in relation to their mastery of a domain. Identifying the domains, together with appropriate assessment instruments, will require a high degree of understanding of the particular discipline, assessment practices and learning theory. The Power Domains may provide an integrated framework for curriculum development within the colleges with realistic, assessable aims, thereby enabling teachers to more accurately describe differing levels of achievement. None of the above approaches are ``ready-made'' solutions to the problems associated with the measurement of human performance, but they are solutions compatible with school-based curriculum. They also avoid problems inherent in external examinations. (iii) Problems with External Examinations Parents and members of the public who have successfully passed through external examination systems accept them as providing valid, reliable measurements of performance and as a means of maintaining standards. Yet there are inherent problems which are difficult to overcome. Some problems were expressed by the Committee, but the Report did not provide any data for assessing the magnitude of these problems. Evidence is available from external examiners' reports to suggest that examination results are used to judge the quality of teaching. For example, external examiners have reported ``. . . the general standard of the external papers showed the results of efficient teaching''. Such statements apply to teachers across an educational system, rather than to specific teachers. No doubt external examinations have the potential (with a large measurement error) for identifying poor teachers, but a number of other factors such as initial student ability and socio-economic status should be removed prior to forming a valid conclusion. As pointed out by Moore (pp 52-53), examinations were originally designed for assessing performance and for certification. With the expansion of secondary education, without a commensurate increase in tertiary places, examinations acquired two additional roles: selection for tertiary education by turning examinations into competitive events, and accountability in terms of success or otherwise at examinations. Moore warns that failure to distinguish between the acquired and original roles ``. . . leads to distortions and malfunctions'' (p 53). If teaching standards should be monitored, then measures more valid and reliable than external examinations could be devised. But are standards of learning really maintained through external examinations? First consider whether the results obtained over a number of years are consistent. Table 1 relates to an external General Mathematics Year 12 examination and shows the means of the average mark as a percentage of the maximum possible mark for a number of years. Table 1 Average Mark as a Percentage of Maximum Possible Mark 1979 1980 1981 1982 1983 1984 mean score 37.3 41.6 44.3 44.9 55.1 55.8 The variations may be explained by changes in the standards of the examination, changes in the abilities of the students, changing standards of the markers, alteration of the scaling procedures or any of a number of other reasons. On the surface the external examination results are not consistent over a period of time and would therefore not appear to represent a consistent standard. Moore suggests that the accuracy, or reliability, of examinations requires removal of fluctuations caused by examiner and marker bias, because the examiner selects the questions for the student and the marker judges the merit of the answers. Clearly ``examiners do act as something more than disinterested judges of student answers'' (Moore p 62). Just as school-based assessment may contain biases and errors of judgement, so may external examinations. By restricting access to completed examination papers the system does not facilitate discovery of biases. Under school-based assessment, estimates of a student's performance over a period of two years, by several different teachers under varying conditions and with items appropriate to the aims, will minimise assessment biases. Furthermore, there is a greater chance of uncovering biases when students, teachers and parents have free access to all facets of the assessment procedures and when acceptable appeal procedures operate. Another way of looking at consistency is to compare school-based assessments with external examination results. From 1982 and 1984 data, Table 2 shows the grand means (on a 200 point scale) in the core parts of seven subjects. Those subjects had more than 1000 candidates in large groups and less than 100 candidates in small groups. Table 2 Grand Means of External Examinations and School Assessments 1982 & 1984 Subject 1982 Ext. Exam School. Asst. 1984 Ext. Exam School. Asst. Accounting 106.32 121.65 118.36 126.29 Aust. Hist. 112.21 120.95 114.44 120.73 Biology 104.13 125.40 112.70 125.32 Chemistry 112.79 133.16 133.20 133.66 English 109.39 124.32 109.02 128.93 Eng. Lit. 117.21 134.51 116.97 137.33 Geography 114.47 127.59 119.56 128.21 From the above table, inconsistencies over the two year period display variations within and between subjects. The largest difference, 20.41, in the grand means occurs with the external Chemistry examination results, not with the school assessments. When commenting on a French examination, the examiners remarked ``This year's examination proved to be of uneven difficulty with many candidates finding the Listening Comprehension test and to a lesser degree the closure questions of the Reading Comprehension test to be more difficult than anticipated''. This comment highlights one of the major problems with external examinations, namely that there is very little opportunity for trialling and testing of the paper prior to its use. Whether or not a set standard is represented by a particular paper depends heavily on the intuitive judgements of the examiners and markers. Frequently, research and post-graduate students, employed to mark external examinations, are paid by the number of papers marked. All questions from the one paper are marked at the one time, allowing little time for comparisons of answers to the same question or between markers during the assessment period. Research has been carried out by Mackay to investigate the fairness of public examinations. Mackay's study showed that ``. . . systematic marking errors which may arise from differences in marking standards of different markers and differences in optional questions are of considerable magnitude'' (p 172). Mackay concluded that ``Improved understanding among users of the results of public examinations may lead to an increase in the likelihood that the results of public examinations will be afforded the diligent, sceptical, and probabilistic treatment they deserve'' (p 174). In the absence of an adequate base for setting and maintaining standards, all States and Territories which operate external examinations are obliged to apply standardization procedures. Those procedures involve, to varying degrees, elements of some forms of school-based assessments. In 1972 the Working Committee on College Proposals for the ACT, chaired by Dr R. J. Campbell, considered the effectiveness of external examinations and concluded that ``. . . in its traditional form (it) is neither effective, nor reliably, nor predictive'' (p 67). The recommendation was made that the ``Higher School Certificate examination be replaced by a tested system of continuous assessment . . . to which is added, at least for the time being, an external test of the TEEP or ASAT type, suitably refined as to take account of other aptitudes besides scholastic'' (p 70). What has evolved since that recommendation is a school-based curriculum and assessment system in which consistency, validity and comparability is sought in four ways: in-college moderation procedures, monitoring of college-derived course scores, the external examination of ASAT, and extensive course accreditation procedures. Whilst acknowledging the Senate Committee's concerns over assessment procedures and given that those procedures have developed over nine years, it is considered that external examinations are not compatible with contemporary educational practice. Rather than moving to external examinations, the problems raised by the Committee are being dealt with in other ways. These are explained in the overview to this response. (iv) The Use of ASAT When the Senate Committee compared continuous assessment with external examination issues, ASAT was discussed separately with focus primarily on problems of using ASAT as a moderating device. ASAT is an external examination set by the Australian Council for Educational Research. The examination is a three hour objective test, with questions drawn from the four subject areas of Mathematics, Science, Social Science and the Humanities. The Committee's recommendation that the ACT incorporate an external assessment into continuous assessment is advice already met in part by ASAT. Students' scores are modified according to results on an external examination, following the recommendation in the Campbell Report. Each year's ASAT is prepared by the same organization which monitors its consistency. From the data presented earlier in this paper, ASAT has greater consistency than traditional subject-based, external examinations. Nevertheless, uncertainties in an individual student's ASAT result are recognized and the moderation procedures use the ASAT mean and standard deviation of a course, instead of individual student results. While curriculum in the ACT remains school-based any external examination would, like the ASAT, be limited to tests of general knowledge and ability. Reference examinations have recently been mentioned for tertiary selection procedures, but none are currently in use in Australia. Their validity, reliability and usefulness at the individual level is yet to be established. An alternative might be for some form of external oversight of assessment instruments used within the colleges. (v) Comparisons with Other Educational Systems Comparisons with other States, particularly Western Australia, and recommendations of the McGaw Report appear to have been a factor which influenced the Committee to recommend incorporation of external examinations with internal assessment. All State and Territory certification authorities now use a combination of internal assessment and external examination. All moreover use the external examination to moderate-in some form-the internal assessment. In two of the authorities the external examination is the Australian Scholastic Aptitude Test. Queensland and the ACT are the only two authorities which have been able to adopt a more valid, reliable and effective moderator than the subject-based external examination. The other authorities have at various times expressed the desire to move away from the external examination but because of their long association with the public examinations have to opt for a phased shift from the fully external public examination to internal assessment. The ACT and Queensland were well placed to make a fundamental shift in the early 1970s; a time of marked social change. Both moreover viewed the shift as fundamental to major restructuring that was taking place in those areas at that stage. The McGaw and Blackburn Reports reflect a political scenario and not an educational rationale. (vi) Standards of Learning The data provided in Table 3.2 on page 28 of the Senate report represent an incorrect interpretation of the information provided. In 1985 99% of Year 12 students studied English; 95% Mathematics and 74% Science. A detailed explanation of the shortcomings of the table is included in Appendix 2. C. COURSE ACCREDITATION Course development in Years 11 and 12 in the ACT is the responsibility of the individual college. Courses prepared by the colleges are taken through an approval process that requires the course to be formally supported by the college board; examined by a specialist accreditation panel which contains teachers, academics and community representatives; approved by the ACT Schools Accrediting Agency, and in the case of courses seeking TES-classification, also approved by the Australian National University. Indeed the procedure used to ensure that the courses are of a requisite standard is very similar to that used with the colleges of advanced education. The ACT accreditation procedures were introduced in 1975; evaluated by a committee chaired by Professor Selby Smith (University of Tasmania) and found to be very effective. The Senate Committee in its consideration of this aspect of the ACT operations generally endorsed the current procedures, and simply pointed to some areas where refinements could be made. The report prepared by the Accreditation Working Party also endorses the present structures; discusses each of the concerns mentioned in the Senate Report and recommends various ways and means of allaying them. The recommendations in the report ``Course Accreditation in the ACT-A Review'' were discussed at the February 1986 meeting of the Accrediting Agency. A preferred position with respect to the Review will be formulated, circulated throughout the community and then finalised at the June 1986 Agency meeting, in conjunction with the final report from the inquiry into TES scaling. (Copies of Course Accreditation in the ACT-A Review are available from the ACT Schools Authority.) D. STUDENT, PUBLIC AND EMPLOYER UNDERSTANDING OF, AND CONFIDENCE IN, THE ASSESSMENT PROCEDURES The Senate Committee commended the Schools Authority for the information brochures prepared for general dissemination to the students and public. The Committee also found that the existing assessment procedures were supported, although not fully understood, by those who are most affected by them; teachers and students. The Committee, whilst acknowledging the limitations of its evidence, concluded that there is widespread community ignorance and recommended that the efforts to inform the public be expanded. The Authority has recognised the need to inform the public of educational issues and has previously established a Public Relations Reference Group to develop information programs. The Senate Standing Committee received evidence from the Confederation of ACT Industry (CONFACT) which stated that the ``. . . certification procedures were not understood and that employers were losing faith in the ACT education system'' (Senate p 70). This may be due to employer laziness as much as to any undue complexity in our system. During 1985, the Authority initiated discussions with employers regarding the value of the information on the Year 10 and 12 Certificates. CONFACT deals mainly with students at or below Year 10, who do not commence college studies. Given the high retention rate in the ACT, those students are few in number and are atypical. Their needs are best met by a more detailed account of abilities than is to be found in a single number cypher. Discussions have been held with such groups as retailers, banks, building societies and the Public Service Board. Frequently those discussions have involved many issues of assessment, accreditation and certification. The Agency, before making policy decisions, requires a clear understanding of employer needs, and will consider a paper about those needs at the 1986 April meeting. The Government notes the Committee's reservations about the representativeness of the students and teachers they met during their visits to two colleges. Those reservations must equally be true of the one parent, one student, and the one lecturer who appeared as witnesses before the Committee. There is empirical evidence available from the Anderson, Saltet and Vervoorn study which investigated the shifts from 1972 to 1979 that occurred in secondary college student attitudes towards many aspects of their schooling. The investigation showed that the secondary colleges had been ``. . . an important factor in bringing about a more positive outlook towards schooling among their students'' (Anderson et. al. p 119). The Government recognises that every effort possible should be made to increase the public's understanding, not only of assessment and certification procedures, but also of the educational philosophy upon which the ACT educational system is based. Without that fundamental understanding, discussions and decisions could be dominated by partisan interests. This may inhibit achieving the aims embodied in the philosophy which, as the committee noted, have general community endorsement. Where understanding of a new system takes time to develop, particularly when the myths of the past have to be overcome, lack of understanding does not necessarily warrant returning to a closed system of external examinations or central specification of curricula. E. MODERATION PROCEDURES: INTRA- AND INTER-COLLEGE Moderation procedures begin when a course is developed and presented to an Accreditation panel. Each panel consists of representatives from secondary colleges, tertiary institutions and the community. The panels, through their consultations with course developers and enforcement of accreditation guidelines, fulfil a moderating role by maintaining standards within courses and across colleges. There are several different types of moderation procedures. Intra-college moderation usually involves groups of teachers who monitor the achievement of students. Those moderation procedures include the use of common tests, multiple marking of common assignments, team teaching of units, and faculty discussions regarding assessment and curriculum policies. Teachers may also teach the same students in different units and Heads of Department provide oversight as moderators of courses. Some faculties use a combination of qualitative and statistical procedures, such as back-scaling, to compare results and rank students. Moderation across all courses within a given college occurs at the Principal and/or Assistant Principal level. Inter-college, system-wide moderation procedures are supervised by the Accrediting Agency's Technical Adviser. Most of those procedures are statistical, and the Adviser checks individual course scores at all colleges. Such procedures were instituted because, as suggested by Thomson (p 14) and McGaw (p 8), a basic premise of internal assessment is that, although teachers validly and reliably rank students within schools, additional moderation or scaling procedures are required to achieve comparability between colleges. School assessments are accepted as the basis for discriminating among students within colleges and the scaling procedures, based on the external moderator, are designed to remove arbitrary differences between schools. Consensus moderation procedures operating with course scores have not been developed in the ACT because they are considered to be unwieldy. A plan for intra-course moderation across colleges, which takes advantage of their coherent nature, is being considered by the Accrediting Agency. F. APPEAL PROCEDURES One important recommendation emphasised by the Senate Committee was that the Authority investigate the need and appropriate procedures for appeals against assessment of Tertiary Entrance Scores (Senate p 77). Given the present policy regarding calculation of the tertiary entrance score, the issuing of unit or course scores provides the only appropriate point at which appeals can be lodged. Appeals refer to errors or breaches of the policies. Avenues other than the appeal procedures are available if anyone wants to question Authority policy. At the beginning of a unit teachers are required to provide their students with an assessment plan, which then becomes a contract between student and teacher. Students then have the right to appeal to the college and Agency if that plan is not followed. The ACT appeal procedures are open at all levels and students have the right to appeal about the fairness, correctness and reasonableness of a decision at any stage. Those rights signify an empowering of the students and the accountability of the teachers towards the students. Not all educational systems operate with such open appeals procedures. Consider, for example, those procedures operating in another system. In that State ``. . . candidates who receive Grade D or above in the subjects for which they have applied for consideration will receive no further consideration in the assessment of their performance in these subjects.'' Indeed the ACT is one of the few States or Territories that has integrated the freedom of information philosophy into all aspects of its assessment procedures. OVERVIEW The report of the Senate Standing Committee is basically an endorsement of what transpires in ACT secondary colleges. In particular, the Committee reported satisfaction with: (a) The general acceptance and understanding amongst students and staff about the assessment procedures; (b) the information brochures designed to explain the system to the client groups; (c) the system checks which limit deliberate bias in the assessment procedures; (d) the report into the accreditation procedures; and (e) the Inquiry into TES Scaling. In relation to external examinations, the committee acknowledged that they will not, without moderation, maintain standards and achieve comparability; nor will they provide more information about levels of achievement than the current procedures. The Government shares the Committee's concern for the maintenance of standards and the credibility of the system; however its views on the most appropriate methods for achieving these ends differ from those of the Committee. The Government believes that it is appropriate to use moderation techniques consistent with the underlying educational philosophy of ACT secondary colleges and which also take advantage of the smallness and compactness of the ACT system. The Senate Committee's Report makes scant reference to the underlying educational philosophy of the ACT college system or to the Schools Authority's desire, since 1976, to have the secondary colleges cater for all students wishing to complete secondary education, not just those who aspire towards tertiary education. A recent release from the Commonwealth Statistician (28/2/86) notes that the ACT's efforts to cater for the total age cohort has resulted in the ACT having virtually double the national average proportion of students continuing through to Year 12. The same report also observes that the two education systems with the highest retention rates in Australia are those with school based curriculum and assessment: the ACT and Queensland. Wide consultation with those associated with ACT schooling would reveal the efforts that have been-and are being-made to address the issues of comparability and the maintenance of standards. 1. System-wide initiatives for teachers: (a) moderation Moderation Day 1986 being concerned with the criteria being used for awarding grades and their relationship to the stated curriculum. preliminary examinations of course score distributions and comparability across courses. (b) assessment through the Assessment Task Force development of the SOLO Taxonomy as an assessment technique for determining one aspect of the quality of students' responses. Quality in the SOLO Taxonomy terminology refers to the way in which the ideas are organised within the students' responses. specification of the ``Power Domains'' and development of appropriate assessment strategies. (c) public understanding formation of the Public Relations Reference Group. liaison with employers. (d) small group procedures extension to nine or fewer students. 2. College-based initiatives: (a) assessment development of college assessment policies. in service programs on assessment. 3. System-wide deliberations on the following reports: (a) ``Course Accreditation in the ACT-A Review''. (b) ``TES Scaling''. APPENDIX 1 Assessment: Frequently the terms ``assessment and evaluation'' are all-embracing terms which refer to teaching and learning processes. In the ACT context ``assessment'' is used to describe the measurements taken to determine the learning outcomes in individuals. Validity: ``Validity'' is a measurement term which ``. . . refers to the ability of the test to do the job we want it to . . . (it) is the most important single attribute (of a test)'' (Lyman p 21). Reliability: The other important concept in educational measurement is ``reliability'', which is a necessary, but not sufficient, condition for validity. ``Reliability means that a test gives dependable and consistent scores'' (Lyman p 21). In more practical terms Macintosh et. al. (p 3) explains that reliability requires that ``. . . the judgement of the child's attainment should be relatively robust against changes of tester, test procedure, or occasion when marks are collected''. APPENDIX 2 Through its Table 3.2 (p 28), the Committee reported on the percentages of students enrolled in the top ten subject areas in 1984. Unfortunately, the table contains data from two separate tables in the Year 12 Study of 1984. In combining data, two different populations of students have been used. Those two populations are (i) the number of candidates (4302) which refers to the number of students who completed one or more units in a course, and (ii) the number of students who completed one of the four types of courses. The data in Table 3.2 reported under the heading ``Subject Total'' refers to the number of students who completed courses, not to the number who completed at least one unit in a course. Hence the calculations for the data reported under the heading ``% of Total'' uses two different bases for the students populations. Data reported in Table 3.1 of the Report (p 27) accurately reflects the enrolment characteristics of students in 1985. The enrolment data required by the Senate Committee cannot be obtained from the Year 12 Study of 1984. As information, the data presented in Table 3 below indicates the course choices of students in 1985 who ``Completed Year 12''. This refers to students who had completed a course by term 5, 1985. (ACT Schools Authority, Table 14.5, p 198). Table 3 Proportion of Students Who Completed Year 12 Studying English, Maths and Science Courses Excluding Status Courses and Mature Age Students Completed Year 12 English No. % Maths No. % Science No. % 2938 ... 2900 98.7 2780 94.6 2169 73.8 REFERENCES ACT Schools Authority, Year 12 Study, Number Ten, 1985, Canberra, 1985. Course Accreditation in the ACT-A Review, Advance Copy, Canberra, 1985. (Burns Report) Certificates For Year 12 Students: A Review of the ACT Schools Accrediting Agency, Canberra, 1979. (Selby Smith Report) Anderson, D; Saltet, Marijke and Vervoorn, A, Schools to Grow In: An Evaluation of Secondary Colleges, Australian National University Press, Canberra, 1980. Biggs, J B and Collis, K F, Evaluating the Quality of The SOLO Taxonomy (Structures of the Observed Learning Outcome), Academic Press, New York, 1982. Dickson College Course Accreditation Document. Dunn, S S, and Ratford, W C, ``Where Next?'' in S S Dunn (Ed), Public Examinations: The Changing Scene, Rigby, Adelaide, 1974. Elley, W B, and Livingstone, I D, External Examinations and Assessments, New Zealand Council for Educational Research, Wellington, NZ, 1972. Lyman, H B, Test Scores and What They Mean, 2nd ed, Prentice-Hall, Englewood Cliffs, New Jersey, 1971. Macintosh, H; Nuttall, D, and Clift, P, Measuring Learning Outcomes Block 6, The Open University Press, Walton Hall, UK, 1981. Mackay, L D, ``Setting and Marking of Public Examinations'', in S S Dunn (Ed), Public Examinations: The Changing Scene, Rigby, Adelaide, 1974. Moore, W E, ``Some Functions of Examinations'', in S S Dunn (Ed), Public Examinations: The Changing Scene, Rigby, Adelaide, 1974. Power, C, Criterion Based Assessment and Reporting, paper presented at the Australian Conference of Examining and Certifying Authorities, Adelaide, July 1985. Report by the Senate Standing Standing Committee on Education and the Arts, Examination of Annual Reports Fourth Report Assessment in Secondary Colleges in the Australian Capital Territory, Australian Government Publishing Service, Canberra, 1985. Report on the Working Committee on College Proposal for the Australian Capital Territory, (Dr R. J. Campbell Chairman), Secondary Education for Canberra, (Campbell Report), Canberra, 1973. Report of the Ministerial Working Party on School Certification and Tertiary Admission Procedures, (Dr B. McGaw Chairman), Assessment in the Upper Secondary School in Western Australia, Perth, April 1984. Rust, B. W., Examinations: Pass or Failure? A Critical Survey, Pitman, London, 1967. Thomson, P, Assessment for Australian Capital Territory Secondary Schools, Australian Council for Educational Research, Melbourne, 1974. Victorian Institute of Secondary Education, Handbook for 1985, Year 12 Curriculum and Assessment, VISE, 1984. Report on HSC Assessment Program 1982, VISE, 1983. Report on HSC Assessment Program 1984, VISE, 1985. Senator GRIMES —I move: That the Senate take note of the paper. Senator COLSTON(Queensland)(10.07) —I thank the Minister for Community Services (Senator Grimes) and the Government for responding to the report of the Senate Standing Committee on Education and the Arts on assessment in secondary colleges in the Australian Capital Territory. As Chairman of the Senate Standing Committee on Education and the Arts, I shall make a few observations of a preliminary nature about the response. After I have studied the response in more depth, I may wish to add to the remarks I intend to make today. Some other members of the Committee may also wish to comment at a later date or later today. In its report, the Committee drew attention to shortcomings in the Australian Capital Territory Schools Authority's annual report for 1983-84. The Government's detailed response suggests that because of the special framework in which the Authority operated at that time, its annual report was considered appropriate. Nevertheless, the Committee considers that the Australian Capital Territory Schools Authority's annual reports should meet the standards which are required of all other statutory corporations. I note the Government's assurance that the Committee's remarks will be taken into account in the preparation of future annual reports, which the Committee looks forward to reading. In chapter 3 of the Committee's report, the merits of continuous assessment and external examinations were discussed. In paragraph 3.39 the Committee recommended that the Australian Capital Territory Schools Authority should review the possibility of using external examinations as part of its assessment procedures in the future. The whole of that paragraph deserves study, but I shall read three pertinent sentences from that paragraph: It is essentially misleading to argue, as some have done, that the only educational choice is between external examinations and continuous assessment . . . the real choice in the Australian Capital Territory is between retaining the present system, possibly with some refinements, and using a combination of continuous assessment and external examinations. On the basis of the evidence before it, the Committee would have a preference for the latter approach. The Government's response, however, indicates that it is convinced of the educational and technical superiority of moderated school-based assessment. Further, the Government states that it intends to continue with procedures which are compatible with the educational philosophy of the Australian Capital Territory system. The response refers to the devolution of responsibility from the centre to the colleges, and the necessity of developing an assessment scheme that overcomes the strictures and problems of public examinations. The Committee did not expect that the Australian Capital Territory Schools Authority would rush to adopt a system of external examinations. I am disappointed, however, that the main thrust of the response appears to be the denigration of external examinations. There is no indication that the Schools Authority has considered seriously the possible merits of the Committee's recommendations. In effect, the detailed response tabled today is an apologia for the current system of assessment. The only references to external examinations are designed to highlight their shortcomings. The Committee discussed some of these deficiencies in its report. Yet, in the short time I have had to examine the Government's response I have noticed that one of the references in the response appears to be less than intellectually honest. The Government's response has presumed that the Committee is advocating the use of `subject-based, public and compulsory (examinations) for all students'. This presumption is incorrect. The Committee deliberately refrained from specifying what type of external examination might be appropriate, expecting that the Schools Authority would address itself to that question. There are several points of detail in the Government's response on which I should comment. Firstly, the Government's response includes the statement that `it is considered that external examinations are not compatible with contemporary educational practice'. I find that comment difficult to comprehend in view of the fact that external examinations are used not only in other States of Australia but also in countries which are more prosperous and technically advanced. Secondly, the Government's response claims that the Australian scholastic aptitude test is an external examination. I doubt that an aptitude test such as ASAT could properly be described as an external examination. To claim that `the Committee's recommendation that the ACT incorporate an external assessment into continuous assessment is advice already met in part by ASAT' is, at best, a grossly spurious suggestion. Thirdly, according to the response, the Blackburn report, the report of the Victoria Ministerial Review of Postcompulsory Schooling, in Victoria and the McGaw report, the report of the Ministerial Working Party on School Certification and Tertiary Administration Procedures, in Western Australia `reflect a political scenario and not an educational rationale'. Presumably this means that public opinion was taken into account in these two States. When the Committee took evidence it heard comments about a lack of community involvement in the change of assessment procedures in the Australian Capital Territory. If those comments are valid, and if there had been community involvement, it is interesting to speculate whether the Australian Capital Territory would now have a system of continuous assessment. The fourth point on which I should comment is the statement in the response that the Committee had noted that the philosophy of the Australian Capital Territory education system has general community endorsement. The Committee did not make any such statement. There are many other matters which, given more time to examine the response, are worthy of comment. One of these areas is the Authority's response about appeal procedures. But these other matters can wait to a later occasion. There are two other matters, however, that I consider I must address before concluding. The Committee did not set out to write a prescriptive multi-volume report, which it would have had to do if it addressed all the issues the Government response seemed to imply it should. The Committee did hope that the Authority would use its comments-the Committee's comments-as a first step in applying its expertise to what is a complex issue. The other matter is that I consider senators can make relevant comments in certain areas without necessarily having specialist knowledge in those areas. Indeed, it may be that a lack of such knowledge can be of benefit in that senators are able to take a fresh look at procedures which are routinely accepted by the specialists. Nevertheless, it should be noted that this Committee does have members who have a long involvement in the field of education and whose qualifications in that area are not inconsiderable. As one of those, and I expect my views will be shared by some of my Committee colleagues, I am disappointed in the lack of professionalism with which the Schools Authority has responded to the Committee's report. Senator TEAGUE —(South Australia) (10.14)-The Chairman of the Senate Standing Committee on Education and the Arts has been constrained in his response to this ministerial statement. It is clear that he, on behalf of the Committee and on his own behalf, is not happy or satisfied with the unbending statement of the Minister for Education (Senator Ryan) that all is well in the assessment system in the Australian Capital Territory Schools Authority and that there is no need for change, particularly the changes and considerations that were brought to the attention of the Senate by the Committee. The Senate is at a disadvantage in that the Minister's statement has not been read this morning here in the chamber but rather has been fully incorporated in Hansard. Before coming to my assessment, therefore-and I am speaking on behalf of the Opposition on this matter-I will give one or two minutes of background to the significance of this statement. The Minister's response is in two parts. The first is a four-page summary of the Government's response to the several chapters of the report of the Senate Committee and, secondly, there is a longer paper which concentrates on the merits of various forms of assessment at years 11 and 12 in the school system in the Australian Capital Territory-whether there should be school-based internal assessment or external examinations. These two statements respond to a report of the Senate Standing Committee on Education and the Arts which was completed last December. The Committee was enquiring into the Australian Capital Territory Schools Authority annual report of 1983-84. During that period there were two notable public controversies in this Territory. One was the voiced and rising public concern at the credibility of the assessment system because it was not based on external examination but was school-based and thus was distinctly different from the assessment systems of all other States, except for some comparison with Queensland which is also very much reliant on school-based assessment. The second controversy that year concerned the adjustment by the Minister, Senator Ryan, of the Australian Capital Territory year 12 tertiary entrance scores on the basis of alleged sex bias. She gave extra points to the tertiary education scores of some girls in the Australian Capital Territory not on the basis of their assessment but as a systematic adjustment that she said was to give them extra points to make up for inherent bias in the method of assessment. This proved to be totally unfounded and wrongly introduced by the Minister. The following year, after the public controversy and after considerable debate by the Opposition in the Senate, the Minister's adjustment to the Australian Capital Territory Schools Authority's approach was removed. Those very considerable public controversies were not mentioned in the annual report of the Australian Capital Territory Schools Authority for the relevant period. The first concern of the Senate Committee when you, Mr President, referred that annual report to it was to ask the Australian Capital Territory Schools Authority to give reasons as to why there was such a deafening silence in the annual report on two matters of considerable public controversy. The second and subsequent goal of the Senate inquiry was to explore these matters and see what reassurance could be given by the Australian Capital Territory Schools Authority that would satisfy the Senate Committee in its reporting to the Senate and would also give greater confidence to the people of the Australian Capital Territory, who had expressed these concerns, that there would be a more careful analysis. After the various findings of the Senate Committee report, what has this Government concluded? What is its response? It has made an unbending, resolute defence of practices in the Australian Capital Territory of depending completely upon school-based assessment, thought moderated by the Australian scholastic aptitude test, for year 11 and 12. The Chairman of the Senate Committee, Senate Colston, has said just now that in part that response is less than intellectually honest. I would go much further than that, and say that it is entirely misplaced. It is gratuitous for the Government to include within its response this morning words which have not actually been used in the Senate-the speech was incorporated-including allegations that those detractors of the present Australian Capital Territory system are reliant upon myths, that they have come to their criticism on the basis of a political scenario rather than an educational rationale, and that especially employers in the Australian Capital Territory, as well as some parents, are stupid if they are critical of the present Territory practice because they lack understanding of, or lack the capacity to understand, what it is readily admitted is a complex assessment procedure. Senator Peter Baume —That is arrogance. Senator TEAGUE —I agree with Senator Baume; it is arrogant to make such accusations. There is the linked accusation in the report that those who do not understand the apparently noble, right and sound assessment procedures in the Australian Capital Territory that the Minister is defending not only are acting on myths or stupid but also are lazy. There is a reference in the Minister's response to employers in the Australian Capital Territory being too lazy to understanding the ASAT moderated school-based assessment system. I regard those remarks as unnecessary and insulting to employers and parents in the Australian Capital Territory. It is unworthy of the Government and the Minister to make such a statement. Let me come to the other particular controversy that I referred to earlier, and that is the alleged sex bias in the assessment procedure. In the 1980s, but especially in 1983, it became apparent that in single-sex colleges in the Australian Capital Territory girls had generally lower tertiary entrance scores and therefore it was asked how this situation may have arisen. Was it because the girls in those single-sex colleges were taking subjects that were of such a nature that they gained lower assessment points? Was it because in those schools the retention rate was so much higher than in other colleges so that students of lower ability were included within the assessment, effectively bringing down the average score? Was it because girls were undertaking subjects different from those undertaken by boys? Was it because in the actual procedures of teaching and learning in schools teachers concentrated on giving greater encouragement to boys rather than girls? Was it a question of whether girls could better undertake their studies, be more successful, in coeducational colleges or in single-sex colleges? All those various hypotheses could be appealed to to explain the outcome, but in the midst of all those varying explanations the Minister, Senator Ryan, chose one, without sufficient evidence, and said that this outcome was the result of a systematic bias in the procedures of the assessment system itself and, therefore, the Australian Capital Territory Schools Authority was encouraged by the Minister, unilaterally, to adjust those scores directly, just to give some extra points to the girls who were seen to be affected. That was done without any sound analysis, without any sound basis for doing so, and when this was brought to greater attention by debate in the Senate and public criticism in the Australian Capital Territory the Minister withdrew. Subsequently, the Committee's inquiries concentrated on this matter to some extent. There is a whole chapter in our report on it. But there is a virtual deafening silence in the Minister's response to this matter. There is only one sentence; there is no straightforward, honest admission of her earlier mistake in 1983. Rather, there is in the Minister's response a cool, quiet statement that the Committee has suspended its final judgment on this matter because it supports the current thorough inquiry by a committee of experts drawn from the Schools Authority, from the Australian National University and from the Canberra College of Advanced Education. In fact, I believe that that inquiry evolved because of the Senate Committee's investigations into this matter. Given the inadequacy of the Government's decision in 1983 to make adjustments, it is clear on all accounts that the expert inquiry is needed. It is still being undertaken, and of course the Senate Committee has suspended its final comment until that Committee of experts reports. Of course, the Government notes that we have suspended our final assessment of this question until we have the additional evidence. That is the only reference that the Minister has made to this possible sex bias in the ASAT moderation of tertiary education scores. I find that entirely inadequate and it lacks honesty in the same way as other matters in the report that the Chairman of the Committee, Senator Colston, assessed in those terms. Let me come back to the principal matter in the Government's response this morning-the school based assessment procedure versus external assessment. It is correct, as the Minister claims in her response, that in 1972 a working committee on college proposals for the Australian Capital Territory, chaired by Dr Campbell, who subsequently became the Chairman of the Schools Authority and who served that Authority admirably over some six or seven years, considered the effectiveness of external examinations and, as stated by the Minister, concluded: . . . in its traditional form (it) is neither effective, nor reliable, nor predictive. The Minister cites that finding by the original working party that set up the present assessment procedures in the Australian Capital Territory as if it were a complete reason for the present practice, but to find some inadequacies in external examinations is not in itself a sufficient argument for there not being some part in the assessment procedure for external examinations. The Senate Committee unanimously found that the Australian Capital Territory school assessment procedure ought to have an element of external examination in it. After all, this is the case in Western Australia, South Australia, Victoria, New South Wales and Tasmania. In all those States there is an external examination element in the assessment at the year 12 level. That situation is not directly addressed by the Minister, except to note that the continuing inclusion of an external examination is based on a myth which persists in those States, as if the public reliance on external examinations as being necessary to assess correctly the end of school outcomes of students is a myth and that only for that reason in all these States is the external examination element being retained. That is unworthy of the Minister and the Schools Authority to so condemn the practices in the various States of Australia, not least in Western Australia, where a most competent inquiry was undertaken recently into the assessment system. In that recent inquiry there was a robust defence of the soundness of including an external examination element in the assessment procedure. The Minister goes on to say in this statement that it is not just because myths persist in the States-of course, the enlightened Australian Capital Territory has done away with myths-but also because the States are captured by reflecting a political scenario and not an educational rationale. Let me quote from page 9 of the longer second paper of the Minister's response where she states: The ACT and Queensland were well placed to make a fundamental shift in the early 1970s; a time of marked social change. Both moreover viewed the shift as fundamental to major restructuring that was taking place in those areas at that stage. The McGaw and Blackburn reports reflect a political scenario and not an educational rationale. I ask the Minister whether she would be bold enough to say that directly to Dr McGaw. Would she be bold enough to accuse Dr McGaw of completing a report into the Western Australian assessment system and coming to this conclusion so as to reflect a political scenario and not an educational rationale? The accusation that is made is that this recent inquiry and the other State systems are not educationally sound but have adopted myths and politics as the basis for their continuing with external examinations. The Senate Standing Committee on Eduction and the Arts unanimously disagrees with the Ministers of this Government. Whilst it is the case that the Minister for Territories is now responsible for the school system in this Territory, the Government as a whole is responding in this report and is taking up the arguments that no doubt have been the result of advice from the Minister for Education, the Department of Education and the Australian Capital Territory Schools Authority. It is just not good enough for the various States and these expert educational authorities to be dismissed in such an arrogant, cursory and superficial way as to say that only the Australian Capital Territory, and perhaps Queensland, have an assessment system based upon sound educational analysis and principles and that the other States are still basing their systems on myth and political allegiance to that myth. I think this is further compounded by the arrogance of the Minister's response that citizens in this Territory fail to understand the superior principles of the Australian Capital Territory system because they are either stupid or lazy. Page 10 of the Government's response refers to the Senate Standing Committee's evidence from the Confederation of ACT Industry, which stated: . . . certification procedures were not understood and that employers were losing faith in the ACT education system. The Government's response to that matter was put on page 10 of the statement in these words: This may be due to employer laziness as much as to any undue complexity in our system. The response states further: Their needs are best met by a more detailed account of abilities than is to be found in a single number cypher. In other words, the Government's response is unnecessarily making fun of employers in this Territory, as if they were trying to assess the ability of students coming from schools and seeking employment on the basis of a single number, a point score out of 100, or whether their priorities for choosing a person for employment should be based upon a single percentage. That is not the case amongst employers in the Australian Capital Territory and it is not the case amongst parents in the Australian Capital Territory. Of course there is every encouragement in this Territory, as in all parts of Australia, for parents and employers to have a full and descriptive account of the abilities of school leavers to take into account their academic achievement in a range of areas that can be quite various, to take into account their personal development and their aptitude for employment in various areas. It is entirely unworthy of the Government to respond to this Senate Committee's report by flinging off such empty criticisms at the citizens of this Territory. On behalf of the Opposition I express profound dissatisfaction with the Government's response to the Senate Committee's report, not only in defending the original annual report's inadequate reference to these matters of controversy, but also in giving an unbending, unyielding defence of current practice in assessment, despite quite different practices in other States; despite the unanimous finding of the Senate Committee that there ought to be a change in the Australian Capital Territory and that consideration ought to be given to an external examination element within the assessment procedure; and the inadequacy of this Government reponse in its reference to the alleged sex bias by putting in one brief sentence without squarely acknowledging its error, through Senator Ryan's intervention to adjust scores in 1983. When the Government's response becomes known to the citizens of the Australian Capital Territory and offence is caused by its accusations and arrogant criticisms of employers and parents, I think much more will rebound upon this Government. In any event, members of the Senate Committee will seek to debate this response and its inadequacies more carefully after the statement has been studied in the coming days. I seek leave to continue my remarks later. Leave granted; debate adjourned. Motion (by Senator Grimes for Senator Button) agreed to: That leave be given to introduce a Bill for an Act relating to financial assistance by the Commonwealth for certain research and development. Bill presented by Senator Grimes, and read a first time. Standing Orders suspended. Senator GRIMES(Tasmania-Minister for Community Services)(10.41) —I move: That the Bill be now read a second time. I seek leave to have the second reading speech incorporated in Hansard. Leave granted. The speech read as follows- This Bill is a step in the process of completing the Government's package to promote technology in industry and the Government's industry policy objectives. These objectives are to encourage the development of internationally competitive, export oriented and innovative industries in Australia. Australia needs to build on its innovative skills and research strengths by lifting the level of research and development undertaken by industry, by improving awareness of technology in industry and by forging strong links between industry and researchers. It is imperative that industry should develop a `technology culture' so that it becomes aware of opportunities resulting from research in Australia and overseas. Research and development spending by Australian industry is low (0.22 per cent of GDP compared with a median of 0.98 per cent for OECD medium R&D performers) and has been declining over recent years. The Australian Science and Technology Council (ASTEC) in its recent report on Public Investment in Research and Development in Australia said that a substantial increase in innovation and performance of industry research and development is necessary. This present level of research and development is just not good enough if Australian industry is to be internationally competitive. The Government is prepared to give generous assistance to Australian industry to become more competitive. It is now up to industry to take up the opportunities the Government has provided. Research and development leads to the development of new and improved products which assists industry in opening up new markets, expanding existing markets and becoming more competitive. It also assists development of new or improved production processes which increase productivity and helps make industry more competitive. Most importantly, performance by industry of R&D raises its awareness of technological development and facilitates better choices in the purchase and introduction of technology. Research and development is only one, albeit significant input to successful innovation and improved industry performance. Other elements of the innovation process including production, management, finance and marketing expertise, are also fundamental to success. Policies to promote increased R&D in Australia should therefore be seen as an integral part of our broader industry and technology policies. The key element in the Government's effort to encourage research and development is the market forces based 150 per cent tax concession. The concession has operated since 1 July 1985 and is estimated to cost around $100m in 1986-87. To date the signs are encouraging, already some 900 companies have indicated that they intend to make use of the tax concession scheme in 1985-86 and 1986-87. Based on data provided by these companies the anticipated increase in real R&D expenditure in 1985-86 will be in excess of 30 per cent. Further increases are expected in 1986-87. When announcing the tax concession scheme on 29 May last year I indicated the Government's awareness that not all firms could benefit from it. For example, the 150 per cent tax concession would not support worthwhile research and development by startup firms which are important sources of innovation and wealth creation. Such firms need `up front' cash to support essential research and development projects and because, in their initial years of operation, they do not make profits, they are unable to benefit from the tax concession. To this end the Government has decided to introduce measures aimed at filling important gaps in research and development assistance. A new scheme, the Grants for Industry Research and Development (GIRD) Scheme, with the following major elements will be introduced: Discretionary Grants: providing a similar level of effective support as the tax concession does for taxable companies (i.e. a taxable grant of 50 per cent of eligible expenditure). These grants will have broadly similar form to the project grants of the present Australian Industrial Research and Development Incentives Scheme. Generic Technology Grants: to support new or emerging technologies of fundamental significance for industry competitiveness in the 1990s but unlikely to develop if left to the market alone; these grants would fund development of research in collaboration with industry to a stage where industry would take up further development; and National Interest Agreements: awarded for projects with significant national benefits which would not be undertaken by industry on a commercial basis. It might be argued that, as the tax concession is available to all companies which have tax liability, all companies without tax liability should be eligible for discretionary grants. However, in the context of limited funding the Government has of necessity opted for a selective approach. Only those enterprises which meet certain criteria will be eligible for discretionary grants. Highest priority for grants will be given to newly established firms needing up front cash to carry out their innovation projects. They would be those adjudged competent to perform or have performed the required research and development and to commercially exploit the results. On commercial viability grounds regular loss makers who cannot demonstrate a plan to become profitable should not generally warrant support. In their case research and development support may not be the main problem. However, there will be instances, for example, where a long established but consistent loss making firm is involved in industry restructuring for which the discretionary grant may be a very effective form of adjustment assistance. Grants would be payable for a maximum period of three years in respect of any one project. The definition of research and development which qualifies will be the same as for the 150 per cent tax concession. Grants will be limited to certain areas initially, including manufacturing, mining, construction and computer software. New or emerging technologies with the potential to significantly influence industrial development in the 1990's are unlikely to be fully developed if left to the market alone. The market orientated tax concession would therefore not assist research and development in these areas. Risk is high, the development time frame is often very long and sufficient appropriation of the benefits by the researcher is often not possible. Even with the 150 per cent tax concession it is doubtful whether firms will be able to adequately diversify the risk involved for optimal investment from a community viewpoint. An element of `technology push' is needed to provide the fundamental support. Yet these technologies have application over a range of industries and can strengthen or extend existing comparative advantages. They can be directed at the creation of new markets through development of new products; and they can revitalise existing industry, increasing its productivity through new and improved process technology. For the purposes of the proposed new R&D incentives these areas of technology have been labelled `Generic Technologies'. Some examples of such broad-ranging technology areas are biotechnology, microelectronics and advanced materials. Within such areas there could be numerous technologies. For example, priority application areas for the existing National Biotechnology Program Research Grants Scheme range from plant agriculture, through veterinary, animal husbandry, pharmaceutical/medical, biotechnology equipment and instrumentation, food processing to the chemicals industry. From time to time there will also be research and development projects with significant national benefits for which the researcher is unable to capture sufficient benefits to interest entrepreneurs. Australia's very good record of scientific research is not reflected in the application of science and technology in industry. Support for these `Generic' and `National Interest' areas of technology could be a mechanism for bridging the gap between researchers and commercial interests, for promoting a research and development culture in which both industry and research institutions participate. The benefit of such interaction is two-way. Industry becomes aware of the opportunities R&D presents to provide new products or new/improved processes. Research institutions become aware of opportunities to extend their fields of study and to orient their work toward industry. Biotechnology has already been identified as having potential benefits for a wide range of industries and will be the first generic technology for the purposes of the scheme. The Research Grants Scheme of the National Biotechnology Program will be incorporated in the Generic Technology Grants element of the new scheme. Other generic technologies, such as advanced materials, may be declared eligible for assistance under the scheme in future. The GIRD Scheme will be administered by the Industry Research and Development Board with responsibility to select projects for support according to guidelines determined by the Minister. The Board will be assisted by committees with expertise in specific areas and supported by a secretariat. Firms wishing to take advantage of the 150 per cent tax concession will register with the Board. The GIRD Scheme will operate for five years from 1 July 1986 until the tax concession scheme expires. GIRD and the tax concession scheme will be reviewed at the same time. Sunset provisions in the Australian Industrial Research and Development Incentives Act 1976 mean that no further Commencement Grants funded under that Act will be made after 30 June 1986. A report by the consultants, Price Waterhouse, has indicated that this element of the previous Australian Industrial Research and Development Incentives Scheme (AIRDIS) had not been very effective. This was supported in a report by the Australian Industrial Research and Development Incentives Board itself. After 30 June, the Project Grants funded under that Scheme would be replaced by the Discretionary Grants under the new scheme and Public Interest Projects would be replaced by National Interest Agreements. Commencement Grants for eligible research and development expenditure incurred before 1 July 1986 will continue to be paid in accordance with the provisions in the present Act. Project Grant agreements entered into prior to 1 July 1986 will be honoured. This will also be the case with Public Interest Projects. With the Grants for Industry Research and Development Scheme and the 150 per cent taxation concession I believe the Government has got its price subsidy support for industry research and development about right. Some smaller changes may still be required and, of course, we will monitor and, as need be, adjust our policy strategies. Together the two schemes will help significantly improve the overall climate for research and development in industry, contributing to the development of more innovative and internationally competitive and export oriented industries in Australia. With other initiatives such as the National Industry Extension Service and revised Offsets arrangements they are an integral part of the Government's strategy to make technology work for Australia. There are encouraging signs that the 150 per cent taxation concession has already had a positive impact on industry attitudes to research and development. I am confident that the two schemes will lead to a significant increase in the private sector's commitment to R&D and to the development of a ``technology culture'' in Australian industry. Financial Impact Statement The cost of the new scheme contained in this Bill in 1986/87 would be $12.5 million. In addition existing forward obligation for AIRDIS would have to be met: $45.2 million in 1986/87. The present cost of AIRDIS and the biotechnology grants scheme is about $70 million annually. Savings will therefore be around $12 million in 1986/87. The main form of assistance for R&D in industry will be the 150 per cent tax concession. On the basis of registrations received this is estimated to cost around $100 million in regard to income tax returns for the year 1985/86. It is not possible to estimate the 1986/87 cost of that measure until registrations are received and a more precise cost will not be known for 1986/87 until tax claims for that year are made in 1987/88. I commend the Bill to the Senate. I table the explanatory memorandum for the Industry Research and Development Bill 1986. Debate (on motion by Senator Sheil) adjourned. Bill received from the House of Representatives. Ordered that the Bill may be taken through all its stages without delay. Bill (on motion by Senator Grimes) read a first time. Senator GRIMES(Tasmania-Minister for Community Services)(10.42) —I move: That the Bill be now read a second time. I seek leave to incorporate the second reading speech in Hansard. Leave granted. The speech read as follows- This Bill proposes a number of amendments to certain bounty and subsidy Acts administered by the Comptroller-General of Customs. For some time it has been the practice in this Parliament to have wherever possible cognate debates on bounty and subsidy schemes. Consistent with this practice this omnibus Bill contains all of the proposed amendments to bounty and subsidy Acts which are at this time required to be dealt with in the 1986 autumn sittings. New bounty and subsidy schemes will continue to be self contained in individual Bills in the usual way. The most important measures in this Bill, which I will detail shortly, propose amendments to- (1) the Bounty (Computers) Act to enable bounty to be paid under the provisions of that Act on modems and multiplexers generally used with computers; (2) the Bounty (High Alloy Steel Products) Act to introduce separate bounty schedules for high alloy steel bar products and stainless steel flat products; and (3) the Bounty (Ships) Act to enable bounty to be paid under the provisions of that Act on certain hovercraft. The significant amendments to the other bounty Acts acquit undertakings given by the Minister for Industry, Technology and Commerce to the Senate Standing Committee for the Scrutiny of Bills to provide a right of review of determinations by the Comptroller-General of Customs in respect of the effective registration date of premises and, in the case of the Bounty (Metal Working Machines and Robots) Act, decisions by the Minister in relation to the modification of bountiable equipment. The other amendments contained in the Bill are of a formal nature which either correct minor errors discovered in the principal Acts or slightly vary schemes to ensure that any bounty or subsidy is correctly paid. I now turn to the major amendments proposed in this Bill. The addition of modems and multiplexers to the definition of `bountiable equipment' under the Bounty (Computers) Act is proposed as a consequence of the Government's consideration of the Industries Assistance Commission (IAC) report No. 352 of 5 October 1984 on telecommunications and related equipment and parts. Modems and multiplexers are communications equipment used as the link between computers to enable them to communicate with one another. The Government's acceptance of the IAC recommendation that a 25 per cent value added production bounty on modems and multiplexers generally used with computers was announced on 10 October 1985. The decision to introduce this bounty on units produced after 1 July 1986 recognises the increasing convergence of telecommunications and computer technologies and the need for consistency in the assistance accorded the various segments of the information industries. The introduction of the bounty together with consequential tariff changes is designed to remove assistance anomalies between these goods and other computer equipment, reduce problems of product substitution, and complement earlier government decisions designed to foster the local computer hardware industry and avoid cost imposts associated with the widespread use of computer equipment. Finally, in relation to this act, the provisions of clause nine of the Bill which are in similar terms to section 9 of the Bounty (Metal Working Machines and Robots) Act make it clear that an IAC report is not required prior to the making of any ministerial declarations for the purposes of section 5 of the Act. The provisions of section 5 of the Act provide the facility to vary the classes of equipment eligible for bounty by ministerial gazettes notice. This facility is essential to cater for the rapidity of technological change in this industry and thereby keep the Government assistance package relevant to the needs of the industry. It was the intention from the inception of the legislation that section 5 variations would be made without an IAC inquiry on each occasion, though they would still be subject to parliamentary scrutiny through the usual tabling and disallowance procedures. The amendments to the Bounty (High Alloy Steel Products) Act in part 5 of the Bill replace the present single schedule of bounty rates with separate schedules for high alloy steel bar products and stainless steel flat products. This alteration is proposed as a consequence of the Government's acceptance of a recommendation by the Steel Industry Authority. When the present bounty arrangements were put in place Comsteel, the major producer of steel bar products, was also the sole producer of steel flat products. Following an industry re-organisation in April 1984 the production of bar and flat products respectively was transferred to the separate companies of Comsteel Vickers and the BHP Coated Products Division. As a result of relatively buoyant market conditions being experienced by the manufacturer of flat products, bounty payments for both sectors of the market have been at low levels. This has been detrimental to the manufacturer of bar products, Comsteel Vickers, which is experiencing depressed market conditions. The proposals in this Bill are thus designed to enable each sector of the industry to receive an appropriate level of bounty assistance based on product sales, as intended under the steel industry plan. The new schedules are constructed on a similar sliding scale to the present arrangements, providing maximum assistance at uneconomic levels of output and phasing out at higher levels. A maximum bounty rate of 20 per cent will be payable where the annual rate of sales is less than 10,500 tonnes for high alloy steel bar products and less than 10,000 tonnes for stainless steel flat products respectively. No bounty is payable where the annual rate of sales is in excess of 23,000 tonnes for bar products and 25,000 tonnes for flat products. The previous bounty ceiling of $9 million, which applied to the combined sales of both sectors will be apportioned on the basis of $3.28m for bar products and $5.72m for flat products. The new bounty schedules are to apply retrospectively from 1 July 1985. The last of the major proposals contained in Part 7 of this Bill will permit bounty to be paid under the Bounty (Ships) Act on the production of hovercraft type vessel, of over 150 gross construction tons if such vessels are registered as ships and used to convey passengers or goods solely or principally over water ways. Hovercraft were previously excluded from bounty eligibility in 1980 because there was no hovercraft industry in Australia at that time, and the construction techniques then employed and the method of propulsion, principally jet engined, were considered to relate more to the aircraft industry than to shipbuilding. Since then, however, Australian industry has developed the capacity to manufacture air-cushioned vehicles, commonly referred to as hovercraft, using shipyard techniques and powered by diesel marine engines. These vessels are registered and controlled under the relevant shipping regulations. As such vessels compete directly with high speed ferries and hydrofoils, both of which are eligible for bounty under the Act, it has been decided to extend the present Act to cover these air-cushioned vessels. The impact on bounty payments is expected to be slight as hovercraft essentially compete with other high speed vessels and any hovercraft sales would be largely at the expense of the other craft. In conjunction with the bounty proposal it is proposed that air-cushioned vehicles falling to chapter 89 of the Customs Tariff Act which exceed 150 gross construction tons and which are currently dutiable at 25 per cent, will be free of duty. This will bring hovercraft into line with the tariff treatment accorded other bountiable vessels in the Customs Tariff Act. Financial Impact Statement The inclusion of modems and multiplexers as bountiable products under the Bounty (Computers) Act is expected to cost an additional $3.5 million per annum in bounty payments under that Act in 1986-87. It is anticipated that the bounty payments under the new steel arrangements in the Bounty (High Alloy Steel Products) Act will be about $4.3 million in 1985-86 compared with $3.5 million under the existing arrangements. With respect to the proposed amendments to the Bounty (Ships) Act the market potential for hovercraft has been assessed at 2 per annum involving bounty payments of approximately $1.2 million. However overall expenditure is expected to be minimal as the hovercraft would be essentially competing with other high speed bountiable vessels and any sales of hovercraft would largely be at the expense of those other craft. The other proposed amendments in this Bill have no direct financial implications. I commend the Bill to the Senate. Debate (on motion by Senator Sheil) adjourned. Bill received from the House of Representatives. Ordered that the Bill may be taken through all its stages without delay. Bill (on motion by Senator Grimes) read a first time. Senator GRIMES(Tasmania-Minister for Community Services)(10.43) —I move: That the Bill be now read a second time. I seek leave to incorporate the second reading speech in Hansard. Leave granted. The speech read as follows- The Customs Tariff Amendment Bill 1986 which is now before the Senate contains significant amendments to the Customs Tariff Act 1982. The Bill contains 10 schedules which incorporate changes- (i) initially introduced by gazette notice and subsequently proposed in the House of Representatives as Customs Tariff proposals; (ii) introduced directly by Customs Tariff proposals; or (iii) which are being introduced by this Bill. Schedule 1 to the Bill is operative on and from the first of July 1985 and provides the mechanism for the restoration of duty free admission of certain parts used in the construction or modification of bountiable vessels. The Government's October 1984 decision on the Australian Shipbuilding Industry provided for the removal of the 2% revenue duty on imports of such ships' parts, making them duty free. This was intended to assist shipbuilders to hold down costs of inputs and improve their competitiveness against imported new vessels, which are duty free. At that time most ships' parts were admissible at 2% under a customs by-law. This by-law subsequently lapsed on the first of July 1985 when the old commercial by-law system was terminated. By ceasing to be eligible for the 2% duty rate provided for by the customs by-law they thus lost their eligibility for the further duty free concession. This nullified the intent of the shipbuilding assistance package. The amendment in this schedule reinstates the eligibility of the parts for the 2% duty and consequently they will again become free of duty in accordance with the government's shipbuilding assistance decision. Schedule 2 to the Bill, operative on and from the second of August 1985, provides for the wool content level in the pile of carpets from New Zealand eligible for duty free entry to be reduced from 80% to 78% by weight. This relaxation of the wool content requirement has been agreed with New Zealand under the Australia New Zealand closer economic relations-trade agreement and takes effect from the date set out in the exchange of letters between the relevant Australian and New Zealand ministers. Schedule 3 to the Bill, operative on and from the twenty-first of August 1985, complements the Subsidy (Grain Harvesters and Equipment) Act 1985 which was passed in the 1985 budget sittings. This schedule removes the 15% general tariff rate previously applicable to grain harvesters and certain parts for these machines. Also included in this schedule is a consequential amendment to maintain the duty treatment applicable to certain metal parts. The changes contained in Schedule 4 to the Bill are operative on and from the eleventh of October 1985 and implement most of the government's decisions on the industries assistance commission's report on telecommunications and related equipment and parts. The changes arising from this report are the first stage of the two stage plan to revitalise Australia's communications equipment industry for growth into the 1990s and beyond. Under this first stage, the Government has accepted the IAC's recommendation that tariffs on most imported telecommunications products and components be reduced from 30% to 20%. These reductions are being phased in over a four year period. The IAC's report on the industry had recommended reductions over a two year period for most products. In agreeing to a four year phased reduction, the Government has sought the co-operation of the local industry in developing a comprehensive strategy to address the industry's long term problems. This strategy is expected to be announced by the middle of 1986. Issues which need to be addressed to enable the local industry to become more internationally competitive, export oriented and innovative include: The relatively small size of Australian companies; Insufficient commitment to local research and development; Fragmented market efforts; and Restrictive regulatory procedures which act as a disincentive to growth. These broad issues will be tackled in the later package of measures. From the government's side, the package would largely entail improved co-ordination of existing government activities, particularly in the areas of government purchasing, offsets, technology programs, regulation and trade strategies. The government's decision to handle the question of assistance in two stages was the result of extended consultation within government departments, with industry groups and other interested bodies, and with the government's tripartite advisory council on the electrical, electronics and information industries. These groups are continuing to be actively involved in developing the package of industry development measures, within the framework of general government policies. As part of its decision on the IAC's report, the government has accepted the recommendation for a 25% value added production bounty to be paid on modems and multiplexors generally used with computers. This bounty is to apply from the first of July 1986 and the duty applicable to equivalent imported goods will be reduced to minimum rates from that date. In addition, preforms used in the manufacture of optical fibre are to be subject to a general tariff rate of 20% from the first of July 1986. The relevant tariff changes are contained in Schedule 9 to this Bill. Schedule 5 to the Bill is operative from the twenty-second of November 1985 and comprises most of the legislation to implement the government's decision on the IAC's report on re-import concessions. The government's decision results in considerable simplification of the provisions governing the concessional entry of goods which have previously been exported from Australia. Goods, and parts of goods, which are returned to Australia without any change to the identity they possessed when they were exported are eligible for duty free entry. Unlike the previous concession, there is no requirement that the goods have not entered the commerce of another country; no time limit after which they are not eligible for duty free entry or that their ownership has not changed. The requirement that all Commonwealth taxes and charges due at the time of exportation from Australia have either been paid and not refunded, or, if refunded, are paid again prior to duty free entry being granted, does, however, remain. A new provision is being inserted into the Customs Tariff Act to allow the duty free admission of goods repaired overseas, or replaced, under a specific warranty applicable to previously imported goods. One of the Government's decisions is not included in this particular schedule to the Bill. Goods exported for repair or renovation which cannot be performed in Australia are to be eligible for duty free entry under commercial tariff concession orders made by the Comptroller-General of Customs. New provisions are being inserted into the Customs Act 1901 by the Customs and Excise Legislation Amendment Bill 1986 to enable such orders to be issued on and from the first of July 1986. The consequential amendment to the Customs Tariff Act 1982 is contained in Schedule 9 to this Bill. A minor amendment is being made to the remaining provision relating to the concessional entry for goods returned to Australia after having undergone repair or renovation overseas. Provided that the goods retain the identity they possessed when they were exported, the duty payable on their return will be assessed on the value of the repair or renovation only, at the ad valorem rate applicable to the parent goods. In line with the IAC's recommendation, this provision does not apply to goods subjected to alteration overseas. Schedule 6 to the Bill puts in place tender quota provisions associated with the post-1984 arrangements for passenger motor vehicles. This schedule is operative on and from the first of December 1985. Following amendments made last year to the Customs Act 1901 it is now possible to depart from a rigid twelve month period for tender quota allocations. Accordingly, a period of fourteen months is being provided for the one year quota to allow a one month anticipation before the start of the calendar year and a one month carry-over after its conclusion. Similarly, the four periods involved in the four year tender will each run from the first of December in a year to the thirty-first of January fourteen months later. Vehicles imported under the single period tender quota scheme attract a general tariff tender quota rate of 81.5%, a premium of twenty-four percentage points over the base quota rate. For the four year tender quota scheme the tender quota rate is 68.5%, eleven percentage points higher than the 57.5% base quota rate. Schedule 7 to the Bill is operative from the first of January 1986 and contains a variety of amendments. The amendment of Schedule 1 to the Principal Act removes Portugal from the list of countries eligible for developing country preference. This action coincides with Portugal's becoming a member of the European Economic Community. Similar action was taken when Greece joined the Community. This Schedule puts in place the 1986 developing country preference and tender quota arrangements applying under the Government's textiles, clothing and footwear sectoral policy. Included in these amendments are arrangements to allow for extensions of validity for textiles, clothing and footwear tender quota allocations. Also included in this Schedule are amendments removing redundant phasing rates of duty from Schedule 3 and Part II of Schedule 4 to the Principal Act. This action has enabled further tariff simplification to occur as certain tariff classifications are amalgamated. In a similar vein, redundant phasing provisions in Schedule 5 to the Principal Act, which covers New Zealand imports, are being removed. The final amendment in Schedule 7 amends Item 23 in Part I of Schedule 4 to the Principal Act. This Item was inserted in the Customs Tariff Amendment Act (No. 2) 1985 which was passed in the 1985 Budget sittings. It has been found that the Item is deficient in that it does not provide concessional admission for parts of the components designated in the Item. Such parts for components were eligible for bounty payment under the previous assistance regime for heavy commercial motor vehicles and thus should receive the benefits of the provisions of Item 23. The amendment of the Item will achieve this objective. Schedule 8 to the Bill, operative on and from the eighteenth of February 1986, provides for the application of the principles of the Government's decision to implement a revised system of tariff preferences for developing countries to the goods covered by the Industries Assistance Commission's report on tableware and other goods of ceramics. The Government decided that, in accordance with the IAC's recommendation, the general tariff rate for the goods under reference should remain at 20%. I will outline the principles of the new developing countries preference scheme when I come to Schedule 9 of the Bill but in regard to goods of Tariff Item 69.11, covering tableware and other goods of porcelain or China, all developing country imports will receive a five percentage points margin. For tableware and other goods not being of porcelain or China (Tariff Item 69.12) the Republic of Korea and Taiwan Province will remain ineligible for the 15% developing country rate until the first of July 1988. Schedule 9 to the Bill contributes most to its size. Its operative date is the first of July 1986. This Schedule implements new preference arrangements for developing countries and for forum island countries. Under the revised developing countries preference scheme, the developing country rate will be five percentage points below the general tariff rate, where that general tariff rate is 5% or greater. For goods subject to other than an ad valorem rate a margin equivalent to five percentage points is being provided. The new scheme will not apply to goods where there is no protective rate, or where goods only attract duties identical to Australian excise tariff rates. For goods incurring both excise and protective rates the new scheme will apply to the protective component but such rates have been structured so that in no circumstance will the rate be lower than the equivalent excise rate. Developing country quotas will be abolished except where they relate to textiles, clothing and footwear products where quotas will continue until the thirty-first of December 1988. Under the new scheme there is no provision for graduating either products or countries from it. As a transitional measure, where action has been taken to exclude countries from the present scheme for particular products in the three years prior to the first of July 1986, they will continue to be excluded for a further two years. The scheme will apply to products covered by the textiles, clothing and footwear industries plan from the end of the current plan on the thirty-first of December 1988. It will apply to goods covered by the steel and motor vehicles sectoral policies from the first of July 1986. However, the current exclusions of certain countries for some cold-rolled steel products will continue until the end of the present steel plan on the thirty-first of December 1988 and quotas already allocated for the importation of motor vehicles will be continued at the existing margin of preference. The existing developing countries scheme has distorted Australian industry policy, increased disparities in tariff assistance between like goods and created uncertainty about assistance levels for local manufacturers thereby hampering restructuring and business planning. It has also led to increasing friction with Australia's developing country trading partners. The revised scheme will be administratively simpler, more certain in application, and focus attention towards more constructive industry developments and trade goals. The Government recognises that, as a result of the changes, preference margins will be created in some areas and increased in others. Overall this will be offset by significantly reduced margins in other areas of industry. The Government considers that the application of a five percentage points margin of preference would not be large enough to cause any major difficulties for industry. However, reference to the Industries Assistance Commission remains where an industry is experiencing difficulties competing against imports from any source. The Government's decision follows a thorough review of the system of granting preferential access to developing countries. As part of this review Professor Helen Hughes of the Centre for Development Studies at the Australian National University was commissioned to report on the scheme and her recommendations form the substance of the new approach. In the review the Government rejected such options as abandonment of DC preferences or adoption of trigger mechanisms to automatically graduate countries or products out of the scheme. The option adopted reaffirms Australia's commitment to the concept of developing country preferences. Australia was the first country in the world to introduce such preferences, which are now accorded by most developed countries. The new scheme represents a significant improvement over the existing scheme. The new scheme provides Australian industry and all Australia's trading partners, both developed and developing, with a settled framework for development of investment and trading plans. Under the new system the developing country tariff rate and the general tariff rate will be set as a package and industry planning can proceed in this knowledge. Australian industry seeking to complement local production with external sourcing can plan with greater confidence than exists under the present arrangements. In discussion most of the developing countries in the Australian region have welcomed the broad thrust of the new system which incorporates important principles endorsed by the developing countries generally. Some disappointment has been expressed at the reduction that will be entailed in existing margins of preference for some items and a larger margin of preference than five percentage points was generally desired. The Australian Government considers that any disadvantage arising from margin reductions will be offset in the longer term by the guarantees of margins at any volume of trade in the situation where Australia's tariffs are moving towards lower levels of assistance. The other initiative in regard to Australia's trading relations contained in Schedule 9 is the new Forum Island Preference Scheme. Australia undertook a major review of the South Pacific Regional Trade and Economic Co-operation Agreement in 1985. Following this review the Prime Minister announced at the 1985 South Pacific Forum meeting in the Cook Islands that Australia would introduce a new scheme which would expand the duty free access entitlement for Forum Island countries on and from the first of January 1987. The Prime Minister announced that duty free unrestricted access would be granted for all exports from forum island countries, other than for those goods to which sectoral policies apply. The goods covered by these sectoral policies are textiles, clothing and footwear, steel, passenger motor vehicles and sugar. In addition, those products on which excise is levied when they are produced in Australia will be subject to a customs duty at the same rate as the excise duty. The government has now decided that, with the exception of passionfruit products, the introduction date of the new scheme will be brought forward to the first of July 1986 to coincide with the commencement date of the new developing countries preference scheme. The changes in regard to passionfruit products will take effect from the first of January 1987. The original operative date for passionfruit products is being maintained to allow a transition period for local producers because virtually all imported passionfruit products come from the forum islands and these islands have a penetration of the Australian market in excess of ten per cent. Schedule 9 also includes those changes to operate from the first of July 1986 which arise from the Government's decision on the IAC's report on telecommunications and related equipment and parts. Certain modems and multiplexors are to become dutiable at minimum rates and optical fibre preforms are to be dutiable at a general tariff rate of 20%. An amendment is being made to item 3 in part I of schedule 4 to the principal Act which presently provides duty free entry for goods imported for the personal or official use of the Governor-General, the Governor of a State, a member of the family of the Governor-General or the Governor of a State or a member of the staff of the Governor-General or the Governor of a State, being a member of the staff who is not an Australian citizen. This concession goes back to the time when governors and their staff were mostly appointed from outside the country. As this is no longer the case there is no justification for continuing concessions in relation to goods for personal use. The concession is accordingly being restricted to goods for the official use of the Governor-General, the Governor of a State or a member of the family of the Governor-General or the Governor of a State. No concessions will be available for members of the staff of the Governor-General or the Governor of a State. The final amendment required to implement the Government's decision on the IAC's report on re-import concessions is also contained in schedule 9. Item 31 in Part I of Schedule 4 is re-drafted to allow the issue of commercial tariff concession orders for goods exported for repair or renovation which cannot be performed in Australia in the normal course of business. The opportunity has also been taken in this schedule to remove all redundant phasing rates from the various schedules to the principal Act. The final schedule to the Bill, schedule 10, is to operate seven days after royal assent of the legislation. This schedule inserts a new legal note, note 12 to chapter 84 in schedule 3 to the principal Act, defining the term ``of the track-laying type'' which is used in connection with tractors and tractor bases. Special provisions for goods ``of the track-laying type'' at minimum rates of duty have appeared in the customs tariff for many years. The concept of equipment incorporating tractor bases of the track-laying type attracting a separate duty on the tractor base arose out of an IAC report in 1974. It has always been considered that the provisions only applied to the traditional tracked vehicles that can only operate when their tracks are attached. A recent ruling by the Administrative Appeals Tribunal has applied the term in question to a loader which was imported with tracks which go over the wheels of the vehicle but which can operate as a wheeled vehicle without the tracks. This extension of the term has had the effect of lowering the level of assistance intended to be accorded the local manufacture of such machines. The major local manufacturer has made representations to the Government concerning this loss of assistance. After consideration of this matter, the Government accepts that the intended assistance levels should be restored and, accordingly, an amendment is being made to the Customs Tariff Act. Financial Impact The revenues raised by customs duties are incidental to their prime purpose of assistance to industry. With this qualification in mind, it has been possible to make some estimates in regard to changes to customs revenue for some of the changes contained in this Bill. The removal of the duty on grain harvesters and certain parts is expected to reduce revenue by $4.1m in 1985-86 and $8.25m annually thereafter. The general reduction in tariffs resulting from the Government's decision on the IAC's report on telecommunications and related equipment and parts is not expected to reduce Government receipts. This conclusion is based on the knowledge that over 70 per cent of imported telecommunications equipment enters under concessional arrangements and that projected increases of dutiable imports of telecommunications equipment will more than compensate for the reductions in tariffs. In the case of outgoings the complementary amendments to the Bounty (Computers) Act in regard to modems and multiplexors is expected to cost $3.5m in 1986-87. This increase in outgoings is expected to be partly or fully compensated by increases in the level of dutiable imports of telecommunications equipment. The changes made as a result of the Government's decision on the re-import concessions IAC report are basically designed to improve the administration of the concessions rather than vary their scope to any great degree. Thus any financial impact will be minor. Similarly, the Government's decision on the IAC's report on tableware and other goods of ceramics is revenue neutral. It is difficult at this stage to quantify the financial impact of the revised system of tariff preferences for developing countries. It has, however, been estimated that, overall, the revised scheme will result in a slight increase in assistance. Estimates of any additional revenue to be gained by such an increase in assistance could only be calculated on existing import trends. In order to speculate on any such increase, an assumption would need to be made that these import trends will continue after the introduction of the revised scheme. The Government is not in a position, at this stage, to so speculate. The proposed removal of tariffs on imports from the forum island countries is not expected to have a significant impact on revenue. Australian imports from the relevant countries amounted to only $217.5 million in 1984/85 and 98% of these were accorded duty free entry. In addition, the forum island countries have limited capacity to displace third country suppliers to the Australian market. All the other changes in the Bill are also expected to have minimal financial impact. There are no significant administrative costs associated with the Bill. A summary of amendments for each schedule to the Bill has been prepared. Copies are available from the records and tables office. I commend the Bill. Debate (on motion by Senator Sheil) adjourned. Bill received from the House of Representatives. Ordered that the Bill may be taken through all its stages without delay. Bill (on motion by Senator Grimes) read a first time. Senator GRIMES(Tasmania-Minister for Community Services)(10.44) —I move: That the Bill be now read a second time. I seek leave to incorporate the second reading speech in Hansard. Leave granted. The speech read as follows- The purpose of this Bill is to give effect to improved arrangements for administering the environment Protection (Impact of Proposals) Act 1974 and to provide greater emphasis on public involvement in carrying out environmental assessments under the Act. The object of the Act, which came into force in 1974, is to ensure that to the greatest extent practicable, matters affecting the environment to a significant extent are fully examined and taken into account in relation to actions and decisions of the Commonwealth Government and its authorities. The administrative procedures under the Act provide a means of achieving this objective through a process of environmental assessment which includes, provision for the preparation and public review of environmental impact statements. The Act is a cornerstone of the Government's environment protection legislation. Under its provisions the environmental implications of a wide range of proposals have been examined. These include airports, railways, ports, highways, buildings, and coal, iron ore, uranium and woodchip export projects. Mr President, the amendments proposed by this Bill are the result of a comprehensive review of the Act by the Government. In carrying out the review, the Government has taken into account key elements in the ALP platform on the environment, and has benefited from several reports from Parliamentary Committees. On 11 October 1984, a statement was tabled in this House which provided a response to 19 recommendations in reports by the House of Representatives Standing Committee on Environment and Conservation, and two recommendations in a report of the Senate Standing Committee on National Resources, all dealing with various aspects of the legislation and related matters. On 17 April 1986 the Government's response to the recommendations of the May 1985 report from the House of Representatives Standing Committee on Environment and Conservation: ``Administration of the Environment Protection (Impact of Proposals) Act, 1974'' was tabled. I would like to comment on one recommendation in this report that the Government has decided not to adopt. That recommendation calls for an amendment to the Act to enable the Environment Minister to initiate action under the Act. As honourable senators will be aware, the current procedure is for the minister responsible for making the decision on a proposal-known as the ``Action Minister''-to make a decision on the environmental significance of a proposal and, by designating a proponent, formally initiate action under the Act. After giving this matter long and careful consideration, the Government has decided not to change the current procedure. However, in reaching a decision, the Government took into account two important procedures. The first is that memoranda of understanding are to be agreed between the environment department and other Commonwealth departments and authorities. These memoranda will provide a clear basis for identifying proposals that are environmentally significant. The second is that, in the rare event that there is a difference of opinion between Ministers on the environmental significance of a particular proposal, the matter would be resolved by the normal process of referral to the Prime Minister and Cabinet. The Act will continue to provide for the preparation, public review and submission, to the Commonwealth environment Minister, of environmental impact statements (EISs) for proposals of major environmental significance. Amendments will provide, however, for the preparation of public environment reports (PERs) for proposals with less complex, or less important environmental implications. Experience has shown that many proposals, of a localised nature, or involving only one or two issues of environmental significance, arouse considerable public interest. Such proposals may not warrant the preparation of an EIS, which is normally a comprehensive document requiring considerable time and resources to prepare in draft and then final form. However, under current procedures there is no provision for obtaining public comment on the environmental aspects of proposals except through the procedures associated with an EIS. A PER, however, will be a simpler and less costly document than an EIS, but will still provide a sound basis for public comment and Government consideration. The Act currently places an obligation for a proponent to provide the environment Minister, or his Department, with sufficient information to enable the Minister to decide whether an EIS should be prepared. Experience has shown that this obligation is not sufficiently clearly expressed, so an amendment of the Act will permit the Minister to require the supply of information to enable him to consider the need for an EIS or a PER. Section 10 of the Act enables any person to write to the Minister asking what action has been taken, or is proposed, to assess a proposal under the provisions of the Act. The Minister is required to respond promptly to such requests. This provision is consistent with Government policy on freedom of information and has been frequently utilised. However, the requirement for the Minister to respond promptly was considered too vague by the House of Representatives Standing Committee on Environment and Conservation which recommended that a period of three months be specified. The Government accepts this recommendation, and the Act will be amended accordingly. The Act enables the Minister to direct an inquiry on any environmentally significant matter for which a Commonwealth action or decision will be required. The inquiry process calls for the convening of a Commission to conduct the inquiry and for the Commission to report its findings and recommendations to the Minister. However, there is no provision in the Act for a Commission to report within a specified time. This could lead to practical difficulties. Accordingly, the Act will be amended to enable the Minister to direct a Commission to report its findings and recommendations by a specified date. The Government's intentions to improve the administration of the environmental assessment process and to provide scope for wider public consultation are largely reflected by amendments which will be made to the administrative procedures under the Act. These amendments respond to many of the recommendations made by the House of Representatives Standing Committee on Environment and Conservation, and will be presented to the Governor-General-in-Council for approval in due course. I would like briefly to touch on the more significant of these amendments. A number of the amendments will improve the current mechanism for the preparation, public review and reporting on EISs. The amendments include making public the decision of the Minister to direct an EIS on a proposal and, on written request, to require the Minister to make public the reasons for not directing an EIS on a proposal. Provision will be made, following the direction of an EIS, for consultation between the Department, other governmental authorities and public interest groups on the guidelines for the preparation of the EIS. Provision will also be made for consultation between the Department and the proponent during the preparation of an EIS, to ensure that an adequate response is made to the guidelines. Other important amendments will provide for ministerial discretion to extend the period of public review beyond the current 28 day minimum, to direct a round-table discussion on a proposal following public review of an EIS, and to make public the Department's assessment report prepared after examination of a final EIS and the Minister's recommendations following such examination. Two further amendments will relate to Government collaboration with the States and Territories. One will give formal status to the Minister's discretion to take into account any State or Territory environmental assessment action when deciding whether an EIS or a PER is required. The other will provide the Minister with authority to enter into arrangements with the States and Territories to facilitate the operation of the administrative procedures and to require that these arrangements be made public. Mr President, the Environment Protection (Impact of Proposals) Act 1974 is a major piece of legislation which, since its introduction, has significantly assisted Ministers in taking environmental implications properly into account in government decision making. The amendments to the Act and administrative procedures, which the Government intends to make, will further improve the effectiveness of the process. I commend the Bill to the Senate. Debate (on motion by Senator Sheil) adjourned. Bill received from the House of Representatives. Ordered that the Bill may be taken through all its stages without delay. Bill (on motion by Senator Grimes) read a first time. Senator GRIMES(Tasmania-Minister for Community Services)(10.45) —I move: That the Bill be now read a second time. I seek leave to incorporate the second reading speech in Hansard. Leave granted. The speech read as follows- This Bill contains measures which will amend the Social Security Act 1947 and the Compensation (Commonwealth Government Employees) Act 1971. The main amendments to the Social Security Act 1947 are- the introduction of the ``young homeless allowance''; a bar to payment or unemployment, sickness or special benefit to a full-time student who is eligible, in principle, for an education allowance; a change in the treatment of lump sum compensation payable to sickness beneficiaries; and a change in the rate of benefit that applies to a legally married but permanently separated unemployment beneficiary to the rate that applies to a single unemployment beneficiary. The Bill will also provide for the social security amnesty. In ``Youth Policies in the 1985-86 Budget'' (Budget Paper No. 13), the Government recognised the needs of unsupported young people, whether students or unemployed, and indicated that new provisions would be introduced, under strict conditions, to provide an independent rate of allowance equal to that of the living away from home rate under the tertiary education allowance. This Bill introduces a new allowance for 16 and 17 year olds who are homeless and without support. It will increase the rate of income support received by 16 and 17 year old unemployment, sickness and special beneficiaries, who currently receive $50 per week. The allowance, called the ``young homeless allowance'', will result in such a beneficiary being eligible for a level of assistance equal to the tertiary education allowance, currently $73.28 per week. The allowance is available only on strict conditions, which are intended to ensure that only those in genuine need are assisted and that there is no undue incentive for a young beneficiary to leave home. The current measure will apply from 1 July 1986, and will cost $2m in 1986-87 and $2m in 1987-88, in broad terms. In conjunction with this development, the Bill also provides that unemployment or sickness benefit (and in consequence, special benefit) is not available to a full-time student who is, in principle, eligible for an education allowance. The policy this reflects is that such persons should look to and be covered by education allowances rather than what are, primarily, work-force related benefits. There will be some cases where, following recent AAT decisions, a full-time student receiving special benefit also receives an education allowance, typically a Secondary Allowances Scheme (SAS) payment. Since there will be a corresponding ``young homeless allowance'' available separately under the SAS program, most (if not all) of these beneficiaries will be more appropriately assisted by the education allowance, rather than special benefit. Full-time students not eligible, in principle, for an education allowance may, however, qualify for benefit, as may some part-time students who will not be eligible for education allowances. Consistent with the ``young homeless allowance'', this measure will apply from 1 July 1986. However, transitional arrangements will ensure that an eligible beneficiary at that date may continue to receive benefit until the end of the academic year. This ``bar'' will create estimated savings of $10m in 1986-87 and $20m in 1987-88. The Bill will make new arrangements for the treatment of a lump sum amount of compensation received by a sickness beneficiary. In many cases there are lengthy delays in the resolution of compensation claims. Accordingly, the Act currently enables sickness benefit to be paid as an interim form of income support where a person qualified for benefit has a compensation claim pending, subject to the benefit being repaid, in whole or in part, where the claim is resolved in favour of the beneficiary. However, it is currently unclear whether a lump sum should be treated as compensation for the balance of the person's life, the balance of the person's working life, of some lesser period. The new arrangements would treat all lump sums in the same way by precluding a person from sickness benefit for a period calculated by dividing the lump sum by Average Weekly Earnings, as measured by the Australian Statistician. This means that anyone receiving sickness benefit who is seeking lump sum compensation will be able to be certain as to the consequences for their sickness benefit. This initiative will apply to all lump sum payments which are paid or become payable on or after 1 July 1986, and will create estimated savings of $20m in 1986-87 and $20m in 1987-88. The Bill will change the rate of unemployment benefit which is applicable to a beneficiary who is legally married but permanently separated. Currently, such a person is eligible to the rate of $97.90 per week which is applicable to a single unemployment beneficiary with dependants, rather than the lower rate applicable to a single beneficiary without dependants, which is $91.45 per week. There is no difference in principle between a legally married but permanently separated person and a person who is not married. The abolition of this unintended anomaly will also mean that where a legally married but permanently separated beneficiary is divorced, the rate of benefit applicable will not thereby drop to the rate applicable to an unmarried person. This change will create savings of $4.5m in 1986-87 and $5m in 1987-88. The Bill will also provide a legislative base for the social security amnesty which was announced on 12 February 1986. The amnesty is, of course, one element of the Government's strategy designed to significantly reduce social security overpayments and to further improve the administration of pensions, benefits and allowances. The amnesty only applies to people who have omitted to do something-that is, they failed to advise a change of financial or other circumstances. It has been specifically designed for people on the ``treadmill''. In effect, these people want to set the record straight, surrender the payment completely, or have the rate corrected downwards. However, they have been afraid to come forward in the past because they fear prosecution or having to repay the amount overpaid to them. The amnesty allows these people to get off the ``treadmill'' without fear of repercussions. The amnesty does not apply to people who have deliberately told lies to increase their payment or commence a new one. It does not cover changes in circumstances which occur after 12 February 1986. It is worth emphasising that the amnesty is for ``treadmill'' cases-not those deliberately cheating the system. The amnesty will have two main consequences. First, future outlays will be reduced because people who come forward between 12 February 1986 and 31 May 1986 under the amnesty will cease to receive payment or will be paid their correct entitlement in the future. Second, correcting the record in these cases will allow resources to be better targeted on the prevention, detection and recovery of overpayments in deliberate fraud cases. The Bill will also make a number of less significant changes and make minor or technical amendments which will up-grade the Act. I turn now to the amendments which this Bill would make to the Compensation (Commonwealth Government Employees) Act 1971. The principal aim of the amendments is to improve the administration of the Compensation system. The three main reforms proposed by the Government would- extend the powers of the Commissioner for Employees' Compensation so that a claimant may be required to provide certain information; clarify a provision of the Act which gives rules for the calculation of weekly benefits to partially incapacitated employees; and remove the six months time limit within which a claim for compensation must be lodged. The Commissioner has occasionally had difficulties in obtaining information in support of a claim for compensation, particularly where the claimant has sought legal advice before making the claim for compensation. In the absence of sufficient information to determine a claim in favour of the claimant, the Commissioner must determine that liability to pay compensation does not exist. The claimant may then ask the Commissioner to reconsider that determination or seek review of the determination in the Administrative Appeals Tribunal. In general, if the reconsideration or appeal results in a more favourable determination, the claimant becomes entitled to legal costs associated with the reconsideration or appeal. Such costs are not payable in relation to the initial determination. To overcome some cases where there has been an apparent abuse of the system, the Commissioner's powers would be extended so that the provision of the information relevant to a claim for compensation may be requested where the claimant has the information or can obtain it without unreasonable expense or inconvenience. If the claimant fails to comply with the request and subsequently seeks a reconsideration of the initial determination, the Commissioner may declare that the claimants costs in relation to the reconsideration are not payable. A decision of this nature will itself be reviewable by the AAT. The powers of the AAT in relation to the costs of proceedings before it will also be varied by these amendments. The AAT may not make an order in relation to the cost of proceedings in a case where the claimant failed to comply with a request for information if the AAT is satisfied that, had the Commissioner had the information requested, the initial determination would have been more favourable to the claimant. The second reform proposed by the Government would clarify section 46 of the Compensation Act, which provides rules by which benefits payable to partially incapacitated employees are calculated. In calculating these benefits, the Commissioner is required to take account of the amount that the incapacitated employee is ``able to earn'' in some suitable employment of business. The phrase ``able to earn'' has been subject to various interpretations, such as ``is actually earning'' or ``would be earning if he could find employment''. It is desirable to reduce this uncertainty. Accordingly, the Bill would insert a new sub-section 46 (4a) which would set out the factors to be taken into account in determining how much a partially incapacitated employee is able to earn. Those factors include the amount the employee is actually earning, the amount the employee would be earning if he or she had accepted an offer of suitable employment, and the amount that he or she would be earning if the employee had engaged or continued to engage in suitable employment. Where the employee has failed to seek suitable employment, the amount per week that, having regard to the state of the labour market at the relevant time, the employee could be expected to be earning in suitable employment could be taken into account. Other factors which can be considered are whether the employee's failure to accept an offer of employment, or to seek, engage or continue to engage in suitable employment was reasonable in the circumstances, as well as any other relevant matter. The third main amendment to the Act would remove a provision imposing a time limit on the lodgment of claims which is of little practical use. In general, a claim for compensation must be lodged within six months of the employee becoming aware of the injury or disease. However, the Act also provides that a claim for compensation made outside that period shall be deemed to have been made in good time if the Commonwealth would not be prejudiced if the claim were treated as a sufficient claim, or if the failure to lodge the claim within six months was a result of the death or absence from Australia of the claimant, or from ignorance, mistake or any other reasonable cause. In practice, these qualifications mean that few, if any, claims will fail because of late lodgment. The Bill would remove the prescribed six months period, so that claims need only be made in writing and served on the Commissioner. These are not all the changes to the Act which would be made by this Bill. Several other minor or technical amendments will be made and are referred to in the Explanatory Memorandum accompanying the Bill. None of the above measures have cost implications, and should produce small administrative savings. I commend the Bill to the Senate. Debate (on motion by Senator Sheil) adjourned. Motion (by Senator Vigor) agreed to: That Business of the Senate, Notice of Motion No. 1, standing in the name of Senator Vigor be postponed till three sitting days after today. Debate resumed from 7 May, on motion by Senator Gietzelt: That the Bill be now read a second time. Senator PARER(Queensland)(10.47) —Before the Senate are Appropriation (Parliamentary Departments) Bill (No. 2) 1985-86, Appropriation Bill (No. 3) 1985-86 and Appropriation Bill (No. 4) 1985-86. The purpose of the Bills is to provide the Government with funds to cover essential additional expenditure for 1985-86, and the Opposition does not oppose them. However, as indicated by Senator Michael Baume, the Opposition will move an amendment to the motion for the second reading of the Appropriation Bill (No. 3) highlighting the litany of promises broken by the Hawke Government. The Bills provide an opportunity to focus some attention on the current sorry state of the Australian economy and on the Government's contribution to that very sorry state. The first thing I must say is that the outlook is appalling. This is not simple doomsaying by an opposition trying to talk down the economy, nor does it simply reflect the views of those who the Government claims have an ideological axe to grind. Unfortunately, it is an economic fact that our prospects, both in the short and long term, are of great concern to all thinking Australians. After one and a half terms of the Labor Government, despite the heaps of congratulations bestowed by it on its prices and incomes accord, despite a massive devaluation of our currency that was supposed to make us more competitive by providing a fillip to our manufacturing sector, despite the world economic recovery and despite having had the benefit of a wages pause and the breaking of the drought in 1983, Australia today faces the following economic predicaments. We have a current annual inflation rate of 9.2 per cent. This contrasts with our major trading partners' much lower rates. The Organisation for Economic Co-operation and Development average is a mere 3.8 per cent and that figure is inflated by New Zealand's inflation rate, which stands at about 16 per cent. Moreover, the gap is widening, not narrowing, despite the assurances of the Treasurer (Mr Keating) that the rate of inflation has peaked. He says this every month even though we keep reaching new levels of inflation. Australia's comparative inflation rate is the worst in nearly 30 years. The Government has absolutely no cause for complacency or self-congratulation on this. One can fool some of the people some of the time but not all the people all the time. We are about to award ourselves a 2.5 per cent CPI wage increase on top of the 3.8 per cent awarded in November. In addition, the Australian Conciliation and Arbitration Commission is being pressured by the Australian Council of Trade Unions to award a 3 per cent so-called productivity award, to be followed by a further 4 per cent in October in wage indexation-and government spokesmen talk about declining labour costs. In 1986 our unit labour costs are likely to increase by about 6.5 per cent. The projected figure in the seven major industrial countries for the same period is a mere 2.5 per cent. The apologists on the Labor benches, who bury their heads in the sand, miss the point when they continually refer back to the 1981 wages explosion in their defence of the accord. What happened in 1983-85 may have been an improvement. After all, the unions now have no need to try to destroy the Government of the day as they did in 1982. The unions have their Government firmly under the political control of the ACTU, but such comparisons are simply irrelevant. The simple fact is that we should be doing better than we are on the inflation front, and the Government cannot get away from this. The reason for our inability to compete is our high domestic cost structure-specifically our labour costs. It is not simply that wages are too high-in some industries they are; in some they are not. The problem is that wage rises currently apply across the board. They hit every industry, every producer, and every firm in Australia, irrespective of capacity to pay or capacity to compete effectively overseas. This is why the accord must go. Senator Button knows that the accord, as currently constituted, cannot deliver the competitiveness that has eluded us despite the depreciation. The Government knows it; the financial Press knows it. Charlie Fitzgibbon, described by Bill Kelty as the most impressive union official he has ever dealt with, knows it. The Confederation of Australian Industry knows it. At the very least, the productivity case must be deferred. The September wage case must be discounted, and industries which cannot pay should not pay. I simply point to our declining terms of trade, our foreign debt of nearly $80 billion which is growing at the rate of approximately $1 billion a month due to our current account problems and our record Budget deficits of the past three years. It is time that we as a nation faced the fact that we either accept the facts by moderating wage rises, or else we face further reduced living standards by further depreciations of our currency. The choice is ours. It is not a matter of sweated workshops or exploitation of the workers. It is stark economic reality, sheeted home by the exposition of our economic performance by a floating exchange rate. I turn to some of the other economic indicators that give us cause for great concern. I have mentioned inflation. I have mentioned our overseas debt, which now stands at $70 billion. When Labor came to power it was half what it is today. The last three Budgets have contained deficits totalling $20 billion. They are all records. The current account deficit after nine months of 1985-86 stands at $10.4 billion-greater than the total for 1984-85 and likely to exceed Budget projections this year by about $3 billion. The J curve is looking decidedly droopy. Let me quote the often-quoted comment of the Leader of the Government in the Senate, Senator Button, who said: I don't know who invented the bloody J-curve but I tell you it wasn't an Australian who learnt about the Australian economy. Despite the depreciation, manufacturing production is not picking up. Import substitution does not appear to be solving our problems on current account. Economic activity, according to Westpac Banking Corporation and others, is declining; retail sales are falling; and new dwelling approvals have dropped, as have motor vehicle registrations. The Minister for Employment and Industrial Relations (Mr Willis) has expressed doubts about the likelihood of further employment growth. These are all reliable barometers of the economy. They are not doomsaying; they are facts. There are other facts. Interest rates remain at record levels while rates are falling dramatically overseas. High rates are stifling business investment, hurting rural producers and choking growth. They are placing an inordinate amount of pressure on monetary policy, a fact acknowledged by no less an authority than Mr Bob Johnston, Governor of the Reserve Bank. Interest rates remain high because the Government does not trust the dollar. It will not let the dollar go because it does not have sufficient faith in the economy-and in particular, in the unions-to adjust. What a sad commentary that is. I turn to the much-vaunted trilogy-the Government's own test of fiscal rectitude. The trilogy fails my test of prudent government spending, but it also fails its own test. The Budget deficit has blown out by about $1.2 billion in 1985-86. This is despite an increase in revenue collections of roughly the same amount over the same period, and despite the Government's fiddling of the books over the oil price reductions. Hence, to come in on target as far as the trilogy is concerned, the Government must make cuts of over $1 billion, and, on the evidence, it is simply unable to do this. It will not have a mini-Budget before the Australian Labor Party's National Conference in July-the Left would not allow that. But I doubt whether the Government will be able to make the required cuts at all. Certainly its pruning efforts of the last two years have been reabsorbed in new spending programs. Yet the Government must act to relieve the burden it now places on monetary policy, otherwise the economy will simply dip into recession. And we cannot afford that. The Government's own revenue requirements cannot afford it either. I refer to taxation. The Minister for Finance (Senator Walsh) threatens to break yet another promise of his Government-to cancel this year's promised tax cuts-if the Opposition achieves the defeat or amendment of the fringe benefits taxation. The Government, given its present fiscal problems, no doubt would be delighted to have this excuse. The Minister well knows that it is inflation that will largely pay for the promised tax cuts, not the fringe benefits tax. Comparative runaway inflation does have its uses for this Government. Difficult problems require strong solutions. Earlier this year the Leader of the Opposition (Mr Howard) suggested a six-point plan for immediate actions to restore balance and flexibility to our economic policy mix. Since the Government found the Opposition's ideas on housing interest rate ceilings so helpful in solving its problems a month or so ago, perhaps it will take similar note of the following suggestions: Firstly, there must be expenditure cuts in a mini-Budget. Secondly, the accord must be re-negotiated to provide for further discounting of wages. Thirdly, the productivity case should be abandoned, postponed, or confined to those industries that can afford to pay. Fourthly, monetary policy should be allowed to be eased. If spending cuts and wages changes take place, this will occur. Fifthly, the Government must abandon the anti-business and anti-rural elements of the tax package-negative gearing, capital gains, the foreign tax credit system and the fringe benefits tax. Finally, foreign investment guidelines must be eased. This package of measures is only a start. Only longer term solutions will reverse our deep-seated problems-in foreign debt, current account and terms of trade, in our currency and in our hyper-regulated labour market. We must become more competitive; governments must allow us to become more competitive. This is not ideological baggage; it is not doomsaying; it is not talking down the economy. It is simply economic realism. The Government at last seems to be recognising that the problems exist and are real. Now it must act to correct the problems. The ACTING DEPUTY PRESIDENT(Senator Colston) —Before I call Senator Siddons, I would point out that the previous speaker used in a quotation a term that is regarded as unparliamentary. I note that it was in a quotation, but I think that senators wherever possible should desist from using such terms. Senator SIDDONS(Victoria)(10.58) —The Australian Democrats will support Appropriation Bill (No. 3) 1985-86 as it is a money Bill and, as such, we have an obligation to support the Government. The Opposition has circulated an amendment which will be moved when the Bill is called on. The Democrats have circulated an amendment to the Opposition's amendment. This Appropriation Bill covers a wide range of government finance. The debate on it has been wide-ranging, covering such things as the nuclear issue, our overseas debt on so on. I want to speak to the Liberal Party's amendment. The Liberal Party has sought to draw the Government's attention to various matters, some of which we agree with and some of which we do not agree with. For instance, the Liberal amendment states that there should be a reduction in interest rates. We certainly agree that that should be attended to by Government economic man- agers. The Liberal amendment states that the inflation rate should be brought down to 5 per cent. We certainly agree with that. So we will support paragraphs (a) (i) and (b) (ii) of the Liberal amendment. We will certainly support paragraph (a) (v) of the Liberal amendment, which draws attention to the failure of the Government to fulfil its promise not to raise the interest rate ceiling on housing loans. That was a very serious about-turn by the Government. It refused to honour a promise it made to the electorate. We believe that the failure of the Government to fulfil that promise should certainly be brought to the Government's attention. We will not support paragraphs (a) (iii) and (iv) of the Liberal amendment which maintain that taxation as a percentage of gross domestic product should be held down. We are not unduly concerned about the size of the deficit. We believe that the Government has backed itself into a very tight economic corner by making promises such as those in the trilogy. Given the present state of the economy, we fail to see how the Government can honour its trilogy commitment in relation to the size of our overall deficit. We put people before deficits. We will not support the Liberal amendment calling on the Government not to introduce a capital gains tax. I believe that our position on a capital gains tax has been made abundantly clear in this chamber. We support a mild and fair capital gains tax because, without a capital gains tax, there is no way that tax avoidance can be clamped down on. Paragraph (b) notes the deterioration in the Australian economy as indicated by the continuing balance of payments crisis. We wholeheartedly support that. Later I will spend a few minutes of the Senate's valuable time drawing attention to aspects of the balance of payments problem. We do not support any part of paragraph (c), which relates to the introduction of a mini-Budget, condemns the Australian Conciliation and Arbitration Commission hearing on the productivity case and asks that the anti-business and anti-rural elements of the tax package be withdrawn and that the Government relax foreign investment controls to encourage job-creating equity investment in Australia. That part of the amendment is in line with the Liberal Party's laissez-faire, free market approach which is precisely the approach to the economy the present Government is pursuing. In other words, we have a coalition of the Opposition and the Government which has a completely deregulated, laissez-faire economy, an economic approach which surrenders control to international financial interests. If this course is pursued, inevitably Australia will become bankrupt. We already virtually have lost control of most of our wealth-creating enterprises. They are now owned by foreign interests. Essentially we are renting our country to international forces. At the same time we are still living massively beyond our means. We are like a family which rents its home and buys goods on hire purchase but is not earning sufficient income to pay the interest on those purchases. A family which does that is heading for disaster. Likewise, so is our country. We cannot afford to continue to borrow the money to sustain our living standards without changing our economic approach. We have to earn sufficient foreign exchange to pay the interest on the money we borrow. Right now we are not earning that foreign exchange. Between 30 and 40 per cent of our exports go simply to pay the interest payments on the money we have borrowed over the last four or five years. There has been a dramatic increase in our overseas debt and something has to be done about it. I propose to list one or two areas to which I believe government attention should be directed. In doing so, I will be speaking to paragraph (b) of the Liberal amendment, which reads as follows: 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; The Democrats agree with the Opposition that the Government needs to be criticised on all those points. If we are to pay our way, if we as a nation are like a family deeply in hock, we have only one solution: We have to work; we have to earn income. In terms of our national economy that means that we have to sell more goods and services overseas. We would like to sell more primary products but commodity prices are deeply depressed. We would like to sell more minerals. Again, international prices are very depressed. Therefore we must turn to our manufacturing industries. We must produce goods with a high value added content and sell them overseas. In very simple terms, this means that we have to get our manufacturing industries export-oriented and internationally competitive. They have to become very efficient so that they can sell their goods on world markets. The world must be looked on as our potential market, not the domestic market. The days are gone forever when we could look to import replacement as a solution to our balance of payment problem. If we pursue this approach, the Government will have to assess every manufacturing industry for its export potential and then, with rifle shot accuracy, direct resources to those industries which will, in turn, earn foreign exchange and will export goods manufactured in Australia. The Government's approach has to be selective, in other words. This approach is always criticised because-in Senator Button's words-`governments should not attempt to pick winners'. We are not saying that the Government has to pick winners. We are saying that the Government has to co-operate with industry. It has to determine which industries have export potential and see what can be done to improve their export performance. That is not picking winners. It is co-operating with industry. It is certainly directing resources with rifle shot accuracy where they need to be directed now-to exports. During the war we had to produce our armaments or we would have been overrun. How did the Government go about it? It assessed the industries that had the potential to produce armaments and encouraged them. The crisis facing us now is just as great. We have just about lost the economic war. We are just about to be told to get out. We are just about under the control of international forces, international finance institutions. Unless we realise that we have a state of emergency and that we have to do something about it we will be sold out. If we are to save our country from going bankrupt we must husband our scarce reserves of foreign currency. The financial system must be used to direct investment to export and job-creating areas. By scrapping exchange controls, the Government has given up any powers it had to control the flow of money into and out of the country. Our increasing foreign debt makes it absolutely imperative that foreign borrowings be scrutinised and that those considered unnecessary or undesirable be disallowed. I realise that that is an approach that the Liberal Opposition certainly will not agree with but it is an approach that is now inevitable; it cannot be avoided. We cannot have the luxury of allowing money to flow into this country for any purpose whatsoever and calling on the whole community to earn the export currency to pay the interest on that foreign borrowing. We must reimpose exchange controls simply to stop speculation on the stock exchange in particular and other undesirable non-productive, non-export oriented projects. The Government and industry must co-operate to establish a long term indicative plan in key industry sectors with world markets as the key criterion. National planning must be undertaken, with the co-operation of industry, by a body similar to the Ministry of International Trade and Industry in Japan. Priorities can then be set and action taken to encourage development. That is not picking winners. It is co-operating with industry to decide where we should best direct our resources. Japan has been doing it for 40 years and has built an industrial machine that is the envy of the world. It has established a balance of payments surplus that is almost embarrassing. We must curb speculation on the stock exchange. We cannot afford to allow billions of dollars to be borrowed overseas for non-productive pursuits simply to protect companies from raiders. This means that the whole issue of takeover legislation and company law should be looked at. We should bring in reforms along the lines of ensuring that offers for companies are unconditional, that once made they cannot be varied. Offers should stipulate the closing and settlement dates and these should not be changed. We should ensure that raiding companies comply with section 50 of the Income Tax Assessment Act by first offsetting their interest on the borrowings against related dividend income before any other source of income; in other words, we should eliminate negative gearing. It is simply a matter of enforcing section 50 of the Income Tax Assessment Act. Much has been said about the on-cost burden on industry. The Australian Democrats' position is very clear. Industry in Australia probably bears more on-costs than any industry anywhere else in the Western world. We refer to such things as payroll tax. This could be eliminated over a three-year period. It is a tax on labour. It adds enormously to the cost of production in Australia and adversely affects labour intensive industries. Of course, it is a State tax, but it cannot be eliminated in the States until the Federal Government is prepared to finance the States to eliminate payroll tax. While industry has to bear the burden of payroll tax, its costs of production are very high. It tends to make our industries uncompetitive with those in the rest of the world. We should rationalise workers compensation to spread the cost more evenly across the whole community. It is an enormous additional burden. Workers compensation has very largely become a personal insurance for workers, whether they are on the job or not. As such, it is very much in the nature of a national responsibility rather than a responsibility to be placed entirely at the feet of industry. We should give serious consideration to a `Buy Australia' Act, along the lines of the `Buy America' legislation in the United States of America, to encourage government purchases of Australian made products in lieu of imports. Most people would be surprised to know that public sector purchasing, both State and Federal, costs approximately $22 billion annually. The Government's overseas deficit is presently $3.4 billion per year or thereabouts. If we could divert even a small percentage of these State and Federal Government purchases to Australian sources, we could very easily reduce the size of our overseas deficit annually by about $1 billion to $2 billion and at the same time give Australian industry a much needed boost. We should establish guidelines to direct superannuation funds into more productive areas. About 50 per cent of the money invested on the Australian stock exchanges comes from superannuation funds. That is a very large percentage. These funds very largely represent the savings of the Australian work force. They will double once superannuation for all is introduced. Over a period of three or four years we will find the size of the funds to be invested from superannuation will virtually double. They represent Australia's savings. It is important that they be invested to help the Australian economy-invested in productive enterprises in this country to create jobs for Australians. Although the Government has done something about trying to reduce the marginal rates of personal income tax, we believe that it has not gone anywhere near far enough. There is still a very large disincentive to personal effort in Australia. Unless we fundamentally reform the personal income tax scale this disincentive will continue. The Democrats' position is simply that there should be a tax free threshold amounting to at least $100 per week. From there the primary rate of tax should be 20 per cent and then from 20 per cent the scale should progressively increase in steps of one per cent per $1,000 of income to a maximum of 49 per cent. So, instead of having stairs and sudden changes in the marginal rate of tax, there would be a progressive straight line increase in the marginal rate of tax from 20 per cent to 49 per cent, which level should be the maximum rate of personal income tax. This sort of reform would not cost as much as many people may imagine. In fact the Democrats have carefully costed it and have incorporated the cost of it into an alternative Budget. That is available. We believe that employee share purchasing offers a middle road between the excesses of socialism and unrestrained capitalism or free enterprise. Share purchasing leads to efficiency in industry. It gives employees an incentive to look at their industry and to try to contribute towards increasing its efficiency. That is a vitally important factor. Up to the present time very little attention has been given to this very important initiative. If we are to build our industries to be internationally competitive, if we are to build an industrial machine in Australia along the lines of that in Japan, we have to get away from confrontation in industry. We have to engage the brain power, the initiative, the leadership and the expertise of the whole work force to improve the efficiency of industry. Until we do that we will not be internationally competitive. I suggest that one of the best ways to do that is to encourage employee share ownership. That gets all people involved in what is happening. It gives them all a vested interest in increasing the size of the reward to be divided between the interests of labour and capital, the two fundamental factors in production. Until we increase the efficiency of industry, the reward to be divided between labour and capital cannot be increased. If it is just not there it cannot be divided. Lastly, in the interest of increasing the efficiency of industry, we have to give much more attention to worker participation generally, not just employee share ownership. The Japanese have been dramatically successful with their small group activity, that is, having small panels of about 10 people throughout the organisation looking at their particular work responsibilities. These small groups can then assess whether the ideas from individuals should be applied throughout the whole organisation. If that sounds to honourable senators like a very simple idea, let me assure them that it is, but like many simple ideas it has dramatic consequences. In Japan last year there were no fewer than 1.9 million suggestions from employees in the Toyota organisation alone, all of which were processed through this small group activity. The important point is that 90 per cent of those suggestions were acted on by management. The greatest genius of all time may be leading an organisation, but that person is not going to come up with 1.9 million suggestions. It is a completely different ball game when the whole work force is looking at ways and means of improving the efficiency of what they are doing. Then there will be some action. An organisational structure that allows for co-operation and encourages people to try to improve the efficiency of the enterprise has to be a better organisation every time, as the Japanese have proven. That is the way they have built their industrial machine from a heap of rubble 40 years ago to an industrial complex which is the envy of every Western country. Japan now produces more cars than does the United States of America. Whoever would have thought that could happen in 1945? Senator Crichton-Browne —And in the 1950s we produced more than Japan. Senator SIDDONS —I was not aware of that. Look at the enormous ground that has been traversed by the Japanese in 40 years. They make 90 per cent of the motor bikes in the world and they are vying for leadership in machine tools, computer technology, and so on. The list goes on ad nauseam. The Japanese are leading the world and they have done that by co-operation between the work force, management and government. They have said: `Right, we were in desperate trouble in 1945. We have to earn our keep in the world. How are we going to do it?'. They did it by building their industrial machine to be internationally efficient, to be world leaders in the various areas. If the Japanese can do that, why cannot Australia? Senator Messner —They also have a decentralised wage system. Senator SIDDONS —We have problems with our wage fixing system, I agree, but these problems are not insurmountable. Once we get co-operation between the trade union movement, government and business leaders the whole problem of our wage fixing and industrial relations will disappear, but it will not disappear if we fight each other. That is a fundamental approach, the only approach by which we can possibly succeed. If we think we can hit the unions over the head and get rid of them, we will have chaos. We will have confrontation like nobody has ever seen. Unionism is a way of life in Australia. Our whole system of conciliation and arbitration is based on unions. We have a high degree of unionisation in Australia and we have to accept it. It is built into our system of conciliation and arbitration. The only possible approach, short of a revolution, is to get co-operation between the trade union movement, industry and government. The Australian Council of Trade Unions and the Government are co-operating pretty well right now; industry has to co-operate as well. The whole three have to get together to build an industrial complex that can export manufactured goods around the world. We cannot do that in every area of manufacture but we can do it in some areas of manufacture. It is up to the Government to assess those areas that can be built to world efficiency and exported around the world, and we have to do it fast. We have to work our way out of debt. We cannot sit back any longer and see this enormous flow of foreign borrowings coming into Australia without any consideration of how the Australian people will meet the interest commitment on those borrowings. Certainly we cannot sit back any longer and see billions of dollars go into stock market speculation with no productive advance in our industries whatsoever. Billions of dollars are invested in nothing that has any semblance of productivity for development of the country in any way at all. We support the Appropriation Bill, but it impinges on a whole lot of areas of economic management. We will be supporting some of the areas that are of concern to the Liberal Party. I have spent some time stressing our real concern about the one aspect we have to face up to, namely, the size of our overseas borrowings. That is critical and fundamental. If we agree on that, it can be solved only by a fundamental change in economic direction along the lines of co-operation that I hope I have successfully outlined. Senator CRICHTON-BROWNE(Western Australia)(11.25) —I take the opportunity in speaking on the Appropriation Bills to make some references to the plight of the rural economy. In doing so I want to make it clear that I am not seeking to talk down the economy but rather to put, in as objective a way as possible, the facts relating to the rural industry so that they are understood properly and clearly. The Hawke Government has done more to destroy the Australian agricultural industry than has any other government in recent history. At best it has constantly failed to act where it could have assisted Australian farmers and at worst it has pursued policies in the knowledge that the effect of those policies would be to drive up farm costs and thereby reduce farm incomes. The Government is either too incompetent to realise the real problems facing Australian farmers or has deliberately chosen to ignore them. I believe that it has deliberately chosen to ignore them, because history has shown that farmers are rated very low in the Government's list of priorities. I think it is a pragmatic judgment it makes in terms of the seats that are likely to be won or lost, or the fate of the Government in respect of that section of the community. The Government has sought also to place the entire blame for rural problems exclusively on overseas factors. I doubt that there is a person in the entire nation who would not agree that the agricultural policies of the European Economic Community have greatly damaged the Australian rural industry. The $1.5 billion United States Farm Bill designed to combat the policies of the EEC, will also further harm Australian farmers. The Prime Minister (Mr Hawke) believed that he would solve the problems by going to Washington to ask that Australian farmers not be harmed by United States policies. In effect, Mr Hawke went to Mr Reagan and said: `Mr Reagan, will you please lose votes in your rural lobby so that I can gain votes from my rural lobby'? Of course, that is totally unrealistic. However much the Americans may humour Mr Hawke when he is in Washington, the extent of his impact on American policies was shown when he left the United States of America. No sooner had Mr Hawke left the United States than it was reported that 50,000 tonnes of wheat were to be sold at $20 per tonne subsidy to North Yemen. Two days later it was reported that the United States planned to sell 60,000 tonnes of rice to Papua New Guinea at a price 50 per cent less than that which Australia is presently receiving. It ought to be recognised that Papua New Guinea is our single largest market for rice. Obviously Mr Hawke's endeavours overseas, much as the flourishes of the television cameras would give us the opposite impression, have achieved absolutely nothing. The question that ought to be asked is: What else can the Government do? The answer is that the Government must look at stemming rises in domestic farm costs. This Government has not done so. It has blamed all the problems of the agricultural sector on overseas factors and has persisted with domestic policies which have driven up costs to farmers, which in turn have had a devastating effect on farm incomes. The Government's only other response has been the patch-up Kerin rural policy, which by itself is hopelessly inadequate. The Government has not attempted to deal with the crippling effects of its labour policies, its interest rate policies, tariffs and rising costs-the whole thrust of the burden which has been cast upon farmers. These are the real issues for the farmers. These are the problems with which the Government has to deal if it is serious about dealing with the crisis in the rural economy of Australia. But it has failed to do so. It has come into this place hoping to rectify chronic farm problems with band-aid measures. These measures are, of course, hopelessly inadequate, as any examination of the current state of the Australian rural economy will reveal. In the three years since the Hawke Government has been in office the incomes received by farmers in the major sectors of agriculture have constantly fallen. At the 1986 National Agricultural Outlook Conference, held by the Bureau of Agricultural Economics, it was revealed this year that 50 per cent of all farmers surveyed by the Bureau will earn less than $5,900 a year. Here is the sorry story of three years of Labor Party rule. Income for wheat farmers has fallen from an average $41,425 per annum in 1983-84 to an estimated loss of $7,500 in 1985-86. In the dairy industry income has fallen from $21,259 to $8,800 in the same period while income for livestock farmers has fallen from $26,519 to $4,500. The fall in farmers' incomes is put in perspective if it is compared with average weekly earnings. Based on the December quarter figure for last year supplied by the Australian Bureau of Statistics, a person on average weekly earnings would have earned $21,554 in a full year. A person on average weekly earnings is something like five times better off than the livestock farmer, two and a half times better off than a dairy farmer and infinitely better off than a wheat farmer, because a worker on average weekly earnings will at least put money into the bank while this year, after three years of the Hawke Government, wheat farmers will make a loss of $7,500. Mr Hawke and his Government are prepared to watch farmers go into bankruptcy because they do not have the courage to tackle the problem of rising farm costs. In my State of Western Australia and on farms throughout the country both on-farm and off-farm costs have risen astronomically. It is the rise in the farm costs which, in many respects, is the root of the farmers' problems inasmuch as they can be contained within Australia. It is within the grasp of the Australian Government to do something about these matters, if it is prepared to have the courage, the initiative and the will to do so. On wheat farms average costs are expected to rise by 12 per cent. Almost half of the increase in farm costs is as a result of this Government's policy of deliberately increasing the rate of interest charged on loans. Farmers are now paying between 17 and 21 per cent on loans. The amount farmers have had to pay for money has been compared with overseas rates of interest to reveal the true extent of the damage which this Government is causing farmers. In February this year the minimum overdraft rate in the United Kingdom was 13.3 per cent, while in the United States of America the prime rate was 9.1 per cent. Farm payments on interest rose by 17 per cent in 1984 and are expected to rise by 40 per cent in 1985-86. How can our farmers be expected to pay these kinds of interest rates and compete successfully against overseas farmers who are carrying nowhere near the same interest rate burden? The simple answer is one which every farmer knows-they just cannot compete. Rather then entering this place and attempting to hoodwink the farmers into believing that it is doing something for them, the Government would be better served by looking at introducing policies designed to cause a permanent and sustainable fall in interest rates, down to the levels which are being charged by our international competitors. Labour rates are another cost which is slowly but surely squeezing the lifeblood out of the Australian farmer. Labour rates on Australian farms rose by 5 per cent in 1985. The BAE expects them to rise by 7 per cent on 1986. If the Government were serious about assisting farmers it would try to restrain to some extent these increasing labour costs. It would abandon the productivity increase which we are about to witness-this dreadful farce which has been inflicted not only upon the rural sector but upon the whole Australian economy. If this Government were in any way fair-and that is all the farmers are really asking for-it would examine the incomes of the Australian farmers. If it were to do so it would find that in my State of Western Australia, for example, the State farm employees' award guarantees employees $234.30 a week, or roughly $12,183 per annum. If the Government were fair it would compare this figure with some of the incomes farmers are expected to earn, such as those I have already mentioned. If it were to do so it would realise that many farm employees earn twice as much as their employers and, in the light of that, perhaps it would impose some constraint upon the head-long rush to satisfy the demands of the Australian Council of Trade Unions, to satisfy the demands of the accord and to hell with the economy. The Hawke Government, however, will not moderate its accord until it is finally forced to do so as a result of economic pressures which are about to undo the whole economy. In fact, it has already rejected the notion of considering farmers as a separate case in the light of the current rural malaise. Whether farmers will actually have any money with which to pay this new impost is of no concern to this Government. It has handed over its labour policies to the trade unions through its blind ideological following of the accord. As Professor Richard Blandy, Director of the National Institute of Labour Studies, said: The Accord seek[s] to orchestrate the relations between people at work from a very great height as a result of the manoeuvres between the very powerful in our society. This is not a good scene for the rural producers in our society, the small people, whose interests cannot be politically orchestrated in the same way. As 90 per cent of farms surveyed by the BAE are classified as being family farms, among the many people to whom Professor Blandy addressed his remarks and who are suffering because of the accord are Australian family farmers. This situation is not likely to change because, as Professor Blandy went on to say about the accord: What the unions have done is to trade off a developed capacity to inflict unacceptable damage to the economy and, therefore to the Government of the day, for a direct say in government. There are many other areas where farm costs have increased under this Government, such as the 22.7 per cent rise in the cost of fertilisers and the 18.5 per cent rise in the cost of chemicals which Australian farmers, particularly Western Australian farmers, have had to suffer since mid-1983. In the time remaining, I would like to address the issue of off-farm costs. These are the costs which a farmer has to pay for services once his produce has left the farm gate. In a recent publication by the National Australia Bank Ltd it was revealed that up to 50 per cent of the value of rural produce at the farm gate was absorbed by off-farm costs. Let me examine some of the costs in the wheat industry, for example. From a guaranteed minimum price of $149 a tonne for Australian standard white wheat, or fair average quality wheat, farmers have the following costs deducted: Co-operative bulk handling costs, $13.05; tolls, $1.84; wheat research levy, 35c; Ceres House levy, 10c; wharfage costs, 50c; and carry over to port loading costs, $1.53. So, we see that the farmer has lost $17.37 from what he is theoretically paid for his crop before he even receives payment. We find that the farmer is being paid only $131.63 for his crop. From this he has to deduct rail freight charges. The Victorian Farmers and Graziers Association recently indicated that the average rail freight charges for grain were: Victoria, $21.30 a tonne; New South Wales, $24.80 a tonne; Queensland, $16.20 a tonne; South Australia, $16.70 a tonne; and Western Australia, $16 a tonne. I note that the two States with the longest serving Labor governments are the States which have the highest rail freight rates. Interestingly enough, despite the prices which farmers are being charged in Victoria, the Victorian Minister for Transport, Mr Roper, indicated that Victorian railways would still expect to lose between $5m and $7m on grain cartage. By comparison, the Canadian Freight Association has indicated that a 300 kilometre wheat haul in Canada would cost $13.24-about the same figure when related to the Australian dollar because the dollars are almost equivalent in value at present. Of course, averages frequently conceal the fact that there are isolated cases where farmers have to pay far higher charges. For instance, in a place such as Marvel Loch, some 260 miles from Perth, Westrail advertises a price of $25.28 per tonne. Therefore, some farmers, including these farmers, are paying 20 per cent of the money they receive for their crops simply for rail freight. These rail freight charges, of course, are increasing dramatically. The Australian Wheat Board has computed the average price paid for a tonne of wheat in Australia. The Board has indicated that since 1981 the average cost of hauling wheat in Australia has risen by 51 per cent. Grain handling charges are another cost which is destroying our farmers by making them less competitive than farmers overseas. This is also a cost that neither the Federal Government nor the State governments have been prepared to do anything about. In a classic statement by Mr Kerin on 15 January 1985, which might well have been a trial run for the patch up rural policy which was discussed recently by him, he said that the Commonwealth and the State Labor governments were investigating what could be done to reduce off-farm costs to growers. There was and there still is a very great need for something to be done about the spiralling costs of handling grain. The Bureau of Agricultural Economics has recently revealed that in the six years to 1984-85, the cost of grain handling from primary receival points to export points free on board has risen by 52 per cent in Australia. When our farmers have to compete with overseas farmers, the figures for comparable charges overseas starkly demonstrate the disadvantageous position of our farmers. Over the same period-the six years to 1984-85-handling costs in Canada rose by only 37 per cent while in the United States they actually fell by 18 per cent. At the National Agricultural Outlook Conference in 1985, Andy Stoeckel, the Director of the Bureau of Agricultural Economics, indicated that if there was greater competition in the marketing of wheat it could result in savings of somewhere between $60m and $80m annually. Twelve months after Mr Kerin made his statement, what has been the result of his investigations? The answer, it would seem to me, is absolutely nothing. In the recent rural package, Mr Kerin announced that the Commonwealth was prepared to meet the cost of a joint royal commission with the States into off-farm costs. All the Government has done, of course, is to go from an investigation to a royal commission. How has this helped the farmers to pay their bills as they come in? This is something that Mr Kerin just does not seem to understand. The Government has not decided actually to tackle the reasons why our grain handling costs are so much higher than those of our international competitors. In 1986 Andy Stoeckel returned to the Agricultural Outlook Conference to state: In general, Australian grain handling facilities are characterised by much higher manning levels than those of equivalent facilities in the United States, short shifts, a lack of co-ordination of shift changes, which effectively prevents 24 hour operation and a large number of unions which increases the possibility of demarcation disputes. While wheat farmers will make a loss this year, grain terminal employees will each earn in the vicinity of $35,000 in wages. In New South Wales, Mr Mick Charles, a member of the Grain Handling Authority Board, said that the New South Wales grain handling system is now based on a 46 per cent labour component compared with 32 per cent in 1979. While Mr Kerin has been confronted with a real issue where he could assist farmers, he has done absolutely nothing. Instead, he has produced this farce he calls a rural package which he hopes will gloss over the very real issues. There are many other areas where off-farm costs are much too high. Figures I have obtained from the Australian Wool Corporation show that for a 176 kilogram bale of wool, it costs the wool industry $229 to take the wool from the sheep's back to a point where it is ready to be shipped. The Wool Corporation assumes a price of $571 for a 176-kilogram bale. It therefore costs 40 per cent for wool to be sheared, classed, baled, stored, insured, sold, transported, tested and dumped so that it is ready to be loaded on board ship. Whilst a figure of 40 per cent for costs from the sheep to the wharf is alarming enough, it hides the fact that the cost of wool packs-the packaging for bales of wool-has increased in price over the last 12 months by 17 per cent. Transport costs for wool, both from the farm to the store and from the store to a mill or wharf, have increased by between 7 per cent and 9 per cent. The wool tax has increased from $15.16 per bale to $17.15 per bale, while the market support levy has risen from $25.28 per bale to $28.59 per bale. In each case the increase has been approximately 13 per cent. By comparison, increased costs in overseas nations are far lower. Inflation in the European Economic Community was recently reported to be 4.7 per cent compared with our rate of 9.2 per cent annualised on the last figures. Another example of this Government trying to deliberately mislead farmers has been its portrayal of the exemption it gave farmers from the new fuel excises. Actually, the Government has given them nothing. The Government has not done farmers a favour at all by introducing this measure. Rather, farmers have received the reduction in fuel prices which should have flowed through to all Australians. The Government has robbed non-farming Australians of a fall in fuel prices of $7.95 per litre by increasing fuel excises. It has then tried to tell farmers that because it did not similarly rob them, it has done them a favour. The truth, of course, is that the Government has done farmers no favour at all but has simply robbed the rest of the country of that which it has not robbed them. Indirectly, the Government has still robbed farmers because many farmers, particularly on cattle stations, have to send their stock by truck. By denying road hauliers a reduction in fuel excise, which amounts to something like 36c per gallon of diesel, the Government has kept freight rates at a level which is dangerously higher than they ought to be and higher than what most farmers can afford to pay. As many cattle trucks can manage only approximately five miles for every gallon of fuel consumed, on a journey of 500 miles an additional $36 is paid by the operator because the full reduction in the price of oil has not been passed on. Had there been full fuel price reductions, it would have been inevitable that in a competitive industry such as road freight, part of the savings would have been passed on to farmers. Given that fuel costs frequently amount to 30 per cent of total operating costs for lorries, the reductions which would have occurred would have been substantial. The Government has done virtually nothing to reduce the burden which high levels of protection for Australian manufacturing industries places on farmers. The Institute of Applied Economic and Social Research has calculated that manufacturing protection costs farmers between $1 billion and $1.5 billion each year. When this figure is averaged over all Australian farmers, it is calculated that it costs each farmer about $8,800 per annum. The protection given to our industries was estimated by the Bureau of Agricultural Economics to cost the average wheat farmer $134.62 per week in 1981-82. Today the cost is probably somewhere in the vicinity of $200 per week. Such an amount of money means that if protection was removed, most of the wheat farmers who presently will make a loss of $7,500 this year, would be able to make a profit. Again, I point out the unfairness this Government has cast on this issue. As I have said before, it is only a fair deal which Australian farmers are seeking; nothing more and nothing less. The assistance given by the Government is so greatly weighted in favour of manufacturing compared with that given to agriculture that the situation has no semblance of fairness at all. In its annual report for the year 1984-85 the Industries Assistance Commission indicated that effective assistance to the wheat industry has varied from 10 per cent to minus 3 per cent. In 1984-85 it was at a level of 2 per cent. The 1985 figure for wool was 4 per cent, for beef cattle it was 9 per cent, for pigs it was minus 9 per cent and for poultry it was minus 5 per cent. In 1982-83 the average rate of assistance for manufacturing was 25 per cent. To look at some particular industries makes the comparison all the more awesome. Effective assistance for the production of transport equipment-cars, lorries and the like-was 72 per cent, while for clothing and footwear it was 220 per cent. In order to protect the inefficient Australian industries the Government raises the price of goods which are imported into Australia by imposing tariffs and quotas upon these imports. While this protects Australian industry it does so by increasing the amount which people who buy imported goods have to pay. Farmers are one of these groups. They are paying for this Government's tariff policy every time they buy such basic items as utility trucks, fertilisers and machinery. Farmers lose again when overseas countries place tariffs on Australian rural exports in retaliation for the tariffs which are imposed by this Government. In a report entitled `Wheat Marketing in Australia-An Economic Evaluation' which was published in 1983, the BAE made the following statement which I believe applies not only to wheat farmers but to all Australian farmers: Australia's wheat industry has been growing and performing well internationally without significant assistance and indeed against a significant penalty. Of course, to the extent that the BAE said that the wheat industry was growing, that comment was made in 1983 before wheat farmers had suffered three years of the Hawke Labor Government. The neglect of Australia's farmers which has taken place under this Government has taken its toll. If the BAE figures prove correct, Australia is facing the prospect of somewhere near half of its farmers earning just slightly more than one quarter of average weekly earnings. Real returns on farm investment have fallen to the point where they will average minus 6.2 per cent this year. In part this negative return on capital has been due to falling land prices. Should land prices recover under this Government, many farmers will find that when they sell their land they will be subject to capital gains taxes. They will pay almost half-49 per cent-of the benefit accruing by taxation to the Labor Government. After years of working to build up the value of a rural property, farmers may well lose half of its value to the Commissioner of Taxation when it is sold. Because of time, I have been able to mention only a few of the failings of the Hawke Government in this speech. There are many others which could have been mentioned and discussed. For example, the Government has introduced a sales tax on wine. It has destroyed the intended effect of income equalisation deposits. In this, the world's driest continent, it has removed the immediate tax deductibility for expenditure on water conservation. As if these matters were not enough by themselves, to destroy the ability of farmers to compete with the farmers of other countries on world markets, the Government proposes to introduce a fringe benefits tax. In addition to the cost of having to pay initially for accommodation for employees in remote areas of the country, the Government's fringe benefits tax will mean that farmers will have to pay a tax of 46 per cent of the difference between what they charge their employees in rent and whatever rate the Commissioner of Taxation assesses the market value of the employee's accommodation to be. Farmers will have to stop providing their employees with accommodation, or raise the rent, or try to absorb yet another cost increase thrust upon them by the Hawke socialist Government. It is little wonder that Sir Leslie Price, the former Chairman of the Australian Wheat Board, was recently reported in the Australian Financial Review as saying that between 4,000 and 5,000 farmers may be forced out of the wheat industry. The National Australia Bank suggested in its April monthly summary that up to 27 per cent of Australian farmers, that is more than one in four, will have difficulty remaining viable in the long term. Already the Country Women's Association of Western Australia has planned for emergency food relief in certain areas, such is the plight of the rural industry in Western Australia. It is a tragedy that in a land which once rode so proudly upon the sheep's back and where the Australian farming family was the power-house which drove the economy of the nation we find that under this Government the emphasis has changed. Whereas as late as 1953 agriculture still constituted 19 per cent of GDP, in late 1985 it constituted only 5 per cent. Time prevents me from going through a range of other areas but if one looks at expenditure on social welfare and the part of the Budget which it consumes as a proportion of gross domestic product and compares that with gross rural production one can see that the Hawke Government is clearly seeking to move its priorities from stimulating the rural sector, enabling it to be the power-house which it ought to be and giving it a chance to prosper, survive and increase its share of GDP and to move them to social welfare. The ACTING DEPUTY PRESIDENT(Senator Townley) —Order! The honourable senator's time has expired. Senator VIGOR(South Australia)(11.55) —I raise the problem of monitoring serious injuries in Australia. A considerable amount of both public appropriations and money from the private purse could be saved by having such a system. I am prompted by general overseas experience and by the absence of medical information on the Dalkon shield with which I have dealt at length in the adjournment debate. Between 1964 and 1983 only a handful of adverse reactions to intra-uterine devices were reported to the Commonwealth Department of Health. There were four mentions of the Copper 7 device, 30 of the Lippes loop and 73 of the Dalkon shield under voluntary reporting procedures which were in force at that time. Last year, the Department of Health cited a 0.05 per cent adverse reaction rate because only 74 problems had been notified from the 147,000 shields imported into Australia. Now we find that 3,000 Australian women have joined in a major American class action in Richmond, Virginia. Many other women have contacted women's health centres and the Public Interest Advocacy Centre to register their experiences with this revolting device. These people have never had any intention of going to the courts but they were glad at last that someone was prepared to listen to them. Besides a large number of seriously injured people, there are three cases in which relatives or doctors of women who wore the Dalkon shield and died believe there is a link between the shield and the deaths. It seems quite clear that the voluntary reporting procedures have failed and that the true picture is only now emerging because of the court cases. It is extremely important that we monitor all types of injury. I have been particularly concerned with child injuries in the community. I have tried to get statistics on this area from every possible government instrumentality to use in speeches. Children and women are being injured. People in our society who can least afford it are not having their health monitored properly. It is the policy of the Australian Democrats that we should have prevention rather than cure in medicine. The whole health system, in appropriations and elsewhere, seems to be geared towards curative instead of preventive medicine. To move our system from curative to preventive medicine we need the information necessary to know what we have to prevent. Many women have suffered needlessly because the many individual experiences with IUDs were not collated and used properly. The vicious circle was complete because doctors did not know what was happening. This meant that they often failed to associate the symptoms of seriously ill women with the wearing of the Dalkon shield. In some cases, this lack of knowledge caused doctors to completely disbelieve the women who came to them. The stories did not fit with the promotional material that had been distributed by the company concerned. There was no way of knowing about this problem in any place where a decision could be made. It is interesting that the situation in the United States was similarly clouded, but that country at least had some monitoring and now has a compulsory reporting procedure which was set in force as late as 13 December 1984. We are at least two years behind in getting these types of compulsory procedures into place. All deaths and serious injuries in the United States now have to be reported within five days of the event. On top of that, the Consumer Product Safety Commission has been monitoring a sample of hospital emergency rooms since 1976. This gets danger alerts into the open very quickly. For instance, a United States Federal Court judge last year found that the spermicide, ortho pharmaceutical gel, had caused severe defects in the child of an Atlanta woman who continued to use the product in the first four weeks of her pregnancy. This is the type of information we need to get quickly into medical hands. We need to spend some money on obtaining information. The United States Food and Drug Administration released this quite quickly. In contrast, our Department of Health had to be prodded into action after the National Times reported the American case in 1985. In my maiden speech I referred to the need to establish a child accident surveillance system. Virtually 50 per cent of children under the age of 14 receive treatment for injury each year. Some 70,000 children are admitted to hospitals. Medical expenses are over $200m each year-that is just the medical expenses associated with these cases. Some 60 per cent of all the injuries to children involve common consumer products. I could not find any real statistics except for these general overall figures. Some 50 per cent of the 700 deaths of children each year are related to the road. That is about as much information as I could gather on this terribly important area. Statistical data about what is happening now is not available. At best, it is available only one or two years after the event and it is far too late to identify new trends and to counter them effectively. Statistics are currently available only after a considerable amount of time. If we decided to collect data from accident and emergency departments in hospitals we could start an injury control program. Sweden's child injury rates are about half ours, partly because its surveillance procedures make prevention possible. Norway has just started a data collection system on injuries to all in-patients and a group of five accident and emergency centres are now collecting this information. For each dollar spent Norway expects to save $40 in hospitalisation and other expenses. When extra money is being found to set up therapeutic goods and chemical registers we should insist that the data base be widened to make prevention possible. We should be able to get information immediately. These data bases should be open for doctor inquiry. Unfortunately, the Government will need quite a deal of encouragement to go into injury control rather than just saying: `It is an accident. It cannot be prevented'. I believe that the Dalkon shield episode shows that human suffering can be lessened if we establish proper data collection systems. In the United States, A. H. Robins received reports of spontaneous infected abortions in wearers of the Dalkon shield as early as June 1972. The first known death was in August 1972. By 1973 there had been 400 separate complaints, most listing several people, yet doctors were still given the impression that their observations were quite unprecedented and related only to individual cases. There was no collation of this information. It was only when doctors made contact with one another that the scope of the problem was appreciated. At the same time, sales were suspended in July 1974. However, by then seven deaths and 103 spontaneous life-threatening abortions had been reported. The number of these deaths could have been cut down in the United States. The United States now has a system of injury control and reporting. The death toll had risen to 43 last year, with 313 non-fatal septic abortions. That was because it was not possible to quickly contact people who were fitted with the shield because there was no register of who had been fitted. The reason I am giving American figures here is that Australia's data collection system does not give us a hope of making even a reasonable guess at what has happened here and I believe that that is an utter disgrace. Let me take one example which was mentioned in the Good Weekend magazine of 22 March. The person concerned developed minor discomfort after a Dalkon shield was inserted in April 1972. She had it removed in February 1975 and another was inserted. Five months later the doctor told her that the United States Food and Drug Administration had cleared the Dalkon shield. That was certainly not the case. Terrible abdominal pains beset the woman. Her body became stiff, her temperature fluctuated wildly, and she could not walk or move without suffering agonising pain. I could go on describing those symptoms, but basically this suffering went on with a number of women. There were 3,000 Australian women in this type of situation and the statistics were not there to bring all this together. It is quite difficult to make connections between a recurrent illness and a particular type of device or product, such as the Dalkon shield. The only way this can happen is by collating material. For example, the symptoms of the Dalkon shield problems sometimes resembles flu and include feverishness, vomiting and dizziness. Major life-threatening complications can develop within a matter of hours. There is no routine description of the syndrome. Text books do not include any details of this. It is very important that we have a collection of data. If data had been collected as a matter of course, doctors would have had the relevant information, a timely diagnosis could have been made, and many people could have been saved. There is also the problem that many women did not even know that the IUD which had been inserted was a Dalkon shield. A lot of women did not know because there was no registration of wearers. When a new product comes onto the market there should be some system of registering those people who are using the particular drug or product so that it is possible to monitor that group if it comes under risk. I inquired from the Department of Health what systems are in place in Australia for such monitoring and I am appalled to see that there are very few. Individual hospitals keep statistics but they hold them jealously to themselves. The Family Planning Association in New South Wales did keep some records of the Dalkon shield but these were destroyed in a major flood which hit inner-city Sydney late in 1984. Hence it is rather difficult to know what women have been fitted with the Dalkon shield in Sydney. It may even be that some women are still wearing this lethal device. In the United States the Food and Drug Administration gave approval for a modified monofilament Dalkon shield only on condition that patients registered when they had that device inserted. We do not have a similar system on any of the IUDs we are currently distributing. We have had problems with a variety of medical devices in recent years but, because adequate records were not kept, those involved and at risk could not get any type of early warning. In the case of the Dalkon shield the risk was twofold but basically related to the fact that bacteria travelled up the multifilament plastic strands to a double knot where the plastic device was attached. It took a long time for the effects of the bacteria to show up and they showed up much later as general systemic infections. Unless we record who uses a device and the relationship between disease and devices we will never be able to fix the problem. A microbiologist established that a vastly increased number of bacteria accumulated on the string after the Dalkon shield had been worn for about two years. This is why long-term wearers were at risk. Most of the early monitoring programs in the United States were over just six months. Many of the devices which are potentially dangerous-not only medical devices but also children's toys and electrical devices, although our electrical monitoring system is reasonable-are on the market. It is important that we record information on this matter. Currently this is not happening. I put it to the Government that we should establish proper patient registry and accident surveillance mechanisms as soon as possible. I also want to raise a largely unreported aspect of the Dalkon shield; it concerns access to medical records. There are individual State and Federal jurisdictions, so the matter should be put on the agenda of the next Health Ministers conference. Currently we have enough problems because under the Trade Practices Act only three years are given in which to seek relief from loss or damage caused by defective products. This is made worse because there is no legal right of access to medical records, which makes it rather difficult for people who have been treated at a hospital by other than their own doctor to get access to their own medical records, especially if there is any suspected problem with a product that the hospital has fitted. Consequently, those who discover their cause for action under the Trade Practices Act within the three-year period may face very serious obstacles when they prepare their case. If all the States had the freedom of information legislation that exists in Victoria people would at least have access to public hospital records. With the development of computing, data base and microchip technology and the increasing problems with particular diseases being latent for many years-we have solved the problems of a lot of short term diseases-it is more important that we carry out national surveys and make a lot more diseases and accident-type situations compulsory notifiable. We should keep that information and the statistics on it and monitor changes which can give us early warning of problems that are developing. We will have to look at ways in which the private sector will also be able to retrieve information from these types of data bases. At the moment, patients have no legal right of access to their medical records held by their own doctor. We need to give them this legal right. In the Dalkon shield investigations doctors have refused access to information on the grounds that either they did not want to be involved or that somehow the doctor-patient relationship would be ruined if they gave in to a particular request. I believe that those doctors ought to re-examine their commitment to the healing profession. It is not for them to exercise God-like powers in this direction. However, even where doctors have co-operated, there has been a major financial impediment to people getting this information. Some doctors have sought to charge people for providing the material sought. This should be stopped. Medical information can save lives and it should be available to people at all times. In other cases State regulations have been at fault. For instance, in Western Australia patients have no direct access to their own hospital records. The patients need to be accompanied by the doctor who admitted them to hospital and by their lawyer and they must pay for the time of these professionals. There is a further burden for plaintiffs because they cannot get photocopies of records. Naturally, the cost of such antiquated processes becomes prohibitive for many ordinary Australians. There are enough obstacles on the road to justice without these mazes being put in their way. I hope that the State and Federal Ministers for health will act promptly to give the injured some encouragement in their pursuit of justice and that we will set up a system of monitoring and injury prevention. At this stage I briefly turn to another subject which is of great concern. We have not had any answers from the Government on certain aspects associated with giving to people information on the Chernobyl disaster. I would like to know what steps governments are taking to ensure the safety of Australian people overseas. We tried to get this information in a debate when Standing Orders were suspended. What is the Government currently doing to monitor this type of situation? Without information it is rather difficult to do anything. The fact that the Russians withheld information from their neighbours meant that it was rather difficult to save people from possible radiation hazards at an early stage. It is extremely important that we should not have that problem in Australia. There is the question of whether we have instituted a monitoring system to check for contaminated foods or objects we are importing from that area and the question of getting a register of at least goods that may have come from areas where the level of radiation has severely increased. I would like to know what steps have been taken, or what measures are being set up to monitor radioactivity on products imported into Australia. We know that Chernobyl was not the first such accident. Vast areas of land in the Urals have been affected. When I was in Great Britain in the 1960s all babies were fed with South American dried milk rather than with British cows milk because of the Windscale disaster. People tend to export products which they do not want on their market, and we should be monitoring this closely. It is worth having moneys appropriated for these purposes and I recommend that to the Government. Question resolved in the affirmative. Bill read a second time. Consideration resumed from 17 April, on motion by Senator Gietzelt: That the Bill be now read a first time. Question resolved in the affirmative. Bill read a first time. Senator WALSH(Western Australia-Minister for Finance)(12.22) —I move: That the Bill be now read a second time. I seek leave to have the second reading speech incorporated in Hansard. The speech read as follows- I present Appropriation Bill (No. 3) 1985-86 which, together with Appropriation Bill (No. 4) and the Appropriation (Parliamentary Departments) Bill (No. 2), which I shall introduce shortly, comprises the additional estimates for 1985-86. In these Bills, Parliament is asked to appropriate moneys to meet essential and unavoid- able expenditures additional to the appropriations made for 1985-86 under Appropriation Acts (Nos 1 and 2) and the Appropriation (Parliamentary Departments) Act. These additional appropriations are required to meet commitments that have been approved by the Government since the Budget or foisted upon it by courts and tribunals which have no responsibility for the fiscal consequences of their decisions. Also provided for are additional requirements of an ongoing nature and the reappropriation of certain amounts necessitated by transfers of functions which are unable to be effected under existing legal authorities. The principal factors underlying the requirements are certain unavoidable cost and price increases and exchange rate fluctuations since the Budget was prepared. Although the Budget figuring contained allowances for prospective wage and salary increases, those amounts were not then appropriated, and funds are now required to meet the costs of awards and determinations made since that time and to meet the cost of other factors affecting wages and salaries, such as staffing increases. No provision is made in these Bills in anticipation of a wage and salary increase that might arise out of the current national wage case hearings. Any such increase will be met under the separate appropriation provisions in section 5 of the Appropriation Act (No. 1) and the Appropriation (Parliamentary Departments) Act 1985-86. Of the additional appropriations in the three additional estimates Bills totalling $940.3 million, $755.7 million is sought in Appropriation Bill No. 3, $183.6 million in Appropriation Bill No. 4 and $1.1 million in the Appropriation (Parliamentary Departments) Bill No. 2. These amounts are offset in part by savings in the appropriations made by Appropriation Acts (Nos 1 and 2) and the Appropriation (Parliamentary Departments) Act 1985-86 reflecting the Government's continued determination to achieve savings in expenditure for ongoing programs wherever possible. These savings, amounting to $264.0 million, are detailed under the relevant appropriation headings in the document ``Statement of Savings Expected in Annual Appropriations'', which has been distributed to senators. After allowing for prospective savings, the appropriations now sought represent a net increase of $696.3 million in expenditures financed from annual appropriations. As a proportion of total estimated outlays-encompassing both annual and standing appropriations-this increase amounts to 1.0 per cent. I now outline some of the main areas in respect of which the Government has found it necessary to seek additional provisions in the Appropriation Bill (No. 3) to meet expenditure for the ordinary annual services of the Government. An estimated $297.8 million is for wages and salaries, of which $173.3 million is for defence and $124.5 million for non-defence purposes, to meet increases in award rates, other wage and salary costs and a small increase of 0.2 per cent in budget-approved average staffing levels. These provisions do not include the wage and salary components of additional funds being provided to certain statutory authorities funded under one line appropriations. A sum of $10.7 million is provided for the Attorney-General's Department by way of the reappropriation of funds to the Australian Legal Aid Office following delays in the merger of that office with the Legal Services Commission of New South Wales. This amount has been fully offset from savings in amounts which were to be paid direct to the New South Wales Government in 1985-86 had the merger proceeded. A sum of $16.9 million is included under the Department of Community Services to implement revised subsidy arrangements for childcare services. Under the new arrangements, subsidy is paid on the basis of the number of places centres have for children and varies according to the number aged under or over 3 years. This replaces subsidies previously based on the ratio of qualified staff to children. A sum of $95.9 million is sought for the Department of Defence to meet the effect on the purchase of new equipment and stores of exchange rate variations and other cost and price increases since the Budget. The effect of these increases has been partially offset by reduced requirements for certain naval refit projects and the effect of the Government's decision on oil prices. A sum of $14.9 million is included under the Education portfolio reflecting the reappropriation to the Department of Education of funds originally appropriated to the Commonwealth Schools Commission following the transfer to the Department of program administration for general recurrent grants to schools. Cost supplementation of those grants is also provided for. A sum of $70 million is included within the Trade portfolio to enable the Australian Trade Commission to help eliminate the backlog of eligible claims under the export market development grants scheme. This represents significant additional support to the export sector over the level provided in the 1985-86 Budget. A sum of $16.2 million is sought for the Department of Veterans' Affairs for payments to specialists and local medical officers in respect of medical services provided to veterans and their dependants. The rise is mainly due to the short-term transfer of the payments function from the Health Insurance Commission to the Department of Veterans' Affairs to provide for the manual payment of a backlog in accounts, and is fully offset from savings in amounts appropriated to the Health Insurance Commission in the Budget. A relatively small component-around $2.5 million-of the increase is provided for increased demand for services and increases in rates and costs. I commend the Bill to the Senate. Senator COLLARD(Queensland-Leader of the National Party of Australia)(12.23) —I move: At end of motion, add: `, but 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; (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, 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'. Senator VIGOR(South Australia)(12.23) —As an amendment to the Opposition's amendment, I move: Leave out sub-paragraphs (a) (iii) and (iv) and paragraph (c) of the words proposed to be added. Question put: That the words proposed to be left out (Senator Vigor's amendment to Senator Collard's amendment) be left out. The Senate divided. (The President-Senator the Hon. Douglas McCLelland) Ayes . . . . . . . . . . . 35 Noes . . . . . . . . . . . 26 —— Majority . . . . . . . . . 9 —— Aulich. T. McIntosh, G. D. Black, J. R. McKiernan, J. P. Bolkus, N. Macklin, M. J. Childs, B. K. Maguire, G. R. Chipp, D. L. Mason, C. V. J. Coates, J. Morris, J. Coleman, R. N. Ray, RobertColston, M. A. Reynolds, M. Cook, P. F. S. Richardson, G. F. Cooney, B. Robertson, E. A. (Teller)Crowley, R. A. Sanders, N. K. Devlin, R. Sibraa, K. W. Elstob, R. C. Siddons, J. R. Foreman, D. J. Tate, M. C. Georges, G. Vigor, D. B. Giles, P. J. Walsh, P. A. Haines, J. Zakharov, A. O. McClelland, Douglas Archer, B. R. MacGibbon, D. J. Baume, Michael Newman, J. M. Baume, Peter Parer, W. R. Bjelke-Petersen, F. I. Puplick, C. J. G. Boswell, R. L. D. Reid, M. E. Brownhill, D. G. C. Sheil, G. (Teller)Collard, S. J. Short, J. R. Durack, P. D. Teague, B. C. Guilfoyle, Dame Margaret Townley, M. Hamer, D. J. Vanstone, A. E. Hill, R. Walters, M. S. Knowles, S. C. Watson, J. O. W. Lewis, A. W. R. Withers, R. G. Jones, G. N. Jessop, D. S. Evans, Gareth Kilgariff, B. F. Button, D. J. Carrick, Sir JohnGrimes, D. J. Messner, A. J. Ryan, S. M. Chaney, F. M. (Senator Gietzelt did not vote, to compensate for the vacancy caused by the death of Senator Missen.) Question so resolved in the affirmative. Question put: That the words proposed to be added (Senator Collard's amendment, as amended) be added. The Senate divided. (The President-Senator the Hon. Douglas McClelland) Ayes . . . . . . . . . . . 34 Noes . . . . . . . . . . . 28 —— Majority . . . . . . . . . 6 —— Archer, B. R. Macklin, M. J. Baume, Michael Mason, C. V. J. Baume, Peter Newman, J. M. Bjelke-Petersen, F. I. Parer, W. R. Boswell, R. L. D. Puplick, C. J. G. Brownhill, D. G. C. Reid, M. E. Chipp, D. L. Sanders, N. K. Collard, S. J. Sheil, G. (Teller)Crichton-Browne, N. A. Short, J. R. Durack, P. D. Siddons, J. R. Guilfoyle, Dame Margaret Teague, B. C. Haines, J. Townley, M. Hamer, D. J. Vanstone, A. E. Hill, R. Vigor, D. B. Knowles, S. C. Walters, M. S. Lewis, A. W. R. Watson, J. O. W. MacGibbon, D. J. Withers, R. G. Aulich, T. Giles, P. J. Black, J. R. McClelland, DouglasBolkus, N. McIntosh, G. D. Childs, B. K. McKiernan, J. P. Coates, J. Maguire, G. R. Coleman, R. N. Morris, J. Colston, M. A. Ray, RobertCook, P. F. S. Reynolds, M. Cooney, B. Richardson, G. F. Crowley, R. A. Robertson, E. A. (Teller)Devlin, R. Sibraa, K. W. Elstob, R. C. Tate, M. C. Foreman, D. J. Walsh, P. A. Georges, G. Zakharov, A. O. Jessop, D. S. Jones, G. N. Kilgariff, B. F. Evans, GarethCarrick, Sir John Button, J. N. Messner, A. J. Grimes, D. J. Chaney, F. M. Ryan, S. M. (Senator Gietzelt did not vote, to compensate for the vacancy caused by the death of Senator Missen. Question so resolved in the affirmative. Original question, as amended, resolved in the affirmative. Bill read a second time. Debate (on motion by Senator Walsh) adjourned. Consideration resumed from 17 April, on motion by Senator Gietzelt: That the Bill be now read a second time. Question resolved in the affirmative. Bill read a second time. Debate (on motion by Senator Walsh) adjourned. Debate resumed from 6 November, on motion by Senator Gareth Evans: That the Bills be now read a second time. Senator MacGIBBON(Queensland)(12.35) —In leading for the Opposition I make it clear that the Opposition will not oppose the Australian Nuclear Science Technology Organisation Bill 1985, the Australian Nuclear Science and Technology Organisation (Transitional Provisions) Bill 1985, or the Atomic Energy Amendment Bill 1985. In the latter part of the debate we will be seeking, through amendment, to make these Bills a little more useful and constructive for Australia's national interest. At the outset of this debate I reaffirm the recognition by the Liberal Party of Australia and the National Party of Australia that anything dealing with atomic energy is a highly emotionally charged subject. We approach the subject with due sensitivity and caution. But we do live in a nuclear age. We have done so for 40 years. A large part of the power that is used in the world is generated by nuclear sources. These Bills are concerned in a broad sense with the peaceful uses of nuclear power. There is no involvement at all with nuclear weapons or anything like that. I believe that in this debate we will be the victims of some extreme, emotional fear-raising statements by the Australian Democrats which will serve only to muddle what is a very important argument. We cannot unlearn nuclear physics. Human nature is creative and inventive. Mankind split the atom. We are probing the limits of nuclear physics and particle physics. We will go on until ultimately we unlock their secrets. Whilst there are great dangers in nuclear power, there are certainly enormous possibilities for mankind. Those possibilities will be attained in the fullness of time. Regrettably we will have incidents such as the Chernobyl reactor incident last week. As I made it clear in speaking on that subject, that accident could have been avoided had the Russians consulted other nuclear physicists and engineers around the world and had they acted in a more responsible and cautious way. The disastrous consequences of that accident should never been inflicted on the Ukrainian people. I regard it as a tragedy that Australia has not taken a much larger position in the field of nuclear physics and nuclear engineering. We are 40 years into the nuclear age yet we have virtually no nuclear industry, no nuclear design or engineering capability. The decision in 1969 to build a nuclear reactor at Jervis Bay was correct. It was wrong not to proceed with that reactor, either at another site or at Jervis Bay so that we could achieve the design and manufacturing capability in this country to take us into the nuclear age. One reason that is advanced as to why we cannot buy nuclear submarines is the fact that we do not have any of the support engineering facilities in this country. That is only one application. The whole field of nuclear engineering is developing. Because we have no base in this country other than the vestigial research facilities at the Australian Atomic Energy Commission, Australia cannot be part of it. The governments of Australia have been unduly influenced by the shrill cries of the Luddites and the people of that nature. The hagiography-ridden left wing of the Australian Labor Party is stridently opposed to anything to do with nuclear engineering. Whilst the Australian Nuclear Science and Technology Organisation Bill will give to the Australian Nuclear Science and Technology Organisation the powers to carry out research, clause 5 (3) of the Bill provides: In undertaking its functions the Organisation shall have regard to the national science and energy policy objectives of the Commonwealth Government. That clause will mean that under a Labor Government there will be no research and development in nuclear fields, particularly the nuclear generation of power. Australia will be very much the poorer for that. I said a little while ago that there is a great confusion, intentionally created in the minds of the public by people such as the Democrats, between nuclear power and nuclear armaments. They are quite different things. The peaceful uses of nuclear power have brought very great benefits for mankind. I was in Japan last year and I was very interested to visit one of the Japanese nuclear power installations. That country has suffered the horrors of a nuclear attack on two occasions, at Hiroshima and Nagasaki. The Japanese, above all other races, have reason to be opposed to nuclear physics, nuclear generation and nuclear power if any country has. But there is a ready acceptance and an expanding employment of nuclear generation of power in Japan. They do not have the confusion that exists in the muddled minds of the Australian Democrats between nuclear power and nuclear generation. Of course, as well as generating electrical energy, nuclear power has a great application in propulsion, particularly in ships. The ability of ships to operate for years without refuelling and to operate in absolute safety, provided accepted engineering practices are followed, brings great commercial benefits. The world uses energy. When we became industrialised we faced an increasing demand. First came fire-wood, then coal and oil. But anything that we burn results in the production of carbon dioxide and water. While the water does not hurt in the atmosphere, the cumulative effect of carbon dioxide does have a very severe effect. Most of the hydrocarbons that we burn, whether they are solid or liquid, contain some sulphur. Those that do not contain sulphur attract a premium in the market-place. But the burning of those sulphur containing compounds leads to the production of sulphur dioxide. When released into the atmosphere this produces sul- phurous acid, which is the cause of the acid rain which is now having such a devastating effect on the forests of Europe. But not only the forests are affected; acid rain is precipitated into the lakes and the aquatic life in those lakes is killed off as the acidity level in the lakes rises. It is inevitable, if we go on burning more and more fuels, that we will just swelter in the garbage of the products of those combustions. Seventy-seven per cent of the world's energy is consumed by 28 per cent of its population. As standards rise, that 72 per cent of the population not currently using the 77 per cent energy will need more and more electrical energy. Senator Sanders —Maybe they are smarter than we are. Senator MacGIBBON —They would not have to be smart to be smarter than Senator Sanders. Some countries do not have oil and coal-countries such as Japan. They have to maintain a highly complex society and they have turned to nuclear energy as their source. Because we do not have nuclear generation in Australia, the degree of power generation that comes from nuclear sources around the world is not widely known. There are well over 200 nuclear power-houses in existence. Some European countries, such as France and Belgium, develop 50 per cent of their electrical energy from nuclear power. The application of those power-houses has been of great benefit to the communities. In short, there will be a place in the world scheme-it will be a minor place but a significant place-for the generation of electrical energy by nuclear power in the foreseeable future. That fact leads me to the place of Australia in the scheme of things. Australia has great reserves of uranium oxide. Under the Treaty on the Non-Proliferation of Nuclear Weapons we have a legal obligation to supply that yellowcake under very stringent safeguards to those countries that need it for peaceful purposes. Because of the dogma of the Australian Labor Party those Australian deposits of uranium oxide are not being exploited and developed in the way that they should be. This leads to some interesting things. Apparently one can have good uranium in Roxby Downs but not at Jabiluka, Koongarra, Yeelirrie, Beverley or Honeymoon. In fact, the Labor Party has licensed production only at Ranger and Roxby. I seek leave to continue my remarks later. Leave granted; debate adjourned. Motion (by Senator Walsh) agreed to: That, unless otherwise ordered, till 2 p.m. this day matters of public interest may be discussed by senators, provided no senator shall speak for more than 15 minutes. Senator HAINES(South Australia)(12.45) —Mr Deputy President, first of all may I acknowledge the generosity of Senator Bjelke-Petersen in letting me change places with her on today's speakers list. I want to raise a matter as a result of two Administrative Appeals Tribunal decisions that were made with regard to Department of Social Security decisions in October and November of last year. They are rather extraordinary decisions and they have some rather extraordinary ramifications. I would be interested in some response from the Minister for Social Security (Mr Howe) at some stage. One case deals with the case of Kingston v. the Secretary to the Department of Social Security, which occurred in October 1985. Mr Kingston was 80 years old and shared a flat with a woman who was 75 years old. They had been cohabiting since 1965. Since 1971 the Department of Social Security had treated Kingston and the woman concerned as if they were married, and accordingly paid them their pensions at the married rate. In October 1984 Mr Kingston applied to the Department of Social Security for a full pension-as distinct from him and the lady concerned getting a married pension which, as everybody would know, is not twice the full single pension. The Department of Social Security rejected this application but the Administrative Appeals Tribunal set aside the decision. The Department had argued that Kingston was living with another person of the opposite sex as the spouse of that person on a bona fide domestic basis, although not legally married to that person. The evidence presented by the Department included, firstly a statement signed by the woman concerned in 1977 that she had lived with Kingston as `man and wife' since 1965; secondly, Kingston had not objected to letters received fromthe Department of Social Security in 1975-- Senator Walsh —He also claimed the dependent spouse rebate in 1969. Senator HAINES —I thank the Minister; I am about to get to that. Kingston had not objected to letters received from the Department of Social Security in 1975 referring to the woman concerned as his spouse. Thirdly, in 1969 Kingston applied for a spouse rebate in respect of the lady concerned. The evidence the Tribunal accepted `without hesitation' was Kingston's statement that they were not in a quasi-marriage relationship. The AAT commented-I would alert honourable senators to this because it is worth listening to: Before such a relationship is converted (ie, housekeeping relationship) into a man and wife relationship there must be some kind of spark to ignite the tinder of cohabitation to the fire of a quasi-marriage relationship. Senator Peter Baume —That is quasi-poetic. Senator HAINES —I would have said purple prose, but quasi-poetic will do. Senator Walsh —You would wonder how anybody with an IQ above 65 could have come out with the conclusion that the AAT did. Senator HAINES —I will accept the Minister's interjection but not comment on it because I want to go on to a second AAT decision, a month or so later, on a similar matter. This one occurred in 1982 and it concerned a man by the name of Kennison who was in receipt of the unemployment benefit at the married person rate as a result of his cohabitation with a woman then aged 16 years. In 1983 the Department of Community Services decided to pay Kennison the single rate of unemployment benefit because the woman concerned was under 17 years of age-the legal age of consent in South Australia. The AAT set aside the DSS decision. It was argued by the DSS that because it was a criminal offence for a person to have sexual intercourse with a person under 17, it could not administer the social security system so as to allow any person to benefit from the commission of a criminal offence. I would say that seems a reasonable sort of assessment to make. This argument was rejected by the AAT because in this case there was no direct evidence of a sexual relationship. I just draw the Senate's attention back to the previous decision in which the fact that there was no evidence of a direct sexual relationship meant that one of the people was able to get a single pension-that is a full single pension-rather than a married pension. The AAT stated that neither the AAT nor the DSS was obliged to investigate the existence of any such relationship, although it might be proper for the Department of Social Security to refuse to pay a benefit to a person whose entitlement rested on facts which amounted to a criminal offence under State law. Having received that information I thought that surely since these two cases contradict each other, and are extraordinary within themselves anyway from the attitudes and the assumptions made-assuming that there is no other evidence that I am not aware of-the Department of Social Security would appeal on either or both of those decisions. My staff member who made the contact with the officer concerned was informed that it was not going to appeal. This, then, raises a number of questions. First, why did the Department not appeal to the Federal Court of Australia-as it can, of course, under the Administrative Decisions (Judicial Review) Act 1977? Senator Walsh —The problem is there is no guarantee, based on its record, that the Federal Court would be any more sane than the AAT. Senator HAINES —Again I accept the Minister's interjection without any additional comment. Nevertheless, the two cases are contradictory and they are internally odd. Senator Walsh —Agreed-scandalously so. Senator HAINES —I thank the Minister for his assistance, but I did suggest to Senator Bjelke-Petersen that I would be quick. There are, I would suggest, some rather interesting possible consequences of the precedents set out in these two decisions. First of all, if the fire goes out of a legal marriage tinder box, can each of the partners concerned then claim the full single pension-apparently they can-in a relationship that used to be defined by the couple concerned as de facto but about which they have now changed their minds? Secondly, is a sexual relationship essential to eligibility for receipt of a married pension if people are over the age of 75, but not if one of the parties is under the age of 17? I would like some explanation about that question, and whether the answer is yes or no. Finally, as far as the Kennison case is concerned, does it mean that any couple, providing they are of opposite sexes, one to the other, can receive married unemployment benefits no matter what their age or the legality of the relationship, or whether any criminal element is involved? Does that mean, for example, that if the AAT is going to ignore the possibility of a criminal offence-as it did for this case, where sexual intercourse was quite clearly an offence since the person was under the age of consent as far as the South Australian system was concerned-incest, or the possibility of it, will be ignored so that a sole supporting parent, for instance, can claim married unemployment benefits as long as he or she has under the same roof a person, of whatever age, apparently, who is of the opposite sex? Or do we not worry about the sex of the person? Are we going to take this right down the track so that that does not matter at all? I find it extraordinary, Mr Deputy President, that the Department itself did not appeal in either of these cases. If the information that I have is correct, the Tribunal made those decisions without thinking about the internal inconsistencies and about the potential problems that they have raised. Senator BJELKE-PETERSEN(Queensland)(12.55) —I take this opportunity today to pay a special tribute to a great Australian who, regrettably, passed away very suddenly last week. I speak of course of the former Governor of Queensland, Commodore Sir James Ramsay, KCMG, KCVO, CBE, DSC-a man who distinguished himself by his tremendous service to his country and his great love for his fellow man. Commodore Sir James Ramsay was born in Tasmania in 1916 and joined the Royal Australian Navy in 1930. He served through World War II on various ships in the areas of the Indian Ocean, the Red Sea, the Atlantic Ocean, Singapore, the Persian Gulf, Burma and the South West Pacific, and he also served in the Korean War later on. After the war this distinguished Australian assumed the duties of operations officer and fleet navigating officer, and Commanding Officer of HMAS Warramunga, HMAS Arunta and HMAS Vendetta. Commodore Sir James Ramsay's shore appointments included being Captain of the RAN College, naval representative in the United Kingdom, Director of Plans, Director-General of Fighting Equipment and naval officer commanding the Western Australian area-a position from which he retired in 1972. In 1974 Commodore Sir James was appointed Lieutenant-Governor of Western Australia, an appointment which lasted until 1977. On 22 April 1977 Sir James was sworn in as Governor of Queensland, an appointment which saw his great love for the people and his dedication to the monarchy exemplified. He was blessed with a wonderful wife, Janet, Lady Ramsay, who together with the Governor travelled Queensland widely. I know of many occasions when he went out to Longreach at the time of the endurance ride. The endurance ride went day and night and he was always there, interested in that. In times of drought, in times of flood, the Governor was there. He used to travel by train a lot and he would call in at all the small towns along the way, on whichever route he was taking, in whichever part of the State he was going to. People everywhere spoke very well of our late Governor and his wife. In fact, I am sure we could say he was certainly a man of the people. As the Queen has brought the monarchy to people throughout the Commonwealth, so Sir James represented her very well throughout the State of Queensland as her vice-regal representative. I have been to many occasions when he has presented honours to people. Twice a year he used to present them, at Government House. He was well decorated for the service that he gave to Queen and country. As I said earlier, he was a Knight Commander of the Order of St Michael and St George, a Knight Commander of the Royal Victorian Order and a Commander of the Order of the British Empire, and had been awarded the Distinguished Service Cross. The DSC, of course, was for services rendered during the wars. The Governor retired on 22 July 1985 after giving eight years of magnificent service to the State and the people of Queensland and, in all, some 56 years of service to his country. A senior Governor before he retired, he relieved the Governor-General at Government House in Canberra on a number of occasions. Commodore Sir James Ramsay is survived by his wife, Lady Ramsay, three daughters and a son. I was very honoured to attend Commodore Sir James Ramsay's funeral in Brisbane yesterday, together with almost 1,000 people, including the Premier and Deputy Premier, Cabinet Ministers, members of parliament and distinguished people from all walks of life, to pay my tribute to him and his service to the Commonwealth, to Australia and to Queensland. The service conducted at St John's Cathedral was a very fine one. It was conducted by the Dean of Brisbane, the Reverend Arthur Grimshaw, and the panegyric was preached by the Archbishop of Brisbane, His Grace the Most Reverend Sir John Grinrod. I felt he took a very appropriate text from psalm 107, verses 23 and 24: They that go down to the sea in ships, that do business in great waters; these see the works of the Lord, and his wonders in the deep. During the funeral service the Archbishop said that the late Sir James's joy of life and sense of humour jumped the bridge of protocol in his role as Governor. He said that Sir James was a religious man with a reserve and respect for the convictions of others; he and Lady Ramsay drew people of diverse occupations and background together. I think that that was a very fine tribute to the late Governor. The Navy paid him the highest accolade possible. Six able seamen from HMAS Vampire carried his flag-draped coffin, bearing the ceremonial sword and his cap, from the Cathedral out to the gun carriage where the 124 strong Royal Australian Navy guard saluted and reversed arms as a mark of respect. Hundreds of people lined Ann Street as sailors slow marched Sir James's casket along Ann Street to King George Square. Sir James was indeed an officer and a gentleman. He was truly a remarkable man and a great Australian who will be sorely missed, and I wish to convey to Lady Ramsay and her family my sincerest sympathy. Senator COLSTON(Queensland)(1.02) —Mr Deputy President, I use this opportunity this afternoon to outline to the Senate an incident in Queensland which occurred after I was maliciously maligned by a State Government Minister. The Queensland Minister for Education, Mr Powell, made the attack in the State Parliament and later issued a Press statement in which he repeated some of the things he had said in the Parliament. So far there is nothing unusual about that story, but the story does not end there. A State high school on the south side of Brisbane included the Minister's full Press statement in its February newsletter. In that Press statement Mr Powell accused me and the Australian Labor Party of `attempting to mischievously ferment trouble and rebellion in Queensland's schools'. Mr Powell's parliamentary comments were made and his subsequent Press statement was issued last November after I publicly defended a State high school student who was forced to wear a dirty school uniform from the school's lost property office because she had not been attired in full school uniform. The student, who had to change in an empty classroom, said she had been humiliated by the incident and developed a rash as a consequence of wearing the filthy garments. I pointed out at the time, as I have done so on many other occasions, that State school teachers in Queensland have no authority to insist that school uniforms be worn. Under the Queensland State Education Act and its regulations there are no provisions whatsoever covering the wearing, compulsory or otherwise, of school uniforms. Thus the wearing of uniforms cannot be legally enforced in Queensland State schools, and students who do not wear them should not be excluded from school activities on that basis. In Mr Powell's Press statement, which was reprinted in the newsletter of the State high school to which I have referred, he said I had `engaged in a disgraceful display, symptomatic of the Left Wing's trends to undermine traditional values of authority and responsibility'. Presumably that was due to my desire to see the law upheld. In Queensland most members of my Party have become immune to the idiotic vitriol expressed by members of the National Party, but I did take exception to a State high school giving prominence and wide circulation to Mr Powell's unsubstantiated and vicious personal attack. Having a State high school become so blatantly enmeshed in the politics of the National Party is frightening. I should mention that the principal of this high school had not informed me that these defamatory remarks would be published in his school's newsletter and had not offered me the right of any reply. Indeed, I became aware of the newsletter only when an anonymous person contacted my office-someone who I assume was a parent who objected to her school's newsletter being politicised in such a fashion. After speaking on the telephone to the high school principal about this matter I wrote to him outlining my position on the issue of school uniforms. I now quote the letter which I forwarded to the principal: Dear Sir, In your newsletter of 5 February you included a media release in relation to school uniforms by Mr Lin Powell, Minister for Education. Mr Powell's release was highly critical of me and it made aspersions which I consider to have no foundation. I have made my position clear on the issue of school uniforms in State schools on a number of occasions. Personally, I do not care if students choose to wear a uniform or not. What I do object to is a coercion to wear uniforms where there is no legal basis for such coercion. Some teachers and Parents and Citizens Associations may prefer to have students wear a school uniform, but in Queensland State schools they do not have the legal right to enforce that preference. I am mystified at the Minister for Education in Queensland suggesting that because I like to see the law upheld, I am guilty of fermenting trouble and rebellion in Queensland schools. Because you gave wide circulation to Mr Powell's comments I trust that you will include my letter in a forthcoming issue of your newsletter. Yours sincerely, Mal Colston, Senator for Queensland. In a subsequent telephone conversation, however, the high school principal made it clear to me that my letter would not be published and I would thus not be given that opportunity to put my case to the students and parents who had seen the Minister's scurrilous Press statement in the school's newsletter. Naturally, I was deeply concerned by the highly political stance taken by a State high school. More importantly, however, this incident raises a number of pertinent questions about the sorry state of Queensland under the present State Government Administration. How can a Queensland Government Minister encourage State school teachers to ignore the law and malign those who would stand up for correct legal processes? Mr Powell promised in his statement to support schools which coerced students into wearing school uniforms. In true National Party style, Mr Powell is happy to take the law into his own hands when the law as it stands does not suit him. The incident I have described must also raise questions about the relationship between the Queensland State Government and its bureaucracy. I can see no valid justification for this particular high school reproducing a Press statement which amounts to no more than blatant politicking, and distributing that statement to all the families represented at that school. That high school cannot claim to offer a sound education in the values of independent thinking when its principal allows the school newsletter to become a vehicle for the propaganda of its political master. Has bureaucratic integrity sunk to such a low ebb under the Bjelke-Petersen Government that a school principal will allow politics in his school in order to curry favour with his Minister; or, in a more sinister light, was the principal fearful that his career and school would suffer if he dared to circulate any reply from me? I am sure honourable senators are aware of the Queensland Premier's attitude to freedom of expression in that State. Recently he was quoted widely as saying that Queensland would be a much better State when it got rid of the media. I suppose the Queensland Government would carry on quite well without the media. It could use State-funded institutions to carry and spread its propaganda. I have many personal friends in the teaching profession in Queensland, not all of whom share my political persuasion. It bothers me that an incident such as the one I have described could reflect on them, as I know that they would regard what happened as a despicable event. Although it is now a long time since I taught in Queensland I still have fond memories of the schools in which I worked, my former colleagues and many of my former students whom I still remember and occasionally meet. It is my hope that those memories will not be spoilt by another incident of this nature. Senator PETER BAUME(New South Wales)(1.10) —Mr Deputy President, I wish to speak briefly about a new form of alcoholic drink being marketed aggressively for young people. The drinks are called coolers and, as many honourable senators will know, coolers burst onto the American market in the summer of 1981 and the Australian market at the end of 1984. These drinks known as coolers have been sensationally successful. Sales in the United States boomed to the point where it was claimed recently that some seven million cases of coolers were sold in 1985 alone. In Australia the distribution of coolers during last summer far exceeded the wine industry's expectations. It is claimed that one million cases of a leading brand, West Coast, have been sold after only eight months on the market. There has been a proliferation of brands. As well as West Coast cooler, we have Island cooler, Hula cooler, Castaway cooler, Surf cooler, Berry Estates tropical cooler, Capricorn cooler, SL cooler and Cin Cin cooler. These coolers are a combination of white wine and fruit or imitation fruit juice. They are essentially very sweet drinks, and some have a very high alcohol content, the highest I could discover being on one on sale at Hardy's winery, which had an alcoholic content of 9 per cent. I hasten to say here that I am not objecting to the sale of alcoholic drinks or to the sale of high alcohol drinks. That is no problem; they are available anyhow. I am concerned about the marketing of these products and the market at which they are being directed-new drinkers. A random sample taken in some of Canberra's supermarkets and liquor stores shows that the following coolers had an alcoholic content of between 4 and 6 per cent: West Coast cooler; 4 per cent; Island cooler, 6 per cent; Hula cooler, 5 per cent; and Castaway cooler, 5 per cent. So they are not without a significant alcohol content. I am concerned about this mushrooming market not because these drinks contain alcohol, not because I do not drink-I certainly do-but because of the increasing number of problems associated with the abuse of alcohol in the community and the recruitment of very young people into alcohol use. An analysis of the cooler market shows it to be directed towards new drinkers, or new business. It is aimed particularly at young drinkers or occasional drinkers feeling their way into the use of wine, or being introduced to wine. The packaging of many coolers in small bottles, which makes them look like soft drinks, is important for it serves to distinguish in the minds of customers the coolers from what are called starter wines, such as Barossa Pearl, Ben Ean and Cold Duck. Each of those forms of wine is marketed in a wine bottle and people know that they are drinking wine, but these coolers are marketed as if they were soft drinks. Whereas it is not socially acceptable to swig away at a wine bottle in public, it is certainly socially acceptable to toss back a cooler in a public place. Because of its packaging it looks as if one is just tossing back a soft drink. Some supermarkets display alcoholic drinks like coolers in the same refrigerated compartment as they sell their soft drinks. Advertising by cooler companies, including television advertising, has been extensive. These television advertisements do not appear during the viewing time for small children-I am not suggesting that at all-but the advertisements which do appear are quite unlike beer advertisements or other wine advertisements. They are more similar, perhaps, to advertisements for Coca Cola or other accepted soft drinks than they are to the usual kinds of wine or beer advertisements. They have been tantalisingly and inaccurately described as having `plenty of flavour', and being `crisp' and `refreshing'. They are quite crudely associated with sexual success in one of the articles which appeared in a weekend magazine in Sydney. So they are being marketed and directed towards young drinkers. Most experienced wine drinkers-that would include, I imagine, most senators-would find coolers quite horrible. They certainly would not find them equivalent in taste to any kind of good dry white. They are, in fact, some form of white wine mixed with fruit juice. They are intended for a young, unsophisticated market which is inexperienced at handling alcohol. Or, they may be directed towards people who just want a drink for the alcohol content, just to be affected by drink. Presumably they use fairly low grade wine-I have no objection to that-but they combine these with a variety of real or synthetic fruit juices and cordials. They are drunk like beer, yet most coolers have a higher alcoholic content and are drunk by young and inexperienced drinkers. They often knock the coolers back without realising the amount of alcohol that is contained in them or the dangers which this poses for them as drinkers. It is not surprising that I recently received a letter expressing concern about the effect of coolers on young drinkers. This criticism came from a long-time defender of the alcohol industry, a long time defender of people's right to drink-and to drink with minimum government taxation, I might add-and a person who defended alcohol producers and distributors from what he saw as often unnecessary government interference. I am making the point that he is in no way a wowser. He wrote saying that I should focus my concern on what he called the soaring growth of soft drinks containing up to 6 per cent alcohol, volume for volume-so-called coolers-which are sold to the very young without significant indication by brand name or warning label that they are alcohol-content drinks. He went on to say: When you drink beer you know it is alcoholic; so with wine; and with gin and whisky but not so with coolers. Coolers volume sales are enormous, tax on 6 per cent alcohol is 10 per cent of the wholesale price. He makes the comment: `Scandalous'. Whether or not the excise is appropriate is another issue. Following that letter I undertook some investigations to see what I could learn about the expanding cooler market, and I really do not like what I found. First of all, the drinks do have an alcohol content higher than that of most beers and they are being confused with soft drinks. Marketing campaigns are being undertaken which will lead young Australians to think that they are drinking a soft drink. There are no special controls or monitoring of this new alcoholic starter drink, and there is evidence that the drink is aimed directly at a young audience. I suppose this is my concern-not that the drink should exist, not that it should be on the market, as that is a matter for the manufacturers and for the consumers, but that it is being directed without full disclosure of what it contains at a young drinking market. That seems to me to be unreasonable. It is not good enough. I ask the Labor Government what it is doing to examine the marketing practices of some of these drinks and what it is doing to ensure that adequate information is placed in the hands of those who will buy and use the drinks. I hope the Government is not so pre-occupied with economic matters with economic statistics, that it does not have time to concern itself with the relationship between this alcoholic drink and young Australians. I draw only three conclusions from what I have said. Firstly, we really need to examine the marketing of coolers to try to prevent them being offered as soft drinks when they are clearly alcoholic drinks. That is just a matter of proper consumer information. Secondly, we should look at setting a maximum limit on the alcohol content of coolers, and I suggest that that limit should be towards the lower rather than the higher end of the coolers already available. Thirdly, the Government should try to make sure that young Australians are not being targeted in a deceptive way-are not being deceived, in effect-by cooler advertising campaigns and understand that they are being asked to buy a drink with a very considerable alcohol content which in turn could cause many young Australians to get into trouble with drink driving and with other matters without them having realised that they were exposing themselves to these dangers. Although my children are out of this age group now, it was not so long ago that they were on provisional driving licences and all the talk at that stage was of the great danger they faced of losing their licences following any infringement at all. The inappropriate marketing of these particular alcoholic drinks may, in fact, lead them towards just such problems. Sitting suspended from 1.20 to 2 p.m. Senator CHANEY —My question is addressed to the Minister representing the Attorney- General. Is it true that the Government has decided that judges from New South Wales will not be considered for appointment to the Parliamentary Commission of Inquiry into matters concerning the alleged conduct of Mr Justice Murphy? If that is so, what is the basis of this exclusion of members of the New South Wales judiciary? Senator GARETH EVANS —It is not true that any absolute decision of that kind has been reached. The only consideration was that a number of New South Wales judges had clearly excluded themselves from consideration by virtue of having made some public comments in the matter bearing upon the Flannery and Briese trials. There are also obvious considerations of personal contact and familiarity that arise when one is dealing with a person who comes from a particular jurisdiction. Beyond that, there is, I believe, no foundation for any belief that there is any generalised veto applicable in that respect. Senator ROBERT RAY —I refer the Leader of the Government in the Senate to the release today of the April labour force figures. I ask the Minister: Firstly, how does employment growth in the latest figures line up with the Government's commitment to employment targets set in 1983? Secondly, what has the effect of the participation rate had on the unemployment rate and job growth? Thirdly, what would the unemployment rate be if the participation rate had remained static since 1983? Senator BUTTON —The third part of the question requires some research and I happen to have done that. In relation to the earlier part of the question, let me say this: The latest figures represent an important stage of the recovery of the labour market under this Government. Since April 1983, in our first three years in office, over 669,000 new jobs have been created, compared with our job target of 500,000 new jobs. The target was reached five months ahead of schedule. Job growth has increased by over 10 per cent for this period and is now at a 20-year record. Unemployment has fallen by over 100,000, or 14.5 per cent, and the unemployment rate has declined to 7.9 per cent. It was, of course, around that level in an earlier quarter. When the Government took office, full time employment had declined in the previous year by 243,000, while unemployment had soared by 254,000. There is almost an inverse ratio between those figures. The unemployment rate was then above 10 per cent. Senator Ray asked me about the participation rate. It is an important point because the seasonally adjusted participation rate increased by 0.5 percentage points in April to 62.4 per cent, the highest since the commencement of monthly labour force surveys. If the participation rate had remained at the April 1983 level, unemployment would be 200,000 less and the unemployment rate now would be down to 5.2 per cent. The rise in the participation rate has meant that hidden unemployment has been drastically reduced, as is revealed in the aggregate figures. I might say that all groups have benefited from the recovery in the labour market, including teenagers. The youth unemployment rate has been reduced from 26.6 per cent in April 1983 to 22.6 per cent in April 1986. That is still not a satisfactory result, but it is a vast improvement. Employment growth in the past 12 months has increased by 358,000, or 5.4 per cent, and is now far above the Budget financial year forecast of 180,000 for that period. The Government had made commitments about this matter of employment prior to being elected. Those commitments have been more than fully discharged in terms of what was promised, although they were derided in some circles at the time. Senator Crichton-Browne makes a sotto voce interjection which he may like to make louder-I did not hear it. What was it? Senator Crichton-Browne —I said: `I doubt your statistics'. Senator BUTTON —He did not say that at all. If he is ashamed of his interjections, he should not make them. The point I make is that in terms of the commitments the Government made the figures are very encouraging. All honourable senators ought to be encouraged, even Senator Crichton-Browne. Let me say that, as always, one must approach figures with caution. The fact of the matter is that the record of achievement in respect of the labour market is good, but it is not one which should induce satisfaction or complacency about the general condition of the labour market. I thank Senator Ray for his question because it has a number of important sub-points in it. It is appropriate that the figures be seen in the perspective which was embodied in Senator Ray's very lucid and important question. Senator CRICHTON-BROWNE —I direct my question to the Minister for Education. I am sure that she is aware that recipients of unemployment benefits are denied those benefits as soon as they apply to enrol at a tertiary institution because they are regarded as no longer searching for fulltime employment. As that may mean a loss of the applicant's only source of income, can the Minister explain why it is taking her Department anything up to three months in Western Australia for tertiary education assistance scheme forms to be processed and for money to be paid? I have a case history of a delay of more than three months in the Department, and the Department by its own admission says that it will be two months or more. Does the Minister consider that this period without income is acceptable? What will she do about it and how does she suggest that those people should maintain body and soul during that period? Senator RYAN —I listened carefully to Senator Crichton-Brown's question and it seemed to me that at one point he was suggesting that unemployment benefits should continue to be paid to students. I know that Mr Howard, grappling around for some way to make himself a little attractive to young people, has suggested that unemployed people should be put into education. Senator Chaney —What about late payment? Come on! Deal with the question. What about late payment of students? Do you want them to starve? Come to the substance of the question. Senator RYAN —It is not surprising that Senator Chaney has to start shouting interjections whenever I mention Mr Howard and particularly when I mention the absolute lack of anything like a coherent education policy coming from the other side. I realise that these matters are a great embarrassment to Senator Chaney because he can see daily that support is growing for the Australian Labor Party and is falling away from the Liberal Party of Australia. The Liberal Party tries to conceal its lack of policies, and we get rather disjointed and confused questions such as the one Senator Crichton-Browne has just asked. Of course it is the case that unemployment benefits are paid to people who are unemployed; that is, people who are looking for full time employment. They are not paid to students, who are eligible for tertiary assistance if they fulfil certain eligible criteria. I am concerned at Senator Crichton-Browne's claim that there has been a three-month delay in the case of one student, because it is the custom in many Commonwealth Department of Education offices administering TEAS to pay TEAS to students once they notify the Department of enrolment, even if that means later making a deduction, so that students will not be left without income to which they are entitled. I would be very happy to have investigated the case about which Senator Crichton-Browne has asked a question. I spend a lot of time investigating these claims. I suggest that he would be assisting his constituent better if he were to bring this difficulty to my office straight away, instead of sitting on it for a while to ask a question about it at Question Time. I am not aware that there are delays of that kind in Western Australia. I will have the matter investigated and I will report to the Senate on the current state of time taken between notification of enrolment in a course and the first TEAS payment. Senator CRICHTON-BROWNE —Mr President, I ask a supplementary question just so that I understand the Minister. Is she in fact saying that it is not the norm for her Department to take two months from when the unemployment benefit ceases to make the first payment under TEAS, which is what her Department has clearly advised me? I can give the Minister the name of the departmental officer and I have his advice in writing. Senator RYAN —Senator Crichton-Browne did not listen to what I said. I did not say that it is not the norm for a period to elapse between payment of the unemployment benefit and payment under TEAS. What I did say was that it is not the norm for three months to elapse between notification of enrolment and the first TEAS payment. My Department has the responsibility for TEAS payments not for unemployment benefit. I will certainly report to the Senate on the time that does elapse-of course, there is some time that necessarily will elapse-between a student providing evidence of enrolment and eligibility for TEAS and the first TEAS payment being made. Senator MAGUIRE —My question is directed to the Minister representing the Minister for Housing and Construction. I refer to the excellent and enviable public housing records of the South Australian and the Western Australian State governments which significantly are the result of those States nominating 100 per cent of their low interest Loan Council borrowings for housing trust and housing commission purposes. Will the Minister inform the Senate of the Government's new funding program for public housing, in particular the arrangements covering the Loan Council public housing funds for South Australia and Western Australia? Senator RYAN —As Senator Maguire is very well aware, public housing is a major priority for our Government and that area was not ignored in the recent 2 April housing package announcement. That announcement included the following commitment: That the direct grant funding for public housing via the Commonwealth-State Housing Agreement will be at the same level in real terms this year as last year's very high level, which will result in about $700m in direct grants to the States for public housing. Of course, that compares more than favourably with the $406m that was available for public housing in the last year of the Liberal Administration. The 2 April package also included the commitment that all States will be allowed to allocate up to 60 per cent of their Loan Council funds to public housing, and so receive these funds at the highly concessional 4.5 per cent interest rate. If this change had not been made all States, other than South Australia and Western Australia, would have been limited to allocating only 30 per cent of their Loan Council funds for public housing. Turning to South Australia and Western Australia, these States were allowed last year to allocate 100 per cent of their Loan Council funds to public housing. They had done so for a number of years in the past. In the next financial year, under current arrangements, this will fall back to 60 per cent, which could involve up to $85m less being available for public housing in those States despite the increases in other States. The housing Ministers of South Australia and Western Australia put their views to the Commonwealth Minister for Housing and Construction at the recent housing Ministers meeting in Adelaide. The Minister for Housing and Construction has informed the Government of the situation of these States and the issue will be examined in the Budget context. In conclusion, the Government has every reason to be proud of its public housing record. The total funding, Commonwealth and State, in 1985-86 is $1.8 billion, the highest ever in real terms, and our funding for 1986-87 of at least $700m in direct grants, and up to $700m in concessional loans-that is, a total of up to $1,400m available from the Commonwealth-will lead to up to 21,500 new housing commencements. Of course, that is a dramatic improvement on the public housing record of our predecessors. Senator VIGOR —My question to the Minister for Resources and Energy follows the Government's acknowledgement that Australian uranium tails, U238, is sent to France and can be used in the Super Phenix reactor, and that Sweden and Finland send their uranium to the Union of Soviet Socialist Republics for enrichment. Is the Government aware of a statement made by Georges Benedett, then French Deputy President of the Assemblee Nationale, on 3 November 1983 that `the fast breeder reactor is the only one actually capable of providing plutonium in sufficient quantities to supply the development of our tactical nuclear force'? Can the Minister state categorically that Australian U238 has never been used in the Super Phenix? If so, on what facts does he base his assurance? Is there not an equivalent risk associated with the Australian U238 which has been sent to the United Kingdom? Finally, will the Minister now also acknowledge that Australian origin nuclear material is sent to the USSR from West Germany and the United Kingdom? Senator GARETH EVANS —I am not aware of the particular statement Senator Vigor referred to about fast breeders providing plutonium for tactical nuclear forces, but I think it is worth noting that the Super Phenix fast breeder reactor is clearly used only for nuclear power production and is part of a European program of co-operation in breeder development for peaceful purposes. The reactor is owned and operated by a consortium comprising French, the Federal Republic of Germany, Italian, the Netherlands and Belgian utilities. As the reactor is subject to IAEA, International Atomic Energy Agency, and European Atomic Energy Community, Euratom, safeguards, France simply could not legitimately remove nuclear material in Super Phenix from safeguards for military purposes. The Phenix fast breeder is an entirely different reactor. It is not safeguarded and there would be no legal impediment to the use of this facility for the production of nuclear weapons material. That is the difference between the Phenix and the Super Phenix. Depleted uranium is, as I described, a by-product of the uranium enrichment process. France, being the world's second largest enrichment supplier, has in storage very substantial quantities of depleted uranium of various origins. The depleted uranium of Australian origin to which I referred the other day would comprise only a very small proportion of the total amount in storage. In these circumstances there is no reason to believe that France would wish to use Australian uranium in Super Phenix. Senator Sanders —Are you saying that they have not? Senator GARETH EVANS —I am getting to that. Can Senator Sanders curb his racing hormones and listen for a while? The reports received by the Australian Safeguards Office confirm that Australian origin depleted uranium has not been so used. I repeat for Senator Sanders: Has not been so used. From a non-proliferation perspective, use of Australian origin nuclear material in a safeguarded facility in accordance with an Australian bilateral safeguards agreement, whether a fast breeder reactor used for power production or some other type of civil nuclear facility, does not represent any kind of risk of diversion into weapons production. What I can say about the last part of the question about AONM being sent to the USSR from West Germany and Britain is that the fast breeder reactor operated by the United Kingdom-the prototype one at Dounreay-is a safeguarded facility and is not used for the production of weapons material. No Australian depleted uranium has been used in this reactor. Under the Euratom-Australia nuclear safeguards agreement, West Germany and the United Kingdom may send Australian origin nuclear material to the USSR for enrichment on an all-in all-out basis. But to date, for commercial reasons of their own, neither country has used this provision of the Australia-Euratom agreement. Senator HARRADINE —Does the Leader of the Government in the Senate not agree that, whilst work force participation rates have increased, a disconcerting aspect of the employment figures released today is the increase in youth unemployment to its highest level since this time last year? Is it a fact that youth are not getting their fair share of the additional jobs created by this Government? What, in the view of the Government, are the factors which give rise to this position and, apart from the traineeship scheme, what can be done about it? Senator BUTTON —I am not quite able to deal with the first aspect of the question because the figures I gave in respect of youth unemployment were the figures for the period of this Government and I have not seen the month by month figures. I accept what Senator Harradine has said about that, but I just have not seen the figures and I cannot comment on them on the basis of the last few months. I do not know that Senator Harradine can say there is a Government view about this issue. In terms of the youth traineeships and elsewhere, we have attempted to recognise the particular problem of youth unemployment. But let me say that there are many instances of widespread job vacancies in Australian industry today which are not being filled. I think we have to face the fact that there are a number of significant cultural changes which have led to a reluctance on the part of some young people to take available jobs and to a preference to take alternative courses of action, whether it be in lifestyle or in seeking other levels of employment. I do not want at Question Time to get into a dissertation upon this issue, which I think is highly controversial. Speaking for myself, I doubt that the aggregate unemployment level in Australia really represents the situation of unemployment if one compares today's aggregate unemployment levels with those of 20 years ago. I suspect that full employment in this country is probably at a slightly higher level of unemployment than it was in years gone by. I think that is very much replicated or true of youth unemployment in Australia, for a variety of reasons. I think this is a matter about which it is more appropriate to have a lengthy discussion than to have me speculating at Question Time on the basis of my own views about these matters. In answer to the question, as I indicated in my earlier answer, the question of youth unemployment is of continuing concern to the Government. Senator WATSON —My question is directed to the Minister representing the Attorney-General. I ask: Because of the extraordinary wide application of workers compensation Acts, giving rise to a dramatic escalation in costs borne by industry, would the Minister not agree that something must be done to ease these additional costs to employers, and that there is now a definite social security element enshrined in workers compensation? Since the present treatment of injured workers on workers compensation contrasts sharply with the injured unemployed looking for work, will the Government give consideration to discussing with State Attorneys-General the introduction of a more equitable compensation package for injury? Senator GARETH EVANS —Workers compensation has been regarded hitherto as essentially a matter for the State governments but there is a case for rationalising the compensation system as part of an overall assault on some of the inequities and uncertainties associated with accident compensation generally. It is probably a long haul so far as this or any other government is concerned to be able to bring workers compensation into some more rational framework of compensation systems on an appropriate no fault basis, but it is an exercise upon which this Government has embarked, starting with efforts, in co-operation with the States, to develop no fault compensation systems in the transport area and so on. I will refer the honourable senator's question to the Attorney-General for such further comment as he wishes to make. Senator COLEMAN —Has the Minister for Education and Minister Assisting the Prime Minister on the Status of Women seen comments in yesterday's Tasmanian Mercury in which the Convenor of the National Women's Consultative Council, Ms Edith Hall, stated that women in Queensland and Tasmania are being denied access to relevant information and are unaware of their rights to benefits and equal opportunities? Whilst I am sure the Minister would not be surprised at that statement, would she care to comment on it? Senator RYAN —Of course, I am aware of the disadvantage suffered by women living in Queensland and Tasmania because of the continuing refusal of both of the conservative governments of those States either to provide any sort of anti-discrimination legislation for women in those States or to provide any sort of special programs or information services for them. While it is true that Tasmanian women and Queensland women have benefited from a number of Commonwealth initiatives such as the Sex Discrimination Act and the various programs that we fund, there are some areas of legislation which only States can act on. In particular, of course-- Senator Newman —We have equality in our State for women. Senator RYAN —I hear Senator Newman interjecting. I think she, as someone who has taken an interest in women's affairs, should be ashamed of the record of the Tasmanian Government, which refuses to give its own employees in the State Public Service the same sort of protection against discrimination and sexual harassment as that which every Labor State has provided and as, indeed, was provided in Victoria under a Liberal government and as has been provided by us to Commonwealth employees. Women in Tasmania, despite having female representation on the other side of the chamber, have no protection and it seems to me that there is no move to give them any protection by Tasmanian Liberals, be they Federal or State. Similarly, women in Queensland are seriously disadvantaged because of that Government's refusal to carry out its responsibilities to women-although it must be said that that State does have the benefit of a very strong advocate in our Government for Queensland women, namely, Senator Margaret Reynolds, who is certainly able to compensate to a large extent for the deficiencies of the Queensland Government. We have taken the step of establishing women's information services in Brisbane and Hobart in order to help overcome the disadvantages suffered by Tasmanian and Queensland women. Speaking of disadvantages suffered by Tasmanian women-- Senator Walters —Mr President, I rise on a point of order. Obviously the Minister does not know what she is talking about. Tasmania is the only State that has sent two women to the Senate. The PRESIDENT —Order! There is no point of order. Senator PARER —My question is directed to the Leader of the Government in the Senate. In view of the Minister's well-known attitude towards a more flexible wages system, does the Minister believe there are grounds for looking at a system which would represent more the American-type position where employers and the trade unions negotiate and bargain, and finish up with a contract, within which they may agree upon a certain enforcement procedure, which would then be a legally binding document and would thus allow the processes of the law to apply on that basis? Senator BUTTON —I am glad that Senator Parer referred to my well-known approach to flexibility in the wages system. It is becoming increasingly well known because of his questions; I am not going to answer them any more if I can avoid it. I think this is a good achievement on the part of the Opposition. It has brought up an important issue and I congratulate it on that. It has not done that in relation to anything else. I am asked whether my flexibility, as it has been called, would extend to the American position. I resist all temptations, particularly in respect of the American position. In all these questions Senator Parer has asked me, I think he has to grapple with the fact that, whether he likes it or not, we have a 60 per cent unionised labour force in Australia and that in America the unionised labour force is something now in order of 17 per cent. Senator Withers —Hear, hear! Senator BUTTON —Senator Withers should be on the record as saying `hear, hear' to that because that is the sort of simple solution which he might like. It is not a solution to wage policy issues in the context of the history and environment in which we operate in this country. I am not even sure that the implications of what Senator Parer said about the United States in his question are even right. He identified the American position, as he calls it, as being plant by plant negotiations. I think that the honourable senator will find that that is not true if he considers the American automotive industry at the moment, even though it has a relatively poorly unionised labour force. One difficulty which the American automotive companies will complain about is the very fact that they negotiate industry by industry agreements, not plant by plant agreements. The American situation cannot be clearly identified in the way in which the honourable senator would like to identify it in the assumptions which seem to underlie his question. My answer is that I do not regard the American experience as being relevant or useful in the Australian context. I do regard the European experience in countries such as Germany, Austria, Sweden and so on as being very relevant and useful in our context because their economies have been marked by continuing and steady success over the last 25 years. Senator PARER —I ask a supplementary question. Is the Minister aware that the statement that I made was a direct quotation from a statement by Mr Hawke in 1980? The PRESIDENT —Order! That is not a supplementary question. The honourable senator is adding new matter. Senator ROBERTSON —My question is directed to the Minister for Finance. Last Friday, Senator Michael Baume read out in the Senate a letter which he had written to the Minister claiming that the Government had produced `a record balance of payments deficit'. Can the Minister tell the Senate whether this is a fact and whether he has replied to Senator Baume's letter? Senator WALSH —It is not a fact that a record balance of payments deficit is looming, because by definition a balance of payments deficit is always zero, a fact of which Senator Baume's colleague Senator Messner was made aware at Estimates Committee C when he said to the Treasury Deputy Secretary, Mr Moore: What would you expect the overall deficit on our balance of payments to be this financial year, in the light of current figures? Mr Moore said: `Zero'. Senator Messner said: I am sorry. That was a very clever answer. Mr Moore said: Do you mean current account? I have replied to Senator Michael Baume. Since he has set the precedent of making public in the Senate the correspondence which passes between the two of us, I will read my reply. It states: Dear Senator Baume, I write regarding your letter to me dated 25 April 1986. I note that in that letter you seek to make a number of judgments regarding the present Government's economic policies. As in areas such as fine wine, good music and debenture issue prospectuses, an appropriate level of expertise is normally regarded as a prerequisite to being able to distinguish the good from the bad. Your letter suggests that in the area of economics, you lack such expertise. The balance of payments deficit in 1985-86 will be zero, as it was in 1984-85, 1983-84 and in every other year for which data exists. It is difficult to see how this constitutes a ``record''. In Estimates Committee C on 17 April your colleague, Senator Messner, demonstrated that he understood this fact. I suggest you seek assistance from Senator Messner in order to commence developing a better grasp of economics. I hardly need to point out that under the former Government of this country, the type of intellectual sloth which your letter displays towards matters of economics produced the worst depression experienced by Australia since the 1930s. Senator BJELKE-PETERSEN —I ask the Leader of the Government in the Senate whether he is aware that, because of the duty free importation of 100,000 litres of passion-fruit pulp from the South Pacific Forum islands group, the Westland Food Packers processing plant at Cleveland in south-east Queensland has ceased operations. Can the Minister tell the Senate whether this pulp is being dumped or is being allowed in under some preferential agreement? If the latter is the case, can the Minister tell the Senate what steps are being taken to ensure that farmers and workers will not continue to be disadvantaged by this action? If the importation is a normal commercial transaction, can the Minister inform the Senate when the Government will reverse its present discriminatory policies and allow the costs of all farmers, including passion-fruit growers, to fall so that they can be competitive on all markets? Senator BUTTON —I thought that the honourable senator would have welcomed something entering Australia duty free. She has argued for that for superphosphate for a long time. Senator Bjelke-Petersen —This affects my passion-fruit growers. Senator BUTTON —There it is. The honourable senator said: `This affects my passion-fruit growers'. She puts passion-fruit in the scones too, I suppose. As far as her passion-fruit growers are concerned, I do not know the precise circumstances of this matter. I will certainly inquire for the honourable senator but I think she will find that this Government has agreed-it is now in operation-that imports from so-called Forum island countries, the countries of the South Pacific region, should be at duty free levels now or are being reduced to duty free levels. The Government has agreed on that to assist those economies. It is part of a proper trade approach to countries in this region. I will find out about the circumstances of the honourable senator's passion-fruit growers as requested but I think that she will find that that is the answer. I think that this policy would be approved by most Australians. I hope that the answer which commends itself to passion-fruit processors or growers is that they should get about the task of improving their competitiveness in the Australian market. Perhaps they can then find a market for their product overseas as well. That would be highly commendable. Senator Archer —Three per cent for this and 3.8 per cent for that and you talk about competitiveness. Senator BUTTON —I cannot deal with Sen- ator Archer's incoherent interjection at this stage. If he likes to make it clearer, I will do so. That is the general answer to Senator Bjelke-Petersen's question. I will certainly investigate the particular circumstances and give her a further answer. Senator BOLKUS —I refer the Minister for Community Services to today's reports that the Mitchell royal commission into the Greek social security conspiracy case is about to report. Can the Minister indicate whether this is true and whether the Australian taxpayer will have to foot a bill running into millions of dollars because of the scandalous conduct of Senior Detective Don Thomas, who was found by the presiding magistrate-- Opposition senators interjecting- Senator BOLKUS —Mr President, you can see why those opposite are nervous. He was found by the presiding magistrate to have contrived evidence and concocted his whole sordid investigation, which came to be known as `Don's Party'. Senator Chaney —I take a point of order. I think it is well known by most honourable senators that this question goes to likely criminal proceedings, if not criminal proceedings that have been commenced. Mr President, I ask you to watch the question and any answer given by the Minister. The PRESIDENT —Order! I will allow the question but I ask the Minister to bear in mind the point that has been taken by the Leader of the Opposition when he replies to the question. Senator GRIMES —The commission of inquiry into compensation arising from the so-called social security conspiracy case was established by this Government in 1984. Its terms of reference were that it make recommendations, as Senator Bolkus said, on the levels of compensation which may be payable to people involved in this case to cover out of pocket expenses, et cetera, and also to cover the loss of benefits that some people-very few-received while they were being investigated. The commission under Dame Roma Mitchell has presented its report to the Governor-General. The report is in two volumes: A general part which deals with the commission's procedures and general recommendations; and volume 2, which will make particular recommendations in respect of each of the 173 individuals who submitted claims. Cabinet will shortly consider this report along with the recommendations on those adversely affected by the conspiracy allegations but who were not actually charged. There were a considerable number of people in that class. The latter group has been considered administratively with the assistance of the Greek- Australian welfare association in Sydney. The Government is pleased that these recommendations are now to become available so that appropriate compensation can be paid, ending this sorry episode, which Senator Bolkus described, in the history of the Australian social security system and in the history of Australian justice. When the Cabinet has considered the matter and has considered the report we will report to the Parliament. I think that would be the appropriate time to deal with the matter of how much is involved and how it should be paid-under proper circumstances, unlike the circumstances surrounding the case when it occurred. Senator SIDDONS —My question is directed to the Minister for Industry, Technology and Commerce. Has the Government noted that, since the Repco company was taken over by the New Zealand firm, Ariadne, it has had many of its automotive parts manufacturing divisions sold off? Is the Government concerned that this may result in local content requirements, on which its car plan is based, being impossible to meet for any car manufacturer because parts will no longer be produced in this country? Finally, how can the Government maintain the position that takeover laws do not need reform when before its very eyes an important Australian manufacturer has been taken over and split up, resulting in a loss of industrial capacity to the country and a large speculative gain to the successful raider? Senator BUTTON —I have been very aware of the position of the Repco company since it was taken over by Ariadne. I have had a number of discussions with the Chairman and Managing Director of the company. Of course, I was very aware of Repco before it was taken over by Ariadne. It has not led an entirely charmed life in the last few years, if I can put in it those terms. We as a Government are concerned that the integrity of the motor vehicle component sector be retained as far as possible. There have been discussions about possible alternative sources of manufacture within Australia in respect of Repco functions. I expect that there may be further announcements, but on looking at what has happened to date, the brake function of Repco has been taken over by a British company, the BBA group, which is reputedly a company of good technology that is expanding successfully into world markets, with substantial interests in America. I am not sure what other matters Senator Siddons had in mind, but certainly there have been discussions about other parts of Repco. Again the same sorts of considerations apply. That is to say, it is important that a successor manufacturer be found to continue the manufacturing function previously performed by a particular division of Repco. So the answer to that part of the question really is that we have been concerned about this. We have been monitoring very closely what has been happening and we will continue to do so. In my speech to the Federated Automotive Component Manufacturers last year I made the point that if there were not competent manufacturers in the Australian component industry who could supply efficiently and competitively to the industry, the Government would not hesitate to invite other contributors into the industry. We will do that if that becomes necessary. On the final part of the question Senator Siddons asks: `How can the Government maintain the position that takeover laws do not need reform in the light of these circumstances?'. I do not think the Government maintains that position. The question of takeover laws is being examined by the Government and by a whole range of people because it is important that we have the best contemporary takeover laws we could have. There are disagreements, of course, about the adequacy or otherwise of existing takeover laws. Senator Siddons may have been referring to some of the tax aspects of takeovers in respect of which clearly a different position was adopted by him from the position adopted by the Government in a particular set of circumstances. Those matters are not excluded from examination by the Government and are subject to current review. Senator Siddons referred, in the last part of his question, to a loss of industrial capacity to the country as a result of the Repco takeover. I think I have answered that. We will be very concerned to see that there is not a loss of industrial capacity. It may be that some of the changes that are taking place in relation to Repco represent an improvement in management and industrial capacity subject to the fluctuations of that change. I think it is quite possible that that will happen. Senator COOK —My question is directed to the Minister representing the Treasurer. In Question Time on Monday Senator Maguire asked the Minister for information on the employment levels in the restaurant industry in the wake of the Government's crackdown last year on taxpayer-subsidised lunches. The figures the Minister gave the Senate were described by Senator Michael Baume in yesterday's matter of public importance debate as `deceptive and misleading'. Were those figures deceptive and misleading? What is the relationship between the figures the Minister quoted and the figures quoted by Senator Baume-figures indicating a fall in employment in the industry concerned? Senator WALSH —The figures I used on Monday were taken from the Australian Bureau of Statistics survey of employment and earnings series and the figures Senator Baume quoted yesterday were taken from the ABS labour force survey series. There is a note by the ABS-this is another indication of the sort of intellectual sloth that members of the Liberal Party, and this member in particular, apply to economic questions-in its catalogue 6263.0 entitled `Comparison of Employment Estimates from the Labour Force Survey and the Survey of Employment and Earnings' which states: The SEE covers only wage and salary earners. That is the source of my figures. It continues: Its strength lies in the capacity to provide industry/State estimates which are more reliable than those from the MLFS. That is the monthly labour force survey which Senator Baume used. More importantly, however, the figures Senator Baume used were highly selective. They constituted a highly selective misuse of the series which he used to support a shonky conclusion. They were unquestionably deceptive and misleading, and I will give the Senate the details. The figures I used were a comparison of August 1985 and December 1985 employment. The reasons for choosing the August base is obvious, and December was taken because that is the most recent available month for that series. If Senator Baume examines the survey of employment and earnings figures for September, October and November, he will also find a picture of steady growth. Therefore, for him to speak of the December figures, as he did, as being distorted by the Christmas trade is absolute nonsense-more intellectual sloth. He quoted figures from November 1985 and February 1986- Senator Messner —Tell us about the numbers you used in order- The PRESIDENT —Order! I have repeatedly asked Senator Messner at Question Time to keep silent. I give him a warning. Senator WALSH —Senator Baume quoted figures for November 1985 and February 1986 which showed a decline of less than 1,000, which of course is statistically insignificant. It is interesting to note that he did not give the August 1985 figure-this is where the deceptive an misleading bit comes in-from the ABS series he was using. In August 1985 the figure was 214,000. The increase from 214,000 in August to 230,000 in November is statistically significant-an increase of 7 1/2 per cent. Finally, there is the question of industry groups. Senator Baume suggested that I was pulling a fast one by quoting figures for restaurants, hotels and personal services; that is, the group to which the SEE data applies. The labour force survey data which was so selectively, deceptively and misleadingly quoted by Senator Baume is available on a finer level of subdivision-in fact, on a finer level than the level used by Senator Baume. For the restaurants, cafes and accommodation subdivision, which is the closest approximation to the restaurant industry which is available from the labour force survey statistics-Senator Baume's source-employment in August 1985 was 176,000, employment in November was 189,000 and employment in February 1986 was 190,000. This shows that there was no fall between November and February, the very time which Senator Baume chose to rely on, but for a less accurately targeted definition. Between August 1985 and February 1986, according to the survey data, employment rose by 14,600 or 8.3 per cent. There is absolutely no doubt that the figures used by Senator Baume were deceptive and misleading. Whether that should be attributed to an intention to be deceptive or misleading or just to intellectual sloth in application of economic matters is a matter for others to judge. I also note in today's Australian that one Henry Rose of Howarth and Howarth, an accountancy firm, said that the figures I had used related to restaurants, hotels and personal services. I said this at the time, of course. He claimed that 20,00 jobs had been lost in restaurants. Restaurants are believed to comprise about one- third of the total numbers in the category restaurants, hotels and personal services. Therefore, if restaurants lost 20,000 jobs the other two categories-this is, personal services and hotels-must have gained 40,000 jobs in that period, or had about a 20 per cent growth in employment in four months. This is even higher than the actual growth rate of employment across the economy on which Senator Button commented earlier in Question Time. The point I want to make is that any accountant as creative as Mr Rose obviously he would at one time have got a job writing prospectuses for Patrick Partners. Senator COOK —Mr President, I ask a supplementary question. Will the Minister pass that information on to Senator Baume so that Senator Baume has no excuse for being deceptive and misleading in the future? The PRESIDENT —Order! There is no supplementary question. Senator Dame MARGARET GUILFOYLE — I direct a question to the Leader of the Government in the Senate and refer to an answer that he gave earlier today to Senator Robert Ray's question with regard to employment figures for Australia. For clarification I ask: Were the figures quoted by him for employment growth and employment based on full time employment, or is there an element of part time employment that can be disclosed in the figures that he has provided? Has the Government undertaken any investigation in order to give an explanation of the apparent disparity between those receiving unemployment benefit and those who are seeking employment at present? Senator BUTTON —In answer to the first part of the question, I gave total employment figures. However, on previous occasions when answering questions about the labour market I have drawn attention to the very high levels of full time employment within those aggregate figures. If the honourable senator wishes I will again obtain the percentage. I think last time these figures were available I drew attention to the high component of full time employment in the figures. I am asked whether the Government has had any work done or whatever on the discrepancy between the number receiving unemployment benefit and the number seeking work. I will direct that question to the Minister for Employment and Industrial Relations and obtain an answer. I made the point that the participation rate was abnormally high. There are always explanations for that which-- Senator Dame Margaret Guilfoyle —It might be part time employment. Senator BUTTON —I know; the explanation might fall on any side of the political debate, but I will seek to get an answer. Senator VALLENTINE —I direct my question to the Minister for Resources and Energy. Is it a fact that a French company is currently leach mining for uranium at Manyingee near Onslow in Western Australia? Does the Manyingee ore go to Yeelirrie? If not, where does it go? If it does go to Yeelirrie, where is it earmarked to go after that? Is it leaving the country under the guise of an official export licence from another mine-for example, Roxby Downs or Ranger-via Yeelirrie? Considering that no uranium mines are officially operating in Western Australia, how much uranium has been produced for test purposes at Manyingee, Yeelirrie, Cunderlee, Officer Basin, Robinson Range, Jailore Bore, Mundon Well, Mooloo Downs, Lakeway, Mt Joel, Lake Raeside, Lake Marmion, Thatcher's Soak, Kintyre-all in Western Australia? How much uranium has been extracted from the French operated explorations at Allamber and Burnside in the Northern Territory and Ben Lomond and Lagoon Creek in Queensland? Where does the ore go once it is extracted from these exploration sites? Senator GARETH EVANS —That is the kind of question that encourages an unco-operative answer but, Senator Vallentine and I having a very warm and workable professional relationship on these matters these days, I am only too happy to help her to the extent that I can. Total Mining Australia, a French-owned company, holds a valid exploration licence at Manyingee. Exploration licences are of course solely a State responsibility. There has been no mining at Manyingee this year, the honourable senator will no doubt be pleased to find out. However, solution mining trials have been carried out to assess this technique for exploiting the deposit. The trials, which were approved and monitored by State authorities, have now finished. Work carried out this year has involved site rehabilitation and this work is now virtually complete. Less than 500 kilos of uranium oxide was extracted during the trials. It is stored in drums at the site with the approval of the Australian Safeguards Office. The material is not being exported from Australia. Regarding the various other exploration prospects that Senator Vallentine mentioned, ore has been mined at some locations and samples taken at others. However, as far as I am aware, apart from in testtubes in laboratories, uranium oxide has been extracted only from ore at Manyingee and Yeelirrie on a trial basis. About 11,000 kilos were produced at Yeelirrie and that is now simply in store. This Government, in adhering to its policy on uranium mining, has not approved the export of any ore samples or uranium oxide for testing or any other reason from other than the approved mines at Nabarlek, Ranger and Olympic Dam. All uranium oxide produced during various tests is stored in a manner approved by the Australian Safeguards Office. Senator VANSTONE —I direct a question to the Minister representing the Prime Minister and refer him to a statement by the Hon. John Brown in October 1985 in the House of Representatives, when speaking in a debate on Priority One: Young Australia, that he would make no apology for what money had been spent in co-ordinating the activities in education, employment and industrial relations in this program because `it is making employers aware of what is available in traineeships'. He further states: The information in those advertisements is dedicated to letting employers know what opportunities are available for the employment of trainees . . . How does the Government reconcile this statement by a Minister with the evidence given to the Senate Estimates Committee that none of the advertising for Priority One was directed to private enterprise employers but was all directed to young people? Has the Minister in the other place misled the House of Representatives or has the Senate Estimates Committee been misinformed? Senator BUTTON —On a superficial view, which is the one Senator Vanstone has taken, the two statements might seem to be irreconcilable. I will certainly provide what might be called a reconciliation statement for the honourable senator. I think that the statement of the Minister for Sport, Recreation and Tourism was made in the context of announcements about Priority One projections into the future-about what might happen. The information that the honourable senator was given at the Senate Estimates Committee was about what in fact had happened. Governments, like others who are sometimes ascribed these tendencies, are permitted to change their minds and I guess it looks very much as if that happened. I will have the matter checked and will provide the honourable senator with a written answer. Senator SIBRAA —Is the Minister representing the Minister for Transport aware of the news item in yesterday's Australian Financial Review in which the New South Wales Local Government and Shires Association claimed that proposals to allow the transport industry to operate heavier trucks on Australian roads would add $85m a year to road maintenance bills? If so, what action is the Government taking to ensure that if heavier trucks are introduced to Australian roads it will be in a safe, economic and responsible manner? Senator GIETZELT —The Government is aware of the implications of heavier trucks on our road system. As a result of that awareness, the Government commissioned a report in 1984, called the Review of Road Vehicle Limits, for the purpose of establishing areas of responsibility and the action that should be taken to protect our road system-whether Commonwealth, State of local government. That report was circulated for public comment in January this year. I assume that the response from the Local Government and Shires Association was as a result of the invitation of the Government. The Association's view is that a great more needs to be done to arrest the problem of damage to roads as a result of increased load content on heavy vehicles as well as quantity of traffic usage in recent years. The review was required to report on the efficiency, uniformity and economy of the Australian road freight industry with a view to benefiting all Australians. Therefore, it would be premature for the Government to make any response to the Local Government and Shires Association's views other than to invite all other persons interested to make some comment-which is required by 30 June 1986. So therefore, they have only six or seven weeks to indicate their interest in the issue raised by Senator Sibraa. The Government recognises the need for discussions between the Commonwealth Government and State and local governments about problems of freight usage with the truck manufacturers as well as transport operators. We are anxious to respond to the problem by inviting public comment and by involvement in widespread consultation with all interested parties. Senator GARETH EVANS —On 6 May Senator Jessop asked me whether the organisers of the Bike Ride were receiving any funds from the International Year of Peace budget falling within the Foreign Affairs portfolio. The answer is no. The group applied for funds and its application was considered by the National Consultative Committee for Peace and Disarmament. The Committee did not recommend that it should receive a Federal grant. The question of children being involved in such groups which may take them away from regular schooling is a matter for State education authorities. Senator GRIMES —Yesterday Senator Lewis asked me a question without notice in respect of the home nursing service in the Australian Capital Territory. The Minister for Territories has provided me with the following answer: A workload monitoring committee was set up in December 1985 in the community nursing area as part of the dispute-settling arrangements following last year's nursing strike. This committee consists of an equal number of representatives of management and of nurses employed by the Authority, the latter drawn from nominations by the Royal Australian Nursing Federation. The committee is provided with data relative to nurse staffing and workloads and is empowered to make recommendations to management concerning these matters. In this instance the workload management committee took successive decisions to close its books on palliative care and domiciliary patients. Both these decisions were made without the involvement of senior Community Health Services Division management. The overall resources in community nursing are limited and the response to our recruitment campaign for community nurses has been poor. The difficulty is that the nurses and the RANF are apparently refusing to consider transferring existing resources to areas of need or to consider allocating priorities to patients on a clinical needs basis. At a meeting with the committee and the RANF yesterday, the committee agreed that it will only make recommendations in the future. Management undertook to examine ways of increasing the supply of nurses but within existing resources, with the aim of opening the books for new patients. Community health management will be providing the RANF and the workload monitoring committee with its suggestions for allowing a more efficient deployment of existing nursing resources and for improving the quality of the committee's recommendations. It is hoped that the suggestions will be accepted at tomorrow's meeting of the committee, and that the service will revert to normal operation. Senator GRIMES(Tasmania-Manager of Government Business)(3.09) —I move: That, unless otherwise ordered- (a) the hours of meeting for the remainder of this day be till 6.30 p.m. and 8.00 p.m.-10.30 p.m.; and (b) the Sessional Order relating to the adjournment of the Senate have effect at 10.30 p.m. this day. I have spoken to the Opposition and the Australian Democrats about this matter. The reason is the impending introduction of legislation to establish a parliamentary commission. I hope that the motion has the agreement, if not the approval, of the Senate. Question resolved in the affirmative. Senator COLEMAN(Western Australia) —Mr President, I seek leave to make a personal explanation. Leave granted. Senator COLEMAN —It will be recalled that during Question Time I asked a question of the Minister Assisting the Prime Minister on the Status of Women. During an interjection I understood Senator Walters to say that Tasmania was the only State to send two women to this place. I feel it important to put on record that Western Australia has four female members. I came in in 1974; I was joined by Senator Giles in 1981, Senator Knowles in 1984 and Senator Vallentine in 1984. In South Australia we had Senator Haines from 1977 to 1978; she was back with us again from 1981, and is still here. She was joined by Senator Crowley in 1983 and by Senator Vanstone in 1984. Senator Dame Margaret Guilfoyle is the longest serving woman member of this Senate, having come to this place in 1971 and having been joined by Senator Zakharov in 1983. Queensland had Senator Martin here from 1974 and she has now gone to the House of Representatives. She was joined by Senator Bjelke-Petersen in 1981 and they were joined in turn by Senator Reynolds in 1983. The Australian Capital Territory, where we have only two senators, has returned two women-Senator Ryan in 1975, who is the relevant Minister in this sphere, and Senator Reid in 1981. Looking at Tasmania, we had Senator Hearn from 1980 and she retired in 1984. Senator Walters joined us in 1975. The fact is that Senator Newman is an appointment who has recently joined us by default of a male senator who retired to take his place in the State Parliament. Otherwise that would be the only State to have one woman in this place. Some 16 out of 76 may not sound like an impressive figure, but we are improving. When I first came here in 1974-- The PRESIDENT —Order! The honourable senator is getting way beyond a personal explanation. Senator COLEMAN —I wanted to point out that Dame Dorothy Tangney from Western Australia was the first woman ever to take her place in this chamber. Senator MICHAEL BAUME(New South Wales) —Mr President, I seek leave to make a personal explanation. Leave granted. Senator MICHAEL BAUME —At Question Time I was accused by Senator Walsh of intellectual sloth and providing misleading and deceptive figures to the Senate. In defence of that proposition, Senator Walsh read to the Senate some statistics which he had received by telephone this morning from the Australian Bureau of Statistics which purported to break up in much more detail the table presented in this ABS labour force publication in February. In fact, the statistics he presented merely did no more than exclude clubs from the category I had used. The point I had been making to Senator Walsh was that the category he was using included the booming area of hotels and accommodation, an area which has boomed because of the fall in the Australian dollar bringing a massive tourist inflow into Australia. In other words-- The PRESIDENT —Order! The honourable senator is getting into the realm of debate. He was given leave to make a personal explanation and I would ask him to relate his remarks to his personal explanation. Senator MICHAEL BAUME —The personal explanation is that, rather than my using misleading and deceptive figures and rather than my being misleading and deceptive, the figures I used to criticise Senator Walsh related specifically to the question that restaurants have a totally different employment trend from hotels and accommodation, because of the accommodation boom relating to the tourist industry, and that it is improper and irresponsible to try to confuse this Senate by lumping them all together. Senator Walsh, when accusing me of intellectual sloth, has lumped them all together in an attempt to mislead the Senate. The PRESIDENT —I am pleased to advise the Senate that the Australia Act proclamation signed by Her Majesty Queen Elizabeth the Second on Sunday, 2 March 1986, and the pen used during the ceremony will be placed on permanent display in King's Hall. The signing of the proclamation of the Australia Act reflected Australia's status as an independent and sovereign nation, and was an historic occasion. Display of the document and pen in King's Hall will complement the display of the table, document and pen associated with Her Majesty Queen Victoria's assent to the Australian Commonwealth Bill in 1901 which is already on display in King's Hall. The Prime Minister (Mr Hawke) has proposed to the Speaker and me that a display of important constitutional documents be mounted in the new Parliament House during the Bicentenary year. We have written to the Prime Minister supporting that proposal. The PRESIDENT —On 18 March 1986 I reported to the Senate certain matters relating to the provision of smallwares for the New Parliament House. I advised that the Joint Standing Committee on the New Parliament House at its meeting on 21 February 1986 decided on an open tendering system conforming to government purchasing policy in relation to the procurement of smallwares. The Department of Local Government and Administrative Services has been providing advice on appropriate tender procedures and has made an officer available to assist with the acquisition. I am pleased now to advise the Senate that the Joint House Department will, as the first stage of the tendering process, be advertising in the national Press on 10 and 17 May 1986 and in June issue catering magazines, seeking expressions of interest from prospective suppliers of smallwares. The evaluation of responses will enable the determination of a short list of prospective suppliers for tender purposes. Senator HARRADINE(Tasmania)(3.13) —I move: That the Senate take note of the statement. I do so simply to round off the record insofar as the new and permanent Parliament House is concerned. There would have been another woman senator from Tasmania in the new Parliament House had it not been for the fact that the Australian Labor Party preferences ensured that she was defeated. Question resolved in the affirmative. Senator COONEY(Victoria) —by leave-I draw the attention of the Senate to a tribute paid to the late Senator Alan Missen on Tuesday, 22 April 1986, in the Canadian Senate by Senator the Hon. John M. Godfrey, Chairman of the Canadian Parliamentary Joint Committee on Regulations and Other Statutory Instruments. I will not read the tribute in its entirety but the Senate Standing Committee on Regulations and Ordinances this morning thought it fitting that I should draw it to the attention of honourable senators. Part of Senator Godfrey's statement was as follows: Honourable senators, news of the death on March 29 of a senator of the Commonwealth of Australia, Alan Missen, reached me on Friday. I rise to pay him tribute. Honourable senators may well ask: What had this Australian senator to do with us? The answer, honourable senators, is that he had much to do with the successful establishment of the review of delegated legislation in this Parliament and throughout the Commonwealth. It is fitting that he be remembered here. Senator Missen was one of a long line of forceful, independent chairmen of the Australian Senate's Regulations and Ordinances Committee, the counterpart of our Joint Committee on Regulations and Other Statutory Instruments. He was a member of the committee from 1974, and chairman in the years 1978 to 1980. The Australian Senate, armed with a statutory power of disallowance over delegated legislation, is the most effective chamber in the Commonwealth in preventing executive abuse of delegated powers. Together, the Australian Senate and its committee are Commonwealth pathfinders in the Parliamentary control of executive actions under delegated authority. Senator Missen should be remembered in Canada primarily for his personal contribution to the establishing of effective parliamentary scrutiny of delegated legislation in this Parliament, and for his bringing together of all those involved in this critical, though unsung, task throughout the Commonwealth. It was in his role as a Commonwealth elder statesman, that I first met Senator Missen and thereby came to appreciate the signal contribution he had already made to Canada, quietly and generously. I learned much from him and I admired his independence of mind. I seek leave to have the text of the whole tribute incorporated in Hansard along with the Committee's letter of thanks to Senator Godfrey. The letter and tribute will be sent to Senator Missen's widow Mollie. Leave granted. The documents read as follows- CANADA THE SENATE Tuesday, April 22, 1986 The Senate met at 2 p.m., the Speaker in the Chair. Prayers. COMMONWEALTH OF AUSTRALIA THE LATE SENATOR ALAN MISSEN- TRIBUTE Hon. John M. Godfrey: Honourable senators, news of the death on March 29 of a senator of the Commonwealth of Australia, Alan Missen, reached me on Friday. I rise to pay him tribute. Honourable senators may well ask: What had this Australian senator to do with us? The answer, honourable senators, is that he had much to do with the successful establishment of the review of delegated legislation in this Parliament and throughout the Commonwealth. It is fitting that he be remembered here. Senator Missen was one of a long line of forceful, independent chairmen of the Australian Senate's Regulations and Ordinances Committee, the counterpart of our Joint Committee on Regulations and other Statutory Instruments. He was a member of the committee from 1974, and chairman in the years 1978 to 1980. The Australian Senate, armed with a statutory power of disallowance over delegated legislation, is the most effective chamber in the Commonwealth in preventing executive abuse of delegated powers. Together, the Australian Senate and its committee are Commonwealth pathfinders in the parliamentary control of executive actions under delegated authority. Senator Missen should be remembered here primarily for his personal contribution to the establishing of effective parliamentary scrutiny of delegated legislation in this Parliament, and for his bringing together of all those involved in this critical, though unsung, task throughout the Commonwealth. It was in his role as a Commonwealth elder statesman, that I first met Senator Missen and thereby came to appreciate the signal contribution he had already made to Canada, quietly and generously. I learned much from him and I admired his independence of mind. A Liberal senator from the State of Victoria, Alan Missen stood on the progressive wing of his party and never hesitated to vote against it when he considered it to be wrong. In the late 1970s, the idea was floated that the parliamentary committees set up to scrutinize delegated legislation from around the Commonwealth should get together to share their experience, and to pool their knowledge, and, just as importantly, to encourage the establishment of parliamentary scrutiny where it did not exist. Senator Missen took this idea up enthusiastically and put on the brilliantly conceived and managed First Commonwealth Conference on Delegated Legislation in Canberra in October, 1980. It was an outstanding occasion. Out of this conference grew the Commonwealth Delegated Legislation Committee, a Secretariat, and the Commonwealth Delegated Legislation Bulletin. Senator Missen secured the funds to set up and maintain the Secretariat and to publish the Bulletin, thus ensuring that the impetus of the Canberra Conference was not lost and that its benefits were not wasted. Today, scrutiny committees in all Commonwealth jurisdictions are kept up to date with the abuses of executive power uncovered throughout the Commonwealth, and with the principles used by scrutiny committees to expose and correct those abuses. Even the failures reported in the Bulletin are instructive as revealing the pitfalls to be avoided by others. The energy flowing from the First Commonwealth Conference was channelled by Senator Missen as Chairman of the Commonwealth Delegated Legislation Committee and led to a second conference being held in this chamber in April, 1983. Representatives of more jurisdictions attended and the event was a signal success. Again, Senator Missen played a leading role. A further contribution of this outstanding man should be noted, honourable senators. He was very much involved in setting up the Australian Senate's Scrutiny of Bills Committee whose task is to spy out and alert the appropriate Senate committee to oppressive and unjust provisions and dangerously drawn enabling powers in bills before the Australian Senate. The powers of this Australian Senate committee were the inspiration for my own motions to endow our own Joint Committee on Regulations and other Statutory Instruments with some of these powers. As senators will remember, after some years of fruitless effort, I was able to get the approval of the Senate for these in February last year, and I am hopeful that the House of Commons will soon concur. Recently, the House of Commons adopted rule changes that will greatly increase the powers of the Joint Committee on Regulations and other Statutory Instruments with respect to disallowance of regulations. These together with my motions when they are concurred in will be Senator Missen's memorial amongst us. Hon. Senators: Hear, hear. PARLIAMENT OF AUSTRALIA THE SENATE Standing Committee on Regulations and Ordinances May 1986 The Honourable John M. Godfrey Q.C. The Senate OTTAWA Ontario KIAOA4 Dear Senator Godfrey, At its meeting on 8 May 1986, the Committee resolved to take special note of the very fine tribute you paid in the Canadian Senate on 22 April 1986 to the late Senator Alan Missen. As you of course know, Senator Missen was a former Chairman of the Senate Standing Committee on Regulations and Ordinances. His record of diligence, independence and bi-partisanship in pursuit of the Committee's objectives in scrutinising delegated legislation, and in advancing the cause of parliamentary control of executive power are an example to us all and will be hard to equal. His stature in the network of Commonwealth delegated legislation committees was very clearly demonstrated by the fact that, although he was a life long back bench Senator in Australia, his untimely passing was the subject of such a sincere valediction spoken in the Canadian Senate. The Committee asked me to write to you acknowledging your tribute to a former Chairman and encouraging you, and indeed all of our colleagues on delegated legislation committees, to keep alive and bright the vital flame of diligent bi-partisan scrutiny of subordinate laws, in the interests of parliamentary supremacy and for the protection of personal rights and liberties. Courageous and combative as he was in defence of parliamentary and personal freedoms, Senator Missen has shown us how to perform our task as legislative scrutineers. We have much to learn from his strength of personality and commitment to principle. The Committee resolved that your statement should be incorporated in the Australian Senate Hansard. With best wishes from the Committee. Yours sincerely, BARNEY COONEY Chairman Senator ELSTOB(South Australia) —I present the twelfth report of the Publications Committee. Report-by leave-adopted. Senator RICHARDSON(New South Wales) —I table further additional information received by Estimates Committee A and seek leave for it to be incorporated in the Hansard record of the Committee's proceedings. Leave granted. Senator McINTOSH(Western Australia) —I table additional information received by Estimates Committee E and seek leave for it to be incorporated in the Hansard record of the Committee's proceedings. Leave granted. Senator ZAKHAROV(Victoria) —I table additional information received by Estimates Committee F and seek leave for it to be incorporated in the Hansard record of the Committee's proceedings. Leave granted. Senator TATE(Tasmania) —I table Scrutiny of Bills Alert Digest No. 8 dated 8 May 1986 concerning an aspect of the Fringe Benefits Tax Assessment Bill 1986. Senator COATES(Tasmania) —On behalf of the Standing Committee on Finance and Government Operations, I present the report on Northern Territory superannuation arrangements, together with the transcript of evidence. Ordered that the report be printed. Senator COATES(Tasmania)(3.18) —by leave-I move: That the Senate take note of the report. This report concludes the Committee's inquiry into the superannuation arrangements for Northern Territory Government employees. Following the granting of self-government to the Northern Territory, a joint task group was established by the Commonwealth and the Northern Territory in 1979 to make recommendations concerning Northern Territory employer superannuation contributions. This was pursuant to the Memorandum of Understanding signed at self-government. The joint task group reported in mid-1984. The then Minister for Finance, Mr John Dawkins, and the Chief Minister of the Northern Territory, Mr Ian Tuxworth, agreed to the arrangements proposed by the joint task group. On 4 April 1985 the Minister for Finance, Senator Peter Walsh, informed the Chief Minister that the arrangements had been reviewed. This led to our inquiry. The Committee has considered matters raised by the Northern Territory Government, the unions and the evidence of the Minister for Finance and has come to conclusions about them. Several other issues are dealt with in our report but the central matters are as follows: The Committee does not consider that an agreement in the terms proposed by the joint task group necessarily was required. The phrase in the Memorandum of Understanding `being placed in a position' does not necessarily mean being placed in a financial position, as asserted by the Northern Territory Government. The Committee does not consider that the Dawkins-Tuxworth exchange of letters in October and November 1984 constituted a legally binding agreement. The Committee considers that the Commonwealth Government legally could determine conditions of the type contained in the 4 April 1985 letter from the Minister for Finance, although it might have been preferable for the Minister to have discussed any changes with the Northern Territory Government prior to their implementation. The Committee draws attention to the variation to the proposed action of the Minister for Finance revealed by him at the public hearing held on 11 September 1985 and the developments which have occurred since its public hearings. It welcomes these developments. The Committee emphasises that there are proper mechanisms such as the Commonwealth Grants Commission available for the Northern Territory, as for the States, to claim an increase in Commonwealth grants because of changed circumstances or because of extra or special financial responsibilities, and for such a claim to be assessed taking into account the Territory's disabilities and its own taxing efforts. No doubt the cost of employer superannuation contributions will be a factor when the Grants Commission next recommends an adjustment for the Northern Territory. The Committee's terms of reference required it to study the joint task group report and to recommend on its implementation. The report proposed effectively institutionalising, by a method involving the exchange between the Commonwealth and the Northern Territory of almost identical cheques, the then existing temporary situation of the Commonwealth's paying the employer superannuation liability for Northern Territory Government employees. The Committee believes such an arrangement to be unsatisfactory and does not recommend the implementation of the report. The Committee believes that it is inappropriate for the Commonwealth to continue to shoulder the burden of employer superannuation contributions for a self-governing Territory when the Commonwealth has no control or even influence over the numbers or salary levels of the Northern Territory public servants involved. Now that the Minister for Finance has modified the terms of the new arrangements, the Committee is satisfied that the conditions applying to Northern Territory Government employees, being members of the Commonwealth Superannuation Scheme, are appropriate to the Northern Territory as a self-governing Territory which values its independence and its ability to set its own spending priorities. I should draw attention to the fact that Senator Short and Senator Vanstone have expressed, in an addendum to the report, some reservations in about five sentences or phrases in the report. Three of those are matters of judgment or opinion, with one degree of political judgment or another. But two of the reservations relate to the conduct of the inquiry. As Chairman of the Committee, I think I need to respond to them. With regard to paragraph 3.6 of our conclusions, the comment has been made that we did not seek a legal opinion about the Dawkins-Tuxworth exchange of letters. With regard to paragraph 3.13, the comment is made that the Committee did not seek expert evidence on the report of the joint task group. I wish to point out that, during all the time that we were dealing with this matter, no member of the Committee suggested that a legal opinion should be obtained on the first matter or that expert evidence should be sought on the second matter. I do not believe that such a legal opinion is necessary; nor do I believe that expert evidence was needed on the report of the joint task group. But in any case the main point is that we have studied the joint task group report. We have had it for over a year. I have certainly studied it, although it must be said that the Committee did not as a committee debate it for a long period, if that is what was expected. The general decision of the Committee at the end of last year was to draft a report. The draft, in various versions, containing such conclusions has been around since February or March. There has been no suggestion from any member of the Committee that further evidence should have been sought about either of those matters until a few days ago. I merely point out that this inquiry was initiated by the Opposition. If the Opposition wanted that additional evidence, Opposition members on the Committee could have suggested that. I commend the report to the Senate. Question resolved in the affirmative. Consideration resumed from 28 November, on motion by Senator Reid: That the Senate take note of the report. Question resolved in the affirmative. Debate resumed from 20 March, on motion by Senator Archer: That the Senate condemns the Hawke Labor Government for- (a) plunging the housing of Australian families into the worst position in 50 years by doctrinaire and unbalanced policies; (b) creating and maintaining a high interest, high tax economy that makes home ownership an unattainable goal for many young Australian families; (c) presiding over and causing a rapid decline in the availability of rental housing, causing extreme hardship to low income families in particular; (d) creating uncertainty by not releasing after 6 months, details concerning taxation policy on investment property; and (e) destabilising the finance market by artificial and sectoral constraints which will have long-term detrimental effects on home ownership funding. (Quorum formed). Senator MICHAEL BAUME(New South Wales)(3.27) —When this matter was last being debated, the Government was persisting with the fiction that it was possible to provide money for housing despite the fact that lending bodies were being offered rates that were simply not competitive. Since this debate started the Government has partly resolved this problem, in a belated and distressing way, by easing the maximum limit of 13.5 per cent that had applied to interest rates for savings bank loans. Of course, this will serve to increase the volume of money available for those people who can afford to borrow. But it also involves an absurd situation in that the people who already had loans through the savings bank system are protected against the impact of that increase. I am not protesting about that; what I am protesting about is that that protection extended only to people with savings bank loans and not those with loans from other bodies such as the building societies, which will now be obliged to increase the rate of interest to their depositors. Coincidentally there has been a continuation of a problem that we have pointed to over a long period. We have been pointing out to the Government that its high interest rate policy has made it very difficult for home owners to be able to afford to repay the loans, let alone to obtain them. We have been pointing out that this high interest rate policy would inevitably have a disastrous impact on the building industry. Of course, that has taken place. It is disheartening to us that, if only the Government had acted when we first suggested, the impact would not have been nearly so serious. I suppose one can say that, if the Government had done what has been suggested about economic policy for the past 18 months or two years, there would not have been this enormous level of high interest rates, because high interest rates are the result of deliberate Government policy. The Government cannot get out of it by saying that there is a free market and it is that free market which has created these high interest rates. In fact, the Government has depended entirely on monetary policy as its only instrument in controlling the economy. We have seen only recently that major advisers to the Government, such as the Reserve Bank, and the Governor of the Reserve Bank in particular, have criticised strongly the Government's heavy dependence on a high interest rate policy. The Governor of the Reserve Bank only last week made a speech in which he outlined the serious consequences for growth-and, as a result, employment-of maintaining this high interest rate policy as the only weapon of Government economic policy, or at least carrying the brunt of Government economic policy. He said that it would result in interest rates which were higher than he would prefer to see and that this would also be a consequence of the Government's attitude in relation to the balance of payments current account. I have to say `current account', even though everyone knows what the balance of payments problem is, because Senator Walsh is in one of his fastidious moods at the moment and requires it to be called `the balance of payments current account'. As a result of the Government's deliberate high interest rate policy we have seen this extraordinary reduction in housing activity, which the Government now says belatedly that it will try to do something about. It will be solving a problem that it has created itself. Let me outline how big the problem is. There was a substantial decline in housing activity in the second half of 1985 after two years of recovery. New housing starts declined in the September quarter by one per cent and in the December quarter by 5.3 per cent. The forward indicators of activity in the housing sector suggest that there will be a further decline in activity all through this year. Already we have seen that local government building approvals declined by 26 per cent-over a quarter-between August last year and March this year. The March figure is the lowest monthly level for three years. Housing loans by the major lending institutions declined for the seventh consecutive month in February 1986 to a level about 31 per cent lower than in July 1985. These forward indications of activity this year cannot and will not suddenly be reversed by the Government's belated action in the area of releasing interest rate controls over one part of the housing lending market. Of course, a change in the major thrust of the Government's economic policy is required. Some more regulation of its own activities and less regulation of the activities of the commercial areas is needed. The Government needs to cut its own spending so that there will be greater reliance on fiscal policy than on monetary policy. Of course, we will not get that because we have already seen from the leaked Government document that the Forward Estimates figure is $6.4 billion. The demand by the Treasurer (Mr Keating) and the Minister for Finance (Senator Walsh) that $1.4 billion be cut off Government spending in prospect for next year is being stoutly resisted by all the spending Ministers involved. So our chances of getting a Government deficit of around $5 billion, which is still far too high, are very slight indeed unless something dramatic happens after the upcoming biennial Australian Labor Party Conference. Obviously nothing will be done before then in case the rank and file try to take control of their own Party. The real policies of the Labor Party bear little relationship to the policies being pursued or attempting to be pursued by Messrs Hawke and Keating. The Government's own advisory body, the Indicative Planning Council for the Housing Industry, has confirmed that a downturn is under way, and industry and forecasting groups such as the Housing Industry Association, the Master Builders Federation of Australia and BIS- Shrapnel Pty Ltd have also forecast a downturn. As a result of this Government's deliberate and determined policy and activities the housing industry has been forced back into a boom-bust cycle, with all that means for cost additions, uncertainty of employment, and disappointment and natural resentment from those people, particularly young people, who seek to be able to buy a home. The impact on all those industries, as a result of this boom-bust approach that the Government appears to favour in the housing industry, is one that we were told would not take place. This Government was going to be a rational, new, exciting, dynamic government that knew what it was doing. I do not know that a 26 per cent fall in building approvals between August and March gives any indication of a government that knows what it is doing. I do not think that getting the lowest monthly level of approvals for three years is any indication of a government that knows what it is doing. If the Government knows what it should be doing and has deliberately decided not to do it, it is culpable; so in this area it faces the charge of either culpability or incompetence. There is no doubt that these high interest rate policies have reduced the supply of cheap housing funds and have put housing finance beyond the means of many Australians. To make matters worse, the Government's tax policies, including the abolition of negative gearing provisions and a capital gains tax, have reduced investment in residential properties. Let us get this very clear indeed. Because of the tax situation that had existed, it was worth while for people to build homes and units for letting purposes at rents that were far below the sort of return that could be got by putting money into Commonwealth bonds. So most people would not have got anything like a 14 per cent return by building a flat or a house and letting it to someone, particularly to people in lower income groups who cannot afford to buy their own homes. We had a situation where there was an incentive for people to build homes and units, even though they were going to get a return of only 6 per cent in rental terms from that investment. That was because, if or when they ultimately sold that property, they would be entitled to gain a tax-free return. In other words, they would get the total benefit of selling that property, if or when they chose to do so, which would make up for the fact that they were getting such a low return from the rent. The taxation situation created an environment in which rents were generally able to be far lower than would otherwise have applied and, in a sense, provided provided a degree of subsidy to people who wanted to rent. One may say that that is ridiculous-why would people want to do that; why not do it directly? I draw the Senate's attention to the fact that many people were looking at the total rate of return when they ultimately came to sell the property and therefore were prepared to take a lower than economic rent. The fact is that they were providing a competitive market, so that even those property owners who did not intend to sell their properties-the people who would not be looking to get an ultimate return of that nature-nonetheless had to compete, as owners of rental properties, with the other owners who were looking at a total rate of return, including the tax-free capital gain, when they ultimately sold their properties. So, in a sense, the market price for rents was created by what could well have been a small minority-who knows what size the minority was-of people who owned properties and nonetheless rented them out. As a result of this system, the people who rented in Australia received a far better deal; they ended up paying rents worth something like 6 per cent on average of the value of the property instead of having to pay a rate of something like 14 per cent, which would have been needed to provide an adequate and equal return to the owner of that property if that owner had decided, instead of building a property, to put the money into Commonwealth bonds. By changing the tax arrangements now the Government will ensure either that there will be massively higher rents-because of these negative gearing and capital gains tax arrangements-or that people will cease to build properties for rent. That, in itself, will have an impact on pushing rents up for those properties which do exist. There will be a scarcity, and when there is a scarcity the market price will naturally rise. The Government has, through its tax package, increased the cost of rents. We must recognise that the great bulk of people renting properties are those who do not have the resources to buy them. This particularly applies to young married couples and those in the society who have at some stage suffered financially or have not been able to accumulate the amount of money necessary to build a house. We have had government policy directly putting up the price of buying homes in the first place, because of the huge interest cost, and then putting up the price of renting homes because of the change in the taxation arrangements. At the time of the last election, home loan interest rates were 11.5 per cent. They are now 15.5 per cent from a government which said that it would reduce interest rates. The monthly repayments on a 25-year $50,000 home loan are now $150 a month higher than they were 18 months ago. This is just overwhelming and disastrous for those people who have been struggling to save in order to buy a home. Is it any wonder that we have had this 26 per cent fall in building approvals between August last year and March this year? It is no wonder at all. People simply cannot afford it any more. I made the point that the rental market will no doubt tighten, with housing rents increasing as new home construction falls. Many Australians will be forced into the rental market. Not only will there be a reduction in the volume of properties available for rent, but also more and more Australians who cannot afford to buy homes, because of this Government's high interest rate policy and the other matters of which I have spoken, will be forced into the rental market. Already, the Real Estate Institute of Australia has shown that there is a very low and declining level of vacancies. Already we have seen the market being squeezed. Private housing rents have risen by 10.1 per cent over the past year. That is above the consumer price index increase of 9.2 per cent. Increases in some cities, particularly in Sydney but also as I understand it in Perth, have been far greater than this. So we have a situation in which rents are already going up faster than the CPI. As the Government's taxation policies bite more deeply we will see a massive increase in rents relative to the overall increase in the CPI. That is bad enough because that affects those people who are in the earlier period of their lives and struggling to find somewhere to live. On the other hand, what about the impact on the building industry? Increased unemployment in both the housing industry and related industries-including building supplies, household goods, real estate and finance-obviously are in line. Employment in the construction industry has already fallen over the year to February after strong growth in the previous year. Reduced investment in private housing will increase demands on public housing, leading to further lengthening in already long waiting lists. It is all very well for us to hear, at Question Time, a Minister in this place talking about the increased contribution to public housing. There will be a far greater increase in the demand for public housing as a result of this Government's belting of the private sector, of the ordinary people trying to get their own homes. Naturally, there will be an enormous increase in the demand for public housing. The attempts the Government is making now to cope with an increased demand for public housing will, of course, be totally inadequate to meet the enormously increased demand for public housing that it, by its own actions, will have generated. The housing package that the Government announced on 2 April, after this debate originally started, was a clear acknowledgment of the crisis situation facing the housing industry and the need for government action. As I have mentioned, this package included the removal of the 13.5 per cent ceiling on home loan mortgage interest rates for new bank loans after that date, but the ceiling is to be maintained on existing home loans. There is enormous disagreement about what will be the impact lifting the ceiling on new home loans. The Government claims that the package will ensure that savings banks lend $6 billion for housing in 1986-87, which it says is sufficient to raise the level of housing starts to 135,000. That is up from the 100,000 starts or fewer that the Government claims would have occurred without its intervention. In other words, if the Government had not moved to fix up the total chaotic mess that it created in the housing industry there would have been only about 100,000 housing starts, according to the Government. The Government is picking it up, it says, as a result of this package, by 35,000. I think we should remember the enormity of this admission by the Government that its own incompetence was going to push housing starts down to 100,000. It now says that housing starts will go up to 135,000 because of these new arrangements. As building societies will not receive any government subsidy they will be relatively disadvantaged compared to savings banks under the new arrangements. Any increase in loans by the savings banks is, therefore, likely to be partially offset by reduced lending by the building societies. The Minister for Housing and Construction (Mr West), and the Chairman of the Indicative Planning Council for the Housing Industry, Professor Gruen, have both conceded that the achievement of the 135,000 figure is crucially dependent on sustained falls in interest rates through the next year or so, and that without such falls the number of housing starts will be considerably fewer. I must say, I do not expect any Minister in this Government to make any more promises about falling interest rates because their prospect of success is in inverse proportion of the vehemence of assertion. The more the Government has said in the past that interest rates will fall, the worse the rise has been. I am unnerved that the Government seems to be operating on an assumption that there will be a fall in interest rates and that the target of 135,000 cannot be achieved unless interest rates fall through the next year or so. Homeseekers who are depending on getting a home would be very unwise, it would seem to me, to build up their hopes too much on being rescued by this Government's gesture in this area if the Government depends so heavily on interest rates falling. So the 135,000 figure is, therefore, very optimistic indeed. The industry estimates put the likely figure at between 120,000 and 135,000 starts. Of course, even if 135,000 new housing starts are achieved, it will be below the Indicative Planning Council estimate of underlying demand for housing of 147,000; so there is no doubt that the Government will not, even if it is successful, reach the level of underlying demand. I state again that the basic reason for that is that the Government has relied far too heavily on a high interest rate policy. The interesting thing is that there remains conflict over the Government's precise requirements of the savings banks before it passes over the interest rate subsidy. There has been a fair amount of disagreement on that score which I have not got time to go into at this stage. But the Budget implications of the housing package are also interesting because the cost to the Government Budget of the housing package in the coming financial year could be as high as $150m, although it is difficult to estimate. This is primarily accounted for by the interest rate subsidy because, depending on financial developments, the sum could be considerably less if the final subsidy instalments are not required; in other words, if interest rates fall. This additional outlay will further aggravate an already difficult Budget process. The required expenditure cuts necessary to achieve the trilogy constraints-if anyone seriously believes in the trilogy any more-by sufficiently tightening fiscal policy to allow an easing of monetary policy, are now greater because of the housing package. We have the irony that the housing package, which depends for its success on getting interest rates down, will itself be a factor in pushing interest rates up because this will increase the Government's deficit and, therefore, its demands on the market for money. The additional cost of the housing package, taken together with the rural package, the oil refiners compensation package and the decision not to have a May mini-Budget this year, casts great doubt on the Government's ability to deliver a credible Budget this year. In contrast to this, the Opposition's approach to housing, I believe, is eminently sensible. The high level of interest rates remains the fundamental problem for the housing industry and this can be corrected only through a more balanced economic strategy. The Opposition says that it has that strategy. Further wage discounting for the effects of the depreciation of the consumer price index are required. The 3 per cent productivity increase should be delayed for at least a year. The Government should make a major economic statement detailing significant expenditure cuts to take effect from 1 July. The decision to abolish negative gearing provisions and to introduce a capital gains tax should be reversed. This will revive investment in dwellings, particularly multi-unit dwellings such as town houses, units and flats. If such action were taken there would be no need for the band-aid measures contained in the Government's housing package. Senator HAMER(Victoria)(3.55) —We are considering a motion moved some time ago by Senator Archer dealing with the problems of housing in Australia. Housing, of course, is the most fundamental need and the biggest single investment most Australians will make during their lifetime. When looking at housing we have to look at four different aspects of it. We cannot look at a single problem. There is the question of the costs of new loans to acquire housing; there is the question of what happens to people who have existing loans, what happens about welfare housing and, finally, the availability of rental accommodation. We have to keep all these problems in mind whenever we look at the problems of housing. Senator Archer's motion contained five points which I will go through in turn. The first point was that the Hawke Government should be condemned for plunging the housing of Australian families into the worst position in 50 years by doctrinaire and unbalanced policies. Certainly we were heading for a crisis in accommodation and in housing loans. The number of new building approvals fell by 9.7 per cent in the three months to February to be 13.9 per cent below the level of a year earlier. The number of new dwelling finance approvals fell by 17 per cent in the three months to February to be 23 per cent below the level of a year before. This country needs about 135,000 new houses a year to meet its needs. Under the Government's policies, before the abrupt and most peculiar change I will come to in a moment, we were heading for a production of under 100,000 which would have created not only a real housing crisis but also a crisis right throughout the housing construction industry and for the people who make facilities for houses and equipment for houses. It would have had major economic repercussions. There is no doubt at all that it was the policies of the Hawke Labor Government that created these problems. The main reason it created these problems is the second leg of Senator Archer's motion-that the Hawke Labor Government should be condemned for creating and maintaining a high interest, high tax economy that makes home ownership an unattainable goal for many young Australian families. We have to look at what is happening to the Australian economy. People do not yet seem to have grasped the seriousness of what is going on in the Australian economy. All too many people think if they have a job: `Things seem to be going fairly well for me, I have a job. The economy seems to be all right as far as I am concerned'. What they do not grasp is that we are borrowing $1,000m a month to support our current standard of living. No country can go on doing that. It is South American-style finance. The net overseas debt has doubled in the three years since the Hawke Government came to power. It is an impending financial catastrophe and this Government just does not seem to have grasped the problem. Those members of the Government who have grasped it are trying to wish it away in some peculiar way. Look at what has happened to our balance of payments. The current account deficit in February was $979m. In March it was $1,023m. It has gone up substantially from the year before. We keep on hearing about the J curve. I am glad that Senator Button, the Leader of the Government in the Senate, has some sensible views about the absurdity of the J curve. Nevertheless, we keep on hearing from the Treasurer, Mr Keating, how the J curve will solve all our problems. Senator Michael Baume —It has become an L curve. Senator HAMER —It has become an L curve. I think he needs `L' plates. Certainly he is not up to `P' plates yet. The J curve, after we devalued and had an inflow of imports for a while, was supposed to worsen our current account deficit, then with our exports becoming more competitive and with us exporting more, we were suddenly supposed to become more competitive an go up on the long stroke of the J curve. That just has not happened. It has not happened because of other aspects of government policy. One would think that a country that was borrowing $1,000m a month for its current standard of living would at least try to keep its costs down in order to make itself competitive so it could get more exports. No one in this world owes us a living. If we are going to export on world trade markets we have to be competitive. But what are we doing? We are giving ourselves three pay rises this year. One is going on now, about 2.4 per cent, then probably in the middle of the year there will be a totally phoney 3 per cent productivity bonus and there will be another pay rise, probably 4 per cent or more, at the end of the year. This is economic insanity. I can only repeat over and over again that a country which borrows $1,000m a month-and has to do so because it is not competitive on world markets-and which continues to grant itself pay rises loses its competitiveness on world markets. We have enough problems being competitive as it is with our problems of shipping and the waterfront, quite apart from pricing ourselves out of world markets by absurd wages policies. This Government is showing no sign whatever of even remotely grasping that this is the core problem of what is going on. The Government reminds me irresistibly of the attitude of the Neville Chamberlain Conservative Government in Britain when faced with the rise of Hitler. It pretended the situation was not serious. It believed it could negotiate the problem away. It even went to Munich and got `peace in our time'-an accord with Hitler. I think our so-called accord should have been drafted in Munich. What this Government is doing is a catastrophe. It is causing great harm to the Australian economy and great harm to future generations of Australians. In this particular context we have to look at its effect on housing because our interest rates are very high indeed. Interest rates are high because the Government has to keep them high in order to prop up the dollar because the dollar still is set, despite the agreement in Tokyo, freely on international markets. World assessment of our performance is reflected in the value of our dollar, which has gone down by 30 per cent since the Hawke Government came to power. That is a 30 per cent decline in the way the world views the Australian economy since the Hawke Government came to power. That 30 per cent decline is only against the US dollar, which has itself declined by about 25 per cent against currencies such as the German Deutsche mark and the Japanese yen. We are viewed by world markets and world financiers as a very poor risk indeed. We have to examine ourselves and see why this is so. The Government has to try to prop up the dollar because it cannot let the dollar sink forever-for the very simple reason that we already have an overseas debt of $70 billion and every time our dollar declines or depreciates further the cost in Australian dollars of servicing international debts goes up. Instead of propping it up by improved performance, by organised work, by holding our wages to reasonable levels and not granting ourselves pay rises that we have not earned. The Government is trying to do this by holding interest rates at a high level. The effect of these high interest rates spins off into housing. Let us look at comparative figures for prime interest rates. At the moment, our interest rate is just under 18 per cent. In Japan it is 6.9 per cent; West Germany, 9.1 per cent; France, 10.6 per cent; the United Kingdom, 12.5 per cent; and the US, 9.5 per cent; and Australia, 18 per cent. That is done, as I said, to prop up the dollar rather than tackle the fundamental problems of the economy. The effect spins off into housing. The reason that our housing interest rates are so high is that that is an inevitable consequence of this Government's policies. The third leg of Senator Archer's motion was that the Hawke Government should be condemned for: . . . presiding over and causing a rapid decline in the availability of rental housing, causing extreme hardship to low income families in particular. The Hawke Government has caused this in two ways; in a third way the State Labor governments are making the situation even worse. We will not have rental housing unless people are prepared to provide it-unless they regard it as a reasonable investment. The Hawke Labor Government's proposed capital gains tax is a direct disincentive for people to invest in rental housing. Even worse is the elimination of negative gearing, whereby if a person made a loss on acquiring and renting property, he could offset that against other income. That has been stopped and that is another very strong disincentive for investment in rental property. As night follows day, it is an inevitable result that there will be a rapidly increasing scarcity of rental accommodation. That situation will be made even worse by new tenancy laws. This is not universal. Wherever there are Labor governments there seem to be attempts to make the provision of rental accommodation as difficult, as dangerous, as unpleasant and as unworkable an investment as possible. A new tenancy Bill going through the Victorian State Parliament will make it extremely unattractive to invest in rental property. The consequence will be a drying up of the availability of rental property and people will be paying higher rents. Once there is a scarcity demand will push up rents. All this is being done in the name of socialist equality. As with all the Government's proposals, this looks superficially attractive but in the long run it will be disastrous. I have to admit that the fourth leg of Senator Archer's motion is now out of date. The Government has actually done something. Senator Archer said that the Hawke Government should be condemned for: . . . creating uncertainty by not releasing after 6 months, details concerning taxation policy on investment property. At last something has been done-but after an inordinate delay. It is disgraceful the way that this Government announces policies that will have very severe effects on investment and confidence and then leaves it for months, in some cases years, before the Government makes it clear exactly what the legislation is. It is gross incompetence to announce a policy and not to introduce detailed legislation promptly after announcing the policy. This Government is guilty of that type of slack administration over and over again. At least in this area it has now announced details of its policy eight months after it announced its broad intention. The final leg of Senator Archer's motion was that the Hawke Labor Government should be condemned for: . . . destabilising the finance market by artificial and sectoral constraints which will have long-term detrimental effects on home ownership funding. The Government was faced with the problem that the number of houses being built in Australia would fall to under 100,000 because of very high interest rates and the Government, as a consequence of its policies, had to do something. It could not tackle fundamentals so it subsidised the savings banks to the tune of $120m, with a further $25m being set aside, provided the banks kept interest rates on existing housing loans pegged at 13.5 per cent, well below the market level. For new mortgage loans the sky is the limit; there are no controls. Savings bank loans are currently in the rage of 14.7 to 15.5 per cent, about the same as building society loans. Why did the Government do this? The Government declared that economic circumstances-for which we should read `Hawke Government economic mismanagement'-forced it to take this step because there was a very real risk that housing commencements would fall below 100,000. Housing construction is a significant part of our gross domestic product-about 0.3 per cent-and is also a very important means of employment. The four major savings banks tried to get a deal of $180m to hold the lending rate on existing loans to 13.5 per cent. The Government showed at least some sense and refused that and reduced it to $120m on the basis that the savings banks continued to lend for new housing at $6 billion a year. That agreement has a life of one year and is reviewable quarterly. There are a few questions I want to ask about that. First, savings banks provide about 50 per cent of housing loan finance. Building societies provide about 29 per cent. I should admit to the Senate before I go any further that I am a director of a building society but I have no financial interest in any of these matters. However, it gives me an insight into some of the problems. I inform the Senate of the basis for some of my remarks. The Government has given the subsidy to one group of people with housing loans, those who have a mortgage with a savings bank. Why does this apply just to savings banks? On the whole, building societies have been dealing with younger and less affluent groups in the community than have savings banks. Why does the Government do this deal with savings banks and not deal with other groups of lending? Surely it is just as important that their mortgage rates be kept down. Why is the Government advantaging people who borrow from a savings bank and disadvantaging those who borrow from a building society, a trading bank or another organisation? There is absolutely no rationale for this. If it is a matter of efficiency; I point out that a very detailed analysis has shown that as providers of home finance building societies are markedly more efficient than are savings banks. What we have to look at with an organisation like that is the difference between the average cost of its funds and the average return it gets from mortgage and other investments. Savings banks work on a margin of about 4 per cent. Building societies generally-of course, in each case there are variations-work on an average difference of about 2.8 per cent. The building societies are quite significantly more efficient. One of the reasons for this, of course, is that the savings banks are locked into a very archaic and old-fashioned form of branch structure. They are locked into some staff practices which are very inefficient. Nevertheless, as far as we should look at who should be helped, I would have thought that we should help the efficient rather than the less efficient. The Government is being completely irrational in what it is doing. If it wishes to try to help people who have existing loans one can see the argument for that. People enter into a major investment and, because of absurd government policies, interest rates go through the roof. It is very unfair for people who have their major savings tied up in housing investment. If we do not hold down interest rates, of course, people might have to sell their houses and pay out their mortgages. However this measure should surely apply to all people who have housing loans, not a particular group. Half of these people happen to have loans from savings banks. Finally, of course, the problem the Government is causing is that the rate for new housing loans will be over 15 per cent. It is probable that, because of the increased competition the savings banks can now provide for the pool of investment money, building society rates will also have to go up. Unless there is a subsidy from the Government-there is no sign of there being one-the building society rates will apply not only to new borrowers but also to people with existing mortgages. What we have from this Government is a thoroughly muddled economic policy which is having consequences right through the economy. The consequence that hits home most to the Australian public, I suppose, is the effect on their mortgage payments. People can see immediately what damage the Government is doing to the economy. But that is only a symptom. The cause of the problem is the Government's unwillingness to recognise the economic situation we are in, its unwillingness to recognise that no other country owes us a living. If we want to be competitive on world markets-if we are to maintain our standard of living-we must take strong and decisive steps to improve the efficiency of the economy, improve our work practices, and improve our export performance. Without that, the high interest rate on housing loans under the Hawke Labor Government is only a beginning. Where it will end I do not know. Senator ARCHER(Tasmania)(4.14) —in reply-I would like to close the debate on this motion, which reads: That the Senate condemns the Hawke Labor Government for- (a) plunging the housing of Australian families into the worst position in 50 years by doctrinaire and unbalanced policies; (b) creating and maintaining high interest, high tax economy that makes home ownership an attainable goal for many young Australian families; (c) presiding over and causing a rapid decline in the availability of rental housing, causing extreme hardship to low income families in particular; (d) creating uncertainty by not releasing after 6 months, details concerning taxation policy on investment property; and (e) destabilising the finance market by artificial and sectoral constraints which will have long-term detrimental effects on home ownership funding. Several honourable senators have spoken in this debate. Debate started towards the end of March and we are now closing it on 8 May. It is interesting to see what has happened during that period. The debate has highlighted the housing situation. The date on which the debate commenced-20 March-seems years away now because of the changes that have occurred. That was the stage when we were getting promises from everybody, from the Prime Minister (Mr Hawke) and various members of the Australian Labor Party through to the Minister for Housing and Construction (Mr West) and others, that there would be no increase to the interest rate limit of 13.5 per cent. That promise was made by various people on numerous occasions. I was never of the opinion that that 13.5 per cent was a magical figure but I always believed that while there was uncertainty about housing funds it would be very difficult to make decisions on housing in the market-place. In that period the State Council of the Queensland Labor Party attacked the Government very strongly and Mr Wran attacked the Government very strongly about its intervention when that was not what he had in mind. We then had the building societies and their problems and we had the bank handout. Frankly, as we were saying in the debate in March, those were not the real problems. The problems were that the costs were too high, there was economic uncertainty, and monthly mortgage repayments were getting to the stage where people were unable to meet them. All those points still remain. Nothing that has happened since then has made this any different. Ultimately, the Government decided that it had to listen to some of the advice that was being tendered and some of the complaints that were being made and have a better look at where it stood on the housing question. All that happened as a result is that, instead of housing problems being created by one lot of artificial situations, they have now been replaced with a few more artificial situations. One problem has been replaced by another. I noticed in the Melbourne Age of 4 April a headline `Home loan moves end of great Australian dream'. That was after we had decided what was going to happen. That was after the Government had decided that changes needed to be made, certainly not before. Going back to about September last year, various members of the Opposition-the Leader of the Opposition (Senator Chaney), myself and others-were raising the question of the problems of the housing industry, the inevitability of a major decline in building, a great fall-off in home ownership, and considerable losses of tradesmen in various aspects of the industry, flowing through to the supply industries as well. We waited so long that the crunch came and the decline was in full flight before anything was done. It was another of those cases, like the case of Mr Justice Murphy, where the Government held off. We went past the stage where it may have been possible to get some remedies going had action been taken at the right time. When action had been taken Professor Gruen, Chairman of the Indicative Planning Council for the Housing Industry said: `It has been done but I still have grave doubts that it is likely to make the housing position what we would like it to be. We do not think that, even with these band-aids, we will be able to restore the figures we have been promised'. The 135,000 new houses certainly will not be achieved for a variety of reasons. I am one of those who says that 135,000 houses is an artificial figure in the first place. I do not believe that there is a market for that number anyway. The history of the last five or six years confirms that in relatively good housing years the average has been only about 129,000. So to talk about getting that figure up to 135,000 in difficult times, whether or not money is available, is really not on. We are now in the position where this $6 billion has been guaranteed by the banks. I believe the problem that will show up in the housing industry is that there will not be a demand for $6 billion from the banks. They have been put over a barrel and have had to promise to lend this amount of money, but I do not think it will be required. I will be very interested to find out what will happen if, because of lack of demand, they are unable to fulfil the stand-over promise as to the benefits that will flow as a result. I think the house building market will be slack. I believe that the imported commodities that are going into houses are starting to get terribly expensive. Anyway, we have lost so many tradesmen to other areas that it would now be very difficult to get together a proper work force. It has always been the same: Whenever there is a severe downturn in the housing industry people leave and very seldom come back. We train a lot of tradesmen in a variety of trades. They stay until they finish their apprenticeship and they stay while the market is quite active, but if they have to leave because of an economic problem they very seldom come back. In the rental market the situation is probably even worse. The great bulk of rental housing in many towns and cities in Australia is owned by people who do not really want to be rental home owners. They own property only because it has happened more or less accidentally or incidentally. A lot of people own a spare house that they have had left to them. They may own a house that they purchased for the use of an aged parent or student children. They may have owned a house and built a new one but retained the old one and decided to let it. There are other things that they could do with their money. It is not a matter of rental housing being a top investment. A lot of people like to feel that they own a little property. This Government has traditionally been anti-landlord. There has always been a stigma attached to owning a rental property. This fails to acknowledge the great number of people who depend on being able to rent reasonably priced accommodation in the private market in a reasonable location. Government housing will never be able to fill the needs of the rental market. The Government should provide housing for those who are unable to get it otherwise-people who are in a critical situation, people who are unable to afford housing in the private market, or people who have special reasons for needing such accommodation. It will never be possible for the Government to fill the need. It will always require the private sector very largely to fill the gap. In the course of my business before I became a senator I handled a lot of rental property. I know how important it is and how much the market depends on it. Of the rental stock around Australia, thousands of units have been sold off in the last six months. Even more have been sold off in the last, say, 18 months as the returns on capital invested in other areas have been much greater. It has become apparent that, due to various other disincentives, people are shedding rental properties that they do not need to own and are putting their money into management trusts, stocks and shares, and other areas. That too has taken away a lot of potential new housing sales for the next year or so, and this trend will certainly continue. More and more people are now finding out the undesirability of a house investment as against other investments. As the opportunity arises to do so, people will be selling off. Many of these houses will be available at prices that are considerably lower than new house prices. With the very high cost of interest and repayments it will suit more and more people to take advantage of being able to buy lower priced houses. What will the Government do about that? I do not expect it to replace this loss with Government housing because it is just not possible. Of course, this has not stopped the Government from bringing in various changes to the taxation system which are definitely and specifically against the rental housing market. The March figures have just been confirmed. On 20 March I predicted that the figures for March would be even lower than they were last year and, as I understand it, this is the case. The figures are now down by about 60 per cent on last year's figures. This is a very severe drop. It will take a tremendous amount of work to get this figure back to a reasonable level. I feel sorry for the Indicative Planning Council because one of the disadvantages it has had is that it is instructed as to the method it is to use in its projections. For instance, it must use the information on economic circumstances that is provided by the government of the day. If the government of the day gives the Indicative Planning Council a list of incorrect instructions, it is very hard for it to come up with figures that are right. I am not criticising this Government; I am criticising the system. We should not appoint a body of the nature and weight of the Indicative Planning Council and then tell it what information we want it to base its base projections on. I would like us to look at freeing it up, giving it an opportunity to be a part of the development process, enabling it to give us, much earlier than in the past, figures on what it sees will happen, instead of giving it the parameters that it has had recently based on productivity, inflation rates, the value of the dollar and various other things, all of which have turned out to be at variance with the facts. The next problem we have is that, because of high interest rates and the increasing bureaucracy at local, State and Federal levels, the price of land is continuing to go up. The cost at that end also of getting into a house now is more difficult. One only has to look at the figures which are now the norm in Canberra to see that that is so. At the end of last month the mean average price of houses sold was of the order of $100,000. That is not the sort of price that any new home buyer could possibly contemplate when we are talking of interest rates which may be as low as 13 1/2 per cent for some of the money but may be as high as 18 or 19 per cent for the majority of the money. Newspapers have given a lot of coverage to the problems of the housing industry since the debate started on 20 March. I hope that the Government is looking very carefully at this matter. Mr West has not made any comment on the problems that have developed since the changes were made and he has given no indication of what those changes may do to improve the situation. Frankly, I do not think that the changes that were made will result in any improvement. I certainly do not go along with the problems that were created by interfering with the differences between the banks and the building societies. There are much cleaner ways of doing it. To now shuffle what happens in the race for investment funds will not help the situation at all. The only thing that has happened since the matter was debated on 20 March is that the tax package has now been brought down. We now have the details of negative gearing propositions; we can now take into account the anti-housing bias that this provides. People will be less likely than ever to invest in new housing for rental. As a result of the Government's having achieved that, one can be sure that it is only the tip of the iceberg and that in the longer term the Government will proceed in an anti-housing direction. We have the problem of inflation and Australia is far against the world trend. People who are trying to build new houses are finding costs getting greater and greater. A great deal of imported material is used by the housing industry and this is making the job more difficult. The Government must face up to the problem. It must decide not only whether it wants to see more people in better housing but also what it intends to do to maintain the levels of employment allied with the various factors related to the provision of new housing. Housing is absolutely fundamental-it is the most fundamental thing in our society. Nothing is more essential than a proper, regular housing industry. Its continuity is essential, but housing has always suffered from the ups and downs of government policy. There has always been a tendency for governments either to slap some money into housing to try to build up the economy in a hurry or to take it out, to cool it down, and then the industry is unable to cope with such variations in the way they are inflicted. The Government must even out the housing market and introduce some predictability. In the last year or two we have seen a considerable loss of housing funds. We have also a loss of tradesmen and suppliers. I refer to items such as furnishings even down to gardening equipment, instant lawn or anything else-curtains, furniture and many other industries are being affected by the sudden downturn. This will flow back through other industries and will produce a long list of bankruptcies and financial difficulties. I raised this matter in March because it was serious; it was serious then and is more serious now. The problems are very clear and we fully understand them. The industry requires predictability the whole way through. I thank honourable senators who have participated in the debate. Question resolved in the negative. Debate resumed from 14 March, on motion by Senator Boswell: That the Bill be now read a second time. Senator PARER(Queensland)(4.34) —In speaking on the Conciliation and Arbitration (Amendment) Bill 1986 which seeks to amend the Conciliation and Arbitration Act 1904 in relation to industrial matters, I commend Senator Boswell for providing a vehicle that will serve yet again to highlight the concern of the majority of Australians about the implications of accord mark II. If anyone thinks that there are not real concerns, I would refer him to the gallup poll survey in the Bulletin of 6 May. It was pointed out that in regard to union-controlled superannuation 53 per cent of trade union members said that the funds should be industry based run by employers and fund members; 23 per cent said that it should be company based jointly; and 10 per cent said that it should be industry based run by trade unions. Among non-unionists 41 per cent said that the funds should be industry based run by employers and fund members; 29 per cent said company based; 4 per cent said it should be industry based run by trade unions; and 26 per cent could not say. The important aspect of it was that fewer than one in 12 Australians believe that superannuation funds should be run or controlled by trade unions. Accord mark II is a well-contrived and devious agreement between this government and the Australian Council of Trade Unions to hand over economic control of Australia to the ACTU. It is well recognised that the ACTU has political control of the Government and is now in the business of handing over economic control. Senator Robertson —Get some facts if you want to put out this nonsense. Senator PARER —The honourable senator asks for facts. An interesting insight emerges from a paper by Brue Hartnett, who was with the ACTU at the time. He delivered it to the Australian Labor Party Special National Conference in 1981. I quote: There are a number of issues raised by the extension of union involvement in superannuation schemes. Ultimately these questions include an examination of the investment strategies of those funds and their implication for industrial relations employment and structural changes in the economy. What we must recognise at this early stage of union involvement in the superannuation issue is that the control over the funds will provide unions and governments with considerable financial leverage. That leverage will be used to advance the cause of socialism in Australia. If there were any doubts before, now we know the real purpose of the accord mark II. The coalition is not opposed to legitimate superannuation as a means of people during their working lives providing for their own retirement. We are totally supportive of such a concept provided that there is absolute freedom of choice. Let me trace the history so far of the schemes we have seen. Senator Robert Ray —Read the guidelines. Senator PARER —The guidelines do not reflect what is happening in practice and I think the senator is aware of that fact. One has only to look at some of the disputations of the last few months. I think Senator Robert Ray might have been stopped from leaving Canberra airport because of a Transport Workers Union strike trying to force union members into joining the TWU superannuation scheme. Let us look at the schemes. Let me discuss briefly the basis of superannuation. As we all know, there are two types of superannuation: One is the benefit promise scheme where the pay-out at the end of the period is a multiplier of final average salary. Generally those schemes involve a degree of employer and employee contribution. There is a requirement every now and then to have an actuarial review. If the scheme is found to be actuarially unsound, it is generally up to the employer to make up the balance to get the scheme back on track. The other type of scheme-this is the one referred to in the accord and is the basis of the current claim before the Australian Conciliation and Arbitration Commission-is the accumulation type scheme or a contribution promise. It is understandable that that sort of scheme would be introduced for itinerant workers. In other words, funds are invested and the pay-out at the end of the period on retirement or prior death would be related to the investment performance of those funds. It is also important for itinerant workers that those sorts of schemes include portability provisions. Senator Robert Ray —Why didn't your mob bring it in? Senator PARER —I will come to that. Schemes were available and there was encouragement to join them for taxation advantages. What has happened to date? We have had a plethora of union schemes which originated from the Australian Council of Trade Unions in Melbourne. Most of them have companies as trustees. Generally the office of the trustee company is care of the ACTU in Melbourne. Examples of those schemes include the building unions superannuation scheme, the Allied Unions Superannuation Trust, the Metal Union Superannuation Trust and the Transport Workers Union and Federated Storemen and Packers Union of Australia schemes. They all had very similar characteristics. Their trustees were companies. I will take BUSS as an example because the schemes are all much the same. They are the mirror image of one another. I believe that the architect of the schemes was Gary Weaven, who made some very interesting comments about these schemes. Senator Robert Ray —He was not the architect of all of them. Senator PARER —He was not the architect? Senator Robert Ray —Not of all of them. Senator PARER —Going back to the Transport Workers Union scheme, there is no doubt in my mind that one Mr R. J. Hawke was involved in that scheme. There was Bill Landeryou and, I think, Simon Crean. It has been said to me on a few occasions that they never expected the plans that were formulated back in 1972 or 1974 to reach fruition so quickly. Senator Robert Ray —It just shows their talent. Senator PARER —It shows the control they have over the Government. Let me quote from comments made by Gary Weaven in Superfunds in September 1985. There are a couple of good quotations. He said that the ACTU would seek to achieve the `endorsement' of government, which it now has, the Arbitration Commission and employer organisations. Mind you, it did not seek to achieve the endorsement of employer organisations; it browbeat them into it. It is now working on the Arbitration Commission, trying to browbeat that organisation as well. Mr Weaven said that ACTU was seeking the endorsement for guidelines to include `broad criteria' as to the development of occupational superannuation schemes. Mr Weaven then went through a list of items, the last of which was `establishing union control' or, presumably in brackets, failing that, partnership in the administration and investment of funds. Absolute control is the aim. It is said that the building unions superannuation scheme and Allied Unions Superannuation Trust have been dramatically successful because they were designed by the ACTU and unions for the interests of workers. What absolute garbage! Those schemes have an identical background. Representatives of the schemes went to the various insurance companies and fund managers and negotiated. There is nothing wrong with negotiation. One gets a good deal. But what they negotiated was not absolutely in the interests of the members of the schemes. In this instance a deal was negotiated whereby the company BUSS Pty Ltd would receive a management fee. I believe that the fee was a dollar a man a week. A fee is a nice word for a commission. Those people will argue-I have discussed it with them: What is the difference between their receiving the commission and paying it to someone such as a life underwriter? My argument is that doing so is absolutely wrong. They should have paid a fund manager and every cent that was available should have gone into the fund for the employees. That did not happen. They were interested in two things. The first was the size of the commission which, if extrapolated across the whole area of people not covered by superannuation, would have amounted to $3m a week going into their coffers. That would have amounted to $3 billion a year being available for investment. These schemes were what I would term dirty schemes because they included the element of commission, which they should never have done. The ACTU is not stupid. It realised that if this practice was allowed to continue it would find itself on the rocks, so it decided to negotiate a couple of clean schemes. I call them clean schemes because their end is to control a large volume of money. I will get to why they want to do that, in a minute. The idea behind the clean schemes was: `Let us make an arrangement. We will form a company between the ACTU and one of the tame employers groups and employ an outside fund manager'. That particular scheme is called ARF-I do not know whether it is short for `Arfur' in Minder-and it is ready to go. One may ask the fund manager how sure he is that one year, two years, or three years down the track, when the scheme is in place, the ACTU or ARF will not say: `Why are we employing a fund manager?'. It is easy to sell. One says: `We can employ four or five of those characters and pay them double the amount they are getting already. We will have absolute control of those funds'. People have said that that is pretty nasty, and that what the ACTU will do is concentrate the investment of those moneys, which might run at $3 billion a year, in sensitive industrial areas and put the heat on employers to make industrial settlements. Frankly, I do not believe that is the case. Senator Robert Ray —It has not happened yet. Senator PARER —They do not have the money yet but they are lining up. Senator Robert Ray —The storemen and packers have $20m. Senator PARER —Have they got $20m? They will be doing it. They are just going easy at this stage. Mind you, it has not gone through the Conciliation and Arbitration Commission. The schemes will zero in on the key industries. Senator Robertson —Do not judge others by yourself. Senator PARER —Just wait and see. It is not that I have not had discussions with some of the honourable senator's people about this. I will tell the honourable senator what their answer was. They will zero in on the key industries-- Senator Robert Ray —For reasons of profitability. Senator PARER —If profitability were the only hallmark in their decisions I do not think too many people would worry. But the rest of Australia is concerned. That is why only 7 per cent of people are prepared to trust these schemes to handle their money. As I said, they will zero in in the same way as in the case of political coups in other countries, people zero in on the media, the radio stations, television stations and newspapers. Senator Robertson —Take it out of the hands of the Establishment. Senator PARER —That is exactly what they will do. When I have charged them with that- Senator Robertson —Do you mean take it away from Murdoch and Packer? Senator PARER —I am delighted that Senator Robertson has agreed with me because that is exactly what I have been told-that they will do that. That is their No. 1 target. I am delighted to get that admission from Senator Robertson- Senator Robertson —Do not misuse what I have said. I said it would be a wonderful idea. Senator PARER —The honourable senator said that it would be a wonderful idea for the trade unions, through the superannuation funds, to zero in on the radio stations, the newspapers and the television stations. Senator Lewis —Is that what he said? Senator PARER —That is exactly what he said. I mentioned earlier Mr Gary Weaven, the same gentleman, incidentally, who recently in industrial discussions, when he was told that a certain agreement was not in keeping with the accord, said: `Don't you realise, Mr X, that we are the Government?' We in the ACTU are the Government. Haven't you woken up to that?' That is the same Mr Weaven. Mr Weaven has made the remark that BUSS and AUST were so darned successful because they were set up by the ACTU. I will tell honourable senators why they were successful. They were successful because of standover tactics, coercion, and blackmail that was no different from that employed by the Chicago Mafia. They forced employers and employees to join schemes against their will, irrespective of the fact that schemes were already in existence, irrespective of the fact that alternative schemes offered better returns to the members of that very union. The last time this matter was debated here as a matter of public importance I produced 40 documented cases of standover tactics used by the people behind the BUSS scheme to force employers and employees to join the scheme. Black bans were imposed upon building premises. People were told that, if they did not get their BUSS ticket-that is the term used-they would never work in the industry again. There were examples of threats of physical abuse. That is why the BUSS and AUST schemes have got where they are. As to competing schemes, some employers have hung out. When one investigates this one finds, oddly enough, that the union people are only too happy to talk about it. They are prepared to tell us what they are doing, what their aims are and, as confirmed by Senator Robertson, what their final aims are. Regrettably, employers will tell us that, yes, they were stood over and, yes, they were blackmailed and, yes, they were told that if they did not join a BUSS scheme they would never work again. However, in the main they were not prepared to come forward and give hard evidence because of their fear of retribution. That is something that I do not believe we can tolerate in this country. Senator Robert Ray —If that is provable, you are right. Senator PARER —Even Senator Ray agrees with me on that. Mind you, Victoria can be a rough place too. I wish to commend Senator Boswell for providing this vehicle. The whole of Australia must realise what this is all about. It is an attempt to hand over economic control of this country to the ACTU. It will change the whole direction. The ACTU already has political control, as I have said. In the coalition we believe in and strongly support occupational superannuation. The record of previous coalition governments, as well as the increase in superannuation coverage recorded over the period from 1974 to 1983, can be used to demonstrate our commitment. Senator Chipp —Will you vote for this Bill? Senator PARER —I am just telling honourable senators what we believe. The coalition supports universal access to superannuation. It is in line with out self-provision principle, which was also the ground used for opposing the assets test. The coalition is committed to supporting the extension of occupational superannuation through the taxation system. We strongly support both employer and employee contributions to superannuation and will encourage those. We believe that superannuation funds should be controlled by the trustees for the benefit of the members. The coalition does not support the use of superannuation as a weapon to extend unionisation throughout the work force. While on that point, I mention that under the BUS and AUST schemes, the fund manager acts as the policeman for those schemes. if a person is found on site without a BUS ticket, it is reported back to the union, which promptly declares the site black. When the BUS ticket is taken out, the black ban is lifted, but more importantly, the fund manager gives the union a computer printout of every person on that site. There is no doubt that this is also a real attempt to increase the level of trade unionism in this country from 55 per cent to 100 per cent. We do not support the use of superannuation as a weapon to extend unionism throughout the work force. When we get back into power-which will not be very long, by the look of the figures-we will not tolerate the use of coercion or blackmail to advantage union funds. We also oppose the bias in the guidelines in favour of union funds and against existing enterprise based schemes. Employers who have already taken action to cater for the retirement needs of their employees should be encouraged and not penalised. We also favour the development of a diversity of genuine superannuation schemes in a competitive climate to provide employees with a choice of which scheme best suits their needs. Senator Robert Ray —Of course! That is common sense. Senator PARER —If Senator Ray can assure me that the way those six funds have operated until now will change, he may have something to talk about. The way that they operate at the moment is no different from the stand over tactics used by the Mafia fellows in Chicago. They have been very successful. Senator Robert Ray —That is garbage and you know it. Senator PARER —That is unbelievably bad logic from Senator Ray. He is usually pretty good at this sort of thing. Senator Robert Ray —Name me one that we have rubbed out! Senator PARER —What about the Transport Workers Union? Is that the next one to be rubbed out? Senator Robert Ray —Are you saying that that is a Mafia-run organisation? Don't talk rot. Senator PARER —From what it has done, it appears to be a Mafia organisation. It certainly stoops to blackmail and standover tactics to force people into superannuation schemes. I conclude my remarks by again complimenting Senator Boswell for providing this vehicle to highlight again the real aim of the accord mark 2, so that the people of Australia can see that the country is being sold out to the ACTU, and to reiterate that we support superannuation and occupational superannuation but provided there is absolute freedom of choice. Senator SHEIL(Queensland)(4.58) —I rise to support this private member's Bill, the Conciliation and Arbitration (Amendment) Bill 1986, brought in by Senator Boswell to amend the Conciliation and Arbitration Act 1904 with respect to the definition of an industrial matter and to clarify and entrench it in law. By way of a opening statement I say that, as has been said earlier in the debate, the Opposition is not opposed to superannuation schemes for employees, employers or self-employed people. Indeed, we encourage people to prepare for their retirement, but we want to see the schemes properly organised and properly run so that there is safety for the contributors. Headlines in today's newspapers illustrate the concern of people for union-run schemes. When they have before them the evidence of what has happened to other businesses and industries that have been run by unions, they have a very just concern that the unions should not run superannuation schemes. The Bill is important. The matter is under consideration by the Conciliation and Arbitration Commission at the moment, but that Commission is under some degree of coercion by the unions because-- Senator Robert Ray —That is an insult to the Commission. Senator SHEIL —It has been threatened with serious and severe industrial action if it does not find in favour of the unions. Senator Ray should read the front pages of today's newspapers. Because the Conciliation and Arbitration Commission has delayed its consideration, it has been threatened with further union action. Senator Ray is saying that this is not coercion against the Commission. Senator Robert Ray —I am saying that it would never give in to coercion. Senator SHEIL —Then why is it being used? Senator Robert Ray —I am saying that it would never give in. Senator SHEIL —They are hoping that it will. Initially the Government was aiding and abetting the unions in their approach to the Commission. Now the Government is most relieved that the Commission has decided to defer its decision for a little while. The Bill is not altering the law, it is merely entrenching the law as it exists. It has no retrospective element at all. When the matter of pensions was previously put to the Conciliation and Arbitration Commission, in the case of R v. Hamilton Knight; ex parte Commonwealth Steamship Owners' Association in 1952, it was referred to the High Court of Australia, which clearly ruled that the provision of superannuation and pension benefits was not the province of the Conciliation and Arbitration Commission. Yet here we have the Government aiding and abetting the unions to apply to the Conciliation and Arbitration Commission to provide superannuation benefits. This is clearly a back-door approach to the Conciliation and Arbitration Commission to provide superannuation benefits. Senator Robert Ray —You whinged like mad when you didn't get your superannuation payments. Senator SHEIL —Senator Ray is way off track there. The Government has encouraged the unions to approach the Commission on a matter that is not its province. In fact, the unions are using the Conciliation and Arbitration Commission to behave in a legislative manner. It is properly the province of this Parliament to make laws about superannuation and pensions, yet the unions want to do it through the back door, using the Conciliation and Arbitration Commission. Senator Robert Ray —Have you never heard of a productivity case? It is a productivity rise. Senator SHEIL —Senator Ray calls it a productivity rise. It is 3 per cent across the board. That is an absolutely ridiculous submission. Nobody can decide which industry is having a productivity rise of 3 per cent and which is having a rise of 30 per cent. In fact, a coal industry ruckus is going on at the moment because the union is claiming a 30 per cent superannuation productivity wage rise. The unions are trying to confuse the words. I think it was Norm Gallagher who said: `Make no mistake, this is a wage rise'. Of course, it is a wage rise on which no tax will be paid. Senator Lewis —It is a tax rort. Senator SHEIL —It is a tax rort. Not only that, but there is also no employee contribution; yet the unions want to call it superannuation. How can they do that? That makes it not a superannuation scheme. So the unions are playing with words, playing with the facts as they exist and going by the back door to bypass the proper role of the Parliament in getting the Conciliation and Arbitration Commission to perform a legislative function because the Government is not game to do it. Senator Parer cited the examples a few minutes ago. I refer to the competitiveness of Australian industry and how it will be affected should this kind of superannuation productivity bonus scheme be put under the control of the unions. Firstly, the unions would have a considerable income from the money to manage the superannuation funds. A lot of that money, it is feared-I think justifiably-could be used to fund industrial action. Senator Robert Ray —Where is your evidence for that? That is a ridiculous statement. Senator SHEIL —I am saying that that is the fear, which is very real. I have that fear, which is why I am opposed to the scheme. Not only that, but the superannuation fund would have a lot of money to invest. This would give the unions the power to invest in different industries and therefore would affect the way in which those industries are run. Senator Robert Ray —The one thing in common between the unions and you is that you both like profitability. They will not invest in non-profitable enterprises. Senator SHEIL —That is right. The unions follow the old proverb that he who pays the piper calls the tune. All of a sudden we will have the unions running businesses. On past experience all businesses run by the unions have been failures-one hundred per cent of them. Yet Senator Ray wants people to take it on face value and to let the unions run some of the biggest businesses in Australia. That would be foolhardy and stupid, which is one of the reasons why I am opposed to it. If the unions have the money to fund industrial action, as well as investing in and taking over the running of businesses, imagine what that would do to overseas investment confidence in Australia. I cannot imagine that anyone from overseas would want to put money into the country knowing that the unions were running the whole shebang, because already Australia has a bad reputation, both as a supplier and as a deliverer on time. Senator Robert Ray —They invest in Queensland-what is the difference? They are silly enough to invest there. Senator Bjelke-Petersen —They know the right place when they see it. Senator SHEIL —Yes. Because of all those things, we are opposed to the legislation. That is just my opening statement. I will go on to the details of what the Bill will do. The Bill clarifies the definition of an industrial matter. It states, quite simply and plainly: A reference in this Act to industrial matters does not include a reference to any matter affecting or relating to superannuation or pension schemes or any provision or proposed provision which directly or indirectly provides that an employer shall contribute to a superannuation or pension scheme. It is as simple as that. It is a three-clause Bill which maintains the existing law. There has been a query about retrospectivity, but retrospectivity applies only when a law passed today is made to apply to something in the past. Until the Conciliation and Arbitration Commission has made a ruling, nothing is retrospective, so this Bill has no retrospective element at all. It is certainly not a radical move; it is entrenching the decision of the High Court of 1952 which clearly stated that the Conciliation and Arbitration Commission had no role to play in superannuation and pension matters. I want to stress particularly that the Government has aided and abetted the unions to approach the Conciliation and Arbitration Commission to get it to make a decision on a superannuation matter. I have already stated that that is using the Conciliation and Arbitration Commission for a legislative function that is properly the function of the Houses of Parliament. We can find no reason to support what is going on. The National and Liberal parties stand firmly behind the private member's Bill. We thank Senator Boswell for bringing it to our attention. If this Bill had not been brought forward there would have been no opportunity to debate a matter as important as this. He has given us the vehicle on which we can at least bring it to light. I have mentioned that it is not a true pension scheme. I would call it a type of work compensation scheme, because the amount of money involved in it, the 3 per cent productivity increase, would not be sufficient to provide superannuation for anybody. In fact, if people collected that when they were 55 years of age, they would have only sufficient money for a trip around the world or some minor expense, but certainly would not have sufficient for their retirement. They would blow that lot and go on the ordinary pension, so there is no question that it is a pension or superannuation scheme in its own right. It is just a deferred wage rise on which no tax will be paid and which will put a lot of money into the hands of the unions. Senator Robert Ray —It is taxable at the end, though. Senator SHEIL —Is it? We do not know about that. It has not been mentioned. Senator Robert Ray —Have a look at the tax changes brought down in May. Of course it is taxable. Senator SHEIL —Senator Ray can say that, but I think it should be pointed out to the Conciliation and Arbitration Commission that it does not have a role in superannuation or pensions, which are not industrial matters as are wages and conditions. I support the Bill. Senator BJELKE-PETERSEN(Queensland)(5.10) —I rise to support the Conciliation and Arbitration (Amendment) Bill 1986 introduced as a private member's Bill by my National Party of Australia colleague, Senator Boswell. It aims to amend the definition of `industrial matters' in the Conciliation and Arbitration Act by excluding from the Commission's jurisdiction superannuation and pension schemes. I believe in superannuation. When I worked before I got married, I belonged to a superannuation scheme. When I left work-I cannot say that I received a very large amount-I received a small percentage of interest with the money that I had paid in. Nevertheless, I think that superannuation schemes, properly run, are very good for employers, employees and self-employed people. I believe that I am speaking for the majority of Australians today in registering my strongest protest against the Australian Council of Trade Union productivity superannuation deal. It is blatantly obvious to all but the ACTU and this Australian Labor Party Government that Australia cannot afford this push for so-called productivity gain-in reality wage rises. Australia has 600,000 unemployed. Our inflation rate is running at 9.2 per cent. Interest rates have gone completely out of control and, I regret to say, are among the highest in the world. Our producers are struggling to be competitive on world markets with the result that our farm sector is in serious decline. We have an enormous balance of payments deficit. Australian employers simply cannot sustain additional labour costs. If they are forced to do so by this ACTU superannuation push we may rest assured that more jobs will be lost. As far as I am concerned, the Bill should be supported by all concerned Australians who feel that the ACTU superannuation push is nothing more than a blatant attempt to by-pass the parliamentary process in securing wage rises for the ACTU membership. It is as simple as that. The ACTU is saying to this Government and to the whole of the Federal Parliament: `We do not need you; we are more powerful than you. What the ACTU wants, the ACTU will get, whether you like it or not'. The whole issue of this productivity push is, as far as I am concerned, the last straw. Just how long do Australians have to put up with the bully boy tactics of the unions in this country? When will the Government realise that it has an obligation to say to Mr Simon Crean and the rest of the union cronies that they have gone too far? Queenslanders are fed up. In Queensland we are used to seeing courage and determination in our leadership. We are not used to the weakness being displayed at the helm of this Labor Government, especially at this time, when the country needs leadership. Unfortunately, I fear that our Prime Minister (Mr Hawke) has begun to believe his own publicity machine-that is, that he is everybody's good mate and a great arbiter. Actions speak louder than words, and speak louder than advertising campaigns. As far as Australians are concerned, the Prime Minister does not do enough of the right sort of acting. The great superannuation debate is a complex one. It is not simply a matter of posing the notion because it is being advanced by the ACTU. This question goes beyond party political bias. Australia could be catapulted into a major economic recession if this superannuation push is successful. The Confederation of Australian Industry has forecast that the payment of a 3 per cent productivity based increase, paid as superannuation-it is quite possible that it will be more than 3 per cent because the unions are on record as saying that that is their portion and that the employers have to put in another 3 per cent or even more-would turn the mild slow-down which we are presently experiencing in economic activity into a real recession. Another major employer group, the Business Council of Australia, has suggested that business profits are not adequate to cover this pay increase. Mr Bryan Noakes, the Director-General of the CAI, has been quoted in the Australian as saying that it was difficult to believe that the Government was treating the nation's economic problems seriously when it was supporting the unions' productivity claim. He said: The granting of the superannuation payment will make the coming downturn more prolonged and far deeper than it would otherwise have been. The unemployment rate in this country grew from 7.8 per cent to 8 per cent in February. Our balance of payments deficit jumped to $1.33 billion. Similar Australian Bureau of Statistics information has revealed a downturn in manufactured output during the December quarter, and continuing declines in housing approvals and savings banks deposits. We heard quite a deal about the housing industry in a previous debate. If these ACTU attempts to use productivity as the basis for yet another cost increase on industry are successful we can be sure that the consequences will be borne, not just by employers, but by everyone in the form of higher prices, interest rates and unemployment. I am not opposed to the concept of superannuation where individuals put in their share and the employers add theirs. I agree that individuals should make provision for their future-a future, I might add, which should be independent of government support. To this end I agree with the individual's pursuit of a superannuation scheme, whether that scheme be a company or a private one. After all, it is the individual's money. In the long term this can result only in healthy competition between various superannuation schemes. If the ACTU superannuation push is successful, we will see something like $1 of every $11 that the employer puts into the scheme going to the union coffers as administrative costs. Supposing that this is an accurate figure, we would see about $3 billion annually finding its way into strike funds and into the Australian Labor Party. I find it hard to imagine what sort of havoc the unions would wreak if they had $3 billion a year to play around with. If it were not so dangerously serious it could almost be a joke, but I am not laughing and there are millions of earnest, hard working Australians out there who also are not laughing. We are deadly serious and very worried. In the words of the editorial of the Australian of yesterday, 7 May, is it in the interests of Australia to have giant union superannuation funds which could have even an indirect influence on the investment decisions of the institution managing a fund for a union? I think not. We simply must not allow this deal to go through. The unions have far too much power in this country as it is. I urge concerned fellow senators to support this private member's Bill and to ensure that this country is not put in jeopardy by the selfish actions of the unions hierarchy, which wants nothing more than to bring this country to economic disaster by stealth and by force. We who have the power to do something about this today must join together and act responsibly for the sake of millions of Australians who want no part of it. I support Senator Boswell's Bill and commend it to the Senate. Senator PUPLICK(New South Wales)(5.20) -I rise to speak on the Conciliation and Arbitration (Amendment) Bill 1986 introduced by Senator Boswell, which gives honourable senators an opportunity to bring to the notice of the Parliament the considerable disquiet which is felt not only by Opposition senators, but also widely throughout the community at the proposed productivity award, in terms of superannuation, which is now before the Australian Conciliation and Arbitration Commission. Without going into the complexities of whether in fact the Commission has the power to deal with the provision of superannuation for the Australian work force, whether in fact it is being threatened or cajoled into dealing with a subject which the courts have previously held was not with its general purview and is seeking to get around those court decisions by some sleight of hand whereby superannuation replaces wage increases, is a debate of considerable importance but is not the central issue to be addressed in dealing with this particular piece of legislation. I do want, however, to start with some remarks about the case currently scheduled to go before the Commission. The proposals currently before the Commission have been analysed in detail by the firm Morrow Australia Pty Ltd which I think is generally recognised as the most outstanding private consultancy firm in this area. That firm has identified five particular concerns about the case currently proposed to be heard. Those concerns are as follows: First, that the choice as to whether any productivity award is to be directed towards an employer, union or industry fund be on the basis of an individual election by each employee rather than the so-called consensus view of any group of employees as reflected through a decision by their union. In other words, employees should have truly individual freedom of choice. I do not believe anybody would dissent from that particular point of view. Certainly nobody on this side of the chamber would dissent from that point of view. Secondly, that other than in the case of death or serious ill health, any benefits preserved as a result of any productivity award should be unavailable to the individual until the statutory retirement age. That is again a significant matter to which I wish to return later. Thirdly, that provision be made for at least some existing superannuation benefits, which have to date been provided outside the industrial negotiation process, to be offset against any productivity award Fourthly, that the trusteeship requirements for approved funds be such as to ensure that there is not an undue concentration of power in any one individual or group of interests. Again, that is a matter to which I wish to return later. Finally, that the Commission ought to make it clear to all parties that, if superannuation is to be brought into the conciliation and arbitration scheme, it must be accepted that any industrial action in support of superannuation benefits beyond those required to be provided under any productivity award ought to be regarded as a breach of the accord or any other agreement entered into, and ought to be dealt with accordingly. Even those who have some sympathy for the case which is currently before the Commission recognise that that particular case is already substantially flawed. However, there are issues which are of far greater moment and which go to the whole question of the way in which superannuation ought to be looked at and dealt with in Australia. I believe that the provision of superannuation for employees in Australia is a desirable objective but it ought to be based fundamentally upon the question of the free and independent choice of the individuals concerned. One has to be aware, for instance, of the enormous rise in expenditure which is taking place within the welfare system in Australia. If one looks, for instance, at the annual report 1984-85 of the Department of Social Security and one simply turns to the question of the number of persons in receipt of the age pension, in 1966 there were some 636,984 persons in receipt of payments of $442m. By 1985-only just under two decades later-the number of persons in receipt of the age pension was 1,331,782 at a cost of $5,638m. Quite clearly the welfare system in Australia cannot go on providing unlimited amounts of money for the payment of pensions and other benefits. It is, therefore, axiomatic that at some stage a major shift in the way in which we provide for our retirement and security must take place towards superannuation. I put to honourable senators that that must be done only within the context of a completely voluntary arrangement entered into by individuals themselves. We are already facing an additional pressure on all of this by the enormous changes which are taking place in work patterns in Australia and the decisions progressively being made, including by tribunals in New South Wales, for a balancing of the retirement age. People are being allowed, indeed encouraged, to retire at earlier ages and there is a considerable amount of debate as to whether the retirement age for both males and females should be brought into line. The Senate will shortly be debating a piece of legislation to amend the Sex Discrimination Act. I do not want to anticipate debate on that matter other than to say that that legislation provides inter alia for a reduction to the age of 60 of the eligibility of males to receive certain welfare benefits, including those provided in terms of aged persons accommodation and delivered meal subsidy arrangements. In other words, the Parliament is shortly to be confronted with legislation bringing down the age of eligibility of males to 60 in order not to provide a situation of discrimination between the way in which males and females are dealt with in terms of welfare payments and welfare matters. I come back, however, to the point that I believe is essential to the debate, and that is freedom of choice for individuals and resistance to the encroaching power of the trade union movement. I say firstly that in terms of dealing with the position of the unions it is interesting to quote what the unions have said about the use of superannuation. In an article by Max Ogden, education officer with the then Amalgamated Metal Workers and Shipwrights Union, in its monthly journal of May 1979, this was said: Whatever the figures, it is now clear that superannuation funds which are workers' money,-- I interpolate there to say that it is not exclusively the workers' money, there is a great deal of the employers' money involved there too-- make up such a considerable proportion of investment funds now, that control of these would be tantamount to either complete control, or certainly a major influence in directing the economy. He goes on: I suggest that democratic control-- again I interpolate to say that to hear the word `democratic' used by an officer of the then Amalgamated Metal Workers and Shipwrights Union must be one of the most gross perversions of the English language that anybody could possibly imagine-- of pension funds should mean not necessarily that the money is used for the purpose of the highest interest rate, but that it should be seen in a much broader social context . . . In other words, being told by the unions that they would use the money not as they ought in order to get maximum return on the investment funds of their members and contributors, but rather to be used for what the then AMWSU regarded as social purposes, clearly indicates that it is not the preservation and promotion of the rights of the individual workers that is at stake in terms of many of these union officials, but rather a back door method by which they can increase their control of the Australian economy. Today, of all days, in the Australian Financial Review, appeared an article by Gerard Noonan under the heading `Super funds will begin to control markets, says study'. I quote from that article: A superannuation study commissioned by the Metal Trades Industry Association has suggested that 50 per cent of the Australian stock market will be controlled by superannuation fund managers by the year 2000, tripling the current level of involvement. This is a study commissioned from Noble Lowndes, one of Australia's most distinguished firms of consulting actuaries. The articles goes on: Noble Lowndes raised a series of doubts about the economic effects of what it termed `this proposed measure for compulsory saving',-- that is the case currently before the Commission-- arguing that no proper economic survey had been undertaken. Nevertheless, it estimated that a 3 per cent contribution level would add conservatively $3 billion to total present funds of $35 billion. It suggested that where funds now held some $17 billion worth of stocks (about 17 per cent of total market capitalisation) by 1991 they would hold $36 billion (31 per cent) and by the year 2001 $79 billion (52 per cent). That is, 52 per cent of the total market capitalisation of the Australian economy would be in the hands of superannuation funds. Under the scheme of arrangement which the Government favours those funds will be brought progressively under the control of a limited number of trade union heavyweights. We have had debates in this Parliament about the Commonwealth Employees Superannuation Fund and about the structure of the board that was to be responsible for dealing with its superannuation. With the assistance of the Australian Democrats we amended that legislation to ensure that control was not vested in the hands of a narrow sectional group within the trade union movement which did not accurately reflect the contributors to that fund. That was a matter of debate here some months ago. When one considers what is being advanced under the aegis of the Australian Conciliation and Arbitration Commission one can see that unless some sort of discipline such as that proposed in Senator Boswell's legislation is imposed we will allow ourselves to become hostages to fortune as far as this is concerned. Instead of people being able to choose their superannuation arrangements freely we will find the unions in control of the superannuation funds, and through the superannuation funds, in a commanding position in our free economy and our free market. As I have already said, the union leaders clearly indicated years ago that they sought that, not for the purposes of advancing their members' interests in a financial sense or for protecting them in their retirement but to use the financial power to make the sorts of social and political changes to which unions such as the Amalgamated Metal Workers Union are committed. There should not be doubt in anybody's mind that the Liberal and National parties are committed to developing rational, responsible and available superannuation schemes throughout Australia. Our shadow Minister for Finance, Senator Messner, when he was the shadow Minister for Community Services, gave an address on 15 August 1985 to a luncheon meeting of the Association of Superannuation Funds of Australia. I will cite two of the points he made. First, he noted that there had been a substantial increase in the percentage of the work force covered by superannuation schemes-from 28.7 per cent in 1974 to 45.5 per cent in 1983. He said that that `must, in the view of the Liberal and National parties be continued'. We all support that. Senator Messner concluded his address in these words: Let me draw together the strands of my argument and outline several general criteria for a cost effective system of retirement income. The time has come when the facts need to be addressed: that costs cutting in retirement income can only flow from decisions which take a long run perspective and which promote self-provision; that those who argue for restraint in social welfare expenditure should recognise that, in the long run, only the promotion of independence through integration of the tax and social security system can achieve this; and that short-term savings in expenditure on other categories of income support can only be made by examining eligibility to ensure assistance is being effectively directed to those in need. These matters are the real politic which the Liberal and National Parties are facing. They represent the fundamentals of our policy review and development. That is a very accurate statement of exactly what we as the Opposition parties are seeking to bring into the superannuation debate. It is really quite simple to put this down in a number of very precise and clear points. First, as the Opposition parties we are committed to the expansion of the use of superannuation, not only because we believe it to be in the best interests of individuals to be covered by superannuation but also because we believe that we cannot afford the burgeoning welfare bill which is the only alternative. Secondly, the key element in the expansion of the superannuation system must lie in the element of free choice and not be part of some coercive attempt, whether made directly by the unions in the way in which Senator Parer outlined or whether it be through the aegis of the Conciliation and Arbitration Commission. The principle of free choice must be maintained. Thirdly, we are opposed to the unions being put into a position from which, by using some of their members' money but also the substantial contributions provided by employers, governments or whatever, they are allowed to take control of a substantial part of the Australian economy and turn it not to the advantage of their members but to the promotion and advancement of their social and political aims. On that basis Senator Boswell has put legislation before the Parliament to draw attention to these matters. The Liberal and National parties believe that superannuation is being grossly mishandled at the moment by the Government. It is again an example of the extent to which the Government is prepared to kowtow to the trade union movement in a quite outrageous and unjustified fashion. The issues before the Parliament are most important and are ones which the Liberal and National parties take very seriously. Debate (on motion by Senator Archer) adjourned. Motion (by Senator Gietzelt) agreed to: That Government Business take precedence of General Business for the remainder of this day. Debate resumed. Senator MacGIBBON(Queensland)(5.38) —Before the adjournment of the debate earlier in the day I had been talking about the nuclear generation of power and the peaceful uses of nuclear energy on the world scene. I made the observation that there are well over 200 nuclear power generators in the world. In fact, the figure is in excess of 300. The nuclear generation of power is a fact of life and will be an important supplemental source of power into the forseeable future-until such time as nuclear power generation turns to nuclear fission. That is at least 30 years away, and probably 50 years away. I made a personal observation that I regret that we have no nuclear power houses in Australia because we have been in the nuclear age for 40 years and we have no development of nuclear engineering design capability as a consequence of not having that source of power. I hasten to add that I recognise clearly that this is not an economic proposition in Australia. It would cost us a great deal to build a nuclear power-house, as we have a cheap source of coal. I believe that the educational benefits to the scientific and academic world are such that it would be worth a subsidy of hundreds of millions of dollars a year. Nuclear power houses use uranium, of course. I was about to consider the supply of uranium from Australian sources to the world market. I observed that under the Australian Labor Party, Ranger and Roxby Downs are the only two sites at which it is allowed to be mined. I should have added Nabarlek, the Queensland Mines Ltd operation, which I have visited several times. Australia's potential is massive for the mining of low cost, high grade and readily accessible uranium ore. We have at least 30 per cent of the world's known reasonably assured sources of uranium. Australia is a stable country politically and, as a signatory to the Treaty on the Non-Proliferation of Nuclear Weapons, monitors very carefully the safeguards of those people to whom we supply uranium. In March 1984 the Australian Science and Technology Council reported on the nuclear cycle in Australia and it made some observations on the world consumption of uranium. The ASTEC report concluded: . . . the present free world consumption of 34,000 tonnes of uranium will increase to 50,000 tonnes by 1990 and possibly 65,000 tonnes by 2000. The report added: . . . there will be a requirement for between 130,000 and 170,000 tonnes of uranium in the period 1984 to 1986 for which no contracts have as yet been signed. In addition, the existing contracts may not all be firm and there may be opportunities for some utilities to substitute lower cost supplies if these become available. Australian uranium would fall into this category. Further on, at paragraph 4.3.32, the report stated: The market provides opportunities for Australian uranium producers to gain additional contracts and to increase exports beyond present levels. If Australia were to secure one third of the uncommitted share of the market, a reasonable assumption on the evidence available, that would lead to a doubling of the amount contracted for delivery between 1984 and 1996. Most of the new exports would occur in the 1990s. In recent years, uranium has become a major export item for Australia, with sales comparable in value to some other important mineral and agricultural products. The annual value of urannium exports increased from $70 million in 1978 to over $360 million in 1982. If sales were to increase in future to the extent suggested in the preceding paragraph, and if the price of uranium were to remain at $A77 per kilogram for uranium oxide (a reasonable expectation of long term contracts, which generally fluctuate less than the spot price), the annual value of Australian uranium exports would rise to over $1000 million by 1993. The total value of exports in the decade 1984 to 1993 could exceed $6000 million. For a country which is starved of export earnings and which has the biggest debt position it has ever had-a third of our overseas earnings are needed to pay interest on Federal borrowings alone-that is a very important consideration that we cannot afford to be negligent about. Australia's involvement in the nuclear cycle is restricted at the moment; it is restricted to the mining and milling of uranium. We operate a very old research reactor. We have had research into Synroc and the waste disposal cycle. We have had some very limited research into the enrichment of uranium and we transport radioactive material and handle low and medium waste. The next stage in the uranium cycle is the enrichment process. Enrichment has very great economic benefits for Australia because the price of enriched uranium is many times that of the raw uranium oxide-the yellowcake that we sell. Up until the present time, uranium enrichment has been done by either a gaseous diffusion technique or a centrifuge technique. Both of those techniques require huge capital investments. They require very big factories and big capital expenditure to set them up and they use a very great amount of electricity. The output of one big electrical generating station is needed to supply one factory. The process involves increasing the natural percentage of uranium 235 in yellowcake by 0.7 of a percentage point. The enrichment process takes it to between 3 and 4 per cent so that it is a fuel for nuclear power stations. There is often a misconception between the production of fuel for nuclear power stations and weapons grade nuclear fuel. The difference is enormous. The difference is that the power-house requires fuel of a concentration of 3 to 4 per cent of uranium 235, whereas the nuclear fuel, the weapons grade national, is around 90 per cent. Senator Sanders —Lucas Heights has 80 per cent enriched uranium. Senator MacGIBBON —It is simply misleading for the emptyheads in the Australian Democrats and other fools in the community to suggest that we can take a power-house generating electrical power and use that to develop nuclear weapons. It is uneconomic and it is not done at all. The technologies that are used, the gaseous diffusion technique and the centrifuge technique are both very capital intensive. For quite a few years now research has been going on on laser enrichment techniques and this can successfully be done in a laboratory. The great advantage of the laser enrichment technique is that it can be made in very small units. The size of the pro-cessing facility can be increased in increments as required from it at a relatively low capital cost. The other great advantage of it is that it is very moderate in its demands for electrical power. So the cost of making this fuel for nuclear reactors is very modest compared with the gaseous diffusion or the centrifuge techniques. The Liberal Party of Australia and the National Party of Australia would like to see research taking place in Australia on the laser enrichment techniques so that we could process our yellowcake, which we are selling overseas, to a stage suitable for use in nuclear generating stations. The next point I want to talk about is the Nuclear Non-Proliferation Treaty because there seems to be a great deal of ignorance as to Australia's involvement in it. The Nuclear Non-Proliferation Treaty has been one of the most successful international agreements of the nuclear age. It is designed to prevent the spread of nuclear weapons around the world. Its articles provide: Article I: Nuclear weapon States undertake not to transfer nuclear weapons to the control of another country or to assist a non-nuclear weapon State to acquire them. Article II: Non-nuclear weapon States undertake not to manufacture or otherwise acquire nuclear weapons or nuclear explosive devices. Article III: Non-nuclear weapon States agree to accept IAEA safeguards on all nuclear activities in their territories for the purpose of verifying the terms of Article II. Each member country to require IAEA safeguards on exports of nuclear items to non-nuclear weapon States which are not a party to the NPT. Article IV- Australia does not observe this Article- This affirms the rights of all countries to use nuclear energy for peaceful purposes and requires countries in a position to do so to contribute to the development of nuclear energy in member countries. Article V: Each party undertakes to ensure that potential benefits from peaceful applications of nuclear explosions will be made to non-nuclear weapon member States on a non-discriminatory basis and the charge shall be as low as possible and to exclude research costs. Article VI: All parties to the Treaty undertake to work for a cessation of the nuclear arms race, for nuclear disarmament and ultimately for general and complete disarmament. Australia is one of the original signatories of that Treaty, along with 122 other countries. We support the Nuclear Non-Proliferation Treaty. Both this Government and the preceding Government have honoured that Treaty to the letter of the law. Some of the questions that have been raised in this place in the last couple of weeks about the end point of Australian uranium are utterly without foundation. Neither this Government nor the previous Government has had the slightest difficulty in establishing the end-use of our uranium. The three Bills before us-the Australian Nuclear Science and Technology Organisation Bill, the Australian Nuclear Science and Technology Organisation (Transitional Provisions) Bill and the Atomic Energy Amendment Bill-repeal the outmoded provisions of the Atomic Energy Act 1953 and replace the Australian Atomic Energy Commission with a new organisation to be known as the Australian Nuclear Science and Technology Organisation. I would like to pay tribute to the Australian Atomic Energy Commission. I do not think it has had a fair run in recent years. It has been short of the funding it needed but it has had very dedicated staff working for it-it has had very competent professionals on its staff. I think they have done a marvellous job for Australia with the very limited resources that have been devoted to them and they have been exposed to some very unfair and unjust criticisms at times throughout their career. What they have done in the field of nuclear physics and in the biological field has been of enormous service to the Australian public and the Australian health professions. If we did not have Lucas Heights today to provide some of the short life radio isotopes for the treatment of many medical conditions many more people would be suffering in Australia. On that ground alone the work they have done in the medical field more than justifies their cost. The Atomic Energy Amendment Bill will repeal most of the Act because it is out of date. It was set up in the early 1950s when defence implications were involved. The Bill will abolish the Australian Atomic Energy Commission. It is no longer envisaged that the AAEC will be involved in power generation. Its research and development functions will be carried on under ANSTO. The existing provisions for the control of uranium mining were set up with an emphasis on defence implications. They are no longer considered necessary and are to be repealed. Since ANSTO does not need this power, the power will not be in the Acts. The new legislation will restrict Commonwealth powers to matters of international and interstate trade and commerce and prescribe substances in connection with a range of projects or in relation to a territory not related to defence. All external obligations under the International Atomic Energy Agency and other international agreements will be repealed; such obligations will be transferred to the Australian Safeguards Office. The Australian Safeguards Office is to receive legislative backing through the proposed nuclear non-proliferation safeguards Bill which will come before the Parliament soon. The second Bill-the ANSTO Bill-creates a new authority to replace the Australian Atomic Energy Commission. The functions of the new organisation are described in very broad terms but essentially ANSTO will be restricted to nuclear science and technology research and development. As I said in my introduction, the Opposition will support these Bills. We regret that the policies of the Australian Labor Party are such that Australia will not be able to fulfil the role it should in the world, of being able to influence the nuclear fuel cycles and the nuclear generation of power by being actively involved in research and development in these most important fields. The more development we put into this field the more authority we will have in the international councils of the world for the safeguards of humanity which were so important to us when the Fraser Government signed the Nuclear Non-Proliferation Treaty. Senator CROWLEY(South Australia)(5.53) —I rise to make some comments on the Australian Nuclear Science and Technology Organisation Bill 1985, the Australian Nuclear Science and Technology Organisation (Transitional Provisions) Bill 1985 and the Atomic Energy Amendment Bill 1985. I do not wish to elaborate extensively on them but there are some points that I would certainly like to draw to the Senate's attention. In the last 12 months I took the opportunity of visiting Lucas Heights. I am pleased to join Senator MacGibbon in acknowledging the contribution of the Australian Atomic Energy Commission to Australia and to the whole scientific and research area. In particular I place on record my appreciation of the hospitality that the Atomic Energy Commission afforded me and one of my staff members that afternoon. Further I thank Dr Max Brennan, who is not only a colleague but also a friend. I will come back to some of the things that I discovered on my visit to Lucas Heights that are addressed in the aims and objectives of the legislation and its new provisions. As Senator MacGibbon has spelt out, the Government has decided to introduce three Bills, although Senator MacGibbon referred to only two. The third Bill relates merely to transitional provisions in the changeover from the Australian Atomic Energy Commission to the new Australian Nuclear Science and Technology Organisation. That is more an organisational or administrative piece of legislation. The substantive Bills replace the Atomic Energy Commission with the new Organisation and, importantly, repeal the outmoded and offensive provisions of the Atomic Energy Act 1953. The intention of these new Bills is to reflect the Government's policy on nuclear activities; that is, the Organisation will emphasise the research and development of peaceful applications of radio isotopes and radiation and it will concentrate on research and development under both of these headings. It will particularly look at all nuclear science and technology research and development that is in line with the Government's policy. It will look at the production and use of radio isotopes and radiation for medicine, science, industry, commerce and agriculture. Perhaps some time in the future that list will be added to as our research and development discovers new ways of peacefully using radioactivity and radio isotopes. As the Australian Nuclear Science and Technology Organisation Bill states, the new Organisation will have a seven-member executive, the majority of members coming from outside ANSTO. The Organisation will be further assisted by an advisory council of up to 11 members. Again the majority of those members will come from outside ANSTO so as to provide independent advice to the Executive of the Organisation and to the Minister for Resources and Energy. The Bill also establishes a Nuclear Safety Bureau which will be responsible directly to the Minister for the monitoring of the safety of the two reactors at Lucas Heights. Currently the Safety Review Committee reports to the Atomic Energy Commission. The Minister for Resources and Energy (Senator Gareth Evans) in his second reading speech stated that it is very likely that the Safety Review Committee, which reviews independently health and safety matters of significance to staff and the public, will be re-established under ANSTO as the Nuclear Safety Bureau. It is significant that it will report to the Minister on the matters I mentioned. Further, the Joint Consultative Committee, which provides for consultation between management and staff, will also be given legislative recognition and this is entirely consistent with the Government's industrial democracy objectives. The changes both to the aims of this new Organisation and to the structure of the Executive in council go towards ensuring that ANSTO carries out its functions with an emphasis on the needs of Australian industry in as commercial a way as possible. The expectation is that the Government, in encouraging the commercial development of the research and discoveries at ANSTO, could go some way to recouping the cost of some of the outlays required by this Organisation. Although we might aim to develop along the lines of the United Kingdom Atomic Energy Authority's Research Establishment at Harwell, the Government-Senator Gareth Evans noted this in his second reading speech-does not presume that what happens in Australia would reach anything like the same dimensions in significant part because in the United Kingdom there is a much larger industrial base for activities in this area. However, in retaining the commercial revenue it will be possible to develop under this legislation, the prospects for Australia's commercial and industrial development will be furthered. Senator MacGibbon emphasised the second Bill, which repeals the offensive and outmoded provisions of the Atomic Energy Act 1953. That Act was established at a time when Australia was very aware, if not a part, of a world which appreciated a Cold War mentality and many of the sections under that legislation were very serious, particularly the penalties sections. They applied to restrictions on information that people could pass. There were enormous penalties for people who were found guilty of offences under that Act. The world has changed and, more importantly, the emphasis of change in this new legislation moves away from that approach to the development and research that may be happening at Lucas Heights. Therefore, the Government is pleased to seek a repeal of those very offensive provisions. I seek leave to continue my remarks later. Leave granted; debate adjourned. Senator AULICH(Tasmania) —Pursuant to order, I present the report of the Joint Select Committee on an Australia Card, together with a transcript of evidence and written replies to questions asked during the Committee's examination of departmental witnesses. Ordered that the report be printed. Senator AULICH(Tasmania)(6.01) —by leave-I move: That the Senate take note of the report. In doing so I wish to make some consequential remarks as Chairman of that Committee. By a resolution of the House of Representatives and the Senate, a Joint Select Committee of eight members representing each of the four main political parties was established on 29 November 1985 to examine the Government's proposal for an Australia Card to combat tax evasion, social security fraud and illegal immigration. The Committee fulfilled this task within what has been a very tight time schedule. We have held public hearings in every State and have taken 5,000 pages of oral and written evidence. We have heard 168 witnesses and held 18 public hearings. The Committee believes it has served an important function in encouraging a systematic and widespread debate about the related issues of privacy, civil liberties, prevention of tax and social welfare fraud and the question of illegal immigration. In addressing those issues, the Committee was able to come to a series of unanimous recommendations which we believe will be of value to the Government and Parliament and the Australian community at large. These recommendations are contained in chapter 2 of the report. For the interest of members and senators it is worth briefly listing these areas of agreed concern. I refer to the computerisation of births, deaths and marriages registers; the introduction of a data protection agency; the introduction of privacy legislation; the implementation of the banking controls recommended by the Costigan Royal Commission on the Activities of the Federated Ship Painters and Dockers Union; the implementation of the House of Representatives Standing Committee on Expenditure recommendations on illegal immigrants; the transfer of responsibility for payments under education assistance schemes from the Department of Education to the Department of Social Security; and administrative reforms within the Department of Social Security relating to proof of identity procedures. However, when the major issue of whether or not there should be an Australia Card was addressed, the Committee split in a five-three decision. A majority of the Committee, Senators Puplick and Haines, and Messrs Porter, Blunt and Saunderson, favoured an upgraded tax file number system in preference to the Government's Australia Card proposal. The proposed high integrity tax file number would be used in a wide range of financial transactions and in the reporting of information to the Australian Taxation Office. The majority viewpoint left open the question of whether or not a card should be issued with the tax file number. A minority-myself, Mr Brown and Mr Brumby-supported a modified version of the Australia Card proposal. The main modifications of the minority report were recommendations supporting the inclusion of a photograph on the card and limitation of its use to four departments: The Australian Taxation Office, the Department of Social Security, the Health Insurance Commission and, on a more limited basis, the Department of Immigration and Ethnic Affairs. Thus, the report contains unanimous recommendations, a majority viewpoint, a minority dissenting viewpoint and a personal addendum by Senator Puplick. I wish at this stage to express the Committee's gratitude for the dedicated work of the Committee secretariat. Tim Dodson, Judy Ryan, Brett Levy and Janice Paull must be mentioned individually, but there are many other members of the Senate committee office who offered their ready assistance and without whose help this report would not be tabled today. As a member of the group which brought down a minority report, I wish to point out a number of issues which were at the heart of the reasons why we as a minority group were prepared not to accept the major recommendations of this report relating to the implementation of an Australia Card proposal. First, we need to get back to the basics-that is, whether we have an identity system to combat tax evasion, social security fraud, illegal immigration and other problems relating to the use of false identities within the community. We believe that the proposal put forward by the majority of the Committee in favour of an upgraded tax file number system has a number of major flaws. Those flaws relate to the fact that they have given the Department of Social Security and in particular the Australian Taxation Office the responsibility to run the system. We believe that the Australian Taxation Office is not equipped or presently capable of gearing itself up to handle the immense task of organising this upgraded tax file number system. There are a number of issues I shall want to talk about at a later date, but most of the major flaws relate to what one does with those people who currently hold a tax file number and how they will be brought into the system as proposed by the Committee. The Australia Card proposal, on the other hand, as advanced by the Government and supported for the most part by the minority group on the Committee, encompasses a number of positives that I shall mention in the next three or four minutes. Basically, we are prepared to put, in opposition to the majority viewpoint that the Taxation Office should run the system, the proposition that the Health Insurance Commission is the most appropriate body to handle the identity system, and that the Health Insurance Commission's experience in this area will be invaluable and has not been taken seriously enough by the majority viewpoint on the Committee. It has had experience in bringing in what is basically a universal identity system, coupled with benefits, in the implementation of Medicare. That experience has been of immense value. It has made mistakes here and there from time to time; it is aware of those mistakes, as indicated in the evidence given to the Committee; and we believe that the people in the Commission would be experienced enough to move into a totally new system such as this without the sorts of problems that are inherent in giving the Australian Taxation Office the responsibility-a department which we all know has no experience in this matter and which, we believe, would be incapable of involving itself in the setting up of a national identification system. The major problem we feel that would occur with the Australian Taxation Office having control of this operation, in conjunction with the Department of Social Security, is the qualification written into the majority viewpoint that all taxpayers who have a tax file number, or have had a tax file number for five years or more, would automatically be allowed into the system without any major check of their security, their integrity, and without the validity of their identity being checked. In other words, we believe that as that system has been set up it will contain a fatal flaw which revolves around the fact that there would be a significant number of false identities, false tax file numbers currently in the system which would be allowed to go into the new system. At the heart of any proposal to have a proper identification system, whether to combat tax evasion, social security fraud or whatever, is the need for everyone in the community to feel confident that at all times, and as much as is possible, the identity claimed by people, whether claiming benefits or involving themselves in banking transactions, should under no circumstances be capable of being questioned. We believe that the tax file number system has that flaw of a dearth of proper integrity arrangements, to use the term that went through the Committee on a number of occasions. I was personally disappointed, as I think were other members of the minority group, that we moved to unanimous support for a number of major recommendations. At the same time, when it got down to the major question of whether or not there should be a national identification system, there appeared to be a caucusing which at times pulled people back from accepting the logical conclusions one would come to, having judged all the evidence. I indicated the problem about tax file numbers, which currently lack integrity and which would simply be allowed to go into the system proposed by the majority Committee. The revenue implications are another matter of extreme importance. Obviously, there is no point in a government going into this type of operation, whether it is a tax file number system or an Australia Card system, unless it is sure that the expenditure it is involved in will be less than the revenue which is to be returned from the implementation of the system. We consider the evidence given to us by the Australian Taxation Office to be extremely conservative in terms of revenue implications of an Australia Card proposal. The Taxation Office admitted that in evidence. When we considered some of the techniques for the investigation of forgone revenue we were assured that the Australian Taxation Office had not, for example, taken into account a number of areas of extra revenue, such as the penalties for people who had evaded tax and the back payment of tax that was rightly due but had not been picked up under the current system. Those are just two of the areas where the current arrangement is inappropriate and where we think the Taxation Office was extremely conservative. It is our view as a minority group that $8 billion over 10 years would be the real revenue, or the likely revenue, to be gained from the implementation of a full Australia Card with photograph. I stress that the minority group clearly came down in favour of a photograph being attached to any Australia Card brought into use. We believe that without that photograph the whole question of identity verification would go back into the melting pot. In practical terms, I guess, it is fair to say that that $8 billion would work out roughly to $8 in each taxpayer's pocket every payday. That is a very crude rule of thumb but it is sustainable, given the evidence that came before us. There is one other major area about which all Committee members were concerned. Under no circumstances do I question the integrity of the people who raised these issues. I believe that the whole community has to be aware of them. I refer to the question of the invasion of privacy and matters relating to civil liberties in this country. As we considered the evidence which came before us, as we questioned banks and government departments, as we sought information from commissioners such as Mr Costigan, as we read reports such as the Stewart report, on the whole we were of the view that there is already significant concern about invasions of privacy in our community and that any proposal which was put forward by the Government or the Committee, whether it be the majority or minority, would have to address the whole question of privacy and civil liberties in a very direct way. In common with the majority of members of the Committee, we believe that the data protection agency concept advanced by the Government, the appropriate privacy legislation and the logging of people who have access to any file system so that a record is kept of who has been at one's file and for what purpose they have been at one's file, are protective measures which will, at the end of the day, give us as a community much greater protection of our privacy and civil liberties than would have been the case if nothing had been done and would be preferable to what we have now. I mention, for example, a point that was raised by the banks. People who believe that they can walk into a bank, apply for a loan, give information in seeking that loan to the bank and think that information will remain discreet and within the bank might be under a misapprehension. One major banker who appeared before us indicated quite clearly that, as a matter of course, without telling the loan applicant the bank checks with other banks that all information contained in the loan application is correct. That is an example of the sort of ad hoc invasion of privacy which is now occurring in the community. The unanimous view of the Committee in relation to the civil libertarian arguments and the protective devices that have to be built into the system ought to be taken up very seriously by the Parliament before we advance with any system, regardless of whether it is a tax file number system or the Australia Card proposal. I thank those officers who worked so hard on this report. They have been up night after night in the last week trying to put together the evidence and ensure that the debate that begins tonight is an appropriate public debate. To summarise in one paragraph-not a reportable one, of course-it is fair to say that the Government had the courage to bring before the Parliament a proposal which did not pretend to be anything other than a national identification system. We have seen examples in other countries of national identification systems coming in by the back door, whether they are in the guise of drivers licences, social security cards or whatever. This Government said: `We are bringing in a national identification system to combat that tax evasion, social welfare fraud, illegal immigration and other matters relating to the misuse of identities'. The Government ought to be commended for that. When we begin this debate on whether or not we have an Australia Card or the alternative, put by the majority of the Committee, it should be kept in mind that the debate so far has been open. I believe our Committee has helped a great deal towards opening up the debate and raising the issues. I commend the report to the House. Senator PUPLICK(New South Wales)(6.17) —The Government's Australia Card proposal has as many holes in it as Caesar's corpse and, like that body, I come to bury it, not to praise it. The report of the Joint Select Committee on an Australia Card concludes clearly and by majority decision that the Australia Card proposal should not be proceeded with. The majority of members who make this recommendation consist of myself and Mr Porter from the Liberal Party of Australia, Mr Blunt from the National Party of Australia, Senator Haines from the Australian Democrats, and Mr Saunderson from the Australian Labor Party, who represent all the major parties which are represented in this Parliament. We say in our majority report: Having considered the Government's proposal for a national identification system, as well as alternatives, such as the use of photographic cards and the extension of the use of the current tax file system, the majority of the Committee rejects all proposals for the issuing of identity cards with or without a photograph. The report, which runs to almost 300 pages, takes in in very considerable detail all the arguments which have been advanced for and against the proposal. They were all heard in open session over a prolonged period. It was very difficult for the Committee to report within its short time framework. I pay tribute to the Chairman of the Committee, Senator Aulich, for the way in which the Committee's proceedings were conducted. I pay a particular compliment to the staff of the Joint Select Committee, who worked under enormous pressure in completing the report and who responded to all the demands, reasonable and unreasonable, which were placed upon them by the members of the Committee and by the time constraints. It is unfortunate that in Senator Aulich's tabling statement he has seen fit to make a number of comments which I believe are not supportable by the facts. The first and most unfortunate comment is the implication, clearly directed against the integrity of members of the Committee, that for some reason, resulting from caucusing or pressure, they were not prepared to act in a way which, according to their consciences and as a matter of mature judgment, they thought was correct, that they were pressured to resile from what was supposed to be a reasonable point of view. That is a personal reflection. It is incorrect. Frankly, I resent it. Secondly, one ought to look clearly at a number of matters arising from the minority report. The minority report is written with a degree of personal animus and a degree of slur cast upon the intelligence and integrity of members of the majority. It says, for instance: We are surprised that the opponents of a national identification card system who sat on the Joint Select Committee did not pursue this matter further. This relates to evidence that in fact the Health Insurance Commission has already assigned numbers to every member of the community. It also states: We believe it is likely that they chose to ignore the existence of such a numbering system because widespread knowledge of its existence might serve to strengthen public acceptance of the Australia Card. That is not only untrue; it is also unfair and a reflection on the personal integrity of members of the Committee. It implies that they were not seeking the truth and not seeking to come to a fair, reasoned and rational decision. I say that in that sense the report of the minority stands condemned out of its own mouth. I give two examples. It is alleged that the benefit of the card proposal is to be some $8 billion over a 10-year period. That includes a figure of $1.2 billion, as is indicated at page 249 of the report dealing with the minority opinion, as the saving alleged by the Department of Immigration and Ethnic Affairs. However, at paragraph 1.53 of the body of the report, the unanimous part of the report, which deals with the evidence of the Department of Immigration and Ethnic Affairs, the Committee as a whole dismisses that evidence as next to worthless. It notes that Mr McKinnon, the Secretary of the Department, in describing to the Committee the basis upon which that calculation was made, said at one stage that the figures were presumed, at another stage that they were a rough estimate, at another stage that they were guesswork, at another stage that they were a guesstimate and, finally, that they had been arrived at using a crystal ball. Those words `presumed', `rough estimate', `guesswork', `guesstimate' and `crystal ball' are in fact the exact words used by the Secretary of the Department of Immigration and Ethnic Affairs to describe the quality of his evidence, which the Committee as a whole dismisses and which the minority report then seeks to resurrect and make part of its calculations. Finally, the minority report talks about the majority decision being `cobbled together' and attacks the majority opinion for failing to endorse the issue of a tax card, a matter which we neither endorsed nor rejected but in fact left open, if the truth be told. It states that the absence of such an examination is plainly evident in the failure of the majority to endorse the issuing of a tax card. Again, that is a reflection on the integrity and capability of the members in the majority. It is interesting to note that the minority relies very heavily on the evidence, for instance, of Professor Whalan. Paragraph 2.10 of the minority report states: Professor Whalan is a key figure in the debate. If one looks at Professor Whalan's evidence, which is to be found in particular on page 3825 of the transcript, one sees that Professor Whalan said: On balance-I emphasise `on balance'-I suggest that if we do have a card there is probably now no need for a photograph. But that piece of evidence from Professor Whalan is dismissed by the minority, who say that there must be a photograph, despite the fact that Professor Whalan is described as the key witness. Yet on this his advice is ignored. Looking further at Professor Whalan's evidence, he says that the reason that we ought to accept this is that we should not be like King Canute-that the revolution is coming, that we will all be turned into numbers in a system and therefore we should not resist it. His talk about King Canute can be found at page 3826 of the transcript. So, in terms of the evidence relied upon, the authority relied upon, the figures relied upon, the arguments relied upon and indeed the personal reflections against the majority relied upon by the minority report, it will become evident why the minority is the minority. I turn to matters addressed in what is the report of the Joint Select Committee on an Australia Card which recommends that we should reject the Government's proposals. We were asked to test this essentially on four criteria: First, whether the card proposal would be useful for cutting down taxation fraud; secondly, whether it would be useful for cutting down welfare fraud; thirdly, whether it would have any impact on the level of illegal immigration; and, fourthly, whether it would have any impact on organised crime and criminal behaviour. The Committee reaches the conclusion, after testing each of those proposals, that the Government's proposals as put forward fail. The Committee then goes on to examine each of those matters and to make recommendations that it believes will be more effective in dealing with these matters. It raises the issue of the use of the taxation file number for certain financial transactions. It makes recommendations about the procedures in the Department of Social Security. It makes recommendations about the Department of Immigration and Ethnic Affairs putting into effect the recommendations of the report of the House of Representatives Standing Committee on Expenditure entitled `Who Calls Australia Home?'. In terms of organised crime, the Committee advocates the introduction of a number of the measures originally recommended to the Government by Royal Commissioner Costigan. Therefore we have addressed in the Committee all of the critical tests. We have put forward recommendations which we believe will protect the revenue and help to combat fraud within departments such as the Department of Social Security and the Department of Immigration and Ethnic Affairs. Perhaps one of the useful things to come out of the hearings in relation to social security fraud was the clear evidence that the overwhelming majority of social security fraud takes place by the misstatement of the financial circumstances of the applicants and that only 0.6 per cent of the fraud relates to the establishment of false identity. It is not false identity that is the problem with social security fraud; it is that legitimate identities misstate, either deliberately or inadvertently, their level of income in order to make the assessment of what payment they are entitled to receive. The evidence from the Department of Immigration and Ethnic Affairs demonstrated a complete lack of control within the Department and a complete lack of statistical data available. The Department was pressed on three or four occasions to respond in detail to specific inquiries from the Committee. The responses were generally tardy. When they did arrive they were generally uninformative. The cost implications of the recommendation need to be looked at. In a personal addendum to the report I have sought to identify what I believe to be the deliberate failure of the Government to include costs which are important in establishing the cost-benefit analysis. For instance, the proposal by the Government includes no cost for the replacement of any computer equipment over a 10-year period. Anybody involved in the computer industry will know that that is nonsense. It understates the number of changes that will need to be made to the roll, taken against the experience and the evidence on address changes given to us by the Australian Electoral Commission. It gives no cost for the storing of material by the Australian Archives. It gives no cost for compliance by State and local government. It gives no cost for the compliance required by the private sector, estimated conservatively to be in the vicinity of $377m. It gives no cost for the burden that will be placed on the banking system. It gives no cost for the burden that will be placed on the banking system. It gives no attention to other matters that were raised by bodies such as the Law Council of Australia in its very strong opposition to the introduction of the proposal. I turn next to organised crime. It is interesting that of all the experts who came before us who were competent to deal with the issue of organised crime, in particular Mr Costigan and the senior counsel assisting his Royal Commission on the Activities of the Federated Ship Painters and Dockers Union, Mr Meagher, and the Australian Federal Police, all not only opposed the introduction of the Australia Card but also drew our attention to the overwhelming weight of evidence in the United States of America that the existence of a national identity system is positively beneficial to organised crime. We were told that studies by the United States Department of Justice, by the Comptroller-General of the United States, by the United States Senate in a number of its inquiries and by the commission which was established to look at the use of false identity cards in the United States, all clearly concluded that there was substantial benefit to organised crime-I repeat, benefit-in the introduction of a national identification system. Sitting suspended from 6.30 to 8 p.m. Senator PUPLICK —The next point I address in terms of the matters arising in relation to the Government's proposal for the Australia Card touches on the issue of protection of privacy. Here we have without doubt the most Alice in Wonderland proposal that has ever been put before the Parliament. The Government's proposal says: `Let us first introduce the Australia Card; let us secondly think about introducing a data protection agency; and let us thirdly think about introducing privacy legislation'. In other words, we do it this way: Instead of establishing privacy legislation, then having a body which can monitor privacy legislation and the threats to personal liberties and privacy and then introducing the Australia Card and seeing whether that stands the test of the legislation and the operation of the data protection agency which is proposed, like Alice in Wonderland we will approach this on the basis of the verdict first and then the trial. The Committee is at pains to point out that this is an absolute nonsense in terms of the way in which privacy ought to be protected in Australia and the Committee recommends that both privacy legislation and a data protection agency be put in place before the Australia Card proposal is introduced. The minority members, in their report at paragraph 1.3, have been at pains to indicate the sorts of people who have come before the Committee to support the introduction of the Australia Card. They list the following: The Returned Services League, the Australian Taxpayers Association, the Australian Retailers Association, the Australian Hotels Association, the Salvation Army and the Sydney City Mission. This is one of the more disingenuous parts of the minority report, because when one looks at their recommendations one will see that the latter three of those organisations-the Australian Hotels Association, the Salvation Army and the Sydney City Mission-would all be excluded by law from access to the use of the Australia Card under their proposals. The Australian Retailers Association made the point that it wanted the card because it would do something about the black economy, or cash economy, yet both the minority and the majority are at one in saying that the Australia Card proposal will do absolutely nothing to combat tax evasion through the cash economy. The Returned Services League came along and said that it thought there was really no reason why everybody should not carry an Australia Card because, after all, during the war everybody had to have a number and it was basically good for everybody to have a number. Undoubtedly there are some people who actually believe that to be the case. Most interesting is the Australian Taxpayers Association. Mr Risstrom was our first witness. I say with the greatest degree of objectivity that he was one of the least impressive witnesses the Committee was forced to listen to. The nature of his argument was tendentious and the claims he made were, frankly, racist in terms of describing the way in which a large number of Italians and others were ripping off the system by working in restaurants and not declaring their tax. The whole approach he brought to the Committee was entirely reprehensible. I note that yesterday Australia Associated Press reported that Mr Risstrom had put out a statement in which he said, basically: `It does not matter what the Joint Select Committee says, the Government will of course go ahead and introduce the card. After all, we cannot have the matter of tax cheating decided by a handful of people making decisions for political reasons'. Of course, it would never cross Mr Risstrom's mind that it was possible to do anything for political reasons. He was presumably referring to Senator Haines, who gave him a particularly rough trot at the Committee hearing, when he said that the Committee contained `emotional diehards who had voted against introducing the national identity card, including Australian Democrats' Deputy Leader, Senator Janine Haines'. I cannot speak for Senator Haines, but I am sure that she resents greatly being described as an emotional diehard. I should indicate that, while groups such as the Returned Services League, the Taxpayers Association, the Retailers Association and the Australian Hotels Association thought the card was a good idea, the overwhelming number of people who came before us thought that it was an appalling idea. For instance, the Victorian, New South Wales, Queensland, South Australian and Tasmanian Councils of Civil Liberties, the Law Institute of Victoria, the Queensland Law Society, the Law Council of Australia, the International Commission of Jurists, the New South Wales Privacy Committee, the Australian Computer Society at the national, South Australian and Western Australian branch levels, the Bar Association of Queensland, Professor Walker from the law faculty of the University of Queensland, Professor Barter from the computer faculty of the University of Adelaide, Professor Webster from the community medicine faculty of the University of New South Wales, Dr Emberson from the University of Western Australia, Mr Butler from the law faculty of the University of Queensland, Dr Walsh from the anthropology department of the Sydney University and Professor Johnson of the University of Wollongong all said that the card was an awful idea. The Anglican Diocese of Perth came before us to say that it was an awful idea; the Catholic Social Welfare Commission gave us a submission saying it was an awful idea; the Administrative and Clerical Officers Association, the Federated Clerks Union and the Victorian Teachers Union said it was awful; the Confederation of Australian Industry said it was awful; the South Australian Chamber of Commerce said it was awful-- Senator Sheil —Did anyone want it? Who wanted it? Senator PUPLICK —We will come to that in a moment. The Australian Labor Party was interesting on this matter. We had a formal submission from the National Legal Policy Committee of the Australian Labor Party telling us that it was against it. We received Senator Bolkus's worthy paper saying that he was against it. We received letters from a number of branches of the Australian Labor Party saying that they were against it. The National Conference of Labor Women passed a resolution saying that it was against it. Most of the divisions of the Liberal Party of Australia indicated that they were against it. Senator Sheil, speaking on behalf of the Queensland branch of the National Party of Australia, indicated that that organisation was against it. Yet all of that evidence can be tossed aside by the minority members in their determination to rescue what was left of the Government's proposal after the evidence was in. The question of incrementalism is interesting. When the Government first advanced this proposal at the National Taxation Summit, we were told that only seven Commonwealth departments would have access to this Australia Card and its register. By the time we got the final proposals from the Health Insurance Commission, one of the seven departments, namely, the Australian Electoral Office, had withdrawn; nevertheless, there were by then 13 departments which suddenly thought they needed access to the whole thing. That frightened even the minority members of the Committee, who in their report have whittled it back down to four departments. Nevertheless, I think we ought to be particularly conscious of the fact that this proposal, of which the Minister for Health (Dr Blewett) seems to be the principal advocate within the Government-- Senator Crowley —He is not alone. Senator PUPLICK —I understand indeed that he is not alone. Perhaps he is not alone in being responsible for having introduced the Health Insurance Regulation made under Statutory Rule No. 290 of 1985, which this Senate disallowed. If Senator Crowley bothers to look at the excellent statement made by her party colleague Senator Cooney, indicating why that Health Insurance Regulation should be disallowed, she will see how Dr Blewett, as Minister for Health, by introducing a regulation which consists of only eight words, had nevertheless trampled upon the rights of privacy of every person in Australia. Senator Cooney, in noting the disallowance of that regulation, said this: Yet the potential invasion of privacy represented by the power to circulate medical details is much more serious since our state of physical and mental health is a source of our most intimate weaknesses. Improper revelation of medical information exposes us to humiliation, ridicule, contempt, embarrassment, blackmail and great stress. He went on to say that the Minister for Health, Dr Blewett-the great advocate of the Australia Card and the person who wants us to believe that he is actually concerned about our civil liberties and the protection of privacy-is the Minister who introduced an eight-word regulation which the Senate Standing Committee on Regulations and Ordinances and this Senate saw fit to bring to the attention of the Parliament in order to have it disallowed because of the enormous implication it had in trampling upon the civil liberties and personal privacy of every person for whom there is a Medicare file and Medicare number. The Minister was aware of the Committee's concern because the Committee on Regulations and Ordinances wrote to him and drew his attention to the fact and to its concerns. Nevertheless, he persisted with the making of the regulation which fortunately the Senate caused to be disallowed. We are now to believe that the Minister who was prepared to do that with our medical records is to be trusted to run an enlarged system based upon the computerisation and centralisation of personal details about every man, woman and child in Australia. I say `child' because another thing that has grown in terms of its incremental use about this card, which was originally proposed at the Tax Summit to be introduced only for all adults, is that it is now required under the Government proposal to be introduced for every child. Every child is to be registered, and a card is to be issued which parents have to accept and hold and keep responsible control over for their child from the point of birth. The most important comments made to us were that this proposal would make some very fundamental changes in the nature of Australian society. That point was made to us in the submission to which I have previously referred by the Catholic Social Welfare Commission. It was made perhaps in its most eloquent fashion by His Grace the Right Reverend Michael Challen, Bishop of the Anglican Diocese of Perth and Chairman of the Social Responsibilities Commission of that diocese. His Grace came before us as a witness and made the point at some length. He said in part: Certainly it is imperative upon us all to try to order our society on the basis of commonly accepted moral values primarily, rather than through legislation, through insistence. The more we have taken the second route, the more we minimise the moral imperative. I think we get into a downward spiral. In describing what he meant by that, His Grace was an eloquent and formidable critic of the Australia Card proposal. The same might be said about Mr Costigan, who said in part: . . . you ultimately have to prove that the computer is wrong and you can just imagine the problems if something has gone wrong and you have to persuade the person across the counter that you are right and the computer is wrong. He went on, as did Mr Meagher, counsel who assisted him in the Royal Commission, saying that he opposed the card because it would help organised crime rather than hinder it and because it would change the nature of our society. His Honour Mr Justice Michael Kirby, in a paper which was taken as evidence by the Committee, concluded: What is at stake is nothing less than the nature of our society and the power and authority of the state in relation to the individual. He said that in his very eloquent opposition to the introduction of the Australia Card proposal. When people have had a chance to study this report, which runs to some 300-odd pages, I believe that they will see that the evidence is overwhelming. It would be, I suppose, very difficult to find any proposition-particularly one sponsored by a government, which would bring together people as politically diverse as myself, Mr Porter, Mr Blunt, Senator Haines and Mr Saunderson-on which we could conclude that this card proposal should be rejected. I go back to the words we used in the report: Having considered the Government's proposal for a national identification system as well as alternatives such as the use of photographic cards and the extension of the use of the current tax file system, the majority of the Committee rejects all proposals for the issuing of identity cards with or without a photograph. I conclude by saying that perhaps the one satisfying thing in this whole exercise has been that this was not a piece of legislation which was brought into the Parliament and attempted to be rushed through the Parliament. That occurred because I think the Government understood that it would be unable at that time to secure the support of the Opposition parties and the Australian Democrats to get it passed by this chamber. The compromise that was agreed upon was that there should be a joint select committee of the Parliament to investigate all aspects of this proposal. That joint select committee was formed with four Labor Party members, two Liberal Party members, a National Party member and an Australian Democrat. It met on numerous occasions. It held public hearings in every capital city except Darwin. It took some 5,000-odd pages of evidence in transcript. It heard evidence from 100-odd witnesses. It has received nearly 200 written submissions. At the end of the day, discharging what I think to be its proper parliamentary purpose, it has come to a conclusion that the Government's proposal should be un-equivocally rejected, and it has addressed itself to the alternatives required to deal with the pro-blems properly identified of tax evasion, welfare cheating, illegal immigration and organised crime. I hope the Government will be guided by the recommendations of the Joint Select Committee. I am encouraged in my belief that if it does not and it persists with its recommendations in the form that the Joint Committee has clearly rejected, the Opposition parties in this chamber and the Australian Democrats will ensure that such an unjustified and dangerous proposal is never given legislative effect. Debate (on motion by Senator Button) adjourned. Debate resumed. Senator CROWLEY(South Australia)(8.17) —Before I proceed with my remarks on the Australian Nuclear Science and Technology Organisation Bill 1985, the Australian Nuclear Science and Technology Organisation (Transitional Provisions) Bill 1985 and the Atomic Energy Amendment Bill 1985, I take the opportunity to correct what I may have said in error in my earlier remarks. It was not my intention to mislead either the people or this Parliament, but on examining further what I said it may be that I have done so. I take the opportunity to make it quite clear, first, that the Nuclear Safety Bureau that will be established by this new name under this legislation will be established and given statutory recognition. It will be, if you like, a replacement of the present regulatory bureau of the Australian Atomic Energy Commission. The comments I made about the Safety Review Committee that might have suggested that it was to be established under the Nuclear Safety Bureau are the points of confusion. To be clear, the Safety Review Committee will be established under a separate clause of the new Bill. There is currently a Safety Review Committee, established under the Australian Atomic Energy Commission, with the brief to review health and safety matters of significance to the staff and the public. These functions will continue under the new legislation. Further, if I could go into it, the structure of the Review Committee is important. The legislation mentions specifically that not only will there be the Nuclear Safety Bureau but a Safety Review Committee will also be established. It is interesting to note that the Minister for Resources and Energy shall establish this Committee and that, unlike the new Nuclear Safety Bureau, it will not necessarily comprise members of the staff of the organisation but very likely will comprise people from outside the organisation, as is currently the case in large part. The functions of the Safety Review Committee under the new legislation are very much to the same principal point, that is, to preserve and look after and review the health and safety matters of significance to the staff and the public. That is spelt out in clause 24a (1) of the legislation. Further to that, under clause 4 the Safety Review Committee shall be required to report to the Minister each year, and its report must also go to the Executive. Associated with that is clause 6, which requires the Minister to lay the report before the Houses of Parliament within 15 sitting days after the report is received by the Minister. But even further to that, under sub-clause (5) of 24A of the legislation there is a clause that allows the Committee to submit to the Minister and to the Executive such other reports relating to the operations of the Committee as the Committee considers appropriate. In other words, the legislation allows that the Committee may review or report on matters outside of the annual report. If for whatever reason and from time to time it saw fit to prepare a report outside of the annual report under the legislation, it is able to do so. Under clause 7 the Minister may cause a copy of that report received by him under sub-clause (5) to be laid before each House of the Parliament. Those are very clear elaborations of some of the functions of the Safety Review Committee. Further, I think very importantly, sub-clause (8) describes that the Committee may, in the carrying out of its functions, obtain advice or assistance from any member of the staff of the organisation, which I think describes and avows the understanding of the significance of the Safety Review Committee. The Committee, in fact, can avail itself of any member of the staff or the executive of the organisation to inform it or to provide it with information to allow it to most satisfactorily and fully do what it sees as its task. In fact, I think that is a very significant clause in the Safety Review Committee section of the Bill and I think we should remark that clause because it does convey the significance that the Government, in this legislation, places on the whole question of safety and the importance of the thoroughness and the comprehensiveness of that safety review function. This is no slight clause tacked on. The Government is very concerned that the safety function, and the safety review function in particular, be very clearly spelled out, and so it has done in clause 24a. It is interesting to compare the functions of the Safety Review Committee with the functions of the Nuclear Safety Bureau. It would seem from a reading of the legislation that the Nuclear Safety Bureau has a responsibility to review and monitor the safety of the nuclear plant whereas the Safety Review Committee has the much broader task involving the standards, practices and procedures adopted by the organisation. I think the Safety Review Committee is of considerable significance in this legislation and it has a very comprehensive range of specified tasks. I hope that in elaborating in that way I have corrected any misapprehension I may have given earlier. In summary of my comments at this point I would simply like to make clear that the Bill gives a very clear legislative direction for the future of the research program in this whole area of nuclear science and technology. I would be surprised if the people involved in the area do not welcome this clear legislation and direction by the Government of what it sees as appropriate functions for this new organisation. I would like now to make a few other comments. I understand that some people would argue that we may, in fact, do away with the whole nuclear process, do away with the medical supplies-the medical radioisotopes that are produced currently at Lucas Heights-and close that whole show down if we ever import, buy or establish a cyclotron. I think this is to misunderstand what happens with a cyclotron and a nuclear reactor. In fact, each produces a different range of radioisotopes. They have different functions and different applications. If and when a cyclotron is established in Australia, it would be an additive to what is available from Lucas Heights, not instead of, and that is most important. In supporting the establishment of a cyclotron it would certainly not be my intention to argue a cyclotron as a replacement for the nuclear reactor at Lucas Heights. It is important to be clear that the two would be providing different medical radioisotopes, even if we only confine ourselves to the medical radioisotope area. It is important to know that it would be an additive and not a replacement. I understand that the cyclotron, if and when it is established, could well be included under the provisions of this legislation. I do not wish to pre-empt how that might happen, but as it goes very much to matters of similar sort, that would seem to me to be appropriate and I understand it could so be considered. I would like to make a brief comment, too, about some negative comments, particularly by the Australian Democrats, about the hazards that might be attributed to Lucas Heights because of the age of the reactor. I think it is important to recall to the Senate the answer given by the Minister for Resources and Energy, Senator Gareth Evans, in answer to questions earlier in this session, when he said the age of the reactor is about 25 to 27 years. I am not precise on that. In fact, that is of no serious concern to us in this country precisely because of the safety requirements, the maintenance and the care that has been provided at Lucas Heights. In fact, as I remember Senator Gareth Evans saying, one could probably say that the reactor is safer now than it was in the early days of its establishment. More importantly, this reactor is a particular sort that is not similar to the electrical energy provisions of, for instance, the Chernobyl reactor. It is quite different. Senator Gareth Evans has elaborated that difference and I sincerely hope that Senator Sanders has read his answers and understood them and will not give us yet another serve on misrepresentation of what is in fact the case at Lucas Heights. I would like to conclude my remarks by turning to comments made by the Senate Standing Committee for the Scrutiny of Bills, of which I am a member, about this piece of legislation. In the sixteenth report of 1985 of the Scrutiny of Bills Committee, dated 27 November 1985, at page 3, the Committee drew the attention of the Senate to clause 40 under the heading `Delegation', and the Committee made the comment: Clause 40 permits the Minister to delegate to `a person' all or any of the Minister's powers under the Act other than the power of delegation and the powers of the Minister to appoint deputies for members of the Executive and to give directions to the Executive. The Committee has, on a number of occasions, and again in this piece of legislation, expressed concern in relation to unrestricted powers of delegation. The Committee noted that some steps had been taken in the present piece of legislation-this particular Bill-to restrict those powers by going some way to defining what restrictions there would be, but still the Committee felt it was important to draw the clause to the attention of the Senate because it felt that `by permitting such unrestricted delegation it may be considered to make rights, liberties and/ or obligations unduly dependent upon insufficiently defined administrative powers'. We were pleased in the Scrutiny of Bills Committee to receive a reply from the Minister, whose Senior Private Secretary responded in the following terms: In preparing this Bill it was not envisaged that the powers referred to by the Committee in clauses 17, 26, 29, 38 and 43 would have been delegated. The Minister has therefore agreed that sub-clause 40 (1) (b) should be amended during the Committee Stage of consideration of this Bill, to include these powers in those that may not be delegated. In addition to the powers noted by the Committee, it is proposed that the power to give directions, contained in sub-clause 5 (1) (a) (iii), will also be included in those that may not be delegated. The Scrutiny of Bills Committee reported our thanks to the Minister for his agreement to amend the Bill in this fashion. The Scrutiny of Bills Committee drew the attention of the Senate and/or the Minister to those delegations of powers that cause it concern under the terms of reference of that Committee. I think it is very satisfying when they are noted. The Minister in this case has noted those comments and has taken them into account, to the point where he is proposing amendments in the Committee stage of this legislation. I think that is a point worthy of comment in the debate on this legislation. I am pleased to be able to speak on the Australian Nuclear Science and Technology Organisation Bill. It goes to a very clear statement by the Government of its proposed changes and intentions for what shall happen with the Australian Atomic Energy Commission, what shall be done there and what shall be encouraged. The Senate should be pleased to support this legislation precisely because of the clarification and reordering of priorities it gives to that structure. Senator SANDERS(Tasmania)(8.31) —The Opposition has come up with its usual reliance on gee whiz technology and its other preoccupation with making a quick buck no matter what the consequences. It has been apologising for nuclear technology ever since I have been in this place. I do not think Opposition senators really understand the full ramifications of their apologies-if, in fact, anybody listens to them. In bringing on the Australian Nuclear Science and Technology Organisation Bill and allied Bills the Government is to be congratulated for trying to break the monopoly that the Australian Atomic Energy Commission has held in the atomic energy field. However, the announcement on the Bills by Senator Gareth Evans came at the time that the Nuclear Weapons Prohibitions Bill brought in by the Australian Democrats was debated. The timing of this announcement of ANSTO was no doubt influenced by the desire to counter unfavourable publicity about the Government policy to oppose the Democrats' Nuclear Weapons Prohibitions Bill. The changes have a legitimate basis but they are basically of a housekeeping nature. I urge Senator Crowley to stay in the chamber so that she can listen to the replies to her questions which were directed to me. She is staying. I thank her very much. The Government is being extremely dishonest in promoting the ANSTO Bills as being a positive anti-nuclear initiative. The removal of the draconian penalties in the Atomic Energy Act which would ensue for anyone publishing information on uranium deposits and the nuclear fuel cycle, while necessary, is an attempt to show the dismantling of the nuclear state. Meanwhile, our democratic process is being undermined by the official secrecy surrounding the functions of nuclear-related bases in Australia and on the entry of nuclear weapons into our ports, secrecy which is directed solely at Australians. The nuclear state is thriving in this country through our nuclear links with the United States of America. The lack of parliamentary control over the bases agreements illustrates this further. The replacement of the Australian Atomic Energy Commission with ANSTO is supposed to indicate a trend away from nuclear fuel cycle research. This trend existed irrespective of legislation. ANSTO's functions, as defined in the Bill, include no prohibition on such research. ANSTO is merely supposed to have regard for Government policy. The Government is yet again guilty of refusing to put its alleged anti-nuclear commitment into law, as was the case with the Democrats' Nuclear Weapons Prohibition Bill. The establishment of a nuclear safety bureau to monitor the Lucas Heights reactor is prima facie a good move but in reality is woefully inadequate when compared with nuclear watch-dog agencies overseas. It would simply not be tenable in the United States to appoint such a body from the nuclear industry; in this case ANSTO. ANSTO will have undue control over the NSB, which could be crippled by ANSTO's executive interference and by an inherent conflict of interest. The Government has responded to Democrats' criticism in this area and has changed the Bill, as we shall see later. ANSTO is prohibited from conducting nuclear weapons research. This is laudable and indicates that as a principle Australia has no desire to use nuclear weapons. Clearly, the Government sees a distinction between Australian nuclear weapons and those of the United States, which it fully supports in ever increasing numbers and degrees of overkill, including support for the United States nuclear-powered and nuclear-armed ships which stay in our harbours. The same principle is behind the banning of any defence-related uses of Australian uranium by Australia through the AEA amendments. Yet we do not seem to be concerned about exporting uranium to the West German firm RWE, which may contribute to the French nuclear weapons program by supplying fuel for the Super Phenix fast breeder reactor. The Bills will not change the nature and level of Australian nuclear-related activities. At best, they represent an exercise in housekeeping with some gains for civil liberties. At worst, they are a pathetic attempt to create a false impression that the Government supports the passage of anti-nuclear legislation. Australian Democrats' support for these Bills is highly qualified. We oppose the continued export of uranium. We wish to see the explicit prohibition of most mining and nuclear fuel cycle-related activites. We wish to see cyclotron produced isotopes investigated as an eventual replacement for reactor produced isotopes to rid Australia of any need for the further operation of a nuclear reactor. If we need these isotopes we can readily obtain them from overseas where there is an abundant supply of nuclear reactors. I have been told that a cyclotron would give us access to isotopes which we do not have at present. The Atomic Energy Amendment Bill will allow the continuing function of the Ranger uranium mine. Ranger should be shut down for two reasons: The first is that it supplies uranium which, as I shall point out later, is used in weapons production overseas; the other is that it simply cannot be operated in an environmentally sound manner. Ranger has a water problem. It is inundated by water. It was the company's mistake to begin with and the Australian people are being asked to pay for it. When Ranger was first built water was actually impounded. The engineers thought that they would need to keep some water over the dry season. Apparently they were from more arid parts of the country and did not realise that during the wet the rain literally pours down on the area. They impounded too much water and that has been the problem ever since. Now the mining company is applying to release contaminated water into the environment. It should not be allowed to do so. It has distinct environmental problems. Senator Sheil —Have you seen them? Have you been up there? Senator SANDERS —Yes, I have been there. I have seen the water problems. They have been explained to me by the Ranger people. I have been through the supervising scientists' offices and have become fully aware of the problems. They admit that they have problems. If they cannot release the water they will have to shut the mine. That would be a fine thing. What about the end use of the uranium? After much questioning of the Minister for Resources and Energy (Senator Gareth Evans) we find that this uranium that is shipped from Australia to a country such as Finland is first shipped to France, where it is converted into uranium hexafluoride, that is shipped to Russia, where it is enriched into reactor-grade uranium for use in Finnish nuclear reactors. An equivalent amount of enriched uranium, uranium minus the tails-I will speak about that later-goes from Russia to West Germany or Sweden where it is transformed or processed into fuel rods. This brings up two issues. The Australian uranium or uranium hexafluoride that goes to Russia stays in Russia in large part. It would be like pouring a teacup full of water into a swimming pool of water. Australian uranium is sent to Russia and is poured into the Russian uranium enrichment pool. We get back by a paper work accounting method some uranium. By necessity the uranium that we get back is 99.999 ad infinitum per cent Russian uranium. The uranium which went into Russia as Australian uranium stays around and dilutes the Russian pool. This is irrefutable. Senator Evans has said in answers to my questions that we cannot account for the Australian uranium molecule by molecule as we would with olives on a stick. This means that Australian uranium is staying in Russia, where it is undoubtedly used in the Russian nuclear weapons program. We have been told over and over that we have a moral obligation to supply uranium under the Treaty on the Non-Proliferation of Nuclear Weapons. I put it to this Senate that it is immoral to send Australian uranium which we know will be used in Russian nuclear weapons. It is highly immoral either under that Treaty or under any normal definitions of morality. The other thing that happens with Australian uranium which leaves Russia after the processing phase is that the tails-which are U238-are sent back to France. We have been trying to track this down. We got an answer today, a very convoluted answer, from the Minister. We will really have to wait to analyse Hansard before we can figure out what he said because I do not think he really has a knowledge of the operation himself and he has to rely on pieces of paper which are given to him. The tails, of which we now have 159,991 kilograms, are apparently used in the French fast breeder program. This U238 is used as a blanket around breeder reactors. Why is it used as a blanket? It is used as a blanket to retain plutonium. The uranium tails left over from the Russian enrichment plant would be almost pure U238-a uranium isotope which is not fissionable and cannot be used as a fuel. The U238 is placed in a blanket around the core in a fast breeder reactor to produce plutonium PU239. Ostensibly, it will then be reused as a fuel for the Super Phenix fast breeder reactor. In this way, 330 kilograms of plutonium will be produced per year. PU239 is also used in nuclear weapons and 330 kilograms is sufficient for up to 60 bombs a year. Several statements made by prominent French politicians and officials reinforce the suggestion that France will make use of the Super Phenix military applications. In 1979, General Jean Thuy, previously director of France's military centre for nuclear testing and subsequently an adviser to the head of the Atomic Energy Commission of France, wrote that France was able to make large quantities of nuclear bombs `since fast breeders will provide ample supplies of the necessary plutonium'. Bertrand Goldschmidt, an official with the French External Relations Department, is on record as saying that, while he could no longer speak for the French Government, he was certain that the Super Phenix would be used for weapons production purposes. To be sure, France has not hesitated in using `civil facilities' for military application in the past. The well respected Nucleonics Week journal notes: The French public electricity utility, EDF, reactors at Chignon were used to produce weapons grade plutonium for the military while simultaneously producing electricity, and, more significantly, that the Super Phenix predecessor, Phenix, has provided plutonium to the military branch of the CEA. Today the Minister said that there was a difference between the Phenix and the Super Phenix. One would produce plutonium and the other would not. The French seem to differ with our Minister for Resources and Energy. Senator Sheil —Anything else to say? Senator MacGibbon —Sit down. We have had enough. Senator SANDERS —It is interesting to listen to the interjections from the gaggle of Opposition know-it-alls on my right. In fact, they have very little technical knowledge and can only resort to personal vilification. Their interjections otherwise have no substance. The Australian Nuclear Science and Technology Organisation Bill will have a great deal to do with the operation of Lucas Heights. Lucas Heights runs two reactors. The one of most concern is the HIFAR reactor, which first went critical on Australia Day 1958. This reactor was built by the same arrogant British and Australian nuclear technocrats who gave us the debacles of Maralinga and Monte Bello Islands. These were the people who said that the nuclear age was dawning; they could do no wrong, nuclear power was safe; it was the way of the future. (Quorum formed) I am grateful to the Opposition for calling that quorum because I think more people should listen to this debate. It also gave me a chance to have a drink of water. As I was saying, the HIFAR reactor was built by the same arrogant British and Australian nuclear technocrats who gave us the debacles at Maralinga and Monte Bello Islands. They thought there was an infinite future for nuclear power. They thought that their technology could never fail. In fact, what they did was build an old reactor at the time. It was an obsolete design at the time and now it is geriatric. This reactor is now almost 30 years old. In 1979, they had to close it for four months because of a leak in their heavy water system. Let me quote from an article in the Age of 29 October 1979: The main nuclear reactor at the Lucas Heights research establishment has been put out of action for at least four months while leaking parts in its heavy water system are replaced. Here is an interesting statement about people in the Atomic Energy Commission: . . . a senior Commission official has pointed to the failure in the bellows as a sign of the reactor's age. Remember, this is 1979. The article continues: Dr G. L. Miles, deputy director for operations at Lucas Heights, said . . . If you fly a DC3 in the 1980s, it is going to be more expensive, less efficient and less safe. The reactor was commissioned in 1958, he said, which made it `relatively venerable' as a piece of `fairly complex equipment'. `HIFAR belongs really to the design philosophy of the mid-1950s,' Dr Miles said. The Commission was saying this. The article continues: He said he did not mean that HIFAR was not a good, well-maintained or safe reactor, but it had to be realised that it would need replacing. It is interesting to note that the Commission now says that it will keep it running for ever but we will get into that at a later time. On 31 August 1979, an article in the Australian headed `Tighter Security for Atomic Plant' stated: The Federal Government is taking urgent action to overcome health and security problems at the Atomic Energy Commission's Lucas Heights Reactor in Sydney. ... ... ... The Department of National Development has admitted to the Senate that present security at the plant is not up to international standards. The AEC has conceded that there is a `significant hazard' to workers at the reactor. The Department also said there had been several industrial disputes because maintenance staff were reluctant to do their jobs, fearing health risk. That was in 1979. What does the Atomic Energy Commission have in mind for the reactor at Lucas Heights? I have an article from the Age dated 24 October 1985 which states: The chief executive of the Australian Atomic Energy Commission, Dr David Walker, says it is still working safely and well, producing commercial radio-isotopes and serving as an important scientific research tool. He says that with proper upgrading it can be kept operating effectively until at least the year 2005, perhaps indefinitely. Anyone who is at all familiar with metallurgy knows that a plant which suffers these types of thermal stresses, pressure stresses, can simply not be operated for that length of time. There is a huge accident potential here. This can be illustrated by a careful reading of the Atomic Energy Commission's thirtieth annual report, that for 1981-82. On page 53 the report states: Although HIFAR has now been operating for more than 20 years it has been well maintained. However, standards for safety and reliability have been developed since HIFAR was built and some of its systems do not comply with these new criteria. Here is a piece of bureaucratese; this is real newspeak stuff: Non-compliance with a standard does not imply that the system is unsafe, but on the other hand compliance is an indication that a system is more demonstratively safe. This is real gobbledegook. The document continues: If HIFAR is to continue operation until 1990- much less the year 2005- it was thought necessary to upgrade those systems which have a public safety connotation to a level at which compliance with criteria can be demonstrated. It continues: The present emergency core cooling system which is manual in operation will be converted to automatic and its layout, piping and testing will be upgraded. I sincerely hope so because there have been a terrible number of problems with that. Another problem with the Lucas Heights reactor is the fact that it contains a wall of graphite some two feet thick surrounding the fuel assembly. This is a neutron reflector and it causes neutrons to be bounced back into the fission process in sustaining the reaction. After the Chernobyl disaster there was publicity about what nuclear engineers always knew-that graphite anywhere in a reactor would cause a problem and be dangerous. The Age stated that James Landis, a senior vice- president of Stone and Webster, which is a firm that builds nuclear power plants in Boston, said that the Chernobyl accident is the worst kind of nuclear accident and any reactor that uses or contains graphite is susceptible. We have an old reactor at Lucas Heights surrounded by graphite which has already had problems with its cooling system and a Chernobyl disaster could easily result. The graphite in the reactor is also referred to in a publication by the Australian Atomic Energy Commission on the HIFAR reactor, which points out: Great care was necessary during construction to keep the material as clean as possible because extraneous material absorbs neutrons. Graphite block clearances near the core had to be suitably proportioned to allow for growth in the volume of the graphite due to fast neutron bombardment . . . The Minister for Resources and Energy said in this place that the reactor would not be bombarded by neutrons. The HIFAR reactor people say that it is. We have also been told in this place that the HIFAR reactor is no problem because it is 1.6 kilometres away from the nearest habitation. This is no protection at all, given the Chernobyl disaster, where radiation extended from Chernobyl to Spain and Japan and is now reaching the west coast of the United States. A 1.6 kilometre buffer zone is ludicrous. If those people in Sydney who trust Senator Evans and his reassurances and trust the Atomic Energy Commission ever suffer any radiation damage, I urge them to look at the back of any insurance policy they have. They will find that insurance companies `will not cover any damage directly or indirectly caused by, or contributed to, or by, or arising from, ionising radiations or contamination by radioactivity from any nuclear fuel or from any nuclear waste from the combustion of nuclear fuel'. So insurance companies do not think it is safe, but our Minister for Resources and Energy apparently does and so do members of the Opposition. The problem with the Bill as it exists is that the bureaucrats have had too much to say in the operation of the atomic energy system in the Lucas Heights area. The Lucas Heights reactor has emitted a number of low level discharges and radioactive waste into the Woronora River which has accounted for a number of fish contamination episodes. It has always denied this or played it down. It says that there is no danger. However, Professor Ernest Sternglass, who is from the University of Pittsburgh and is an expert in low level radiation, after studying the Australian Atomic Energy Commission records, stated: The same pattern of high localised levels of radio- activity in the milk, seems to be existing around the Australian test reactor, that we have found around a series of nuclear reactors in U.S. We find that the Atomic Energy Commission in Australia, in company with its brethren around the world, simply does not like to talk about any spills or anything that happens at the Australian test reactor. A headline in the Sydney Morning Herald of 2 October 1985 read `Lucas Heights Leak Report Conflict'. The article stated: The Sydney Water Board and the Australian Atomic Energy Commission have given differing accounts of a delay last month in notifying the Commission about a leak in a vandalised effluent pipe from the Lucas Heights research laboratories. The board insists that the Commission was first notified four or five days after the leak was discovered by a board employee on September 7. In other words the Sydney Water Board had to find out about the leak; the Atomic Energy Commission did not tell it. The article continued: It has admitted that the Commission was not told sooner because of an internal ``misunderstanding''. The Commission is equally emphatic that it was not notified for nine days, when it logged a telephone call from a Board employee at 8.40 a.m. on Monday, September 16. The Board was not notified when there was a leak and it allowed the leak to continue until the civil authorities in the area actually discovered it. This is a reprehensible action and I hope that the ANSTO Bill, in its reconstituted form and with a new clause, will solve this problem. ANSTO shows the inbred, incestuous nature of scientific bureaucracies and their elitist approach. Hopefully in this day and age we can do better than this. I hope that we can bring our technology under control, put technology back under the control of people rather than under the control of technocrats, because they have their own vested interests in all of this. They will delay the reporting of a spill in order to protect their jobs and their prestige. The people must have more of a say. We now have a chance to start afresh if we have the guts to do so. I do not think we have at present; certainly the Senate does not. The people are far ahead of the Senate in their awareness of the problem and their willingness to do something about it. Obviously the Opposition's mind is completely closed. The Government has people in its Party who are very concerned about this matter. At the moment they are in the minority but only slightly. I hope that sooner or later they will gain the ascendancy and see what the people of Australia want. What the people of Australia want is protection from this most deadly threat to themselves and their children that is posed by nuclear technology, nuclear reactors and, of course, nuclear weapons. We believe, as I believe do most of the people in Australia, that all uranium mining should cease, Lucas Heights should be shut down and ANSTO, which is responsible to the people of Australia rather than to the nuclear industry, should oversee the dismantling of our present dangerous nuclear program. I am foreshadowing that I will move some amendments to both of the major Bills which will bring them more into line with the thinking of the Democrats and the Australian people. However, I will go into that in more detail at the Committee stage. Senator TOWNLEY(Tasmania)(8.59) —It is my privilege tonight to speak on the Australian Nuclear Science and Technology Organisation Bill 1985, the Australian Nuclear Science and Technology Organisation (Transitional Provisions) Bill 1985 and the Atomic Energy Amendment Bill 1985. Senator Button —It is indeed your privilege. Senator TOWNLEY —Thank you very much. It is because of the Government, which has kept us here tonight, that I have been given this opportunity and I thank it very much. This legislation replaces the Australian Atomic Energy Commission with a new organisation which will be known as the Australian Nuclear Science and Technology Organisation, or ANSTO, and it repeals certain provisions of the Atomic Energy Act 1953. Prior to the suspension of the sitting for dinner we heard Senator Crowley make a speech. I must say that I regarded what she said as very sensible. She spoke about the cyclotron, which some people believe should be brought in to replace the HIFAR reactor that is operating in Sydney. She pointed out that it is not a replacement. It makes medical isotopes that are an addition to rather than a replacement of those now made in Sydney. Some people say `Get rid of the reactor', but I wonder what would happen if those people needed some kind of medical isotope. About 100,000 radioactive units of isotopes of different kinds used in Australia each year are produced in Sydney. Senator Sanders, for the first few minutes of his speech, criticised the attitude of the United States of America to the nuclear situation. However, it was remarkable that he did not very much criticise the Russian situation or the technology used there. Senator Sanders —It is just as bad. Senator TOWNLEY —It is not just as bad; it is a lot worse. Senator Sanders —You did not listen to my other contributions. Senator TOWNLEY —I do not need to listen to many of them. I listened to the one Senator Sanders gave a few moments ago, and he did not criticise Russia at all or the way the Russians make their reactors. Senator Sanders was most one-sided, and I begin to think that he is an apologist for Russia. I would hate to say that about him but I would not be the first to say it. Senator MacGibbon —I raise a point of order, Mr Acting Deputy President. I ask the Chair to apply standing order 422. Senator Sanders has just had unbridled access to this chamber but is now denying Senator Townley his right to speak. The ACTING DEPUTY PRESIDENT(Senator Colston) —Order! I was about to ask Senator Sanders to cease interjecting because Senator Townley has the floor. Senator Sanders —May I speak to the point of order? My point is that this is personal abuse. Do I get no chance to defend myself? The ACTING DEPUTY PRESIDENT —If the honourable senator thinks that way, he can take a point of order. Senator TOWNLEY —If Senator Sanders thinks that this is personal abuse he can either reply when I finish my speech or meet me outside afterwards. I do not care which. The ACTING DEPUTY PRESIDENT —We will not have any quarrels in this place. I call Senator Townley. Senator TOWNLEY —The Australian Atomic Energy Act gave the Australian Atomic Energy Commission the right to be an active participant in the development of all phases of the peaceful uses of atomic energy. Unfortunately, governments over the last few years have been scared of the development of nuclear power in Australia and have opted for the use of fossil fuels. It may be that that is sensible on the Australian mainland, but I do not believe it is. I would much rather live downwind of a nuclear power plant than I would of a fossil fuel power plant. The amount of radioactivity that drops out of the smoke stacks in such plants, even with the scrubbing that can be done-at tremendous cost of course-is frightening. Anybody who thinks that their health and the health of those who live nearby a fossil fuel plant is good or is likely not to be impaired by living there has not studied the situation. Tasmanians have been used to having clean hydro-power but, because of certain reasons, they are now not able to develop the amount of hydro-power they wanted to develop. Senator Sanders —Does Tasmania really need the energy? Senator TOWNLEY —Senator Sanders again interjects. I am asked whether Tasmania needs the energy. I suggest that Senator Sanders go back and study his mathematics. If he were to study the use of energy in most parts of the world, including Tasmania, he would see that it is increasing. No matter what the honourable senator says, there will come a time in Tasmania when we will need more power. No matter whether he switches off his electric blanket or does not use his plug-in torch or whatever, that time will come. Senator Tate —He might sell more wood heaters. Senator TOWNLEY —We shall not talk about wood heaters here. Senator Sanders —Comalco is leaving. Senator TOWNLEY —Senator Sanders does not know that Comalco is leaving. Show me a bit of paper to prove that Comalco is leaving. Here we have a senator trying to justify not building things in Tasmania that sometimes have a ten-year lead by saying that Comalco is leaving. When it leaves we will have plenty of power and we will be able to sell it for other people to use. Maybe the honourable senator will be able to plug in his electric blanket again. In the meantime, if Senator Sanders wants to save power, let him go ahead and do it. When it was proposed in Tasmania that we build a fossil fuel plant in one area there was a local uproar, and rightly so. For those of use who prize the clean air in Tasmania-- Senator Tate —The cleanest in the world. Senator TOWNLEY —One can understand their worries because, as Senator Tate says, it is the cleanest in the world. Cape Grim, on the north-west side of Tasmania, has a base line station for testing the world's air. I disagree with the establishment of fossil fuel plants in Tasmania. I think that the world will continue to use nuclear power, and I will get on to that in a moment. Former Senator Peter Rae, whom some of us honoured last night in this building, said for a long time that Tasmania should go nuclear. In the future it may well be that that option will be followed. Senator Sanders —What a time to say it, after Chernobyl. Senator TOWNLEY —A former senator, Peter Rae, has been saying that for many years, I am sure well before Senator Sanders came to this country. I certainly support leaving nuclear power as an option-not only for Tasmania, which has very little in the way of fossil fuel of a suitable type, but for this entire country. Therefore, I am sorry that over the last few years nuclear power research at the Atomic Energy Commission has been curtailed. I believe that that Commission should have remained involved in all aspects of the peaceful use of uranium mining, and what goes on after it. We should be involved in enrichment to power production level, not of course to weapons grade. It is all very well for people who speak about this and who are against nuclear power stations to say that materials for the production of atomic weapons can be obtained from power plants. Those who want to make atomic weapons realise that if a country decides to make atomic weapons it does not go through the normal process of making nuclear power plants. It has a dedicated system designed specifically to make the very rich uranium that is needed. When I talk of enriching uranium to the standard used for nuclear power plants, I mean raising the amount of uranium 235, which is usually at about 0.7 per cent in yellowcake, to four or five times that level. That means that it is still safe to carry in one's hands. When somebody says that there has been a spill of yellowcake, it does not mean that it is terribly dangerous. It is only four or five times what it would be if it were in soil. It should not happen because in all areas of nuclear technology one has to take a great deal of care. If one does not take care all the way along the line, one runs into trouble. In the United States Navy, which has operated nuclear power plants for many years, care in every area is one matter that is stressed most. I believe that we should have been sensibly involved in the enrichment of uranium, but the Government has decided even to curtail experimentation in that area. The Government seems to have given in to what I call the ratbag element that says that all nuclear use is bad. I ask again: What would those people say if they needed some kind of radioactive medical product that could perhaps save their lives? I am sure it would be an entirely different story as to whether that nuclear plant at Lucas Heights, which produces about 100,000 doses a year, should be allowed to continue. The Government has decided to move away from nuclear fuel cycle activities. So, in line with government policy, Australia is not involved in the cycle, except for the mining and milling of uranium and for the disposal of wastes. As an engineer I made it my business to visit Lucas Heights and examine the way waste disposal in Synroc is developing. I am very pleased that the Government intends to continue in that area. Just for the record, when uranium is irradiated in a light water nuclear reactor it is usually in there for three years. The initial 1,000 kilograms of fuel is composed of about 967 kilograms of uranium 238 and 33 kilograms of uranium 235. After three years the spent fuel still weighs the same-it is all contained inside the reactor-but of that 1,000 kilograms of fuel, the uranium 238 has dropped to 943 kilograms and the uranium 235, which is the radioactive part that is useful, has dropped to eight kilograms. That leaves 49 kilograms of assorted fission products that are dangerous. Some of them are very dangerous. Some of them are dangerous in the long term and some in the short term. They are usually contained in storage chambers for an initial period prior to either reprocessing or final disposal. If reprocessing is the chosen option, the various chemicals within the assorted fission products are chemically extracted and the useful elements returned to the fuel cycle because they are very valuable. The remainder of the highly radioactive elements are stored in cooled containers. The safety and feasibility of the storage of these elements are well demonstrated. I think it was Senator Sanders who said that the HIFAR reactor at Lucas Heights has been in operation since 1958. That shows how reliable it is. Nuclear reactors have been operating in other areas of the world for a full 25 years. It is not wise for people in Senator Sanders's situation to use scare tactics on people who sometimes are scared of the unknown. Many people do not quite understand how a nuclear reactor works. If one sits down and studies it, it is quite straightforward. It is an engineering problem. The problem with the Russian engineering was that they did not follow the usual containment policies that worked so well at Three Mile Island. The operation at Three Mile Island eventually closed down automatically by itself, which proved that the engineering was of the right design. Admittedly, there was some leakage but let us make a comparison. If one calls Three Mile Island a disaster, what would one have to call the accident in Russia? The Russian accident is certainly of much greater magnitude. I hope that people, and particularly scientists, in Russia will now reappraise their whole situation and realise just how important it is to take the care that has been recognised in other areas of the world-not only in the United States, but also in Germany, France and England-that must be taken in engineering projects that are as large as any nuclear power plant. I was talking a moment ago about the Synroc experimentation that is going on at Lucas Heights. I believe that it will provide a very useful second generation storage system. At the moment, for the purposes of long term storage, resistant glass blocks encased in stainless steel are used. At present several such facilities are under commission or construction in Europe. I believe that Synroc will be more useful in the second generation because in some ways it will be better than glass. It will be more difficult, but there is a high degree of confidence that the Synroc system will be a much better storage system. Glass is good, but Synroc will be better still. Last year the Minister for Resources and Energy, Senator Gareth Evans, announced that Australia and Italy had agreed to co-operate in a research program dealing with high level radioactive wastes. There is to be an exchange of information. The two countries will collaborate in developing technology in the area I have just mentioned. Synroc, which is synthetic rock, was developed by Professor Ringwood of the Australian National University in Canberra. It is based upon incorporating radioactive elements into the very stable crystal structure of a particular type of synthetic rock. We also have agreements with the United Kingdom and Japan. Those agreements are a positive way that Australia can assist in radioactive waste management, something that is of interest to a great number of people in the world and certainly to the many countries that now operate nuclear power stations. Just in case some people do not realise how many nuclear power stations there are, because in Australia we do not have many, I note that at the end of 1984 there were 318 nuclear power stations operating in some 26 countries, 200 under construction and a further 26 on order. As we all know, they are not all in the Western bloc. It is to be hoped that the stations in the Eastern bloc are following the designs and exchanging the information they should be exchanging with the scientists and engineers in the Western bloc who, I believe, have very nearly solved all the problems associated with nuclear power reactors. I commend to those interested in nuclear power and the fuel cycle a reading of the status report 1985 of the Australian Atomic Energy Commission. It is a very good document. It is removed from the hysteria that so often accompanies any mention of uranium or nuclear power. I instance the accident in Russia, which still has not been scientifically analysed. It has been analysed by the Press but not scientifically analysed. The report deserves wide reading, particularly by young people who have an open mind, as opposed to so many people in the world who seem to have closed minds. My reading of the Australian Nuclear Science and Technology Organisation Bill is that, although it will change the name of the Australian Atomic Energy Commission to the Australian Nuclear Science and Technology Organisation, it will not destroy the work at Lucas Heights in the very important areas I have already mentioned. It will encourage the important contribution that nuclear technology can make in the areas of medicine, science, industry and agriculture. The Atomic Energy Commission already does a great deal in the nuclear medical area. It supplies some 50 hospitals with a wide range of radiopharmaceuticals. For someone to say that a cyclotron will be able to replace that range of pharmaceuticals shows how little that person understands cyclotrons. Of course most of us here understand everything that a cyclotron does! I have made it my business to read a little about it, which obviously some people have not done. Senator Crowley, too, obviously understands that if a cyclotron were built in this country it would help add to the number of available radioactive pharmaceutical isotopes. A cyclotron by itself is not sufficient. I wish ANSTO well. I will watch its progress in the future. I hope to visit the set-up at Lucas Heights again in the near future. I suggest to the Government that it should look at bringing in legislation to include the Office of the Supervising Scientist for the Alligator Rivers Region under the umbrella of ANSTO. At this stage I see absolutely no reason why the Supervising Scientist, who deals very much with the kinds of things that are studied by the high level scientists at Lucas Heights, could not be under the umbrella of ANSTO. It may well save this country a considerable amount of money if that is done. I believe that their aims and their expertise would mix very well and that the amalgamation of those two bodies could result in a significant saving. Senator TATE(Tasmania)(9.20) —I rise to speak for no more than about 10 minutes, under the Whip's instructions, and commend the Government on the introduction of the Australian Nuclear Science and Technology Organisation Bill 1985, the Australian Nuclear Science and Technology Organisation (Transitional Provisions) Bill 1985 and the Atomic Energy Amendment Bill 1985. I believe the legislation marks a very mature stage in this Government's grappling with the problem of the harnessing of the tremendous power of the uranium resources that we have in Australia in a way that is directed to peaceful uses for the benefit of humanity. In that regard, the orientation of the new Organisation, as set out in the functions listed in clause 5 of the principal Bill, are entirely proper and bear reading into the record. The Bill states that the major functions of the Organisation are: To undertake research and development in relation to- (i) nuclear science and nuclear technology; (ii) the production and use of radioisotopes, and the use of isotopic techniques and nuclear radiation, for medicine, science, industry, commerce and agriculture; and (iii) such other matters as the Minister directs. Before I stress those beneficial aspects of the harnessing of the atom, it is very important that it be noted that the Bill expressly places a prohibition on the Organisation undertaking research or development into the design or production of nuclear weapons or other nuclear explosive devices. Of course, that prohibition is in total harmony with this Government's efforts over many years to secure a comprehensive test ban treaty in relation to nuclear explosive devices, not merely nuclear weapons. It brings to mind the international aspects of the importance of getting this Organisation to undertake activities within Australia that are in harmony with our international obligations. One must recall that Australia is a party to the Treaty on the Non-Proliferation of Nuclear Weapons, which recognises the right of other countries to either commercial or peaceful exploitation of atomic energy. Therefore, we have an obligation, in supplying uranium to service that right of other nations under the Nuclear Non-Proliferation Treaty, to keep abreast of the latest science and technology involved in the production of such nuclear energy, and indeed an obligation to deal with the waste products of such endeavours. I will come to that shortly. What I want to emphasise is that the Government has taken this Organisation in hand and oriented its program in particular to the production and use of radioisotopes for medicine, science, industry, commerce and agriculture. I believe it is very significant that the Australian Democrats are not opposing this legislation. Even within the Democrats there has been a maturing of their attitude to nuclear matters. Senator Walsh —Really? Senator TATE —Senator Walsh has shown some surprise and I know that, if Senator Townley were not in the chair, he would also have expressed an ejaculation of surprise from his normal seat. However, I recall that back in 1983, when the Democrats introduced into this place the Customs (Nuclear Materials and Hardware) Prohibition Bill 1983, it contained an absolute prohibition on the importation of hardware which would have allowed the reconstruction, refurbishing and continual development of the nuclear reactor at Lucas Heights and associated facilities. It was pointed out in debate by honourable senators from this side of the House that that would have had a disastrous effect on the capacity of Lucas Heights to produce, for example, those medical radioisotopes that are so essential for the treatment and the alleviation of suffering and, in some cases, illness which would otherwise be fatal. In that respect their obsessive concern for the bad aspects of the harnessing of the atom, as expressed in the legislation that they brought in, would have done great harm, had the legislation been passed, to the health of the people of Australia. A year or so later, when they tried to introduce a similar Bill into this place for passage, they placed an amendment in the Bill which allowed for and recognised that the use of radioisotopes in particular for medicine, commerce and agriculture was a legitimate use. So even the Democrats have recognised that the processing of uranium in order to release some of its beneficial aspects for the service of humanity ought to be encouraged. This Bill would take that into proper practical application within this new Organisation. I am glad that Senator Townley mentioned the thirty-third annual report of the Australian Atomic Energy Commission, which covers its activities during 1984-85. There one can read many pages of calmly presented programs which, on any reading, are undoubtedly of great benefit to Australia's hospitals, to those in pursuit of agriculture and to those involved in various industrial endeavours. In particular, it is to be noted that the Synroc project involves many research and development projects which, as I have already indicated in my opening remarks, are really part of Australia's obligation to the world. If we are to supply uranium, we have a moral obligation to use our best scientific endeavours to devise a scheme to trap the wastes in a way that will not be harmful to mankind over succeeding generations. Insofar as we have the scientific, engineering and technological expertise that could be of service to the world in this regard, I believe the Government is quite right to maintain an organisation that can carry through with international collaboration the further refinement and development of that process. I wish to pass to another aspect of the Bill which finally removes from this body of legislation many legislative provisions which were quite obnoxious from a civil liberties point of view. When I first entered the Senate in 1978 I think the second or third speech I made was on the Atomic Energy Act, as it then was, when the Liberal Government was attempting to amend it in some way. I recall very vividly that the late Senator Alan Missen and I complained about the fact that the Act still contained provisions which were designed for the 1950s use of Australia's uranium resources, particularly the Rum Jungle resources, for the nuclear weapons developments of our allies, particularly, of course, the United Kingdom. In that regard the legislation was littered with provisions that were explicable only if one was thinking of the development of uranium mining projects destined for a defence purpose. I need not reiterate the sorts of legislative provisions that were embodied in that legislation. But I am delighted to see that those particular provisions have been deleted from the Act; that is as it should be. In fact it may be remarked in passing that it was the common concern of Senator Missen and I, and some others around the chamber, that led to the conclusion that a scrutiny of Bills committee was required. Back in 1978, when the then Liberal Government was introducing legislation to deal with the commercial development of the Ranger deposits, it could have taken the opportunity to deal with these provisions, which, as I have said, were really conceived in a different era, but it did not. But had the Standing Committee for the Scrutiny of Bills been in operation at that time, it would have picked that up and helped debate to get under way in the chamber which would have led to deletion of those provisions before now. Insofar as the Government at this stage has brought in legislation which overcomes those obnoxious and tyrannical provisions, it makes this body of legislation a package which is worth commending to the Senate. Finally, I note that the Government expresses in the second reading speech of the Minister for Resources and Energy (Senator Gareth Evans) an intention to bring into the Parliament legislation which will help to carry through our obligations under the South Pacific nuclear free zone agreement and the nuclear non-proliferation arrangements, to make it very clear that Australia will neither possess nor station on its soil nuclear weapons or nuclear explosive devices. It is essential that that legislation be brought in before the end of this session. I hope that the Ministers and the Caucus committee concerned can bring that to pass. Insofar as this legislation before us provides a sound legislative basis for the operations of the Australian Nuclear Science and Technology Organisation, I commend it to the Senate. (Quorum formed) Senator PUPLICK(New South Wales)(9.32) —The purpose of the Australian Nuclear Science and Technology Organisation Bill is to establish the Australian Nuclear Science and Technology Organisation as a successor to the existing Australian Atomic Energy Commission. The Bill will provide a new organisation with functions which support current Government policy towards nuclear research and development. These will reflect the realignment of the Australian Atomic Energy Commission activities away from the present work on the nuclear fuel cycle towards a greater emphasis on the applications of radioisotopes and radiation in medicine, science, industry and agriculture. The Bill provides that ANSTO shall undertake research and development in relation to other matters not outlined in what I have already said, as the Minister in charge may direct. Further, the Minister shall give such a direction only if he is satisfied that the work would make effective use of the staff of the organisation and would not duplicate any activity being performed by other Commonwealth bodies. Other clauses prohibit ANSTO from undertaking any research or development into the design or production of nuclear weapons or other nuclear explosive devices and for the organisation to have regard to national science and energy policy objectives. The general powers of the Organisation are given in a way which complements the work of other statutory authorities and replicates the general approach which is being taken to statutory authorities to allow them to enter into contracts; to hold or dispose of real or personal property; to occupy, use and control land or buildings; to undertake construction; to form or participate in companies; to appoint agents and attorneys or to act as agents; to engage persons to perform services; to design, produce, construct and operate equipment and facilities; and undertakings of that nature. The restrictions placed on ANSTO are similar to those placed on other statutory authorities in that ministerial approval is needed for the formation of subsidiary companies or taking shares in companies. Parliamentary oversight of the activities of ANSTO is, I believe, adequately catered for in this new piece of legislation. The Atomic Energy Commission, as it has operated, has served Australia extremely well over two decades. I believe that the work of the Commission has established Australia as a leading participant in a large number of those activities related to the development of atomic energy and to the peaceful use of uranium and radioactive material. The Commission and the whole operation of the nuclear fuel cycle in Australia have been subject to a number of inquiries, the most significant of which was the inquiry undertaken by Professor Slatyer in his report on Australia's participation in the nuclear fuel cycle. I also draw attention to a report of the Australian Science and Technology Council, dated 4 November 1985, entitled `Nuclear Science and Technology in Australia'. ASTEC undertook a major review of the legislation and facilities for development of atomic energy in Australia. While I do not want to rehearse in detail the recommendations of that ASTEC report, I draw attention to the comments made in the report about the HIFAR reactor at the Atomic Energy Commission establishment at Lucas Heights, south of Sydney. We heard today from Senator Sanders what I thought was a most scurrilous piece of fearmongering about the condition of the HIFAR reactor at Lucas Heights. That, I believe, not only does no credit in advancing the cause Senator Sanders seeks to advance, but also is very irresponsible and quite improper. The statements that were made about the status of the HIFAR reactor, its safety and the way in which it operates were entirely unjustified. If one looks at the report, one will see that certainly the HIFAR reactor is old; it is about 25 years old. Nevertheless, it has an impeccable record of safety and operation. It has provided, particularly in terms of radio- isotopes for use in medical technology, life-saving materials of considerable benefit to the whole Australian community. To make allegations about its unsafety or the extent to which it is a threat to the life, security and wellbeing of the people who live adjacent to the reactor is grossly improper. I refer to a number of the activities currently undertaken by the Australian Atomic Energy Commission which will now be undertaken by ANSTO. I mention the sorts of things which rarely get much attention. For instance, the Commission is involved in projects such as undertaking major flow studies. These sound very exciting and perhaps a little pedestrian, but when one considers that work has been done for organisations such as the Broken Hill Proprietary Co. Ltd on the operation of its blast furnaces to improve the efficiency of its operation, one can see the very considerable industrial benefits that flow from the work the Commission has undertaken. The Commission has done a great deal of work on the environment in studying things such as solar effect, the operation of sewage treatment works, and the disposal of wastes using material which is radioactive and can be monitored and traced. The Commission has made a very valuable contribution to the examination of environmental issues and the improvement of environmental conditions. It has done coastal engineering work in areas such as Port Brisbane on the question of how the port might avoid the problems of silt. It has done valuable work in the St Vincent Gulf in much the same fashion. It has looked at things as unromantic as termites, studying the way in which they have affected rural areas and destroyed historic buildings, and it has allowed steps to be taken for the conservation of the natural and man-made environment. The Commission has played a role in assisting Australia's overseas aid program. Advice has been given to countries in the region, such as Malaysia, which has been of very considerable benefit to their national and scientific development. That has been done through the Atomic Energy Commission and has made a significant contribution to improving our relations and assisting in the development of less developed economies within the region. A topic which undoubtedly will come before the Parliament from time to time and on which I have already asked a question of the Minister representing the Minister for Health, the Minister for Community Services (Senator Grimes), is food irradiation. I happen to believe that the work which the Commission has been undertaking to identify correct procedures and standards for the irradiation of food in order to allow the preservation of food, to increase the shelf life of food, to avoid the financial losses which have occurred to producers and marketers because of the destruction and spoilage of food, has been a very valuable contribution. For instance, assistance has been provided to less developed countries as far as this is concerned. There has been a study of the meat trade with the Middle East-whether it will be possible to provide a system whereby meat can be treated in such a way as to preserve it for transport so as to help reduce our dependence on live sheep exports to the Middle East. It has looked at the fact that mushroom producers in Australia lose probably $1m a year because of wastage and spoilage of food which could be overcome by a proper program of food irradiation. Lastly, I mention one of the important things that the Commission has done in terms of the study of water and soil problems in Australia. A study has been done of the Great Artesian Basin, tracing the element caesium 137 throughout the water table. It has been demonstrated that it may, in fact, take a million years for water to travel from its entry point to the west of the Great Dividing Range or from the Gulf of Carpentaria to the Centre. It is a distance of perhaps only 1,000 kilometres, but the study has made people conscious of the fact that in effect a mining of water takes place, that the artesian wells and bores represent a mining of water and that the water may not be as easily replaced, as plentiful, or as renewable a resource as people have previously thought to be the case. Elsewhere the caesium 137 studies have demonstrated that for every one tonne of wheat harvested in Australia something like 40 tonnes of topsoil has been lost. As honourable senators will know, we have had many debates in here about soil conservation and soil management programs. We have identified soil degradation and the loss of topsoil as one of the major areas which need to be attended to in the conservation of natural resources and the environment. That information has been largely provided by the studies undertaken by the Atomic Energy Commission. Looking forward, one would hope that in the bids that Senator Evans might be making in Cabinet on the forthcoming Budget perhaps he will be in a position to advance the cause of the Atomic Energy Commission in terms of the provision of a cyclotron for that facility. As honourable senators will know, there has been a great deal of interest in that matter. There was an article in the Age on 13 April this year indicating that ASTEC, the Australian Science and Technology Council, the National Health Technology Advisory Panel and a medical cyclotron committee chaired by Dr Keith Lokan, a Melbourne physicist, have made recommendations about the location and siting of a cyclotron facility in Australia. At the moment we are not able to produce the full range of medical isotopes that we would like to be able to produce because of the absence of this very expensive state of the art piece of technology. I believe that the Atomic Energy Commission has an extremely strong case for that facility to be located at Lucas Heights, to make use of the existing technology and of the very high level of skill which is certainly available at that facility. The production of stable isotopes is another area of activity which the Commission, and shortly the Australian Nuclear Science and Technology Organisation, undoubtedly would want to be involved in. The production of molybdenum 98 for technetium production, which yields no fission products, could establish a world market which could be used as part of the promotion of a science and technology effort in the so-called sunrise industries which commend themselves very much to this Government. We know that the Atomic Energy Commission has been involved in working on ceramics and processes involving ceramics. There have been attempts to improve the quality of what is called PSZ, partially stabilised zirconia products, that have been a by-product of the development of the Synroc process in which the Commission has played a leading role. The Commission is clearly facing a number of problems which ANSTO will now face. In view of the important legislation about to be introduced, I seek leave to continue my remarks later, Mr Deputy President. Leave granted; debate 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 Gareth Evans) read a first time. Senator GARETH EVANS(Victoria-Minister for Resources and Energy)(9.47) —I move: That the Bill be now read a second time. I seek leave to have the second reading speech incorporated in Hansard. Leave granted. The speech read as follows- This Bill is to establish a Parliamentary Commission of Inquiry into the conduct of Mr Justice Murphy. The Commission is to consist of 3 persons who are or have been Judges of a superior court. The terms of reference are set out in clause 5 and are to inquire and advise the Parliament whether any conduct of Mr Justice Murphy has been such as to amount to proved misbehaviour within the meaning of section 72 of the Constitution. It will be noted that the terms of reference provide for a potentially wide-ranging inquiry. This has been necessary because, notwithstanding his acquittals of criminal charges, allegations continue to be made against his Honour. It is necessary for the standing of the Judge and of the High Court that all allegations be dealt with one way or the other. The width of the terms of reference is to be read in the light of clause 5(2), under which in carrying out its inquiry the Commission is to consider only specific allegations made in precise terms. Mr Justice Murphy is not to be required to give evidence before the Commission on a matter unless it is of the opinion that there is before the Commission evidence of misbehaviour sufficient to require an answer and the Commission has given the Judge particulars in writing of that evidence. These important requirements are intended to limit the inquiry to specific allegations, and also vexatious or irrelevant complaints to be summarily rejected by the Commission. In addition, clause 5 (4) requires the Commission not to reopen issues dealt with in the trials leading to the acquittal of Mr Justice Murphy except to the extent it is necessary to do so in order to examine other issues in the performance of its inquiry. This includes in particular the issue of guilt or innocence of the charges laid, and whether the conduct the subject of the charges was such as to constitute proved misbehaviour in any other way. The Commission is required by clause 6 (2) to base its findings on evidence admissable in a court of Law. It is to have all the normal powers of a Royal Commission, including the power to subpoena witnesses and call for documents and other material. This will include Mr Justice Murphy, where the Commission decides that there is a case to answer on the matter in question. As is normal for Royal Commissions, self-incrimination is no excuse for failing to answer, but the evidence cannot be used in any court proceedings other than for perjury. See clauses 16 and 27. In order to enable the fullest possible consideration of the matters in issue, but in such a way as not to unduly prejudice the rights and reputations of individuals, the presumption is to be (subject to any decision to the contrary by the Commission) that the proceedings of the Commission will be conducted in private. (clause 7 (1)). The Commission is to have access to documents and other materials of the Stewart Royal Commission, including tapes and tape transcripts and summaries, now held by the National Crime Authority. (clause 13 (1)). In considering any allegation it is to have regard to the outcome of any previous official inquiry into the allegation, and only consider it to the extent that the Commission considers it necessary or desirable to do so. (clause 5 (3)). Under clause 8, the report of the Commission is to be furnished on or by 30 September 1986 unless both Houses extend that date. The Commission is to report to the President of the Senate and the Speaker of the House of Representatives- (a) its findings of fact; and (b) its conclusions whether any conduct of Mr Justice Murphy has been such as to amount, in its opinion, to proved misbehaviour within the meaning of Section 72 of the Constitution. As members appreciate, if it so reports it will still be for each House of Parliament to decide whether a case of proved misbehaviour within the meaning of Section 72 of the Constitution has been established. If the report is that there is no conduct that amounts to proved misbehaviour it will, I trust, be accepted by all members as putting the matters dealt with finally to rest. I commend the Bill to the Senate. Senator GRIMES(Tasmania-Minister for Community Services)(9.48) —I move: That, for the purpose of debating the second reading of the Parliamentary Commission of Inquiry Bill 1986 and notwithstanding anything contained in the Standing and Sessional Orders, the Deputy Leader of the Opposition (Senator Durack) and the Leader of the Australian Democrats (Senator Chipp) shall not speak for more than 20 minutes each and other senators shall not speak for more than 15 minutes. I think the motion is self-explanatory. Question resolved in the affirmative. Senator DURACK(Western Australia)(9.48) —The introduction of the Parliamentary Commission of Inquiry Bill 1986 into the Senate is an historic occasion and one of very great significance for the Parliament, and indeed for the appropriate operation of our Constitution. It is a Bill to establish a parliamentary commission of inquiry to inquire into certain matters and to advise the Parliament-I read from the Bill: . . . whether any conduct of the Honourable Lionel Keith Murphy has been such as to amount, in its opinion, to proved misbehaviour within the meaning of section 72 of the Constitution. Why do I say that this is as an historic occasion? Surely, many people would say, establishing commissions of inquiries to inquire into numerous questions and to report on them is a very familiar aspect of the political landscape. These commissions are royal commissions or inquiries established by the Executive. They report to the Executive and, of course, in most cases the Executive tables the reports in the Parliament and action can be taken by the Executive, by the Parliament or by both. In this case we are establishing, I believe for the first time, a commission of inquiry by the Parliament itself. The commission is to consist of three members appointed by resolution of the Senate and by resolution of the House of Representatives. Of course, the report will be to the Parliament. The reason for that is that the question on which this Commission is to inquire and to advise is a responsibility of the Parliament and of the Parliament alone; namely, the determination of whether a judge of a Federal court-in this case, the High Court of Australia-is guilty of proved misbehaviour. That is what the Constitution requires under section 72-proved misbehaviour which would justify an address by both Houses of Parliament to the Governor-General in Council for the removal of that judge from office. That is the only way in which a judge of a court created by this Parliament can be removed from office. Otherwise he or she has full protection under the Constitution until reaching the retirement age of 70 years. It is important to note from the terms of this Bill that the Commission will inquire into and advise the Parliament whether any conduct of the judge, in its opinion, amounts to misbehaviour. I think that is also a very proper exercise of the constitutional power of this Parliament and of the functions of this Commission. It is being established by this Parliament to make those inquiries and to give that advice to the Parliament, certainly to make findings of fact, but only in a form which ultimately does not trespass upon the power and, indeed, upon the obligation of the Parliament to make those findings. There are also, no doubt, questions about the standard of proof that would be required. The nature of the conduct which should or could amount to misbehaviour is another matter that this Commission will, no doubt, have to consider and advise the Parliament on. Those matters are not specifically dealt with in this Bill. They were dealt with in this Senate when it established the second committee, the Senate Select Committee on Allegations Concerning a Judge. They were spelt out in the terms of reference of that Committee but I do not see any requirement for that and, indeed, I believe that the functions set out in this clause of the Bill appropriately express the constitutional position. The Parliament is establishing this Commission and is delegating to this Commission powers of inquiry, which the Parliament undoubtedly has-it may delegate those powers to its own Commission-and then ultimately it will have to deal with whatever the findings of fact and the advice of the Commission may be. The Opposition will support this Bill, although we have some concerns about some aspects of it which I will deal with in a moment. It has been quite clear for a long time, probably for more than two years, that a number of grave concerns-certainly less than allegations, but concerns-about the behaviour of this particular judge required an investigation of this kind. When these matters surfaced a couple of years ago the Opposition took the view that an investigation was necessary. We debated it here at great length during the early part of 1984, which ultimately led to the establishment of a Senate select committee of inquiry into the authenticity of the Age tapes and whether there was anything in those tapes which might lead to findings of misbehaviour. As far as the Opposition was concerned, that was an unsatisfactory way of dealing with it. The Opposition was very concerned that the Government was not prepared to co-operate in any way in conducting an inquiry of that kind and when that Committee reported it was even clearer that some independent persons should be appointed to make findings of fact and, indeed, to give advice to the Parliament on these matters. Again the Government would not co-operate. Indeed, we had calls from the then Attorney-General, Senator Gareth Evans, for the matter to be dealt with in the criminal courts. We even had calls from the judge himself that criminal proceedings were the most satisfactory way of dealing with this matter. We always took the view that these matters were matters for the Parliament to resolve; they were not matters for the courts, they certainly were not matters for the Executive and they would have to be resolved in this Parliament in one way or another. We know the history from then on, and I do not want to dwell on it at any great length. Undoubtedly, in the long run, it became obvious and necessary that this was the only path which would lead to these very grave, serious and disturbing questions being resolved. We on this side of the House resent suggestions that have been made that this has been a political witch hunt or indeed that there was a political trial, because that is far from the truth. We have, at all times, wanted this matter to be investigated and advice given to us by completely independent persons so that we could in a calm, sober and rational way exercise our responsibilities in relation to it. Some of the concerns that the Opposition has with this Bill are whether or not the Commission as constituted under the terms of this legislation will perform this task to our satisfaction and to the requirements, indeed, that we have or should have as members of the Parliament charged with this responsibility. Certainly, I have praised the first sub-clause of the functions of the Commission. I will not go over that again. The second sub-clause talks about the Commission, in carrying out its inquiry, considering only specific allegations made in precise terms. We are somewhat concerned about this. We propose to ask some questions about it and maybe seek to amend it because we do not believe that, when a Commission is inquiring into something, it has to have some specific allegation at that inquiry stage. Certainly the Commission should deal in the end, in the sense of making findings and advising us, only with specific allegations. Clearly misbehaviour cannot be proved by suspicion or what amounts to suspicion. There must be specific allegations of misbehaviour and specific charges. We are concerned whether at the inquiry stage this sub-clause may cut off the proper role of inquiry by the Commission virtually at its birth, thus rendering this whole exercise impotent in many respects. That arises particularly in relation to the Age tapes. This Bill gives the Commission access to all the material which was dealt with by Mr Justice Stewart and which was the subject of his report tabled in Parliament last week. It will be of little use to the Commission having that material made available if it cannot make full inquiries into the matters and what they may reveal and if it is to be cut off by saying that there are no specific allegations. In other cases there may well be specific allegations at the very beginning of the inquiry stage. We are also concerned about sub-clause (4), in which it seems that the Commission is very limited in the inquiries that it can make into matters before the trials of Mr Justice Murphy. We prefer and will move an amendment to adopt the original provision in the Bill that was shown to us this morning. We think that it better expressed the Commission's need to make inquiries into those aspects of matters which will be before it. The Opposition is also concerned about the very strict provision that, in the conduct of its inquiry, the Commission shall not make a finding except upon evidence that would be admissible in proceedings in a court. We accept that in making its findings of fact upon which ultimately its advice will be given to the Parliament the Commission will require adequate evidence to make those findings. I cannot imagine judges doing otherwise when finding facts upon which a person may be deprived of his status, rights and entitlements as a judge. But the legislation again, the way it is worded, seems to cut off at a very early stage by the prefacing phrase `In the conduct of its inquiry'. That must be further examined. The deepest concerns of the Opposition are in respect of two other provisions, one which requires that the Commission conduct its whole inquiry in private and the other that says that in its report to the Parliament it has to provide a record of only so much of the evidence as the Commission thinks is necessary to substantiate its findings and gives the Commission the power in submitting its report to the President or the Speaker of the House to require that some aspects of the report in certain circumstances shall not be reported but shall be the subject of a separate report to only the President and the Speaker. These two provisions seem to be quite at odds with the responsibility of this Parliament. In the end, to discharge our responsibilities, we must have access to all the material that was available to the Commission because ultimately we have to make the judgment whether the Commission's findings are justified and whether its advice is justified. Therefore, why do we have a commission of inquiry of this sort, all of which is to remain in private, on one of the most important questions which could arise under our Constitution and which has to be determined by this Parliament? There may be some circumstances in which it may be justified to sit in private but in accordance with all the traditions of the courts of this land and all the traditions of this Parliament an open and public inquiry for all to see and judge is a fundamental principle. To provide that it has to conduct its inquiry in private is absolutely contrary to that principle. As I said, the Opposition will move amendments and make some inquiries of the Minister for Resources and Energy (Senator Gareth Evans) about other aspects of this Bill. I hope that those have been circulated or will be circulated as soon as possible. The matters that I have canvassed are embraced in those amendments. I conclude by saying that we have had many debates in the Senate, particularly during 1984, about this matter. We hope that this Bill will be passed this evening and that the Commission will be established as soon as possible. We hope that it will be able to report as soon as possible and perhaps earlier than the reporting date in the legislation and that this will put an end to the matter. Whether that will place a further burden on us to make further decisions is another question. This is clearly the right way to go and the only way in which these grave questions touching the highest court in the land and devolving on us a very heavy responsibility can be properly and constitutionally determined. The DEPUTY PRESIDENT —The Senate earlier approved special speaking times for this debate. There has been a request for rearrangement. Is there any objection to Senator Haines speaking for 20 minutes and Senator Chipp for 15? Senator Georges —I want to speak on this matter. Have you limited my time, Mr Deputy President? The DEPUTY PRESIDENT —Your time is limited to 15 minutes. Senator Georges —I do not doubt that I can say what I need in 15 minutes but I object to the truncation of this time by arrangement. The DEPUTY PRESIDENT —Order! The Senate earlier passed a motion on this matter. That is not in dispute. The question is whether we have a rearrangement to allow Senator Haines to speak for 20 minutes and Senator Chipp for 15 minutes. There being no objection, I will allow that course to be followed. Senator HAINES(South Australia)(10.08) —I thank the Senate for its co-operation. The Parliamentary Commission of Inquiry Bill 1986 we are debating in the Senate tonight establishes in an unprecedented manner a parliamentary commission of inquiry. After the second Senate select committee had met, considered various allegations, called and cross-examined witnesses and put forward its report, the Australian Democrats stated that, as far as we were concerned, the matter rested with the courts and that whatever the outcome of any full judiciary inquiry the matter would thus have been dealt with accordingly. I do not want to canvass details of events over the past few years but we have had two Senate inquiries and two court cases, and the last of those court cases resulted in Mr Justice Murphy being found not guilty of the charges laid against him. As far as we were concerned at that stage, that acquittal meant the end of the matter. However, other people felt differently and for a variety of reasons that I do not particularly want to canvass here, continued to agitate. Senator Durack said in his speech that what we had to do was to approach this matter in a calm and rational manner. Without wishing to attribute any motives whatsoever to anybody in this chamber, I would suggest that there is certainly in the public mind a distinct hint of a witch hunt. I do not think witch hunts can really be held in a calm and rational manner, not even when they are disguised under the terms of a parliamentary commission of inquiry. We have a number of concerns about this Bill. We have those concerns partly because we do not believe that any additional inquiry of this or any other sort is necessary following the acquittal of Mr Justice Murphy at his last trial. However, part of the concerns deals with the contents of the legislation before us. I have raised these concerns with the Prime Minister (Mr Hawke), with the Attorney-General (Mr Lionel Bowen), and with the Attorney-General's representative in the Senate, Senator Gareth Evans. I acknowledge that some of these concerns have been picked up-I thank the Government for this-and have been included in the legislation before us tonight. However, one which concerns me and which concerns my Party considerably is the frequent reference within this Bill to the words relating to the meaning of proved misbehaviour under section 72 of the Constitution. One of our problems from the beginning has been that there is no definition of proved misconduct in the Constitution. It is extremely difficult to work out just what the meaning of section 72 (ii) is. We know that it relates to the need for an address from both Houses of Parliament to the Governor-General on proved misbehaviour or incapacity before a judge of the High Court of Australia can be removed. But there is no definition of that, despite the fact that the 1897 debates canvassed this whole question quite considerably. This means that we are left with something which unfortunately is particularly subjective. As a result, views will differ about what proved misbehaviour is and the criteria used to prove that misbehaviour. During the debates in 1897 the question of the American situation was raised and the problems that that country had. I think it is worth while for us to look back at what the founding fathers intended for section 72 and why they included the words `misbehaviour' and `incapacity' in the first place. Speaking on 20 April, Mr Glynn pointed out in relation to the United States Congress: . . . even went to the length of endeavouring to deprive the Supreme Court of a portion of its jurisdiction when they found the judges did not fall in with the views of some of the representatives of Congress. In the United States . . . there is power to interfere with the jurisdiction of the Supreme Court. ... ... ... In America attempts have been made to take away the jurisdiction of the judges where the judges were not complacent to Parliament. I do not think it is going too far to suggest that, if we are not very careful indeed, we will lead ourselves into the situation where proved misbehaviour is defined as something caused by judges who are not complaisant to Parliament. At the stage this debate had reached when that comment was made, the original section 72 contained no reference at all to what criteria were going to be used to remove a judge of the High Court, other than that an address by two Houses of Parliament was required. Mr Glynn went on, however, to question the integrity of members of parliament by saying: You- that is, the other speakers- leave it to the discretion of the two Houses of Parliament to remove a judge, but that power should be put in their hands. Sir William Zeal interjected: Is it dangerous to be connected with politics? Mr Glynn went on: It should not be regarded as a danger to have the matter connected with politics; but there is the fear of having a repetition of what has occurred in America, and the likelihood is greater here that under the inception of the system there, because with the larger franchise, we are so subject to being swayed by popular opinion. I think that is something we all ought to remember. A very grave miscarriage of justice is likely if what we do in this place is subject to the pressures coming from popular opinion. As a consequence of those comments and some others, Mr Kingston moved to amend the proposal. He said: I think we should be at great pains to secure the absolute independence of the Judges of the Federal Court, particularly of the Judges of the High Court of Australia, who are intended to adjudicate on matters which may affect the Federal Executive and the Federal Parliament. To my mind we shall be committing a glaring mistake if we do not protect these judges from ill-considered action either by the Federal Executive or by the Federal Parliament. He went on: Besides the first declaration that he shall hold office during good behaviour,- that is, the judge shall hold office during good behaviour- we have also this: May be removed by the Governor in Council upon Address from both Houses of Parliament in the same Session, praying for such removal. He continued: It strikes me that if you pass that the effect will be that on the address of both Houses a Judge can be removed independently of whether or not he has been guilty, and that should not be so. He went on to say that the clause should be amended to include the words `misconduct', `unfitness' or `incapacity'. As usual in debates of this kind, and this was no different from our own, there was some discussion about this. The word `unfitness' was left out and the word `misbehaviour' was substituted for the word `misconduct'. The founding fathers had no doubt at all about the fact that the Parliament had to have something other than its own beliefs about the behaviour of a particular judge when it came to the extremely serious matter of removing a judge from his position. The people involved in this debate clearly believed, as Mr Isaacs went on to point out a little later, that the issues mentioned in Todd in his book On Parliamentary Government in England should obtain. On page 191 Todd says: Misbehaviour included, first, the improper exercise of judicial functions; While we are on that point I wonder whether the reported-I stress that it was only reported-suggestion by a number of High Court judges that they would not sit with Mr Justice Murphy constitutes an improper exercise of judicial functions. Todd went on: second, wilful neglect of duty, or non-attendance; and, third, a conviction of any infamous offence, by which, although it be not connected with the duties of his office, the offender is rendered unfit to exercise any office or public franchise. He went on to stress: In the case of misconduct outside the duties of his office the misbehaviour must be established by a previous conviction of a jury. There was no question that when the founding fathers amended section 72 they were intending that misbehaviour would be judged according to whether a previous conviction of a jury had been determined. We are concerned too that the Bill allows the three judges-assuming the Government can find three judges to sit-to determine what, in their opinion, is proved misconduct under the meaning of section 72 of the Constitution. I would suggest that this is leaving the whole thing wide open to a High Court challenge from whoever has standing in this case with regard to exactly what the word meaning in the Bill means. Given that the Australian Democrats are opposed to the inquiry in the first place and will oppose the Bill at the second reading stage, we are nonetheless concerned that since it is a fait accompli-because the Opposition is supporting, indeed it is enthusiastically encouraging, the Government in establishing the inquiry-the terms be as fair as possible. Therefore we believe it is appropriate that only specific allegations made in precise terms should be considered. The presumption that the inquiry should be held in private, while itself presenting some problems, we acknowledge, avoids the airing of all sorts of scuttlebutt that a public inquiry would necessarily entail. Therefore we cannot accede to the Opposition's amendment that the inquiry be public unless the Commission wishes it to be held in camera. Having in camera hearings might leave us open to suggestions that this a star chamber, that there are secret hearings and that there may be cover-ups. I suggest that to a very large extent we absolve ourselves of any of those sorts of allegations through clause 8 (1) (3), which insists: The Commission shall submit with its report- that is a public report which it is obliged to make to the Parliament- a record of so much of the evidence before the Commission as the Commission thinks necessary to substantiate its findings of fact and its conclusions. In other words, the Commission is obliged to provide the Parliament with evidence that has led it to make findings of fact and not simply to strew around the place all sorts of allegations and scuttlebutt which may or may not turn out to have any grounds for belief at all. What we have to remember when we talk about the value of having a public inquiry is that unfortunately no rules of evidence exist in the public forum; that allegations are frequently regarded as facts by those people who would like to believe them; that the media, whether it does it deliberately or not, frequently places selective emphasis on those things that it publishes and in doing so can distort, in the public's mind, the issues that are before the inquiry or the Parliament. We do not believe that the inquiry will necessarily resolve the issue. If proved misbehaviour-whatever that means in the opinion of the three judges-is found, is the Government going to be prepared to accept that and to act under section 72? I stress that the initiative must come from the Government, and that means that the first move, if misbehaviour is found, must come as an address from the House of Representatives. If no proved misbehaviour is found, will the Opposition parties accept that or will they continue to pursue the matter? I would have hoped that they would accept it, but this morning I listened to the Opposition spokesperson on this matter, Mr Spender, saying on Channel 9 that it was quite within the powers of the Parliament to disagree with the judges and to go ahead as it saw fit, notwithstanding any decisions or reports made by those three judges. I repeat: This inquiry will not necessarily resolve the issue. We have over our heads the spectre of a High Court challenge with regard to the meaning of proved misbehaviour. We have the possibility that if some is found the Government will not act and if some is not found the Opposition parties will continue on their merry little way in their intent to get Mr Justice Murphy no matter what else happens as a consequence. What worries us a great deal is something that I alluded to early in my speech: The Government may well have taken the action it has taken in bringing this Bill before us as a result of actions that other High Court judges have purported to have taken in refusing to work with Mr Justice Murphy. The real danger in this situation, if it has been accurately reported, is that the other High Court judges, without any constitutional power to do so, are effectively setting a precedent whereby they can indirectly determine who their fellow judges will be. It opens the way for some future new appointment, perhaps, to be objected to by a number of other High Court judges who do not like something about that judge. Senator Chipp —A self-assumed right of veto. Senator HAINES —As Senator Chipp says, it is a self-assumed right of veto if the judges' actions have been accurately reported. I find that at least as great a slur on the High Court as anything that people allege Mr Justice Murphy could have done to that high judicial office. We oppose this piece of legislation because we oppose the establishment of the inquiry. We do not consider it necessary, given past events. We hope that, since the Opposition is joining the Government in this extension of what can only be termed a witch hunt, at the end of it all the matter will rest on the findings of the three judges and we can get on with what I believe are far more important pieces of legislation than we have to deal with in this chamber. Senator GEORGES(Queensland)(10.26) —I suppose there is one slight advantage in being in political limbo; I can assume the right to speak, having no other forum in which to express my views. You might recall, Mr Deputy President, that from the very start I was opposed to the inquiries that were set up. I said that the first inquiry would create precedents and lead to situations over which we have little control. That has proved to be correct. The inevitable result of those early inquiries was to bring us to this point. We are now faced with a continuation of the exercise which, if it were merely a political exercise, would be of continuing interest to us. However, as we continue and extend this inquiry we continue the agony of a person who, for two years, has been placed on a pillory, has been scrutinised and examined and has had his personal life brought under close examination. I would have thought that once he was acquitted that would have been the end of the matter. I believe that the inquiries held two years ago should never have been commenced. We now find ourselves going through another unnecessary exercise, but to the person concerned it is an extension of an experience that should never be the experience of any citizen in this country. What I find abhorrent is that at the very time that we are debating this matter-during the day and even at night-the home of the person concerned is under the closest scrutiny by the media, which have determined that they should work not at the highest levels but at the meanest levels. We are really engaged in a process which has been thrust upon us by a certain section of the Press which has determined that a particular individual, by innuendo and secondary means, shall be exposed and shall be destroyed. I believe that we are party to that destruction. If it had not been for the tremendous courage and tenacity of the person concerned, Mr Justice Lionel Murphy, they would have achieved that result earlier by way of resignation. I am surprised that the Opposition, in spite of the soft words of Senator Durack, continues to approach this with what can only be described as political savagery. When one examines it, that is exactly what it is about, and it has been revealed by Mr Spender in his remarks in the other place and by Senator Durack, more quietly and perhaps more politely, that the examination will go on. The exercise of this Commission will come up with the same result-an exoneration of Mr Justice Murphy. But in spite of that, we will go through the exercise that we should be going through right now if the Opposition were determined to succeed. At last the Democrats have seen the light. In spite of two Senate inquiries, they have seen that there was nothing else to find-nothing to find, in fact. The jury in less than three hours, given the right advice from the bench-and that is critical of the previous advice, and perhaps I should not be critical of a judgment-was able in a short time to come to a conclusion which we in this Parliament should have accepted. But that is not the purpose of the whole exercise. The purpose of the exercise is to discredit and destroy a justice of the High Court. In so doing we destroy not only that person but the court itself. The damage to that institution about which I warned at the time, as did other people, is beyond repair. I believe in political appointments to the High Court. I believe that a person who has served in this Parliament on either side of the House and who has the legal qualifications should be appointed to the High Court. Eventually we shall extend the High Court's numbers to enable it to carry out its responsibilities. It is necessary to appoint to the High Court people with political experience. They will have to assess legislation which comes from the Parliament. They will be aware of the format of that legislation but they will have to give it a human face. My view is that political appointments are a necessary process of achieving that result. The High Court will do as much to change the attitudes in our society as we do in this place. The appointments we have made politically have been sound, but what have we endeavoured to do by our Standing Orders, which we have breached so remarkably on both sides of the House in the past two or three years? The Standing Orders say that once we make the appointment that judge should be free, without criticism from this place, to carry out his duties and his responsibilities. We had sufficient faith in the integrity of the people appointed to believe that they would carry out their legal function fairly. There may have been one or two breakdowns, nonetheless in the long run it has been a success. My view is that, once we attempted to scrutinise the personal behaviour of a justice of the High Court, we were engaging in a dangerous exercise. In this case it has been an unfair exercise which should never have been initiated, because many of us knew the reputation of this person. We also knew his weaknesses, which we should have considered to be his strength. But we continue to pillory the person and we continue to do damage to the institution. We do things in haste. If we had reflected on what was being said even by High Court judges-and I agree with Senator Haines that it ought not to have been said-we might have discovered that the advice was not as it appeared in the first place. If we had discovered that, we could have resiled a little, moved away. But it seems to me, looking at the matter, having come coldly back from a different environment into this political madhouse which seems to have developed, that the advice given to the Attorney-General may have been the opinion of one judge and one judge alone. If it was the opinion of one judge and one judge alone, that judge has allowed himself to fall into error. But it is an error that we forced him into because we created the situation in which that judge became involved. Again, the Standing Orders prevent my canvassing this; but, in the long run, the truth will be revealed. If one is seeking the truth, one should not proceed in haste. What are we doing now? A Bill to set up a commission and to create a precedent was dealt with by the other place in an hour. We are here now, held back from our normal program, to determine the matter here tonight and here also we are truncating the debate on the issue. My view is-and this is the view of the Democrats-that there should be an end to this. But since the determination has been otherwise, I suggest that we expedite this exercise, get it over, and then reflect on the whole process when the report of the Commission comes back. I am certain, given the wisdom of the terms of reference, which the Opposition for some reason seeks to amend, that there can be only one conclusion to this inquiry-that there is no case, and never has been, for Mr Justice Murphy to answer. Then we should leave it at that. I am beginning to believe that that might not be the case, having viewed the process that we have followed. There has been a political motivation to all this; there has been error after error on both sides; there has been error on the part of those who have become involved. Do not let us become an instrument of those who in secret listen to communications between people. In many cases they obtain information illegally, information that is moved around by rumour, that surfaces in the Parliament under privilege, forces us to an inquiry and gets us involved in this mess in which we now find ourselves. We could have completed the matter after the first inquiry. I remember Senator Chipp agonising. It could have gone either way. He wanted more information, as was his right. But if he had gone the other way, there would have been an end to the matter. When we came to the second inquiry and we went through that exercise appointing some sort of commission to assist us, and the four senators we appointed went through that traumatic exercise, at one stage it was possible that the whole matter could have been brought to an end if the individual who was under stress had been differently advised. I remember the conversation and the advice I sought from Senator Tate and Senator Haines on that afternoon as to whether it was too late for the judge to appear. They said: `No, it is not too late; it would extend the inquiry by a week, but we do not really believe that it is necessary'. Upon that basis perhaps the person concerned did not appear before that Senate Committee. Now when I look at that decision, I believe that it was the wrong decision and the wrong advice. All these situations which are created in this way depend on minor incidents, minor decisions, unexpected situations. I would have thought that when the acquittal came down we should have put the National Times to one side, we should have put the rumour to one side. We should then have proceeded to bring the matter to an end. If the Opposition had decided otherwise, it could have put a substantive motion before the House which we could have determined. My view, based on the Democrats' attitude, is that that would have brought the whole matter to an end. We have now extended it unnecessarily. I regret that. The Senate ought now to proceed to pass this legislation, get the Commission appointed, seek an early result by 1 September and hope that the matter then is at an end. The DEPUTY PRESIDENT —Earlier today the Senate passed a motion changing the time of adjournment from 6.30 p.m. to 10.30 p.m. It is obviously the wish of the Senate to continue sitting. I did not interrupt Senator Georges while he was speaking. In order to formalise proceedings, I now put the question: That the Senate do now adjourn. Question resolved in the negative. Debate resumed. Senator LEWIS(Victoria)(10.41) —This is certainly an historic but certainly not a happy day for the Parliament, nor is it a happy day for the nation. I say very clearly to the Senate that there is no glee and no witch-hunt on this side of the Parliament. Any suggestion that there is or has been a witch-hunt would have to be directed towards me because I was on both the Senate Select Committee on the Conduct of a Judge and the Senate Select Committee on Allegations Concerning a Judge. I wish to give a brief resume of what I did in relation to both Senate committees. In the first Committee report in August 1984, Senator Durack and I put down a joint report in which we said: There is a prima facie case of misbehaviour against the judge. We then made it very clear that that was very much a preliminary finding. In paragraph 19 of our report we said: We stress that we are not finding that misbehaviour has been proved. It would not accord with the principles of natural justice to make such a finding at this stage. So that was very much a preliminary finding. We made it clear at that stage that there would be a need for a proper hearing. We asked-indeed, we begged-the Government to set up a proper hearing. I say to honourable senators opposite who are unhappy about what is happening tonight that we did not have a proper hearing because of Senator Gareth Evans. If Senator Gareth Evans had been giving the Government the advice it should have been getting at that stage we would have had a proper hearing then and it would have been all over. We asked the Government to establish a parliamentary commission of inquiry, which is what we are in the process of establishing now. The Government would not do so. So we set up the second committee, the Senate Select Committee on Allegations Concerning a Judge. In that Committee, I found that a prima facie case had been established. That prima facie case was also, I might say, held by Senators Tate and Haines, but they held that it was on the balance of probabilities. My view was that the evidence was uncontradicted by sworn evidence of His Honour. The inevitable conclusion of that was that the case had to be held to be proven beyond reasonable doubt. I still say that my decision was right, notwithstanding the criticisms which have been made about my decision. I say that my decision was right because subsequently my decision was supported-I draw the attention of honourable senators to this-firstly by the magistrate who committed His Honour for trial and then by the judge of the first trial, who was strongly pressed to say that there was no case to answer but who allowed the case to go to the jury. My decision was then supported by the first jury. Then, after the first jury, five judges of the New South Wales Court of Appeal, having heard all the evidence and argument and having had it strongly represented to them that the case ought not to have been allowed to go to the jury, held that the case should have gone to the jury and that there was evidence which could convict. They ordered a retrial. I believe that that establishes beyond any shadow of doubt that the decision I came to in the second Senate inquiry was a proper and valid decision. Senator Georges —What result? Senator LEWIS —I will finish the story by saying that the fact that the second jury acquitted His Honour in no way detracts from my conclusion, which was that there was a case to answer. I deny that anyone on this side of the chamber is out to get His Honour. I draw Senator Georges's attention to the fact that this Bill is the Government's Bill; it is not the Opposition's Bill. Honourable senators on this side of the chamber are absolutely determined to face up to the responsibility imposed on us by section 72 of the Constitution. Where a Federal judge is impeached, the Constitution imposes on each one of us in this chamber and each member of the other chamber ultimately to determine where there has been proved misbehaviour. That will be the decision ultimately of each honourable senator and of me. We can seek assistance, as we are doing in this Bill, but ultimately it will be our decision. I return to the second Senate Committee report. In that report, I raised four other matters for consideration, one of which has been dealt with. I raised in the report-I was the only one to do so-the evidence of His Honour Judge Flannery, which has now been dealt with, as have the criminal allegations. I raised three other matters in that report which have not been dealt with. They are set out on pages 5 and 6 of my report. I refer to one matter in particular because I hope that when the commissioners are considering the allegations in this matter they will consider the following allegation. I quote what I said: There is evidence before the Committee of comments made by Mr Justice Murphy to the Chief Magistrate about what is colloquially referred to as `the Social Security Conspiracy Case'. There are two points about the comments: (i) they were made at a time when the charges were being heard by a magistrate so that they may have been improperly made and with an intention to pervert the course of justice or may have been a contempt of the court, and (ii) they were made by a judge of the High Court who subsequently was called upon to make findings on appeal about some aspects of the case and who may reasonably have supposed that he would be required to do so. As I said, I hope that the commissioners will apply their minds to that evidence and also to the other two matters which I have raised and which are substantiated by the reports of Mr Xavier Connor and Mr John Wickham to the Committee. Turning to the Bill that is before the Senate, there are two absolutely crucial points in this matter. The first is: What is the definition of proved misbehaviour? The second is the standard of proof to be adopted. When the Senate Committee met it had before it two definitions of misbehaviour, one by the Solicitor-General and the other by Mr Pincus. The Senate Committee was required by the Senate to apply its mind to those two definitions. This Bill does not contain either of those definitions. So one is led to believe that in due course the commissioners will determine for themselves the proper definition of proved misbehaviour. They will ultimately advise the Parliament of what is the proper definition of proved misbehaviour in their view. The other definition is the standard of proof to be adopted-whether it will be on the balance of probabilities or beyond reasonable doubt. That undoubtedly will be a matter to which the commissioners will have to apply their minds. The simple matter is that the Commission will need to determine the facts and advise us of the facts as they have so determined them. It will also advise us as to the law to be applied in a section 72 case. The terms of reference set out for the second Senate Committee, in my view, probably were much better than the terms of reference set out in the Bill. Nevertheless, we are stuck with the Bill. We need an assurance that all the evidence available to both Senate committees, the Stewart Royal Commission of Inquiry into Alleged Telephone Interceptions and the National Crime Authority will be made available to the commissioners. It seems that that has been covered in the second reading speech, although I will be pleased to hear Senator Evans repeat more or less what he said on television tonight, when I thought he made it perfectly clear that there would be no attempt to restrict that evidence. There are a couple of other matters to which I wish to refer. The first is my concern about the hearing being kept in secret. The truth of the matter is that, unfortunately, the material will leak. Journalists will make their investigations and their inquiries and undoubtedly there will be people who will believe that they have something to gain by telling the journalists some aspects of the story. The inevitable result of that is that some aspects will be leaked for specific purposes. Senator Chipp —By the judges? Senator LEWIS —Not at all by the judges. So many people will be involved in the inquiry that someone will undoubtedly leak material for their own purposes. Senator Chipp was on one of the committees and he saw material being leaked daily from that committee, so he ought to be well aware of the truth of what I have just said. Senator Chipp —Not by the staff. Senator LEWIS —If Senator Chipp is volunteering that it was he who leaked the material, that is his business. I am just saying that the truth is that material will be leaked for specific purposes. That is a tragedy. Ultimately, when the commissioners bring down their report, because the hearings have been secret people will have some doubts about what happened. They will have some doubts about the nature of the inquiry. The result will be that there will be doubts in the minds of some people about the decisions of the commissioners, whichever way they find. That is one of the tragedies of the Government's decision to have the hearing in secret. The second matter I wish to raise is that of specific allegations referred to in clause 5 (2) of the Bill, which states: In carrying out its inquiry the Commission shall consider only specific allegations made in precise terms. I would like Senator Evans to tell the Senate what he believes clause 5 (2) of the Bill means. I presume that, as with the second Senate inquiry, what will happen is that counsel advising the commissioners will consider all the evidence to the commissioners and will draw up a series of allegations on the basis of that evidence. Then in due course His Honour will be given an opportunity to respond to those allegations. Unfortunately, I see that Senator Gareth Evans is so involved in discussion with Senator Haines that he is not listening to what I say. I hope that his advisers will ultimately tell him what I have said so that he can respond. I wish to draw to the Senate's attention the difficulty created for us on the second Senate Committee when that procedure was adopted. Ultimately, when we got around to the closing address, counsel assisting the Senate inquiry pointed out to us that the evidence had raised a fresh allegation. The allegations having been drawn at the beginning and all of the evidence having been considered, by the time we got to the end of the evidence a fresh allegation had arisen out of that evidence. Counsel pointed out that it was probably too late to deal with that fresh allegation because that would have meant that the judge would have to be given an opportunity to respond to that allegation. That is one of the difficulties with having undefined allegations. It is not that I disapprove of it; I simply ask Senator Evans to tell the Senate how he believes that it will work. Finally, I wish to say that everyone on this side of the chamber hopes that this Commission will ultimately be the end of this disastrous affair so far as the High Court of Australia is concerned. We wish the Commission well. We hope that it will be able to get on with this business quickly, come to a decision, and help us to solve the problems we face under section 72 of the Constitution. Senator CHIPP(Victoria-Leader of the Australian Democrats)(10.55) —There would not be an honourable senator here who would not say hear, hear, to the last sentence of Senator Lewis's speech, but I very much doubt whether this Parliamentary Commission of Inquiry will solve the problem. In fact, I am almost certain in my mind that this inquiry will solve absolutely nothing; that after it is over, notwithstanding its findings, we will be back exactly where we are today. The country will probably be $3m to $4m poorer, the time of three valuable judges will have been spent for six months, and the work of the High Court of Australia will have been clogged up in the meantime. Tonight people have talked about tragedy, and I share that view, but in my mind one of the greatest tragedies of the whole saga that now goes back over two and a half years is that, in the Senate Select Committee on the Conduct of a Judge, the first Senate inquiry to investigate the conduct of Mr Justice Murphy, evidence given against him was given not by some fruitcake or some lightweight in the community but by a chief stipendiary magistrate in New South Wales, a highly respected man who I believe associated with the Australian Labor Party, who made the most grave accusations against Mr Justice Murphy. His evidence was tested on two occasions under the most savage cross-examination-as savage as politicians can be-for about a day. As I understand it, the majority of senators on that Committee could not shake Mr Briese in his testimony that he believed Mr Justice Murphy intended to pervert the course of justice. I have always held the view that an accusation made against another human being is one thing; that no matter how honourable the person making the accusation is, the person who is accused must have the right to respond; and that if the respondent is as convincing or as honest as the accuser, every time I would find no result. I would find in favour of the accused. I expect that every honourable senator would share that view. That is the basis of Australian fair play. However, on the advice, I assume, of some people-to this day I do not know whether it was the highly paid legal advisers to Mr Justice Murphy, whether it was any of his parliamentary colleagues or a senator on the Committee-but in any case for some reason Mr Justice Murphy chose not to come to that Senate Committee and be cross-examined on the accusations. I believe that from that moment on the position has got worse. I say with great sincerity that if persons did advise him not to appear at that Committee, and indeed at the hearings of the Senate Select Committee on Allegations Concerning a Judge, the second Committee, those people today carry an enormous responsibility for what has happened and what is happening to Mr Justice Murphy. I have come to the view, as have my colleagues-the Australian Democrats are unanimous on this-that this inquiry should not be held, for the simple reason enunciated by Senator Haines. We have now had two exhaustive and efficiently performed Senate inquiries into the alleged misconduct of Mr Justice Murphy and, out of those inquiries, two court cases. Maybe this is shorthand, but the net result of those two Senate inquiries and the two court cases is that a jury has acquitted Mr Justice Murphy on all or any charges against him. That was a few weeks ago. So I would have thought that, in terms of Australian fair play, at that point the slate was clean. Since then there have been two events. The first was accusations by a former policeman about the Greek conspiracy case. That was properly referred by the prosecutor at the trial, Mr Callinan, to the Director of Public Prosecutions, who examined the accusations. The Director of Public Prosecutions then made a determination that the evidence was of such a character that no prosecution could or should be made. The other event was the production, fortuitously so soon after the acquittal, of the second, confidential part of the report of Mr Justice Stewart's Royal Commission of Inquiry into Alleged Telephone Interceptions of which I was privileged to receive a copy in confidence. While one cannot breach that confidence, I believe it is proper for me to say that my reading of that second part of the report would not lead me to the view that Mr Justice Stewart had recommended a prosecution against Mr Justice Murphy on any matters associated with that report. Where does that leave us? It leaves us with a human being and his family who have gone through 2 1/2 years of hell. Nobody here would know the kind of hell Mr Justice Murphy has been through and is going through. He has suffered four savage examinations of his conduct or alleged misconduct and at the present time his slate is absolutely clean except for certain information-if one could put it that high-rumours or innuendo that go around the place. To investigate those matters, the Parliamentary Commission of Inquiry Bill asks the Parliament to authorise God knows how much money-I am putting it at $3m or $4m and six months time, conservatively. Therefore, the Australian Democrats will vote against the second reading. Our vote will be virtually irrelevant because I take it that the Liberal Party of Australia and the Australian Labor Party will be voting for it. When we get to the Committee stage we will argue that the terms of reference by and large are fair and reasonable. We are deeply worried about the implications of some of them, particularly that we as a parliament are giving to a group of three judges the responsibility that we cannot or are not game to handle here; that is, of defining what is proven misbehaviour. I have come to the view, after closely examining all of this material about Mr Justice Murphy, that we ought to grasp the nettle and try to come up with a definition. At first I was against the proposal of Dr Gavan Griffith, which I am not capable of describing, but at least it is something, and the core of that is that we have to have some measurement of what is proven misbehaviour. The Griffith point essentially is that misbehaviour is only criminal misbehaviour of such a nature which would interfere with the performance of his duties as found in a criminal court of law. I know that it is not perfect-I know that judges, policemen and politicians can engage in misbehaviour of another kind that is not necessarily criminal-but at least it is a test. It is not a subjective judgment. The way we have it now, it must be subjective. I am terrified of subjective judgments because I spent three years as the Minister for Customs and Excise when I was the Chief Censor of this country and had to make subjective judgments as to what was moral or immoral. One thing I learned very savagely in those years was that the judgment about what is moral or not is very subjective and it differs from person to person. If we took two decent, honourable people and let them examine the same behaviour, the chances are that one would say `that is immoral' and the other one would say `that is moral'. The interesting thing is that the subjective judgment of morality changes even in one person from year to year. If we examine our own attitudes, all of us will see that today we think of an act differently from the way in which we thought of it 10 or 15 years ago. People's subjective judgment varies after they have had children, et cetera. Not only are we not defining `proven misbehaviour'; we are allowing three judges to advise us, after receiving learned advice from the Solicitor-General's Office, et cetera. That worries me. The thing that also worries me is the matter properly referred to by Senator Lewis; that is, the standard of proof. On what standard of proof are we asking or directing the judges to come to a judgment about misconduct? When the judges get their commission, will they determine whether Mr Justice Murphy is guilty of proven misbehaviour on the test of beyond reasonable doubt or will they come to a judgment on the balance of probabilities? It is quite possible or probable that the judges will have to bring down two judgments, because the strength of the two tests varies and we have given them no lead. We believe that the proposition that all of the inquiry be held in public is outrageous. I hope that the Opposition has thought this through. The Opposition knows that any royal commission or commission of this kind flushes every fruit-cake in Australia out of the woodwork. Royal commissions about scandal attract people who have a grudge, who want to come out and be a sensation or who want to allege misconduct of some kind. Is the Opposition saying that, if some person wants to make the most outrageous accusation about Mr Justice Murphy, which perchance is totally untrue, absolutely baseless and incapable of corroboration, that should be allowed to be stated in public? That would give licence to the media to put it on page one. What happens to the poor devil whose character and reputation is blackened? We have had in Sydney recently a version of this, in a different sense, involving a certain lady of unfortunate repute-the notorious Love Boat scandal. It is now obvious that that was a total fabrication. If such allegations were made to this Commission in public, they would be splattered across the front pages of the newspapers and every television station under privilege. It might be said that the next day or the next week counsel for Mr Justice Murphy could wipe clean the slate; but the slate can never be wiped clean on a thing like that, as everybody knows. I believe that there is adequate protection in this Bill for that, because if the Commission finds a proven act of misbehaviour on the evidence given in secret and if the Commission wants every member of parliament to believe it and accept its recommendations it will have to publish the evidence upon which it came to that conclusion. I believe that is the protection we get from having some of these matters heard in secret. I conclude, because Senator Haines has adequately covered most of the points, on something which disturbs me. Today I spoke at length with a well-known professor of constitutional law. I put to him a question about certain reported actions of the six High Court judges last weekend. I said: `Is it arguable that if one or more of the six judges threatened not to sit with Mr Justice Murphy this could be evidence of proved misconduct?'. His reply was: `It could provide evidence of the judge's proved misconduct'. He said that the fact that the judges would not sit with Murphy, if indeed that was the case, means that they are suggesting Mr Justice Murphy's guilt by implicit suggestion. What bothers me even more is outlined in paragraphs 1106 and 1107, at page 680 of volume eight, on constitutional law, of Halsbury's Laws of England: ``Misbehaviour''-- he is specifically referring to a judge-- as to the office itself means improper exercise of the functions appertaining to the office, or non-attendance, or neglect of or refusal to perform the duties of the office. I believe it is pertinent tonight to ask ourselves as politicians: Did one or more of the judges refuse to sit, and what sort of position does that put the High Court in today? Senator GARETH EVANS(Victoria-Minister for Resources and Energy)(11.10) —in reply-I am grateful to honourable senators for their speedy and, by and large, dignified consideration of this momentous Bill, the Parliamentary Commission of Inquiry Bill 1986. However, I think we could have done without some of the selective recall and crocodile tears of Senator Lewis in his contribution. To the extent that there were criticisms of particular aspects of this Bill, or questions raised about it, I think it is more appropriate to pick those up at the Committee stage rather than endeavour to reply to them in any global way at this stage. Senators Haines, Chipp and Georges were critical, of course not so much of particular aspects of this Bill but of its very existence, taking the view that a commission of inquiry of this kind is simply not necessary. Let me say that there is much in their speeches and the opinions which they expressed with which I agree. I personally have fought very long and hard-and have endured much criticism myself in the process, much of which has been of a kind which makes Senator Lewis's criticism tonight seem by comparison a mere bagatelle-to ensure that each allegation, as it has arisen during the whole course of this matter, and there have been many of them, has been considered squarely on its own merits, and that we in the Government and in the Parliament as a whole were not stampeded by considerations of political expediency or perceived political popularity into hasty and unjustifiable action, particularly when we have all known that the consequences of such actions, inquiries and investigations, and so on, have been the cause of massive hurt and distress to a particular individual, to his family, his young family, and to the institution of which he is a part. It is important that we have acted as we have until now, and it is quite defensible to have acted as we in the Government and in this Parliament have acted until now. But there comes a point when there can only be an end to all this by an essentially open-ended inquiry, expensive as it may be, protracted as it may be, of the kind that is here involved. I simply share the hope of every honourable senator who has spoken in this debate that this inquiry and our subsequent consideration of the results of that inquiry in this Parliament will be the end of this matter and that it will not just be an end to the matter; it will be an end which is just and fair. Senator TATE(Tasmania) —Mr President, I seek leave to make a personal explanation. Leave granted. Senator TATE —In the course of the debate this evening Senator Georges indicated that it was his belief that Senator Haines and I had given him a prior indication of our assessment of the evidence against Mr Justice Murphy during the hearing of the second committee, the Senate Select Committee on the Allegations Concerning a Judge, such that he claims that we stated in as many words that there was no need for Mr Justice Murphy to present evidence to that second Select Committee. I have to say that I have a very imperfect recollection of that conversation. I do recall that very late in the hearing, some time in October, Senator Georges, in a very flustered state on the staircase outside my office, came across Senator Haines and me and asked whether it was too late for the judge to appear before the inquiry. I have recollection of indicating that no, it was not too late and that it would only make our already-I do not say that I am using the exact words-arduous examination of the matters that much longer. I have no recollection of saying that there was no need for Mr Justice Murphy to appear, leaving as it would an inference that there was nothing of sufficient weight, substance or credibility for him to answer. At that stage of the inquiry it was my opinion that there was something which ought to be answered and that it would be best answered from the judge's own lips by way of him giving evidence to the inquiry. My understanding at the time was that Mr Justice Murphy was not required to appear either by terms of the resolution of the Senate or by his common law right, on which it built, not to appear before a tribunal of that nature which was doing its best to apply the rules of evidence as used in criminal proceedings. I had done the reading on this to ensure that I had the law correctly in mind: If he were not to appear I should not draw any adverse inference against him for not appearing. If I used any form of words which were meant to convey those points, and Senator Georges drew a wrong inference that I was saying that Mr Justice Murphy need not appear because there was nothing for him to answer, I cannot be blamed for the drawing of the wrong inference by Senator Georges, but I do not recollect that I stated those words and I do not believe that I did. It would have been totally to the contrary of my frame of mind at the time. It had always been my expectation that he would appear. I was astonished when he did not and offered the reasons which he did for not appearing. I say that it was also my attitude-and I would like to put this on record-that in the course of the first Senate inquiry and, in fact, late at night on the very last possible occasion, at the instruction of the Committee, I phoned the solicitor instructing the counsel for Mr Justice Murphy and pleaded to him to ensure that the message got through to Mr Justice Murphy that he come and appear before us because we had a genuine belief that if he did it could settle the manner. I always felt that if the judge did make an appearance before the committees of inquiry which I chaired it would greatly aid his case. I just want to make that very clear and I want to reject any implication in what Senator Georges has alleged against me and Senator Haines that we would have tried to indicate to him the state of our minds in relation to the evidence at that time. Senator HAINES(South Australia) —I seek leave to make a personal explanation. Leave granted. Senator HAINES —I concur with the comments made by Senator Tate. I share his recollection inasmuch as 18-month old memories can be imperfect. Nevertheless, I share his belief of what happened. Certainly, I share his regret that Senator Georges may have got an impression that we felt that there was no need for the judge to appear before us. We pointed out to him that it was not too late. I feel that perhaps in an attempt to calm Senator Georges, who was quite justifiably agitated at the time, we may have perhaps not emphasised sufficiently that it was not too late for the judge to appear. I only say in addition to what Senator Tate has said that I shared all along Senator Chipp's belief that he expressed quite firmly and often that the appearance of the judge at either of the two inquiries would have been extremely useful to the committees-- Senator Chipp —And to the judge. Senator HAINES —It would have been extremely useful not only to the Committee but also to the judge. I cannot understand how any impression could have been given that either I or Senator Tate believed that it was neither useful nor necessary for the judge to appear. Having said that, I would like to add that I do not doubt at all that Senator Georges quite genuinely believes that we gave him that impression and I certainly regret it if that is the case. Senator GEORGES(Queensland) —I seek leave to make a personal explanation. The DEPUTY PRESIDENT —Before I seek leave for you, Senator Georges, do you understand that under Standing Orders personal explanations are not meant to become subjects of debate? We do not want debate to and fro. It has to be a personal explanation from you. Leave granted. Senator GEORGES —I could also claim to have been misunderstood. I remember that day clearly. In listening to the summing up, I did speak to the counsel of Justice Murphy and say that in my view it would be prejudicial to him if he did not appear. I knew at that time that Justice Murphy would have liked to have appeared to contest the evidence and that his advice to that point had been different. It was then suggested by counsel that they would contact Justice Murphy and in the meantime I would question whether or not it was possible for Justice Murphy to appear at that late stage. It must be appreciated that counsel-Mr Gleeson, if I recall correctly-had wound up his case. I deny being flustered because the matter was extremely serious. The question I was seeking to ascertain was whether or not Justice Murphy at that late stage could appear. I think I approached the matter with Senator Tate as we walked along the corridor from the refreshment room. Senator Haines sought to disengage-she was there at the time-from the conversation. I said: `No, you will be interested in this'. I asked whether or not it was possible at that late stage for Justice Murphy to appear and Senator Tate said `No'; that it would prolong the inquiry for a week and that it would be necessary-if I could refresh Senator Tate's memory-for Mr Gleeson to be called back as he had already completed his case. The tone of the conversation was to the effect that it was not really necessary. From that I suppose I took the inference that it was not necessary for Justice Murphy to be advised that he should seek to appear at that late stage. In the debate I merely indicated that that is the sort of situation that can arise in this sort of inquiry. Just a slight change of emphasis or a slight change of advice can lead to an entirely different result. I am not being critical of Senator Tate or Senator Haines. They had a very arduous task to perform and the advice I got, of course, was that it could continue on, that there were difficulties and that, of course, perhaps it was not really necessary. I remember those words distinctly because I wrote them down. I wrote them down because I was in the town of Moranbah when the decision of the Senate Select Committee on Allegations Concerning a Judge was announced. I watched a certain television program and I was astonished to hear comments made by members of the Committee that it would have been different had Justice Murphy appeared. At that stage perhaps I got flustered but not on any previous occasion. I wrote down a statement pointing out the whole of that conversation and I have that statement. I have a clear recollection of the day that the Senate Committee's decision was announced and those comments were made. I have that written down. I put it aside because I decided at that stage it was not useful, and I held it. My recollection is clear. The only comment I make is that at that stage I was coldly concerned about this matter. I was not flustered. I may have misunderstood the intention of the words. Nevertheless, on that misunderstanding of those intentions, perhaps advice was given that should not have been given. Question put: That the Bill be now read a second time The Senate divided. (The President-Senator The Hon. Douglas McClelland) Ayes . . . . . . . . . . . 56 Noes . . . . . . . . . . . 6 —— Majority . . . . . . . . . 50 —— Archer, B. R. Lewis, A. W. R.Aulich, T. McClelland, DouglasBaume, Michael MacGibbon, D. J.Baume, Peter McIntosh, G. D.Bjelke-Peterson, F. I. McKiernan, J. P.Black, J. R. Maguire, G. R.Boswell, R. L. D. Messner, A. J.Brownhill, D. G. C. Morris, J.Chaney, F. M. Newman, J. M.Childs, B. K. Parer, W. R.Coates, J. Puplick, C. J. G.Coleman, R. N. Ray, RobertCollard, S. J. Reid, M. E.Colston, M. A. Reynolds, M.Cook, P. F. S. Richardson, G. F.Cooney, B Robertson, E. A. (Teller)Crichton-Browne, N. A. Ryan, S. M.Crowley, R. A. Sheil, G.Devlin, R. Short, J. R.Durack, P. D. Sibraa, K. W.Elstob, R. C. Tate, M. C.Evans, Gareth Teague, B. C.Georges, G. Townley, M.Giles, P. J. Vanstone, A. E.Grimes, D. J. Walters, M. S.Guilfoyle, Dame Margaret Watson, J. O. W.Hamer, D. J. Withers, R. G.Knowles, S. C. Zakharov, A. O. Chipp, D. L. Mason, C. V. J.Haines, J. Sanders, N. K.Macklin, M. J. (Teller) Vigor, D. B. Question so resolved in the affirmative. Bill read a second time. Clauses 1 and 2-by leave-taken together, and agreed to. Clause 3 (Interpretation). Senator DURACK(Western Australia)(11.31) —I move: (1) Page 2, clause 3, definition of `Judge', leave out `a court created by the Parliament', insert `the Federal Court'. This simply raises the question of why a judge who is eligible to sit on the Court should be defined in such broad terms as `a Judge of a court created by the Parliament or of the Supreme Court of a State or Territory'. It seems that the appropriate Federal court would be the Federal Court of Australia rather than simply any court created by the Parliament. Although I do not press this, perhaps the Minister for Resources and Energy (Senator Gareth Evans) could clear up this matter by indicating whether the Government would propose anybody other than a member of the Federal Court or of a Supreme Court of a State or Territory. Senator GARETH EVANS(Victoria-Minister for Resources and Energy)(11.32) —I do not think the Government would have anyone in mind other than a member of the Federal Court or of a Supreme Court of a Territory or State. The drafting is wider. That simply reflects the draftsman picking up a precedent from elsewhere. To the extent that the Opposition moves this amendment, if I were in a more churlish mood I would suggest that it reflects once again the Opposition's prejudice against the Family Court of Australia, but I will not generate churlishness in this chamber by pursuing that point. This does not need to be amended. The Government will bear in mind the Opposition's expression of view. Amendment negatived. Clause agreed to. Clause 4 agreed to. Clause 5 (Functions). Senator DURACK(Western Australia)(11.34) —Before moving any amendment to clause 5, as I said in the second reading debate, the Opposition believes the Government has got sub-clause (1) absolutely right. Sub-clause (2) seems to contain some confusion of thought in the conjunction of the phrases in `carrying out its inquiry the Commission shall consider only specific allegations made in precise terms'. The Commission is broadly a commission of inquiry, but the word `inquiry' has a very extensive meaning in law or, indeed, in ordinary English usage. When somebody embarks upon an inquiry that person seeks documents, asks questions of people and so on. It seems strange that an inquiry would be limited only to specific allegations that somebody has made. For example, under clause 13 the Commission has all the material that was dealt with by Mr Justice Stewart and was the subject of his report last week. The sub-clause says that the Commission will have access to all material before the Senate committees, as I understand it. When the Commission gets possession of this it may have other material in a documentary form submitted to it which may lead it to make and believe that it should make further inquiries. On that aspect of its role, I do not understand the limitation to specific allegations made in precise terms. Clearly, when the Commission comes to make findings it will have to formulate them in specific allegations. It may also want to reduce a lot of information into this form. Before it makes any findings that there is evidence sufficient to establish misbehaviour it would be necessary to have regard to specificity in the matters that are the subject of the inquiry. At the beginning of an inquiry it seems to me to be very limiting to expect it to have regard only to specific allegations. We have suggested an amendment that has been circulated to remove the words `made in precise terms', but have a broader concern about this clause. Before I move the amendment, will the Minister deal with the point I have raised so that I can assess whether we need to oppose the clause as a whole or whether we may be able simply to confine ourselves to the amendment? Senator GARETH EVANS(Victoria-Minister for Resources and Energy)(11.38) —This is an important issue that has been raised by Senator Durack which goes to the nub of the kind of inquiry we envisage as being properly here carried out. It is not a bizarre kind of `Lionel Murphy, this is your life' exercise in which the Commission feels free to range at large down any highway or byway along which some avenue of investigative activity suggests itself, or suggests itself to the Commission's staff. It is a matter of creating an opportunity for those allegations to be made, many of which are well known because they are in the public domain already, or allegations which people may have been saving up to make at a future stage. It is a forum in which those specific charges, allegations or claims can be tested. The mechanism by which we envisage this will occur is essentially through the filtering agency of the counsel assisting the Commission. Whether the Commission would want to advertise I do not know, but we envisage that maybe an initial time limit would be set within which material on which the Commission would base its inquiry would have to be submitted, subject to supplementation perhaps at a later stage if further material emerged. If there is to be an end to this matter the processes of the Commission have to somehow be confined, not in a way to artificially circumscribe the process so that at the end of it there is still more material floating around which has not been answered. It is terribly important and in everyone's interests that any further allegation or claim that anyone might want to make is dealt with by the Commission. But it is a desire to confine it in that kind of way-it must be allegations that are being dealt with rather than open-ended investigation into topics or lines of inquiry that might appeal to the Commission. That is the first point and that goes to the expression `specific allegations'. As to the language `specific allegations made in precise terms', this is not a term of art and I do not think there is any precedent for this clause that anyone could think of. It was again an attempt to convey the flavour of what really seems to be required by these circumstances. There might be allegations that in a sense are specific but are nonetheless imprecise, that are vague. There might be allegations that someone is biased towards unionists, that someone is a friend or an associate of persons of ill repute, that someone is a man of unconventional or maybe even unsober habits, and so on. Claims of this kind of a generally, I suppose one might say, defamatory kind are being made, purporting perhaps to reflect some particular piece of prevailing popular wisdom or prejudice, and it might be thought that the Commission would somehow be obliged to consider allegations of that general kind. But they would not have about them that degree of specificity as to time and place, or as to particularity, as to make them susceptible to effective investigation. That is what we are trying to convey. Of course, much will depend simply upon the common sense of the Commission in responding to the kinds of concerns. I add just one further thing. I think the way in which one could easily have couched these terms of reference would have been by retaining all the matters that are lying around at the moment and specifically referring to them in the text of the Bill-the Thomas allegations and such allegations as may appear or it may be possible to construe from the text of volume 2 of the report of the Stewart Royal Commission of Inquiry into Alleged Telephone Interceptions and so on-and perhaps also retailing some of those matters which have been the subject of previous inquiries. But we thought, on balance, it was better simply to have an open-ended expression of the Commission's frame of reference in clause 5 (1) but then, to convey in clause 5 (2), something of the narrowing flavour that was necessary if the inquiry was not to get completely out of hand. Two narrowing requirements are contained in the Bill. Clause 5 (2) is the first of them and the other one is the requirement that there be, in effect, prima facie evidence produced in support of a particular allegation before the judge is compellable to answer the allegation in question. They are cumulative protections, if you like-cumulative narrowing mechanisms. I do not think I can describe it any better than that or more succinctly than that. They are simply ways of confining the scope of what might otherwise be a totally sprawling inquiry and it is in nobody's interests that the sprawling get too far out of hand. Senator VIGOR(South Australia)(11.43) —I believe that we should support the precise terms and oppose the Opposition's foreshadowed amendment. I voted against the second reading of the Parliamentary Commission of Inquiry Bill on this basis. I believe strongly that hard, single, special cases make bad law. What we have witnessed since the acquittal of Mr Justice Murphy is a frightening example of McCarthyist tactics. Material has been sat upon quite deliberately and leaked to the media in an attempt to achieve what the due process of law would not. I believe that this has been a trial by media and, by requiring allegations to be made in precise terms we can be certain that what will be considered will not be just the types of vague rumours which have been running around the Press Gallery. Extraordinary reports have been made by the Press-reports that brother judges of the High Court of Australia were more or less threatening to go on strike. I find those reports quite hard to believe because, in my view, that sort of conduct, designed to intimidate, could only be described as misconduct itself. If we believed the Attorney-General (Mr Lionel Bowen), as reported, it would be proven misconduct for those judges, and punishable under section 72 of the Constitution. If we do not believe the Attorney-General, as reported, we should call upon him to resign. If we do not believe the Press, we should censure it heavily for what it is doing. If the Government is serious on this matter it should establish a permanent commission of inquiry that can examine the conduct of any judge that the House of Representatives or the Senate may want to put under scrutiny and not go for a specific judge, as in this case. It should then set the terms of reference separately. The Australian Democrats will be voting to reject the Opposition's amendment. Senator DURACK(Western Australia)(11.46) —I am grateful for the intimation, before I have actually moved my amendment, that the Australian Democrats are going to reject it. That seems to be on a par with their general approach to this legislation. Senator Macklin —If you start making gratuitous comments you will get a few back shortly. Just keep to the blasted Bill. Senator DURACK —What about the Democrats doing the same thing? That is a message that the Democrats might take on board themselves. Senator Macklin —If you want to start I will too. It will be no trouble at all. The CHAIRMAN —Order! Senator Macklin, cease interjecting and Senator Durack, address your remarks to the Chair, please. Senator DURACK —I am certainly not going to stand here and take a lot of nonsense from the Democrats. In response to what Senator Gareth Evans was saying, I would have thought that the limitations under clause 5 (1) were very clear. If we are going to have judges of distinction conducting this inquiry they would not be game to take notice of scuttlebutt, rumour or whatever. Senator Gareth Evans —Senators have been known to. Senator DURACK —We are talking about judges of the calibre I presume the Minister will propose to the Parliament. Therefore, I cannot see why there is any need to indicate to them the concerns that apparently have been behind sub-clause 5 (2). Can I take it from Senator Evans that there is nothing in sub-clause 5 (2) which is intended to prevent the Commission inquiring about some material that is given to it which it believes has some relevance to establishing misbehaviour but which requires further inquiry by it before it considers that material, in terms of prima facie evidence, to establish misbehaviour; in other words, that the Commission will not be cut off before it has begun the inquiry if the material it has before it is not a statement by a particular person alleging particular conduct in very precise terms? Senator GARETH EVANS(Victoria-Minister for Resources and Energy)(11.49) —I do not think it is a necessary condition of the Commission being able to act that it has submitted to it a statement from some person in the form of an allegation. It could well respond to material submitted to it which can be characterised by, let us say, counsel assisting as clearly constituting an allegation and then the next stage of the process is to determine whether that is supported by prima facie evidence. It is not intended to be narrowing and constricting in that sense. Senator DURACK(Western Australia)(11.50) —I thank the Minister for Resources and Energy (Senator Gareth Evans) for his clarification of this matter, which has allayed my concern a great deal about what are the likely restrictions, which I fear-if one interprets sub-clause (2) in any literal sense-would be very restrictive of the Commission. That concern is the reason why the Opposition believes that the words `made in precise terms' should be removed. They seem to add further restrictions to the words `specific allegations'. In those circumstances I will continue to press the amendment to remove the words `made in precise terms'. We can accept the assurances of the Minister that the words `specific allegations' would not, in themselves, have the restrictive effect. I move: (2) Page 2, sub-clause (2), leave out `made in precise terms'. Amendment negatived. Senator DURACK(Western Australia)(11.51) —The Opposition was concerned about sub-clause (3) in view of a manifestation it had earlier today. However, I think that the form it is now in is satisfactory to the Opposition so I will not move amendment No. 3. The Opposition believes that amendment No. 4 to sub-clause (4)-- Senator Macklin —Mr Chairman, I raise a point of order. Some other honourable senators might like to discuss the amendments. Are you taking them in order or are you allowing senators to range over any part of the clause? The CHAIRMAN —The question is that clause 5 stand as printed. Honourable senators can range over any part of clause 5. I am taking the amendments in the order that they are received. I am not taking the Bill sub-clause by sub-clause. Senator DURACK —The Opposition is concerned that sub-clause (4) is another attempt to unduly restrict the range of the Commission's inquiry, because it eliminates from consideration of the Commission not only the issues that were dealt with in the trials of Mr Justice Murphy but also any conduct to which those charges related. In our view that is a very wide exclusion. The Bill that the Government had circulated-it was the Government's proposal-at an earlier stage today read in the terms of the amendment that the Opposition has proposed, which is the correct approach in our opinion, namely, that the Commission shall not consider the issues dealt with at the trial. In legal terms that has a clear meaning and it is entirely in accordance with the views that the Opposition expressed after the acquittal of Mr Justice Murphy, namely, that we would not pursue those specific issues which were in issue at the trial and certain facts which had been before Senate committees. I believe that to go further as the second limb of sub-clause (4) provides unnecessarily restricts the Commission. Admittedly, there is an exception which ameliorates that restriction; nevertheless there may well be conduct which was in evidence at the trial which should be looked at in relation to misbehaviour even though it is not conduct which was part of the element, or elements, of the charges that were made against Mr Justice Murphy. We believe that we should restrict the Commission only to the extent that the jury's acquittal has disposed of the evidence which was strictly an element of certain charges. There may well be other conduct that was in question in other evidence given at the trial. Presumably any evidence given at the trial was relevant and therefore it may well be said that that second limb is very wide and would exclude the Commission from looking at quite a lot of other evidence which was not part and parcel of the elements of the charges which were the issues at the trial. For those reasons I will move amendment No. 4 which, as I have said, is the version that the Government had drafted but which it moved away from presumably with the same object as it has revealed in this Bill, that is, to endeavour to be more restrictive of the Commission than the general provisions of section 5 (1) would allow. I move: (4) Page 3, leave out sub-clause 5 (4), insert the following sub-clause: ``(4) The Commission shall not consider the issues dealt with in the trials leading to the acquittal of the Honourable Lionel Keith Murphy of certain criminal charges on 5 July, 1985 and 28 April, 1986 except to the extent that the Commission considers necessary for the proper examination of the other issues arising in the course of the Commission's inquiry.''. Senator GARETH EVANS(Victoria-Minister for Resources and Energy)(11.56) —I hope that we can avoid a too protracted debate on this clause. I seem to have been doing nothing else but talking about it all day trying to get the language of it right. I say at the outset that there is no attempt in drafting this clause to build in any indefensible way walls around some particular area and not make it the subject of inquiry. The whole philosophy on which this Bill has been put together is that we need a capacity, once and for all, to deal with every conceivable allegation that someone might want to make in order to make it impossible at the end of the day for the whole process to start again. It would be utterly counterproductive to build walls around some area if to do so were only to create the possibility of further allegations being made at the end of the day. That is the starting point. The second point to be reminded of is that in the drafting of this clause we wanted to circumscribe, so far as was reasonable, the capacity of the Commission to retill the soil of those endlessly protracted criminal trials in the Flannery and Briese matters. The particular conduct that was in issue up to that point was, after all, conduct within a fairly narrow compass. The argument was all about whether that conduct was such as to constitute an attempt to pervert the course of justice. The principle of autrefois acquit is well known and well accepted and there does not seem to be any argument with it so far as the immediate issue of criminal liability in respect of that conduct is concerned. That is essentially what clauses (4) (a) is directed to. However, we also thought it was reasonable to limit the capacity of the Commission to scrutinise exactly that same conduct whether or not the words alleged to have been used were used, with a view to testing that against some other arguably lesser rigid form of misbehaviour than criminal misbehaviour. We understood the Opposition to be saying as much as that in the joint statement made by Senator Chaney and Mr Spender on 29 April, when they said, in the aftermath of the acquittal: The Opposition do not propose to take parliamentary action in terms of section 72 based on the specific issues dealt with in the criminal trial. I do not want to get into an argument about what was meant, or not meant, by this statement but the way the Government took it was that, since it was obvious that it was not within our capacity in the Senate to relitigate the criminal liability question, what was being conveyed must have been the view of the Opposition that the Senate ought not to reconsider those factual matters by reference to some possibly less rigid definition of misbehaviour. It is really that position of the Opposition, which we think was a fair, reasonable and sensible position last week, that we were trying to pick up in clause 5 (4). There was a belief that the first draft, which the Opposition has now moved as an amendment, did not quite succeed in doing that, and thus the further draft which is now before us in the Bill. Let me make as clear as I can that there is no desire to circumscribe an inquiry by the Commission into some other issue which may involve a reconsideration of some perhaps of the evidence in the Briese and Flannery trials or may involve a consideration of some aspects of the way in which those trials were conducted. Let me give two illustrations of what I have in mind. It has been suggested in at least one newspaper today that an allegation of perjury could properly be made against Mr Justice Murphy in respect of part of his evidence in the Briese and Flannery trials-I think round one-which was to the effect that he had only X number of conversations with Morgan Ryan over a period, whereas in reality he had X plus 10 or something of that kind. That was the suggestion, and I do not stop to argue whether that has any conceivable force behind it. The question as to whether perjury may have been involved is a quite different issue than any that was considered in the Briese and Flannery trials. Should the Commission be minded to pursue and allegation of that kind, it would on this drafting be perfectly free to do so. Let me indicate another issue arising out of the Flannery and Briese trials, which the Commission might, if it were minded to do so, be able to pursue under the text of this amendment. It is being suggested in some quarters, I am not sure how seriously, that Mr Justice Murphy's choice not to go into the witness box but rather to make an unsworn statement on oath, the exercise of that legal right, might in the context of its being exercised by a High Court judge amount to misbehaviour within the meaning of section 72 of the Constitution-on a very wide interpretation of that section. That is a fairly extravagant allegation, but it is one that may be made. Given the width of some of the interpretations of section 72 that are floating around, it may not be all that extravagant at all. It may be made, and to the extent that it was made and the Commission felt that it ought to be pursued, it could be pursued under the language of this clause at the moment. There has been no attempt to circumscribe in any untoward or indefensible fashion. There has simply been an attempt to ensure that there is an end to at least one part of this litigation-that is, the consideration of the particular factual matters that were immediately in issue in those two trials which have been the subject of jury determination. There is much more I can say on all this, but I do not want to burden the Committee with that if it is unnecessary to do so. Friday, 9 May 1986 Senator DURACK(Western Australia)(12.03 a.m.) —I want to reaffirm in respect of the attitude adopted by the Opposition after the acquittal of Mr Justice Murphy, in the terms of the statement the Minister referred to, that the words used in that statement were `the specific issues at that trial'. That is what I believe is picked up in 4 (a). When in 4 (b) one starts to talk about conduct to which those charges related, one is picking up a whole lot of evidence which was given at the trial and some of which may be thought by some people to be relevant to misbehaviour. We are concerned that `conduct' in relation to issues should be very narrowly confined to only that conduct which was part of the actual elements of the charges and not the evidence itself which may be there only because it was relevant to that conduct. I am not sure that we are ad idem on this. We still persist with the view that our amendment is preferable. Amendment negatived. Senator MACKLIN(Queensland)(12.05 a.m.) —There are two issues on clause 5. First, on clause 5 (3): Is one to take it that the in camera evidence at the two Senate committee hearings will be available to the Commission for its use in its inquiry? With regard to 5 (1): In terms of the proved misbehaviour, is it the intention that those words be construed in the light of the common law tradition that flowed through from Britain into the constitutional debates and onwards? It probably finds its most recent expression in the words of Sir Garfield Barwick in the High Court on the Reserve Bank and Commonwealth Banks Bills in 1957 when he said: Thus, the misbehaviour in the Bill will be held to refer to conduct touching and concerning the duties of the member in relation to the office, but will also include acts in breach of the general law of such a quality as to indicate that the member is unfit for office. Senator GARETH EVANS(Victoria-Minister for Resources and Energy)(12.07 a.m.) —As to the latter point, it happens to be the view of the Solicitor-General and of the Government, and a view which I have propounded many times in this place, that the proper definition of proved misbehaviour is along the lines of that just articulated by Senator Macklin, namely, that it is a definition with two dimensions-offences against the general law of such a character that they are incompatible with continued occupancy of the bench, not necessarily a driving offence but an offence involving immorality or dishonesty or something of that kind; secondly, misbehaviour in the form of misconduct directly related to the discharge of one's judicial functions, such as being drunk on the bench or non-attendance, as was mentioned earlier in Senator Chipp's contribution. There are other illustrations one can think of. The difficulty is that that is not the only interpretation of misbehaviour that is doing the rounds. We had the Pincus opinion that was much in issue in the Senate Committee and so on. The Government was faced with the choice of whether to endeavour to legislate what we believe is the accurate definition of misbehaviour and confine the Commission to what we believe very genuinely, not out of any desire to circumscribe the scope of an inquiry for some extrinsic reason, is the accurate definition. We believe that very genuinely and for a lot of reasons I can spell out, based on precedent, practice and principle. We had the choice of doing it that way, but we chose not to because again we did not want this inquiry to be susceptible to a charge, whether cynically or genuinely inspired, that the deck was somehow stacked before the inquiry began. We want our Commission to express a considered view on this issue. We would be delighted if the view it expresses conforms with our own. My definition of an agreeable person is someone who agrees with me. That is true, and we would be delighted if the Commission did. But if the Commission does not express a view in those terms and produces a compellingly reasoned argument to the contrary, we feel that we should have that before us when we finally resolve the matter in the Senate. It is better to leave it open, store up a controversy later, but avoid one now and allow the Commission at least to explore the whole potential range of issues that might arise. That is as much as or perhaps more than I can usefully say about 5 (1). The language of the latter part of 5 (3) is obviously such as to make accessible to the Commission all the material that was in evidence in the Senate committees of inquiry, whether in camera or otherwise, if the Commission is minded to seek access to such material. I think there is still in the way that that is drafted left unsaid whether the Commission has the capacity not only to get access to it but to make that material public in the form of its final report, or whether, rather, the Senate may need to address the question of giving a release for that purpose. That is a question I am not much inclined to address at ten past twelve in the middle of the night, after the week we have had. It is not a question that immediately arises. It is within the capacity of the Senate to control. All that this provision literally says is that the Commission can get access to the material without any questions of privilege and so on arising. I think that is a proper thing at this stage. Clause agreed to. Clause 6 (Evidence). Senator DURACK(Western Australia)(12.10 a.m.) —I move: (5) Page 3, sub-clause 6 (1), insert `prima facie' before `evidence of misbehaviour'. I was interested to note that Senator Evans referred to prima facie evidence when he was speaking on the operation of clause 6. I think that is clearly what is intended. It certainly ought to be the case and I think it ought to be made clear. Senator GARETH EVANS(Victoria-Minister for Resources and Energy)(12.11 a.m.) —I do not have any objection in principle to this amendment. It is entirely consistent with the intent of this clause. I would, however, argue that it is unnecessary to add `prima facie', that that expression is there by implication. It may be that in an ideal world, if we had different logistic circumstances prevailing and no compelling need-- Senator Durack —We haven't got the House of Representatives standing by? Senator GARETH EVANS —It was but I think its patience may have become exhausted. Under the circumstances, whilst I do not disagree with the intent of this amendment, it would be unfortunate if the Bill were to be held up by virtue of this essentially, maybe desirable, but unnecessary, addition. Senator DURACK(Western Australia)(12.12 a.m.) —I accept that. In terms of the Acts Interpretation Act I am sure the provision will be acceptable as it stands. Amendment-by leave-withdrawn. Senator DURACK(Western Australia)(12.13 a.m.) —I move: (6) Page 3, sub-clause 6 (2), leave out the sub-clause, insert the following sub-clause: `(2) In the conduct of its inquiry the Commission shall inform itself in such manner as it thinks fit.'. This amendment is to sub-clause 6 (2), to which the Opposition attaches the greatest significance because it seems to us to be a very restrictive provision as far as the conduct of this inquiry is concerned. I do not want to repeat the short lecture I gave earlier about what an inquiry is. However, what disturbs me is that the provision may be understood to mean that from the word go the inquiry will be able only to have regard to material which is admissible in court proceedings. We entirely agree that the Commission cannot come to a conclusion that there is prima facie evidence of misbehaviour, and it would not, unless it had adequate evidence. I think we can trust the commissioners to do that. The normal provision for inquiries is that commissioners are able to inform themselves in such manner as they think fit. The commissioners cannot call on Mr Justice Murphy to make any comment to them unless there is prima facie evidence. That makes it quite clear what we have in mind. Sub-clause 6 (2) throws the Commission into great confusion as to the basis on which it is able to make a decision that it should pursue certain lines of inquiry. Certainly the Commission would not be required in that case to act on evidence which would be admissible necessarily in court proceedings. It seems to the Opposition that, given the obvious meaning of this sub-clause, most of the material that would be in front of the Commission in relation to the Age tapes would not be able to be used by the Commission for the purpose of conducting any inquiries at all. I will be interested to hear what the Minister says. He may talk me out of my concerns about this provision but, as we see it now, we believe that our amendment to clause 6 (2) is quite necessary in order to get the Commission off the ground. Senator GARETH EVANS(Victoria-Minister for Resources and Energy)(12.15 a.m.) —Bearing in mind again section 15ab of the Acts Interpretation Act, let me state the intention of this clause from the Government's point of view. It uses language not normally associated with royal commission proceedings but rather language more apt to describe an ordinary court proceeding. The way in which we expect it to work is as follows: We do not intend to impose any restriction on the kind of material to which, in the first instance, the Commission may have regard. It is not intended that before the Commission can even consider material put before it that material must satisfy strict criteria of court admissibility. It is fair enough that the Commission should be able to range at large and consider material such as some of the transcripts and summaries of the Age tapes which may not, on their face, be strictly admissible unless subsequently corroborated by some evidence establishing their provenance. What we are saying and what this clause is intended to bite upon is the stage of the Commission's inquiry at which it is actually making findings and, in particular, findings which are adverse to the person concerned. What we are saying, and maybe it is only stating what the Commission would do in practice, given the consequences that may flow from such findings, is that the material upon which the Commission relies at that stage must be material which satisfies criteria of admissibility. This context is different, and designedly so, from the normal royal commission context in which the commission can draw conclusions based on the best material available to it and not necessarily that which satisfies criteria of admissibility. If I can put it this way, the reason why this more rigorous criterion is here inserted is that adverse consequences to the individual concerned will flow directly from the Commission's findings, assuming that they are adopted by the Parliament thereafter, whereas in a royal commission, where adverse findings are made by an individual there is usually another stage of the whole business to follow before the individual actually suffers anything, apart from, perhaps, damage to reputation. The ordinary royal commission of the kind we have been familiar with in recent years will identify someone as having been likely to have committed some serious criminal act or likely to have been a company or an agency responsible for a disaster of some kind. Before that responsibility or potential liability is turned into real liability and real pain there must be some other court proceedings. There must be a criminal action or a civil action or something of that kind. In this case the calamitous consequences flow directly from the findings, on the assumption I am making for this purpose that those findings are adopted by the Senate. It is for that reason that those findings must have a high degree of credibility and reliability, and the time honoured way in which the credibility and reliability of findings have been established is by requiring that they be based on the kind of evidence that is admissible in court proceedings. I know that is a technical explanation and I know that it is getting very late for long, boring technical explanations, but it is important that the intention behind some of these clauses be well understood in order to avoid subsequent controversy. Senator DURACK(Western Australia)(12.20 a.m.) —Can I-- Senator Chipp —For goodness sake. What about a fair go? Senator DURACK —Does Senator Chipp want to prolong this? If he does, he is going the right way about it. Senator Chipp —There was an undertaking by your Leader. Senator DURACK —No, there was not. We are putting up our case as we see fit, in the same way as we listened interminably to the Australian Democrats putting their case. Senator Chipp —What about reporting progress then, if you cannot do it properly? Senator DURACK —Does Senator Chipp want to come back next week? Senator Chipp —No, we will come back tomorrow. Senator DURACK —Senator Chipp is showing a very low threshold of attention and patience. I have no problem with the explanation of the Minister as to how he intends the Commission to operate in this regard. I said earlier that obviously it could only operate on prima facie evidence before it could require Mr Justice Murphy to respond and that certainly it would not make any findings unless the evidence was of sufficient weight to establish a finding of such grave consequences. But I am bound to say that I do not think that clause 6 (2) does that, and therefore I still believe that the Bill should be amended in the way that we have suggested. Amendment negatived. Clause agreed to. Clause 7 (Conduct of proceedings). Senator DURACK(Western Australia)(12.23 a.m.) —I move: (7) Page 3, sub-clause 7 (1), leave out ``private'', insert: ``public''. This Opposition amendment deals with the Commission's being directed virtually to sit in private. The Opposition really does have very grave concern about this. The amendment that I have moved would have the effect of reversing that proposal. The clause states: The Commission shall, unless it thinks the circumstances require otherwise, conduct the whole of its inquiry in private. We believe that the proper approach is that the Commission should, unless it thinks the circumstances require otherwise, conduct the whole of its inquiry in public. That is the normal process by which the legal system and our parliamentary system operate. Admittedly, there are odd exceptions; the first Senate committee that inquired into this matter was one of them. Senator Lewis has explained what happened there. There are grave dangers when any body which is subject to great public attention and interest and which has great responsibility sits in private. It should sit in public unless there is some particular reason to sit in private. That would accommodate the sorts of concerns that Senator Chipp expressed about nuts or scuttlebutt or that sort of thing going around. I do not think that these commissioners, on dealing with such a serious matter, would bother to have any hearings at all about minor and frivolous stuff that nut cases or others might put up or rumour, or innuendo, or gossip around the place. Senator Chipp —Some people think sex orgies are misconduct. Senator DURACK —The honourable senator knows that Senate committees get a lot of material that they do not bother to do anything more about; they just pigeon-hole it and forget it. The counsel assisting the Commission and the commissioners themselves will no doubt choose only material which has got some substance in it before they have anything in the nature of formal hearings. I think that that sifting process will be quite easily taken care of, but for this Parliament to give the direction that it shall virtually sit in private unless there is some particular reason why it should sit in public, I think, is completely reversing the proper approach, the desirable approach, and the normal approach. I have moved this amendment with great conviction. Senator GARETH EVANS(Victoria-Minister for Resources and Energy)(12.27 a.m.) —I think I need speak only very briefly on this because the issues are pretty well understood and pretty clear. Honourable senators have to read this section in conjunction with the next one about the report to Parliament which is expressly required by the legislation to be public, together with the evidence supporting and substantiating those findings, subject only to some exceptions which I think it will be agreed are reasonable. There is no intention whatsoever to conceal the nature of the evidence that is given before this inquiry or any of the findings that are made. It cannot in any way be characterised as a secret exercise, assuming that the Commission allowed it all to run in private anyway and it has the discretion to do it otherwise. It cannot be so described because of those reporting requirements. It is thought on balance better for the inquiry itself to be conducted on a presumption of privacy because of the by now well-known problem with royal commissions and inquiries of these kinds of allegations-not necessarily obviously vexatious or obviously mischievous allegations; it may be quite seriously intended allegations-being made which are profoundly damaging insofar as they create a massive media splash, being the subject of page after page, day after day of media attention, and then at the end of the day the decision being made by the body in question that the allegations are not substantiated, that being given only minimal reporting, with massive damage being done to the reputations of individuals and in this instance the institution of the High Court itself. It has been under enough stress lately for us not to want to subject it to any more. It is a matter for judgment as to how one balances out these competing considerations. We believe that at the end of the day, given that there is no intention whatsoever-and it would again be counter-productive to make it the intention-to keep secret any of the material which does in fact emerge during the inquiry and which is believed by the Commission to be relevant, it is desirable that the presumption be towards in camera hearings. Question put: That the word proposed to be left out (Senator Durack's amendment) be left out. The Committee divided. (The Chairman-Senator D. J. Hamer) Ayes . . . . . . . . . . . 27 Noes . . . . . . . . . . . 33 —— Majority . . . . . . . . . 6 —— Archer, B. R. Messner, A. J. Baume, Peter Newman, J. M. Bjelke-Petersen, F. I. Parer, W. R. Boswell, R. L. D. Puplick, C. G. J. Brownhill, D. G. C. Reid, M. E. Chaney, F. M. Sheil, G. (Teller)Collard, S. J. Short, J. R. Crichton-Browne, N. A. Teague, B.C. Durack, P. D. Townley, M. Guilfoyle, Dame Margaret Vanstone, A. E. Hamer, D. J. Walters, M. S. Knowles, S. C. Watson, J. O. W. Lewis, A. W. R. Withers, R. G. MacGibbon, D. J. Aulich, T. McIntosh, G. D. Black, J. R. McKiernan, J. P. Childs, B. K. Macklin, M. J. Chipp, D. L. Maguire, G. R. Coates, J. Mason, C. V. J. Colston, M. A. Morris, J. J. Cook, P. F. S. Ray, RobertCooney, B. Reynolds, M. Crowley, R. A. Richardson, G. F. Devlin, R. Robertson, E. A. (Teller)Elstob, R. C. Ryan, S. M. Evans, Gareth Sibraa, K. W. Georges, G. Tate, M. C. Giles, P. J. Vigor, D. B. Grimes, D. J. Walsh, P. A. Haines, J. Zakharov, A. O. McClelland, Douglas Jones, G. N. Jessop, D. S. Foreman, D. J. Kilgariff, B. F. Bolkus, N. Carrick, Sir JohnButton, J. N. Hill, R. Gietzelt, A. T. Baume, Michael(Senator Coleman did not vote, to compensate for the vacancy caused by the death of Senator Missen.) Question so resolved in the negative. Amendment negatived. Clause agreed to. Clause 8 (Report to Parliament). Senator DURACK(Western Australia)(12.35 a.m.) —by leave-I move: (8) Page 3, sub-clause 8 (1), after paragraph (b), add: ``; (c) the material on which those findings of fact are based; and (d) its reasons for its findings of fact and its conclusions.''. (9) Page 3, sub-clause 8 (3), leave out the sub-clause, insert the following sub-clause: ``(3) The Commission shall submit with its report a complete record of the evidence before the Commission and copies of the documents submitted to the Commission.''. (10) Page 4, sub-clause 8 (4), leave out sub-clause, insert the following sub-clause: ``(4) Subject to sub-section (6), the President of the Senate and the Speaker of the House of Representatives shall, as soon as practicable after they receive the report, record of evidence and documents of the Commission, cause copies of the report, the record of evidence and the documents to be laid before the Senate and the House of Representatives.''. (11) Page 4, sub-clause 8 (5), leave out paragraph (a). (12) Page 4, sub-clause 8 (5), leave out paragraph (d), insert the following paragraph: ``(d) there may be prejudice to the physical safety of a person,''. (13) Page 4, sub-clause 8 (6), at the end of the sub-clause, add: ``, but shall cause to be laid before the Houses of the Parliament a statement indicating that a separate report has been prepared''. (14) Page 4, after sub-clause 8 (6), add the following sub-clause: ``(7) A separate report prepared in accordance with sub-section (5) shall be laid before each House of the Parliament at the expiration of 10 sitting days of that House after a statement in respect of that separate report is laid before the House in accordance with sub-section (6), unless, before the expiration of that time, each House of the Parliament passes a resolution that the separate report not be laid before the Houses of the Parliament.''. The purpose of these amendments is to better ensure that Parliament is fully informed and has complete access to the material upon which it may have to make a judgment about misbehaviour. As clause 8 is drafted, it does not spell out exactly the material that will be before the Parliament. We believe that it should spell out not only the findings of fact and the conclusions as to whether, in the opinion of the Commission, there has been proved misbehaviour, but also the material on which those findings of fact or those conclusions are based, and the reasons for those findings. We believe that the Commission should also be submitting with that report a complete record of the evidence that it has taken and of all other material presented to the Commission. If Parliament is to be called upon to make a judgment in this matter, it must have all that material before it. The limitations in the clause do not require that. In fact, the Commission has to submit only a record of so much of the evidence as it thinks necessary to substantiate findings, whereas in the end Parliament must make a judgment itself and may require all of the record of evidence given before the Commission. Our other concern about clause 8 is the odd situation that might arise in that some possibly very material evidence may apparently be withheld from the Parliament. I do not know whether it is intended that that should be so. Certainly it is intended that it should not be made public when the Commission reports, because in certain circumstances which are set out in sub-clause (5)-I shall not read them-the Commission may find that there are problems in making certain of its findings public, or making public the evidence on which they are based. In that event, a separate report is delivered to the President of the Senate and the Speaker of the House of Representatives, together with a statement of this opinion. Then, finally, that report to the President or the Speaker shall not cause that material to be laid before both Houses of Parliament. Perhaps it is not intended-I do not know-that the Parliament will never have access to that material, but certainly if that is intended, it is quite wrong. Parliament should be able to have access to that material. That judgment must ultimately be made by Parliament. The alternative code set out in the Opposition's amendments would leave the matter in Parliament's hands. If Parliament felt that certain material might have to be dealt with, whether or not it would have effects of the kind concerned in the circumstances of such a grave decision as Parliament is called upon to make, it is simply impossible to see how it could make such a decision if it did not have access to all the material on which the Commission has made its findings. Therefore, we press these amendments, which we believe are a more satisfactory way of dealing with this matter and one which is far more consistent with Parliament discharging its responsibilities than is clause 8 as printed. Senator GARETH EVANS(Victoria-Minister for Resources and Energy)(12.40 a.m.) —The Opposition's amendments and the Government's clause are essentially two different ways of achieving the same result. There are some attractions which I readily acknowledge in the Opposition's drafting of these particular clauses. Maybe if we had had them before us in the latter stages of the drafting of this thing in the middle of last night there would have been some disposition to accept them. Let me make it clear that I do not think there are any more risks associated with the Government's drafting of these tabling procedures than is the case with the Opposition's alternative. It is true that there is some discretion vested in the Commission not to produce the entire body of evidence it might have taken or had submitted to it in the course of its inquiry, but the obligation is only to place before the Commission as part of the record or attach to the record so much of the evidence as it thinks necessary to substantiate its findings of fact and its conclusions. If we have people of the kind of integrity and calibre we are talking about on this Commission they can be relied upon to get that right and not in any way conceal, deliberately or inadvertently, material which ought to be available to the Parliament. The other matter is the different consideration of the material which would be generally acknowledged, at least as a prima facie claim, to be treated confidentially and circumspectly, because it may involve material which will be utilised or is capable of being utilised in impending prosecutions or because it relates to any of the other considerations set out in the Bill-fair trial, prejudice to safety or reputation, and so on. In relation to that kind of material, each of the two codes proposes a scheme for dealing with it. Senator Durack's amendment proposes that it be submitted subject to a recommendation from the Commission which can then be treated by the respective chambers of Parliament. The Government's Bill gives that material to the Presiding Officers without any specific restriction or direction as to how that material is to be dealt with. The absence of a specific direction or restriction is deliberate. It is left within the discretion and good sense of the Presiding Officers. If they want to make that material available to some or indeed all of the members of the respective chambers they are at liberty to do so in the way the Bill is cast at the moment. Whatever we do, it is important that material which should be before the Parliament in the final determination of this matter is before it. We believe that that result will be secured by the Government's clause, although we acknowledge some merit in the alternative approach that has been produced by the Opposition. Senator MASON(New South Wales)(12.43 a.m.) —I believe that the matter cannot quite be left as the Minister for Resources and Energy (Senator Gareth Evans) has put it. I have a certain sympathy with the Opposition in this matter in that there seems to me in clause 8 (3) certain sloppiness of drafting which I do not really believe says just what the Minister says it means. I would like the Minister to elaborate on that. I could have understood that clause if it had said something like this: `The Commission shall submit with its report a record of all that evidence before the Commission that the Commission finds necessary to substantiate its facts and its conclusions'. I would have thought that that would have been much closer to the Minister's intention. I cannot believe that the Government intends the Commission to have the discretion which is indicated in this by the word `thinks'. It is a very sloppy word to put in. How do we define `thinks'? Surely, some less subjective judgment is necessary there. I think it goes back, reasonably, to the Opposition's amendment (7) by which clause 7 (1) would read: `The Commission shall, unless it thinks the circumstances require otherwise, conduct the whole of its inquiry in public'. I vote against this Bill because I find the whole thing totally obnoxious and nonsense, and a serious erosion of freedoms in this country, but I raise this point in the hope that the Minister might at this Committee stage clarify the point on page 3, which is vitally important. Presumably the commissioners will read that clause and they will judge from that what they ought to include in the report to this Parliament. I would like the Minister to consider carefully the form of words I have put, and I ask him whether that is really nearer to the intent that is required. I require from the Minister the undertaking that that is the case, that a discretion is not really intended to be given to the commissioners beyond one that they should include all that evidence which in fact relates to matters of fact that they report. Senator GARETH EVANS(Victoria-Minister for Resources and Energy)(12.45 a.m.) —About matters of drafting taste there is no disputation. Senator Peter Baume —De gustibus non est disputandum. Senator GARETH EVANS —De gustibus non est disputandum. I thank Senator Baume. I am indebted to him for his assistance. I am happy to give an assurance that it is the Government's intention that the Commission, under this clause, make available to this Parliament all that evidence which is relevant and necessary to substantiate the findings that it makes on a particular subject matter. That is the clear intent. I am sure, given the integrity and capacity of the people we appoint, that they will honour that intent and err on the side of generosity in the provision of material, even at the expense of the nation's pulpwood forests. I appreciate that that is another concern of the Australian Democrats which may be put at risk by such an interpretation. Senator MASON(New South Wales)(12.46 a.m.) —I take it that the Committee discussions on this Bill will naturally become available to the commissioners? Senator Gareth Evans —Naturally. Senator DURACK(Western Australia)(12.46 a.m.) —I seek one further commitment from the Government. I thank the Minister for his explanation to Senator Mason. If the Commissioners take notice of it, it will, I hope, overcome one of our main concerns. Our other main concern relates to the preparation of one of these reports by the Commission in accordance with this clause. Clause 8 (6) states: . . . the President of the Senate and Speaker of the House of Representatives shall not cause that separate report to be laid before the House of the Parliament. Our amendment acknowledges that there may be some very sensitive material affecting someone's safety, for instance, which should not be made public. Does sub-clause (6) really preclude members and senators from having access to that report in private? Senator Gareth Evans —No. Senator DURACK —The Minister does not think so; all right. Can we get that on the record? Senator GARETH EVANS(Victoria-Minister for Resources and Energy)(12.47 a.m.) —I am happy to put that on the record. It is certainly the intent that access in private not be precluded. In fact, it may well be highly desirable. Another way of doing it is simply for the Senate to rely on the good judgment of the President of the Senate and for the House of Representatives to rely on the good judgment of the Speaker in relation to these matters, supported, perhaps, by a group of representatives looking at the material in question. I acknowledge the force of the argument that, unless the respective Houses of Parliament have access to the material which is crucial to certain key findings, they are unlikely to have much confidence in the character of those findings. The dynamics will work to produce that result. Senator DURACK(Western Australia)(12.48 a.m.) —Mr Chairman, in all the circumstances I will not press the amendments. I think we have had satisfactory explanations from the Minister on these matters. I hope it will work out all right. If necessary, we might have to amend this clause but I am sure that the Government will be very co-operative if that is required. Amendments-by leave-withdrawn. Clause agreed to. Clauses 9 to 13-by leave-taken together, and agreed to. Remainder of Bill. Senator DURACK(Western Australia)(12.50 a.m.) —by leave-I move: (15) Page 7, after sub-clause 14 (6), insert the following sub-clause: ``(6a) A Senator or a Member of the House of Representatives may appear before the Commission and make submissions, orally or in writing, personally or by a representative.''. (16) page 7, sub-clause 14 (7), after ``by virtue of'' (first occuring), insert: ``sub-section (4), by virtue of''. (17) Page 8, sub-clause 14 (10), leave out ``shall not be published, and the Commission shall not give such a direction if to do so'', insert: ``shall be published, but the Commission shall give such a direction if not to do so''. (18) Page 8, sub-clause 14 (11), paragraph (b), after ``in contravention of'', insert: ``a direction under''. (19) Page 10, sub-clause 21 (3), after ``appearing before the Commission as a witness'', insert: ``or making a written submission to the Commission''. Probably the most important of these amendments is amendment (15), which is to the effect that `a senator or a member of the House of Representatives may appear before the Commission and make submissions orally or in writing, personally or by a representative'. I suppose this is only moved out of abundant caution. We believe that that ought to be permissible. I do not see anything in the Bill which prevents it but we really want to make quite sure that it can be done. The other amendment of significance-this may really be a problem-is that persons summoned to attend before the Commission or appearing before the Commission would have the same protection they would have if they appeared before the High Court of Australia. As a lot of material will be put in writing, we believe that ought to have a wider significance than just appearing before the Commission and that it ought to cover making a written submission to the Commission. Perhaps the Minister might make some agreeable comments on these amendments as well. Senator GARETH EVANS(Victoria-Minister for Resources and Energy)(12.52 a.m.) —There is a problem about amendment (15) with its provision that `a senator or a member of the House of Representatives may appear before the Commission and make submissions orally or in writing, personally or by a representative'. The problem is not that there is any desire to exclude senators and members having a right to appear as witnesses before the Commission; rather the fear is that by singling out senators and members and giving them a clause to themselves, they would not be construed as being treated in the same way as other categories of witnesses and subject to the same conditions and disabilities-for example, subject to the compulsion to answer. This is the danger we see in drafting an amendment in these terms. We cannot understand it as being necessary that there be explicit reference to senators and members having the capacity to attend as witnesses to ensure that, in fact, they do have that capacity. We believe there is no principle of interpretation or any other relevant rule that would exclude their capacity to appear as witnesses. It is for that reason, not because we have any worries about allowing people to be witnesses, but because we fear that senators and members who do appear before the Commission ought to do so in exactly the same terms as other witnesses otherwise we have a dual class system. It is a technical objection rather than one which I think goes to the principle that Senator Durack is advancing. As to the other amendments, to the extent that at this time of night I can concentrate on what the hell they are about, they seem to reverse the situation so far as the publication of evidence-- Senator Durack —I think two of them are consequential upon amendment (15). Senator GARETH EVANS —Amendments numbered (16), (17) and (18) go to the question, as I understand it-I may be wrong at this stage-of the publication of evidence. Whereas the Bill says that material will only be published on the direction of the Commission, this particular set of amendments seems to say that material will be published in the absence of a direction. Again, we have some sensitive regard to the pulpwood forests of the nation. I think this will generate enough in lawyers' fees and everything else, without generating a major assault on the paper mills. I could make agreeable noises to the extent of saying that, clearly, it is the Government's intent that any material which ought to be published in order to give a full and fair appreciation as to what the Commission and its findings are all about should be published. I hope that expression of Government intent will sufficiently satisfy Senator Durack at this hour. Senator Durack —What about the protection of people making written submissions? Senator GARETH EVANS —That was consequential upon amendment (15), unless I have misunderstood something, in which case the points I was making there are precisely applicable to that too. Amendments negatived. Senator MACKLIN(Queensland)(12.55 a.m.) —I ask the Minister whether or not the intention of clause 16 as it is now drafted would be that the judgment made by Mr Justice Hunt on matters of privilege in the previous proceedings in terms of Mr Justice Murphy would not be operative, so that any evidence given in private in camera would not be able to be admitted in any subsequent court case whatsoever. Senator GARETH EVANS(Victoria-Minister for Resources and Energy)(12.56 a.m.) —That is the effect of the clause as it has been drafted. I do not want to get into the pros and cons of the Hunt judgment or whether the pre-existing law of privilege was in the terms of this particular clause. I simply say that the effect of this clause is as the honourable senator has described it. Senator MACKLIN(Queensland)(12.56 a.m.) —I have one further question that relates to clause 35 and the contempt powers of the Commission. There was some discussion during the second reading stage of the Bill with regard to possible leaks from the Commission, from whatever source and in whatever way. Would that be construed to be a contempt of the Commission if in fact material which leaked from the Commission were published in the media? Would the people who published that material in the media-the journalists or the newspaper-be in contempt of the Commission and hence be liable for the penalties of $2,000 or imprisonment for one year? Senator GARETH EVANS(Victoria-Minister for Resources and Energy)(12.57 a.m.) —It is our view that, leakage of that kind would constitute contempt of the provision on the same analogy as it constitutes a breach of privilege of a parliamentary committee. There may be some room for argument about that, but I think it would be the intention of the clause that it would have that particular ambit. Remainder of Bill agreed to. Bill reported without amendment; report adopted. Bill (on motion by Senator Gareth Evans) read a third time. Senate adjourned at 12.58 a.m. (Friday) until Tuesday, 27 May 1986, at 2 p.m.; in accordance with the resolution agreed to this day. The following paper was tabled: Seat of Government (Administration) Act-Variation of the plan of layout of the city of Canberra and its environs (87th Services), dated 8 May 1986. The following answers to questions were circulated: (Question No. 569) Senator Bolkus asked the Minister representing the Treasurer, upon notice, on 9 October 1985: (1) How many banks provide information on interest payments made to customers and on what basis. (2) What is the relevant cut off point of the amounts of interest paid in respect to the information referred to in (1). Senator Walsh —The Treasurer has provided the following answer to the honourable senator's question: (1) All banks in Australia provide details of interest payments made to customers. A basis for this is Income Tax sub-regulation 11 (2) which requires all companies (including banks) to provide each year to the Australian Taxation Office the names and addresses of persons to whom interest in excess of $100 was paid and the amount so paid. (2) Not all interest payments above the $100 threshold are presently being reported to the Taxation Office. Specified tolerances above this amount for the various kinds of bank accounts have been set by the Commissioner of Taxation and are being progressively reduced. These tolerances have regard to the substantial costs and difficulties facing the banks in providing full information at this time and to the resources and facilities available to the Taxation Office to process the information. It is not appropriate for the Commissioner to make public the amounts of the specified tolerances. (Question No. 903) Senator Jessop asked the Minister for Resources and Energy, upon notice, on 18 February 1986: (1) Is there any evidence that a climate of sustained low world oil prices will adversely affect the level of oil exploration activity in Australia. (2) What is the level of activity of on-shore and off-shore oil exploration in Australia in terms of the number of exploratory wells sunk, and the amount of money spent on exploration over the last 3 years. (3) What is the present level of Australia's crude oil self sufficiency, and to what level of crude oil discoveries will Australia have to maintain in order to maintain this level of self sufficiency. (4) What are Australia's current national reserves of crude oil, at what rate are these reserves being depleted, and at what rate are discoveries being made. (5) Based on projections of the data available, can the Minister for Resources and Energy provide an estimate of what Australia's level of crude oil self sufficiency will be in the years 1990, 1995 and 2000. Senator Gareth Evans —The answer to the honourable senator's question is as follows: (1) If world oil prices are sustained at the current low level for an extended period of time, it is likely that there will be some decline in exploration activity in Australia and overseas. However, as most oil industry analysts currently expect oil prices to recover to 1985 levels during the 1990's, it is expected that many companies will continue with their exploration and development plans but possibly at a slower rate. Some marginal projects and exploration areas may be abandoned until oil prices recover. The quantitative effect on the level of exploration activity cannot be estimated at this stage. At the present time, companies are reviewing the timing of planned activities. Although there are some exploration and development projects within Australia which might be classified as marginal, there are also many attractive exploration prospects and potentially viable discoveries over which companies will wish to retain tenure. The companies not willing to risk losing acreage in which the more immediate discoveries and developments are expected to be made, can be expected to continue to explore with a view to oil prices recovering in the 1990s. Any decision on exploration and development activities will take account not only of oil price forecasts but a wide range of other factors. Australia is an attractive country for petroleum exploration-there are very good prospects for finding oil and our taxation regimes compare well with those of other countries. The maximum marginal taxation rate for new onshore developments is 68.4%. For offshore developments, the Government has introduced a resource rent tax (RRT) on greenfields offshore petroleum projects. The taxation rate of the RRT is 40% which, with normal company tax gives a marginal rate of 67.4%. The advantage of this tax is that it is profits based rather than production based, and that the tax is only applied once the project has reached the threshold rate of return (currently around 29%). If the returns on the project fall below the RRT threshold rate of return, then no tax is paid. The Government has also recently introduced the mechanism for a profits based tax-the resource rent royalty-to be applied to onshore developments. These rates are in fact equal to or lower than those in many other oil producing countries, including UK, Norway and Indonesia, where marginal tax rates are well over 80%. (2) Petroleum exploration wells drilled in Australia over the past 3 years and the associated expenditure is as follows: Year Onshore Offshore Total 1983... 160 ($241m) 49 ($585m) 209 ($826m) 1984... 221 ($369m) 43 ($426m) 264 ($795m) 1985... 226 ($429m) 43 ($387m) 269 ($816m) Source: Exploration wells drilled-Bureau of Mineral Resources Exploration expenditure-Australian Bureau of Statistics (3) Australia's crude oil self-sufficiency for the first five months of 1985-86 reached a record level of 107% following a level of 95% achieved in 1984-85. Oil self-sufficiency is defined as the ratio of crude oil and condensate production plus domestic consumption of naturally occurring LPG to domestic demand for petroleum products. However, it must be recognised that the technical limit for absorption of Australian crude oil and feedstocks by refineries is about 80% of refining output requirements-the remaining 20% of refinery output is met from heavy crude oil which must be imported. Estimates of future levels of crude oil self-sufficiency depend on many factors including demand forecasts, oil pricing forecasts, forecasts of production from existing and planned facilities and forecasts of production from as yet undiscovered fields. Taking all these uncertainties into account, the latest forecasts by the Department of Resources and Energy of future minimum levels of self-sufficiency are in the range: Low Probability High Probability % % 1989-90... 81 66 1994-95... 82 52 1999-2000... 67 39 The Government is continuing to pursue a policy aimed at ensuring and adequate supply of energy is available to Australia at all times. In this context the government is seeking to achieve, in an economically efficient manner, an optimal level of self-sufficiency in liquid fuels over the longer term rather than pursuing an arbitrary target level of self-sufficiency. Consequently, precise rates of new oil discoveries needed to maintain current levels of self-sufficiency are not necessarily relevant to a full assessment of current policy developments. By way of example, production from new discoveries would need to be in the order of 120 million barrels a year in 1994-95 and 173 million barrels a year in 1999-2000 in order to maintain an 80 per cent level of self-sufficiency in those years. However, the size and timing of discoveries needed to achieve this rate of new production is subject to considerable uncertainty and cannot be estimated with any measure of confidence. (4) Under the McKelvey classification system, Australia's demonstrated economic resources of crude oil and condensate as at 30 June 1985 are 2.0 billion barrels (313 million kilolitres). Production of crude oil and condensate over the past ten years has amounted to 1.56 billion barrels (or 247.4 million kilolitres)-and average of 155.6 million barrels (24.7 million kilolitres) a year. Additions to reserves are a result not only of new discoveries, but also reappraisal of known fields. Over the 10 years from 1975-76 to 1984-85 the additions to reserves have amounted to approximately 1.8 billion barrels (approximately 290 million kilolitres)-an average of 180 million barrels (29 million kilolitres) a year. (5) See answer to (3). (Question No. 915) Senator Kilgariff asked the Minister for Resources and Energy, upon notice, on 19 February 1986: (1) How many claims have been lodged with the Office of the Commissioner for Employees' Compensation by Australian participants in the British Atomic tests. (2) How many of those claims have already been dealt with. (3) How many of those dealt with were accepted, and how many rejected. (4) What were the precise grounds of the individual claims of those accepted. (5) How many Australians were employed in any capacity at the test sites during the British Atomic tests. (6) How many of these were members of the Australian Defence Forces, how many were Commonwealth Public Servants and how many, and in what categories, were the remainder. Senator Gareth Evans —The answer to the honourable senator's question is as follows: (1) 217 as at 27 February 1986. The Commissioner for Employees' Compensation has asked all employing agencies to forward such claims to the Canberra Head Office. (2) Liability found-Due to radiation exposure 5; and due to other causes 1. (3) Disallowed 91; Withdrawn 3; Under investigation 117. (4) Liability was found in 5 claims on the basis of evidence of exposure to radiation and specialist medical opinion. In one claim liability was found on specialist medical evidence in respect of a condition due to employment-related causes other than exposure to radiation. (5) 15,364 personnel were identified during the 1982-83 health study of atomic test personnel. (6) Of these, approximately 33 per cent were members of the Australian Defence Forces, 34 per cent Public Servants, 23 per cent non-government, 10 per cent not known. The ``non-government'' category includes construction workers at Maralinga who left the site before atomic tests began (2,700 from Kwinana Construction Company) and various tradesmen and professionals providing specialist services. Senator Walsh —On 20 March 1986 (Hansard, page 1342) Senator Townley asked me, as Minister representing the Treasurer, the following question without notice concerning Australian currency: Now that the $1 coin has proven to be so successful, will the Treasurer examine the possibility of introducing both a $5 and a $10 coin and also have his Department examine changing the size of all Australian coins with a view or reducing their size to an amount of metal more in line with their present value? The Treasurer has provided the following information: The Government continually monitors public demand and acceptance of the various denominations of Australia's notes and coins and, as such, welcomes all suggestions and comments that his suggestions will be carefully considered in the Government's examination of Australia's coinage system. I would also mention that the Government currently does issue a $10 coin, although this is a collector piece and therefore does not generally enter into circulation. Senator Walsh —On 6 December 1985 (Hansard, page 3167) Senator Knowles asked me, as Minister representing the Treasurer, the following question without notice: In the light of the Government's intention to legislate for the quarantining of farm losses from tax deductibility against off-farm income, can the Minister inform the Senate what will be the tax treatment for a farmer who, while operating his own property, obtains additional off-farm income by planting and growing crops on leased farm land? Has the Commissioner of Taxation informed the accountancy profession as to whether such income will be regarded as part of general farm income or included as off-farm income that will be subject to the quarantining provisions, as is currently being asserted by some accountants? The Treasurer has provided the following answer to the honourable senator's question: The Minister for Primary Industry announced on 15 April 1986 that, because of the current depressed state of primary production, the Government has decided not to proceed with primary production loss quarantining measure. Instead, a review is to be carried out of the current application of the relevant provisions of the income tax law and a change will be made to the trading stock provisions to take breeding costs into account in the valuation of certain livestock acquired by natural increase.