Wednesday, 28 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 in Parliament assembled. The humble petition of the undersigned citizens of Australia respectfully showeth. That numerous provisions exist in industrial legislation and awards which purport to provide special protection to women workers but which have been shown to be detrimental to their achievement of equality in employment. Noting the relevant provision in Article ll of the United Nations Convention on the Elimination of All Forms of Discrimination against Women to which Australia is a party your petitioners request that urgent action be taken to ensure that these legal barriers to equality be removed. And your petitioners as in duty bound will ever pray. by Senators Crowley (from 13 citizens) and Reid (from 16 citizens). To the Honourable the President and members of the Senate in Parliament assembled. The petition of the undersigned respectfully showeth: That your petitioners are concerned about foreign owned military bases on Australian territory and the entry into Australian waters and territory of foreign warships and aircraft carrying nuclear weaponry. And that the Australian Government should take an active and constructive role in the promotion of a nuclear-free world. Your petitioners most humbly pray that the Senate in Parliament assembled should: 1. Promote the expression of Australian sovereignty by legislating to bring foreign military bases on Australian territory under the control of the Australian Government. 2. Make it compulsory that the disclosure of weaponry carried by foreign warships and aircraft be given in confidence to the Australian Government prior to a request for entry. And that foreign warships and aircraft that carry nuclear weaponry be banned from Australian waters and territory. 3. Legislate for the cessation of all uranium mining in Australia and its subsequent export. 4. Urge the Government of the Commonwealth of Australia to pose to the Governments of the United States and the Soviet Union that both countries agree to immediately halt the testing, production and further deployment of all nuclear weapons, missiles and delivery systems in a way that can be checked and verified by both sides. And your petitioners as in duty bound will ever pray. by Senator Macklin (from 72 citizens). To the Honourable the President and members of the Senate in Parliament assembled. Your petitioners humbly pray that the Senate, in Parliament assembled, should: Request the Government to introduce a Bill providing: That the LD50 Test, whereby animals are used in the testing of cosmetics, industrial and household substances, be abolished. That, at this moment, animal experimentation be limited to medical research only and that accurate records be kept of all animal research in Australia. That, over the next 10 years, animal experimentation be phased out completely. And your petitioners as in duty bound will ever pray. by Senator Sanders (from 148 citizens). To the Honourable the President and members of the Senate in Parliament assembled. The petition of the undersigned shows: Graduated family allowances are of important assistance to families with more than one child. All family allowances, whether for one, two, three, or more children, have not kept pace with inflation. There are suggestions that all family allowances should be paid at the one flat rate. This would severely disadvantage families with more than one child. Your petitioners therefore pray that the Senate, in Parliament assembled, should reject any suggestion that family allowances be paid at a flat rate and instead should ask the Federal Government to increase the value of existing payments. And your petitioners as in duty bound will ever pray. by Senator Reid (from 149 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 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 Knowles (from 55 citizens). To the Honourable the President and members of the Senate in Parliament assembled. The petition of the undersigned citizens of South Australia respectfully showeth: That we are greatly concerned that the Australian Bill of Rights does nothing to protect the rights of parents to choose to send their children to non-government schools and the rights of individuals and groups to establish educational institutions, which are rights set down in the International Covenant on Economic, Social and Cultural Rights, ratified by Australia. That the Australian Bill of Rights contains no provision to protect Australians against coercion and discrimination in the work-place to ensure that both unionists and non-unionists should have equal rights to employment opportunities. That the Australian Bill of Rights will give the Federal Government unwarranted powers to override state laws, and that the Human Rights Commission will possess draconian inquisitorial powers which will abrogate the rights of individuals and state and local governments. We your petitioners humbly pray that the Australian Bill of Rights Legislation be opposed in the Senate. by Senator Messner (from 166 citizens). To the Honourable the President and members of the Senate in Parliament assembled: the humble petition of the undersigned citizens of Australia respectfully showeth: That we deplore the proposed Bill of Rights because it adversely affects areas of the liberty and freedom of Australians. It will operate against: The States and our Federal system of Government Criminal Justice The Police Education Families Employer/Employee relations It will remove the power of the people through Parliament, by giving power to a new more powerful Human Rights Commission which is not elected, but can act as a Star Chamber. We do most earnestly wish to keep our system of Common Law. Your Petitioners therefore humbly pray that the Senate in Parliament assembled should reject this Bill. And your petitioners as in duty bound will ever pray. by Senator Sheil (from 125 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 we oppose utterly the proposed Bill of Rights because this Bill will Restrict our rights to those listed in the Bill Transfer to government powers not given nor intended to be given by the Constitution Threaten our rights by making them subject to the will of this or any future Government Turn the Human Rights Commission into a political Star Chamber with unjustifiable power Abrogate Common Law and common liberty Set the State above the individual We the undersigned believe in democracy and freedom and earnestly entreat you to recognise that this Bill will undermine the fundamental basis of these. Your petitioners therefore humbly pray that the Senate in Parliament assembled should reject the Bill of Rights. And your petitioners as in duty bound will ever pray. by Senator Sheil (from 78 citizens). To the Honourable the President and members of the Senate in Parliament assembled. The petition of the undersigned respectfully showeth: 1. The Agreement between the United States of America and Australia concerning the Joint Defence Space Research Facility at Pine Gap terminates on 19 October 1986. 2. In the event of war between the United States and the Soviet Union, access by the United States to Pine Gap's facilities makes it a probable nuclear target. 3. Access by all nations to Pine Gap's capacity to monitor and verify compliance with existing and future nuclear limitations treaties could contribute to world peace and security. 4. The people of Australia are entitled to be consulted, through their representatives in Parliament, on any extension or modification of the Agreement affecting their lives, security and welfare. Your petitioners most humbly pray that the Senate in Parliament assembled, should decide that- 1. The Agreement between the United States and Australia concerning the Joint Defence Space Research Facility at Pine Gap not be extended beyond October 1986. 2. Public discussion and inquiry be instituted into the feasibility of negotiating a new agreement with the United Nations during the International Year of Peace offering the verification facilities of the Pine Gap base to all nations. 3. Any agreement concerning the future use of Pine Gap be referred to Parliament for ratification. And your petitioners as in duty bound will ever pray. by Senator Macklin (from 36 citizens). To the Honourable the President and members of the Senate in Parliament assembled. The petition of the undersigned citizens of Australia respectfully showeth: 1. That we oppose the deregulation of housing interest rates without adequate safeguards to protect homebuyers. 2. That we condemn the Government for breaking its unequivocal promise not to deregulate these interest rates. 3. We express our concern that the Government's decision will cause undue hardship to many Australian families. Your petitioners most humbly pray that the Senate in Parliament assembled, should: urge the Government to reverse its decision and re-impose the interest rate ceiling. And your petitioners as in duty bound will ever pray. by Senator Macklin (from 88 citizens). To the Honourable the President and the members of the Senate in the Parliament assembled. The petition of the undersigned citizens of Australia showeth: That many Australian wage and salary earners and self-employed persons do not enjoy secure retirement incomes provided by superannuation; and That the Government issued in December 1985 Guidelines for the implementation of the proposed productivity decision by the Conciliation and Arbitration Commission and draft Operational Standards for Superannuation schemes. Your petitioners therefore humbly pray that the Government: 1. Guarantees to every employee the right and freedom to select the superannuation scheme of his/her choice. 2. Protects the individual exercising that freedom of choice from any coercion, influence or other pressure which may be applied by any employer, association or trade union. 3. Will recognise only those schemes which provide genuine superannuation and reject those schemes which do not provide for- preservation of benefits to retirement vesting of employer contributions equal employer and employee Trusteeship control to ensure security of investments. And your petitioners as in duty bound will ever pray. by Senators Parer (from 183 citizens), Walters (from 51 citizens) and Watson (from 31 citizens). To the Honourable the President and members of the Senate in the Parliament assembled. The Petition of certain citizens of Australia respectfully showeth: that all legitimate business expenses incurred in earning or producing assessable income should be allowable deductions. that the proposed Capital Gains Tax is an unwarranted burden on the rural and small business sectors, which will severely affect their long term viability. that the delay by the Government in introducing the legislation into Parliament, full details of which still had not been revealed after it had legally been in operation for more than six months, has caused confusion and hindered farmers and small business people in the organisation of their affairs. Your petitioners humbly pray that the Government introduces the Capital Gains Tax Legislation without delay and that the Australian Democrats join with the Opposition to defeat the proposed legislation. by Senator Michael Baume (from 15 citizens). To the Honourable the President and members of the Senate in the Parliament assembled. The Petition of certain citizens of South Australia respectfully showeth: that all legitimate business expenses incurred in earning or producing assessable income should be allowable deductions. that the proposed Capital Gains Tax is an unwarranted burden on the rural sector, which will severely affect its long-term viability. that the delay by the Government in introducing the legislation into Parliament is causing confusion and hindering farmers in the organisation of their affairs. Your petitioners humbly pray that the Government introduces the Capital Gains Tax legislation without delay and that the Australian Democrats join with the Opposition to defeat the proposed legislation. by Senator Messner (from 109 citizens). To the Honourable the President and members of the Senate in Parliament assembled. The petition of the undersigned shows: that the Bill of Rights and the Human Rights and Equal Opportunity Bill 1. offer nothing more than is already available under law, 2. deny some Human Rights and do not include others, 3. give dangerously wide powers to an unelected body, and 4. could cause far more damage than they could possibly cure. Your petitioners request that the Senate should: Completely reject the Bill of Rights and the Human Rights and Equal Oppoeruniry Bill. And your petitioners as in duty bound will ever pray. by Senator Bjelke-Petersen (from 25 citizens). To the Honourable the President and members of the Senate in Parliament 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 consultation, 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 Knowles (from 14 citizens). To the Honourable the President and members of the Senate in Parliament assembled. The Petition of the undersigned shows: That we urge you to oppose the Australian Bill of Rights because: This Bill does not guarantee vital rights such as:- The right to own your own home and other property and not to be deprived of it without just compensation. The right to insulate our children from radical forms of education and the right to choice of schools. The right to a referendum for constitutional amendments. The right to true freedom of speech. The Bill gives dangerous, unlimited powers to an unelected Human Rights Commission with no appeal, no legal representation and closed hearings. Your petitioners ask that the Senate, in Parliament assembled, should vote to reject the Bill, believing that such a Bill should only be determined by the people at a referendum. And your petitioners as in duty bound will ever pray. by Senator Michael Baume (from 419 citizens). To the Honourable the President and members of the Senate in Parliament assembled. The petition of the undersigned respectfully showeth: 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 most humbly pray 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 Newman (from 31 citizens). To the Honourable the President and members of the Senate in Parliament assembled. The Petition of the undersigned respectfully showeth: The Government's proposed Bill of rights legislation has been introduced into Parliament with haste and without regard for the adverse effects it would have in many areas essential to the liberty and freedom of the Australian people. Your Petitioners most humbly pray that the Senate, in Parliament assembled, should- Delay any further debate on the Bill of Rights until sufficient time has elapsed to allow public discussion, after which it seek the consent of the people of Australia in a referendum. And your petitioners as in duty bound will ever pray. by Senator Walters (from 150 citizens). The Honourable the President and members of the Senate in Parliament assembled: The petition of the undersigned respectfully showeth: that the humble petitioners respectfully believe that the representatives in Australia of the African National Congress and the South West Africa People's Organisation should not have to suffer unending financial problems related to the cost of rent, food and clothing, and the maintenance of two small offices run on the most austere basis. Your petitioners therefore most humbly pray that the Senate in Parliament assembled should urge the provision of:- 1. Official recognition of A.N.C. and S.W.A.P.O. as the legitimate representatives of the people of South Africa and Namibia. 2. Financial support to the offices and representatives of the African National Congress and the South West Africa People's Organisation to promote the anti-Apartheid cause. 3. Additional financial support for the official representatives of the A.N.C. and S.W.A.P.O. to assist the humanitarian needs of Namibian and South African refugees who are victims of Apartheid. 4. Scholarships for South African and Namibian refugees. These to be provided through the A.N.C. and S.W.A.P.O. education departments. And your petitioners as in duty bound will ever pray. by Senator Zakharov (from 15 citizens). To the Honourable the President and members of the Senate in Parliament assembled. The petition of the undersigned shows: That the Hawke Government should- pass on the full benefit of lower international oil prices on 1 March 1986; not increase or extend fuel taxes; and maintain its tax cut commitments. Your petitioners humbly pray that the Hawke Government honour its commitment to the Import Parity Pricing policy. And your petitioners as in duty bound will ever pray. by Senator Michael Baume (from 15 citizens). To the honourable the President and members of the Senate in Parliament House assembled. We, the undersigned citizens of Australia, humbly pray that the Parliament act to outlaw the practice of the large petrol companies also controlling petrol retail outlets in competition with independent petrol distributors and retailers who they supply, thus acting in a position of unfair competition, and leading to the large companies exerting unconscionable pressure on those independent distributors and retailers. And your petitioners as in duty bound will ever pray. by Senator Vigor (from 49 citizens). To the honourable the President and members of the Senate in Parliament House assembled. The petition of the undersigned respectfully shows: That we strongly support `The A.C.T. Smoking and Tobacco Products Advertisements Prohibition Bill' introduced by Senator Evans, because it represents the first positive national step towards the eventual elimination of widespread serious ill health caused by smoking tobacco. by Senator Vigor (from 150 citizens). To the honourable the President and members of the Senate in Parliament House assembled. The petition of the undersigned respectfully shows: That certain Trade Unions are currently forcing employers and employees to join union-controlled Superannuation schemes through industrial blackmail, thereby extending the Unions' economic power and at the same time infringing individual rights. Your petitioners therefore humbly pray that the Government: (i) Guarantee that Occupational Superannuation is a matter of individual choice. (ii) Declare illegal industrial standover tactics which force people to join superannuation schemes controlled by, or sponsored by, trade unions. (iii) Protect those companies and their employees who establish their own superannuation arrangements at the enterprise level. (iv) Ensure that union or industry-based schemes are not disguised pay rises by providing that em- ployees must also make contributions. (v) Provide that control of the funds of such schemes is vested in the elected representative of the contributors to those schemes. (vi) Oppose any backdoor attempts at achieving compulsory unionism. And your petitioners as in duty bound will ever pray. by Senator Parer (from 22 citizens). To the Honourable the President and members of the Senate in Parliament assembled. The petition of the undersigned respectfully showeth: 1. They are completely satisfied with the design of the existing Australian National Flag. 2. They are aware it properly reflects the immutable characteristics of Australia, namely: (a) The Union Jack-itself the creation of 3 Christian crosses represents the nation's historical origin and the source of its language and law. (b) The Southern Cross on an azure blue background signifying its place in space. (c) The large star depicting the advent of Federation in 1901 and each point depicting a State and the Territories of the Commonwealth. 3. They know the flag has been a source of inspiration to generations of Australians in peace and war. 4. They recall that millions of native-born Australians and newcomers to these shores from other parts of the world have become united under its proud symbolism. 5. They are certain that any change to its form or to its acceptance as the sole Australian National Flag will produce division in the Australian community. Your petitioners most humbly pray that the Senate, in Parliament assembled, should ensure that the existing Australian national flag remains sacrosanct from change and remains the sole national flag. And your petitioners as in duty bound will ever pray. by Senator Walters (from 342 citizens). To the Honourable the President and members of the Senate in Parliament assembled. The petition of the undersigned respectfully showeth: That the Government has imposed an additional patient contribution on the cost of a subsidised pharmaceutical, namely the drug Dilantin. Your petitioners most humbly pray that the Senate, in Parliament assembled, should Bear in mind all the additional costs incurred by people suffering from chronic illness and therefore request the Government to reverse its decision to increase the price of the drug Dilantin to the consumer. And your petitioners as in duty bound will ever pray. by Senator Walters (from 20 citizens). To the Honourable the President and members of the Senate in Parliament assembled. The petition of the undersigned citizens of Australia shows that the proposed Fringe Benefits Tax recently introduced into the House of Representatives by the Labor Government will increase the costs and inhibit future growth of small business in this great Nation. Your petitioners request that the Senate in Parliament assembled should reject this regressive legislation as a matter of utmost urgency in the interests of the well being of all Australians. And your petitioners as in duty bound will ever pray. by Senator Walters (from 304 citizens). To the Honourable the President and members of the Senate in Parliament, the petition of the undersigned showeth: That the goldmining industry is vitally important to Australia and under the existing taxation laws is a growth industry, creating increased employment opportunities in many parts of Australia, producing increased revenue for governments and increased exports, at a time when many other sectors of the economy are in a depressed state. Your petitioners ask that the Senate call on the Hawke Government to reject any recommendation from the current Inquiry, or take any other action which would lead to any new tax being imposed on the goldmining industry, because such a tax would: Cost thousands of jobs in the industry, depress local economies affected by the industry, thus causing a lowering of living standards, in certain non-urban areas of Australia and ultimately a further decline in the national economy. And your petitioners as in duty bound will ever pray. by Senator Robertson (from 306 citizens). To the Honourable the President and members of the Senate in Parliament assembled: The humble petition of the undersigned citizens of Australia respectfully showeth that: There is a threat to medicine by an alliance between some greedy doctors, private health funds and private hospitals who, since the inception of Medicare have run a campaign to destroy Medicare. People, especially pensioners, are suffering. We call on the Government to investigate why our taxes are being spent to prop up private hospitals. To carry out an overhaul of the Medicare legislation to close the loopholes to prevent this exploitation. And your petitioners, as in duty bound will ever pray. by Senator Robertson (from 54 citizens). Petitions received. Senator COLSTON(Queensland) —I give notice that, on the next day of sitting, I shall move: That the Senate, noting- (a) the comments of a trustee of the National Party and prominent businessman in Queensland, Sir Roderick Proctor, who said on Australian Broadcasting Corporation radio in May 1986 that ``The Queensland economy is not in good shape, and in some respects at the moment we don't compare well with some of the other States which just happen to have Labor State Governments''; (b) that this grave message has been conveyed in this Chamber and by the Opposition in the Queensland Parliament for some time; and (c) that the perilous state of the Queensland economy has at last been realised by National Party members in Queensland, urges the current Queensland Government- Senator Chaney-Mr President, I take a point of order. I understand that fairly wide latitude is given in the Senate for notices of motion. However, it seems to me that Senator Colston's notice of motion is a cross between a conversation and a debate, Mr President. I ask you to rule on whether the very odd nature of it, which includes quotations-the point the honourable senator is at now seems to consist of argument rather than being a normal notice of motion-is in order. Senator Grimes-On the point of order: I almost agree with Senator Chaney on this matter. The only difficulty is that since Senator Michael Baume's arrival in this place we have had from him notices of motion which go on for pages, which are much more discursive and much more like a debate than the notice of motion Senator Colston is giving now. Like Senator Chaney, I also believe that it is about time we considered the new practice in this place of delivering notices of motion which go on for about 20 minutes. I think it worth while, Mr President, that you seriously consider the situation. If you do not, perhaps the Senate Standing Orders Committee could consider the situation. The PRESIDENT —On the point of the order that has been raised by the Leader of the Opposition, I have been concerned for some time about the way in which a number of notices of motion are being presented to the chamber in that they seem to be points of argument rather than notices of motions to be debated and considered ultimately by the Senate. I have been having discussions with the Clerk on this matter for some time. I will take on board the suggestion made in Senator Chaney's point of order without necessarily ruling on it at this stage. I will hear the rest of the content of Senator Colston's notice of motion but I strongly suggest that the subject is a matter for consideration by the Standing Orders Committee. Senator COLSTON —Mr President, I will resume at the last paragraph: (c) that the perilous state of the Queensland economy has at last been realised by National Party members in Queensland, urges the current Queensland Government, in its dying days in office, to cease using rhetoric to explain away the State's ills and take positive efforts to boost the Queensland economy. Senator LEWIS(Victoria) —At the request of Senator Cooney and on his behalf, pursuant to his notice of intention given on 27 May 1986, I now withdraw Business of the Senate, Notice of Motion No. 1, standing in Senator Cooney's name for 30 May 1986, which relates to a matter concerning the Senate Regulations and Ordinances Committee. Senator MICHAEL BAUME(New South Wales) —I give notice that, on the next day of sitting, I shall move: That the Senate requests the Government to bring on for debate the Notice of Motion given by Senator Michael Baume on 17 October 1985 in the following terms: That the Senate: (a) expresses its concern at Australia's worsening balance of payments position, evident from the 18 per cent rise in the current account deficit for the September quarter to $3,345m; (b) requests the Treasurer, Mr Keating, to make available any advice from the Treasury on which he relied for his forecast to an Economics Society meeting on 16 October 1985, that the current account deficit would fall to 4.1 per cent of Gross Domestic Product by June next year and then continue the trend downwards; and (c) regrets that the Treasurer intends to try to defend the Australian dollar that is being weakened largely as a result of inappropriate Government fiscal policy, by maintaining a high interest rate policy that will inevitably damage economic growth. Senator Grimes-I raise a point of order. What we have seen now is a refinement of the practice that has been introduced by Senator Michael Baume. He has now used notices of motion to repeat the notice of motion he introduced before. Under the guise of a point of order I request that, in line with Senator Chaney's previous comments, this matter be dealt with by the Standing Orders Committee, otherwise we will be spending all of most mornings in tit for tat exercises of this type. The PRESIDENT —I take on board the point that has been made by the Manager of Government Business in that Senator Michael Baume, by giving a notice of motion this morning, has recapitulated an earlier notice of motion. Perhaps it would be sufficient merely to cite the number of the notice of motion rather than recite the wording of the earlier notice of motion. I strongly suggest that the matter is one of concern to the Senate generally and the question of notices of motion should be the subject of discussion at the next meeting of the Standing Orders Committee. Senator VALLENTINE(Western Australia) —I give notice that, on the next day of sitting, I shall move: That the Senate- (a) notes the announcement by the Reagan Administration that it intends to override the terms of the SALT II agreement late in 1986 by deploying Air Launched Cruise Missiles on B52 bombers; (b) views with disquiet the same Administration's recent reinterpretation of the Anti Ballistic Missiles Treaty; (c) recognises that the Soviet Union has also broken both the spirit and the letter of the SALT agreements; and (d) calls on the Federal Government to maintain its strong stand on arms control and to make a strong condemnation of both the United States of America and the Soviet Union for breaking arms control agreements that already exist and for failing to reach any agreement on current proposals, such as a comprehensive Test Ban Treaty, while continuing to escalate the arms race at every level. Senator MICHAEL BAUME(New South Wales) —I give notice that, on the next day of sitting, I shall move: That the Senate- (a) notes the many Notices of Motion dating back to October 1985 given by Senator Michael Baume pointing out the continual deterioration of Australia's balance of payments deficit on current account and the need for remedial action by the Government, not one of which has been allowed to be debated by this Government; (b) notes the recent belated admission by the Treasurer (Mr Keating) that the Australian people should now be told `truthfully, honestly and correctly just what kind of a hole Australia is in' because of the record and deteriorating balance of payments deficit on current account, all of which confirms the concerns expressed in Senator Michael Baume's Notices of Motion; (c) regrets the Government's delays in responding to the worsening in Australia's economic position which has been evident for many months, so making it more difficult to correct; and (d) calls on the Government to adopt the requests made in Senator Michael Baume's Notices of Motion for an immediate mini-Budget to implement the major reductions in Government spending Mr Keating now says are needed. Senator GRIMES(Tasmania-Manager of Government Business) —I seek leave to make a personal explanation. Leave granted. Senator GRIMES —I claim to have been misrepresented by Senator Michael Baume in his notice of motion. Senator Michael Baume claimed that the Government had failed to bring on his notices of motion and debate them and, as Manager of Government Business, I believe that reflects upon me. I point out that Senator Michael Baume's notices of motion would normally be dealt with in this place in General Business, and General Business is in the hands of the Opposition. It is clearly the Opposition which does not wish to debate Senator Michael Baume's notices of motion. It clearly does not want to do so because the notices of motion are inane. I make the point that people who wish to break down the normal parliamentary procedures act in an undemocratic way. We are not surprised at that, having come from someone of Senator Michael Baume's extreme right wing views. Senator CHANEY(Western Australia-Leader of the Opposition) —by leave-I would just like to put on the record in the Senate this morning that the Opposition has sought from the Government a proper and full economic statement for debate. That request was made in the House of Representatives earlier this week, and the Government has indicated it is not prepared to make such a statement. I make it quite clear that the Opposition believes that the economic debate is one of major importance, given the Government's recent statements on the perilous state of the Australian economy, and we would certainly desire to see a full statement on Australia's economic position put down by the Government so it could be properly debated. It is rather sad that it has to be up to the Opposition to raise a matter so important to Australia when the Government clearly has the major responsibility in the matter. Senator TOWNLEY(Tasmania) —I give notice that, on the next day of sitting, I shall move: That the Senate- (a) recognising that the present Hawke Socialist Government is a very big-spending Government; (b) aware that big spending and big taxes must go hand-in-hand if Australia is to avoid getting even further in debt both internally and to overseas banking organisations; (c) convinced that Australia is already too far in debt for the good of future generations; (d) aware that Australia will spend more of its Budget in the 1985-86 financial year on the national debt interest than it does on either of health, education, or defence, and about 5 times as much as we do on housing; and (e) mindful that this country is already one of the most indebted in the world with liabilities per head far in excess of Argentina, Mexico, Chile, Poland or Brazil, calls upon the Federal Government to issue a statement to the people of Australia explaining just what long-term action it intends to take to solve the national debt crisis. Senator GRIMES(Tasmania-Minister for Community Services) —For the information of honourable senators I table the report of the Foreign Investment Review Board for 1984-85. Motion (by Senator Grimes) agreed to: That, unless otherwise ordered, Government Business take precedence of General Business on Thursdays for the remainder of the Autumn sittings. 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)(10.19) —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 re-introduces the provisions of the Superannuation Legislation Amendment Bill 1985 blocked in the Senate on 8 October 1985, except for those that concerned the structure and composition of the Superannuation Fund Investment Trust. In addition, the opportunity has been taken to include a number of new amendments that are not related to the Trust amendments but which are necessary to ensure that the Commonwealth superannuation scheme operates in an appropriate manner. It is because some of these new amendments are likely to affect an ongoing appropriation that the Bill was originated in the House of Representatives. The primary function of the Bill is, as it was of the 1985 Bill, to implement essential reforms relating to the Trust. These reforms are intended to: clearly define the Trust's objectives and duties; strengthen the Trust's ability to manage and invest the superannuation fund in the most effective and efficient manner; enhance its accountability both to the Parliament and the contributors; and enable it to operate in competitive financial markets with a degree of freedom and flexibility in investment no less than that afforded the larger private sector superannuation funds. I remind honourable senators that the pressing necessity for reform, the general thrust of this legislation, and its urgency, were recognised and supported by all when the 1985 Bill was debated. That previous Bill was the culmination of a comprehensive process of review by this Government of the operations of the Trust; a review process which included an inquiry into the management and operations of the Trust by the now Auditor-General Mr J. V. Monaghan, and an examination of a number of matters associated with the conclusions and recommendations of Mr Monaghan's report by a working party. In addition, the Senate Standing Committee on Finance and Government Operations examined and reported on the 1985 Bill. While approving generally of the provisions and welcoming the Government's prompt action in introducing the Bill, the Standing Committee made four recommendations proposing the insertion of additional material. On behalf of the Government, I accepted three of the Standing Committee's recommendations. The relevant amendments were incorporated in the previous Bill in the Committee stage of its consideration. Of the three amendments, that relating to the method of selection of Trust members is no longer relevant because this Bill does not seek to alter the existing basic structure of the Trust or the existing method of selection of Trust members. The other two amendments form part of the Bill now before the Senate. None of the provisions of the 1985 Bill concerning the accountability of the Trust, its objective and duties and its power to manage and invest the superannuation fund drew unfavourable reaction during debate. The sole matter of contention was the proposed structure of the Trust. Criticism of that proposed structure focused on what the Opposition and the Australian Democrats wrongly characterised as ACTU control. That criticism failed to recognise that the proposed structure of the Trust did not provide for ACTU control but rather for the ACTU to act as a channel, a conduit, through which industrial organisations representing the bulk of the contributors to the fund could put forward persons suitable for nomination to the Trust. The ACTU is the peak council of these organisations and it was cast solely in that co-ordination role. As honourable senators will be aware, the Treasurer and the Minister for Employment and Industrial Relations issued a joint statement on 16 December 1985 concerning guidelines for the implementation of the proposed productivity decision and draft operational standards for superannuation schemes. The Government is seeking comment on the draft standards which are a framework for further discussion and development in co-operation with interested groups. One part of the draft operational standards proposes standards for control of new superannuation funds which envisage equal numbers of trustees nominated by members and employers (or unions and employer organisations where appropriate). It is also the Government's intention that, where the productivity award is paid into existing schemes, member-union representation should be encouraged in respect of those schemes. Until the details of the control aspect of the draft operational standards have been firmed up and there is general agreement on the most suitable structure for the controlling bodies of superannuation funds, it would not be appropriate to make any significant change to the structure of the Trust. Accordingly, for the time being, the Trust will remain as presently constituted under the Act, that is, a full-time member and two part-time members-all members of the Trust being nominated by the Minister for appointment by the Governor-General. One change, however, that is being made is to remove the provision that permits the part-time position of members' representative on the Trust to be held by a pensioner and which requires pensioner organisations to be involved in the nomination process. Because members' accumulated contributions are paid out of the fund on retirement, pensioners and their organisations have no further interest in the performance of the Trust and the fund. For this reason this part-time member position has, in practice, only ever been held by a contributor to the scheme and the amendment being made will ensure that this arrangement continues. The Government recognises that, in today's intensely competitive business environment, the task of managing and investing the fund, one of the largest superannuation funds in Australia, will demand all the skill and expertise of the members of the Trust. The Government is confident that the present Trust members are equal to this task. However, the question of the size and structure of the Trust will be re-examined in the light of both developments in operational standards for superannuation funds and the demands placed on the existing Trust members. In recognition of the nature of the Trust's operations and that the independence of those operations free from direction is essential, the Bill enables the Trust to employ the staff necessary to carry out its functions under terms and conditions determined with the approval of the Minister. Trust staff not covered by the mobility provisions of the Public Service Act will be able to compete for all advertised vacancies in the Australian Public Service. The present staff attached to the Trust are officers of the Department of Finance. They will have the option of accepting offers of employment with the Trust or remaining as departmental officers. It is expected that there will be few, if any, of the present staff who decline offers of employment with the Trust. In addition to the implementation of reforms essential to the efficient and effective operation of the Trust, the Bill incorporates a number of other amendments to the Superannuation Act 1976. The powers of a secretary of a department under the Public Service Act will be conferred on the Commissioner for Superannuation, who is charged with administering all elements of the Commonwealth Superannuation Scheme not relating to the management and investment of the fund. An anomalous situation arising from a deficiency in the original drafting of the Act that has the effect of unintentionally making certain spouses and children of deceased pensioners ineligible for benefits will be corrected. (This is one of the new amendments that may affect future appropriations.) The provisions relating to the issue of benefit classification certificates are designed to protect the Commonwealth against the risk, and thus the cost, of premature retirement or death because of a physical or mental condition existing at the time the person became a contributor. They are being amended following the recent decision of the Administrative Appeals Tribunal to set aside the decision of the Commissioner for Superannuation to issue a benefit classification certificate in relation to Mr P. J. Bewley. The Bewley decision is at odds with an earlier decision of the Tribunal and interprets those provisions in a manner which was never intended and is contrary to the basic principles of the Commonwealth Superannuation Scheme. This is the most recent example of the propensity of courts and tribunals to capriciously change long standing applications of the law in ways which significantly increase outlays. These amendments will establish the desirable precedent that legally capricious and fiscally irresponsible decisions by courts and tribunals will be set aside by the legislature. The proposed amendments clarify that the provisions are to have the meaning attributed to them prior to the Bewley decision rather than the meaning that has now been adopted by the Tribunal. The amendments are to have effect from 1 July 1976, the date of commencement of the principal Act, but will not affect the Tribunal's decision in relation to Mr Bewley. The amendments are retrospective only in a technical sense. Indeed failure to enact these amendments would have a retrospective effect because they would impose on taxpayers a liability to pay enriched benefits which were neither intended nor expected. They do not remove any past benefit. They simply restore the status quo and ensure that past and future cases are treated on a common basis. Clearly it would be quite wrong in principle if contributors to the scheme who are currently subject to a benefit classification certificate could seek to take advantage of an unintended interpretation of the provisions and have their certificates revoked. As there are 66,000 certificates now in force, failure to apply the amendments retrospectively could lead to protracted and expensive legal proceedings and very significant administrative costs. The capitalised cost of the increased pensions that would have been payable to contributors who retired on invalidity grounds in 1984-85 if there had been no benefit classification certificates in force in relation to them has been estimated at $35m. Failure to ensure restoration of the status quo could mean costs of that order would be incurred by the taxpayer for the next decade or more. The Bill also introduces a new provision to allow flexibility in arrangements where persons transfer from the Commonwealth Superannuation Scheme to another Superannuation Scheme without necessarily changing employment. (This amendment may also affect further appropriations). Finally, the Bill contains amendments to the cost recovery arrangements under the Superannuation Acts 1922 and 1976. The amendments will enable the Minister to: Limit an employer's liability to the cost of the employer-financed share of any benefit that accrued under the scheme to an employee for service with that employer; Determine that employers who, prior to 1 July 1981, were treated as if exempt from the requirement to meet the cost of superannuation benefits, are formally relieved of the pre-1981 liability; and Require an employer to meet his liability to the Commonwealth on a pay-as-you-go basis as if the scheme were funded, rather than let the liability build up until benefits are eventually paid. There is no financial impact on the Government as a result of the changes in respect of the trust. By regulations made under the Act, all costs involved in the management and investment of the fund, including staff costs, are borne by the fund. The Government expects that removal of restrictions on the investment powers of the trust as proposed in this Bill will enable greater returns to be generated by the fund for the benefit of contributors. There are no implications for additional expenditure or revenue by conferring secretary powers on the Commissioner for Superannuation. Minimal future additional costs will result from the changes correcting the anomalous disentitlement from benefits of certain children and spouses. To date, only one case of disentitlement has been identified. The interpretation of the medical classification provisions adopted by the Administrative Appeals Tribunal in its recent decision is not only contrary to the purpose of the provisions, but would have significant additional cost implications if allowed to stand. The Commonwealth would have little or no protection against the risk, and thus the cost of premature retirement or death because of a physical or mental condition existing at the time a person became a contributor. Thus, the amendments will ensure that the cost of the Commonwealth Superannuation Scheme does not increase as a result of the Tribunal's decision. While speaking of the cost of the Commonwealth scheme, I would also like to emphasise that, as indicated in my press release dated 5 December 1985, allowances to be treated as salary for contribution and benefit purposes are to be confined to those presently contemplated by the Superannuation (Salary) Regulations. Where moves are made to have further categories of allowances recognised, immediate legislative action will be taken to ensure that they are not treated as salary. The proposed power to modify the Act by regulations in relation to contributors transferring to other superannuation schemes will not of itself have any financial implications. Additional cost (if any) will depend upon the particular arrangements adopted in specific cases. The employers who, under the cost recovery arrangements operating prior to 1 July 1981, were treated as if exempt from any liability would, but for the proposed changes, technically have a legal liability to the Commonwealth for the unpaid amounts. However, in practice, because the employers concerned would require additional funds from the Budget to meet the unpaid contributions, the payments by, and to, the Commonwealth would balance out, leaving the budgetary situation no different from what will be the case under the proposed amendment. All parties have acknowledged the urgency of the reforms in relation to the trust incorporated in this Bill. To further delay their introduction will compound the damage already done to the interests of the more than 300,000 contributors to the fund by the failure to pass the 1985 Bill. I commend the Bill to the Senate. Debate (on motion by Senator Reid) 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)(10.20) —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 amend the Departure Tax Collection Act 1978 to transfer the responsibility for the collection of departure tax to air operators. As honourable senators will be aware the Government, as part of its decision on the recommendations of the Bosch Committee on Aviation Cost Recovery, has decided that departure tax will be an attributable revenue for aviation cost recovery purposes from 1 July 1986. Collection of the tax by air operators will have the major advantage of the removal of departure tax collection booths from airports, with the consequent benefit of achieving more efficient passenger flows through our international terminals. In addition, the Government will be able to reduce existing expenditures of approximately $1 million each year directly incurred in collecting the tax, plus associated overhead costs. In taking this step, the Government is bringing the Australian situation into line with practice in a number of other countries, including New Zealand, United States, Hong Kong, Singapore, Fiji and the Philippines where similar taxes are collected by the airlines. Consultations with air operators have been undertaken and are continuing. The Board of Airline Representatives of Australia, which represents the majority of carriers serving Australia, has been requested to put forward its proposals on how the new collection arrangements should operate. The amendments provide for these arrangements to be provided for in regulations to be made pursuant to the Act, and this will be done when consultations with the operators have been finalised. This approach will also ensure that any necessary changes to arrangements in the future can be speedily made. Consultations held to date with operators indicate that sale of stamps at check-in at airports will be necessary, plus some additional outlets off airports. Clause 5 of the Bill makes it a requirement for international air operators to make tax and exemption stamps available for sale and issue respectively to passengers, and provides that the Government can specify by regulation how this is to be carried out. Operators responsible for making stamps available will include not only the scheduled airlines, but also operators who carry out international charter flights. Clause 5 however exempts from this responsibility operators who undertake private flights and aerial work as these operate few flights, often from non-major airports. The Government has also decided that it would be unreasonable to expect small charter operators, who operate infrequent flights and carry few passengers, to have to comply with the requirements of the Bill. The Minister will therefore be able to exempt individual charter operations, having particular regard to the scale of operations involved. The Act nevertheless requires non-exempt passengers on such private, aerial work or exempted charter flights to pay departure tax, and it is intended that existing arrangements for collection of the tax in these cases will continue. The penalties for offences of failing to make stamps available, without reasonable excuse, is to be $2,000 where the offender is a natural person, or $10,000 where the offender is a body corporate. The Bill leaves unchanged existing arrangements for the collection of departure tax from passengers who depart from Australia by sea. As regards the financial impact of the proposed legislation, I have already referred to the approximately $1 million savings each year in direct costs that will accrue to the Commonwealth. Ongoing administrative costs to the Government arising from the proposal will be minimal. Costs of modifying counters at airports have yet to be quantified, and are to be determined following consultation with the airlines as to requirements. While the cost of collecting the tax currently borne by the Government will now be borne by the airlines, the government considers this to be reasonable, against the background of its decision to make revenue from the tax attributable. Moreover, it should be noted that these are costs which the airline are often required to beat in other countries where they operate. In conclusion, the Bill will achieve an ongoing reduction in Government expenditure on the costs of collecting departure tax, while facilitating more efficient processing of international passengers using our airports. The regulations to be made pursuant to the provisions of the Bill will also ensure that there is no loss of revenue to the Commonwealth. I commend the Bill. Debate (on motion by Senator Reid) 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)(10.21) —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 new arrangements for the introduction and implementation of Bounty Assistance whenever such assistance is proposed following the Government's consideration of appropriate Industries Assistance Commission Reports. At present, Bounty Assistance to industry can only be introduced by way of an act of this Parliament. The Government believes that an inordinate amount of time is spent by the Parliament in considering legislation to implement this form of Industries Assistance which is essentially non-contentious. We consider that the introduction of Bounty Assistance would be more efficiently made through a ministerial notification process, which on the one hand, would preserve and ensure Parliamentary scrutiny by a General Disallowance Right, and, on the other, would not infringe on Parliament's sitting time to the same degree as the current procedure requiring numerous bills and amending bills. To this end part two of the bill proposes that Bounty schemes be implemented by Bounty notices, declared in writing by the Minister and published in the Gazette. Such schemes would of course only be introduced following the receipt of an Appropriate Industries Assistance Commission Report on the particular industry or industries concerned. This is for the reason that the Minister is required to comply with section 23 of the Industries Assistance Commission Act 1973 which prohibits Ministerial action related to the provision of Industries Assistance without a current report on the industry from the Commission. The new procedure proposed by this bill should not be interpreted as a diminution in the importance of this type of assistance. In fact quite to the contrary. The Government has attached and will continue to attach considerable importance to bounties as one of the key elements in its Industries Assistance Policy of providing direct support to industry against import competition. A most important feature of the new arrangements is the ability of the Parliament to disallow Ministerial Bounty Notices. That procedure, which is set out in clause 10, is the same as the disallowance procedure applicable to regulations. I mentioned earlier that the introduction of Ministerial Notices, in conjunction with the disallowance procedure, is designed to save valuable Parliamentary time without derogating from Parliament's opportunity to scrutinise each notice and, if considered necessary, to reject a particular measure. It is appropriate at this point for me to provide some historical facts in relation to bounties. The first bounty legislation was introduced in 1907 by Act No. 12 of 1907 and provided for Bounty Assistance on the production in Australia of a variety of agricultural products and fish. Since that time a considerable number of schemes have been introduced, covering a wide range of Australian Industry, generally, I am pleased to say, with the bi partisan support of the Parliament. There are 18 bounty schemes currently in operation, the most recent being that for metal working machines and robots effective from 1 July 1985. Almost invariably each Parliamentary sitting deals with about 3 or 4 pieces of bounty legislation, with the majority operating retrospectively. It is this retrospective operation which has concerned the Government for some time because the Bounty Assistance cannot be given to industry until the legislation has the royal assent. The new arrangements, proposed by this bill, are designed to eliminate the need for retrospective operation of bounties. Indeed the arrangements will probably overcome the anomalous situation which exists at present whereby a manufacturer or importer can enjoy the benefit of a change in Tariff Rates almost instantly, while an intended bounty recipient might be denied the benefit of Bounty Assistance for some months. This is because tariff changes, which are linked to the bounty, can be effected by gazette notification whereas bounties can only be effected by an act of Parliament. A similar gazette notification procedure for bounties will enable their immediate introduction following the Government's consideration of the relevant Industries Assistance Commission Report. I am sure that industry will welcome this bill for that reason alone. Let me illustrate the current time lag, and the benefit to industry which should result as a result of the proposed notice procedure on this bill, referring again to the Government's assistance measures for metal working machines and robots. The legislation to implement that matter was introduced into the Parliament on 11 September 1985 and received the royal assent on 22 November 1985. Because it operated from 1 July 1985 there was a delay of nearly six months before the bounty could be paid and the Australian producers accorded the benefit from the assistance intended for them. In the absence of this bill such delays will no doubt continue because of the complexity of some bounty legislation and the bi-annual of Parliamentary sitting times. Under the arrangements proposed by this bill a bounty notice for metal working machines and robots could have been gazetted in late June, 1985 immediately following the government's decision, with bounty payments starting at least 5 months sooner than would have been possible under existing arrangements. I now turn to the other important elements in the bill. Parts 3, 4 and 5 will standardize the administrative provisions for all bounty schemes-a vast improvement on the current plethora of provisions which have evolved in the different schemes over the past 15 years. This standardization is expected to result in better administration of bounties-an important consideration in today's public service environment where the government is intent on achieving the best possible use of expensive resources. Further, clause 8 of the Bill will provide the necessary flexibility to amend schemes introduced under this Bill so as to deal with changing technological or economic circumstances. These provisions, which do not apply to schemes now on foot, will allow a scheme to be modified by regulation in very limited circumstances so as to enable for example, an extension of the scheme for up to 6 months, a variation in the rates of bounty payable, the range of goods eligible for bounty or the eligibility criteria for the payment of bounty. The government is of the view that such a facility is essential if bounty schemes are to remain relevant in the face of changing economic or technological developments which could not have been reasonably foreseen at the introduction of the original scheme. The difficulty in applying the books bounty legislation, dating from 1969, to today's printing industry which has undergone vast technological change, is a good case in point. The proposed amendment procedure for bounty schemes, by regulation, will of course preserve the parliament's ability to scrutinise any proposed changes through the disallowance mechanism applying to regulations. Amendments to schemes on foot at this moment will need to be made by appropriate amending legislation in the usual way. Because of the significance of bounties as an element of the government's industries assistance policies, a joint management review of bounty administration was undertaken in 1984 by an experienced team led by a senior partner in the consultancy firm of Arthur Young Services. Many of the provisions of parts 3 and 4 of the Bill respond to the recommendations made by that consultancy firm and will enable the Australian Customs Service to build on the improvements in bounty administration already achieved. The government believes the measures contained in this Bill, which will standardise the administrative procedures for bounty schemes and make their implementation and variation much more relevant to today's circumstances will benefit not only industry, but also the administrators of bounty schemes and the parliament itself. Financial Impact Statement The Bill does not it itself involve any outlays by the Commonwealth. However, bounty schemes established under the Bill will involve outlays, the extent of which will vary from scheme to scheme. For established schemes, estimates of expenditure will be given in the budget papers in the usual way. For new schemes, financial details will be provided at the time of announcement by the government of the establishment of the scheme. I present the explanatory memorandum on this Bill and commend the Bill to the Senate. Debate (on motion by Senator Reid) adjourned. DAIRY PRODUCE BILL 1986 Bills received from the House of Representatives. Motion (by Senator Grimes) agreed to: That so much of the Standing Orders be suspended as would prevent the questions with regard to the several stages for the passage through the Senate of all or several of the Bills being put in one motion at each stage, and the consideration of all or several of such Bills together in Committee of the Whole, and as would prevent the reading of the short titles only on every order for the reading of the Bills. Ordered that the Bills may be taken through all their stages without delay. Bills (on motion by Senator Grimes) read a first time. Second Readings Senator GRIMES(Tasmania-Minister for Community Services)(10.22) —I move: That the Bills be now read a second time. I seek leave to have the second reading speeches incorporated in Hansard. Leave granted. The speeches read as follows- DAIRY PRODUCE BILL 1986 The purpose of this Bill and five other related Bills is to enhance the capacity of the Australian Dairy Industry to market its produce. Measures are proposed to make the industry more market responsive. Government regulation of marketing is to be reduced. Assistance is to be provided in a less distortionary way, as recommended by the Industries Assistance Commission. Also provided for is reform of the Australian Dairy Corporation. One year ago Bills were introduced to reform dairy marketing arrangements. The House of Representatives gave passage to those Bills; the Senate did not. Following the failure of the 1985 Bills to pass both chambers, The Australian Dairy Industry Conference sought Commonwealth Government support for its own plan which, while incorporating most of the features of the arrangements proposed in the 1985 Bills, also incorporated a production restraint device. The Government agreed to assist the implementation of this plan if it were shown to have broad industry and State Government support. Subsequently the Chairman of the Conference reported to me that there was insufficient support in the industry for this so called ``ADIC Plan'' to proceed. Last year the Minister for Primary Industry outlined the genesis and dimension of the problems facing the Australian dairy industry. He also demonstrated that the current assistance and marketing arrangements were inequitable and inefficient. These arrangements stimulate overproduction while discouraging domestic consumption; distort returns to individual manufacturers so that the Australian product mix is not the best; provide greatest assistance to exports to the least profitable markets, encourage imports and constrain industry unnecessarily by regulation. The passage of one year has not changed the nature or dimension of the problem nor the Government's concern to see the end to a system that is, demonstrably, serving the industry badly. Some reform has been able to be achieved within the framework of existing legislation, in particular the discontinuance of ``allowances'' on 1 July 1985. However the need for thorough reform remains. The Government's basic objective is the development of a more efficient and profitable dairy industry, able to respond as quickly as possible to changing market conditions and technology. Only through such industry development can we hope to maintain the largest Australian dairy industry that is viable at an acceptable level of industry assistance. The strategy to achieve this objective is directed both to the domestic market and the export market. In respect of the domestic market, the need is a system that encourages the local industry to improve its competitiveness so that it can maintain its dominance of this market. In regard to the export market, the strategy is to encourage the exploitation of the more profitable export markets, and in particular to discourage production for export that returns a net loss to Australia. This strategy is to be given effect by the following measures: (1) One, the cessation of export pooling arrangements so that exporters become more market responsive. A criticism that has oft been levelled at the current arrangements is that people are encouraged to ``play the system'' rather than to work the market. (2) Second, the replacement of current stabilization arrangements, which provide an encouragement to the production and export of some dairy products more than others by arrangements designed to provide a more uniform level of assistance to all products. This change should, over time, encourage a more profitable mix of production. (3) Third, the market support arrangements which are to replace the current stabilization arrangements will be financed in the least distortionary way, by a levy on all milk production. (4) Fourth, the progressive reduction in domestic price support to a level no higher than the price level at which New Zealand dairy products could be sold in Australia on a fair trade basis. Our industry must, over time, put itself in the position where it can defend its position in the Australian market of the basis of its competitiveness. (5) Fifth, the local industry will continue to be protected against unfair import competition. The industry has been able to achieve redress by invoking anti-dumping and countervailing measures where unfair competition has been shown to damage or to threaten damage to the industry. If, in the future, these measures should prove to be inadequate, other measures will be considered by the Government. (6) Sixth, the Australian Dairy Corporation is to be reformed to enhance its effectiveness, and to upgrade the accountability of the Corporation to the dairy industry. (7) Seventh, assistance is being made available for specific purposes-for adjustment, for marketing innovation, for research, and for dairy underwriting. Last year the Minister for Primary Industry announced that the Commonwealth would be prepared to participate with the States, on a one-to-one basis, in a joint $40 million adjustment program for the dairy industry. Subsequently, the Commonwealth decided that where a dairy specific program was undertaken within the Rural Adjustment Scheme, the Commonwealth would contribute according to the general provisions of the Rural Adjustment Scheme. This means that, for Rural Adjustment Scheme special dairy assistance, the States are now required to match the Commonwealth dairy adjustment contribution only in respect of ``carry-on'' assistance. Arrangements covering dairy adjustment have now been finalised with most of the States. On 15 April last, the Minister for Primary Industry announced the establishment of a $25 million special fund for new marketing initiatives. The dairy industry is one industry that could be expected to take advantage of this Fund. The dairy industry has advised the Government that the operative rate of research levy should be increased. Parliament recently increased the maximum rate specified by legislation, thus enabling an increase in the operative rate. The increased industry contribution to expenditure on research will be matched by a similar increase in Commonwealth assistance for research. I will speak about underwriting later. Let me now turn to the particulars of the Dairy Produce Bill 1986. This Bill provides the necessary elements of the arrangements to assist the marketing of dairy products. The Bill includes provisions to reform the Australian Dairy Corporation, to control the export of Australian dairy products, to enable the collection of levies for various purposes, to enable the making of market support payments, and to reform the Dairying Industry Stabilization Fund. Reform of the Australian Dairy Corporation The Bill provides for significant reforms in relation to the Australian Dairy Corporation. These reforms stem principally from the Government's general Program for Reform of Commonwealth Primary Industry Statutory Marketing Authorities and from the role of the Corporation is to have in administration of the proposed new market support system. The reforms to the Australian Dairy Corporation proposed in this Bill have been decided on by the Government only after extensive consultation with industry representatives. Objectives and Functions The most basic plank of our policy on the reform of Statutory Marketing Authorities is that the functions and objectives of each authority are to be clarified and clearly stated in its enabling legislation. This Bill details the functions of the Australian Dairy Corporation, all of which involve an aspect of the marketing of Australian dairy produce. The objective to be given to the Corporation is that it should discharge these functions efficiently so as to enhance the profitable production and marketing of Australian dairy produce. In a number of important areas the Corporation is to have significant discretion as to how it discharges it functions. These areas include, for example, the range of dairy produce to be assisted, the basis on which particular dairy products are to be assisted, and the availability of stock-holding finance from the Corporation. The proposed legislation requires the Corporation to make decisions in these matters having regard to its objective, and in some cases requires the Corporation to set down the criteria to be used to test whether a course of action would further the objective of the Corporation. Accountability As with other Primary Industry Statutory Marketing Authorities, the Australian Dairy Corporation has dual accountability. One line is to the Parliament. The other line is to the dairy industry. The Commonwealth Government recognizes the Australian Dairy Industry Conference as the industry organisation best able to speak for the Australian dairy industry as a whole, and the Council of that body as the appropriate organisation that should be consulted by the Corporation on the Corporation's activities generally. The Council of the Conference consists of representatives of dairy farmer organisations and representatives of dairy product manufacturing and trading organisations. The Conference has agreed to expand this membership to include a representative of the market milk sector and a representative of employees in the industry. The proposed legislation will require the Council to be consulted by the Corporation when the Corporation is planning its strategy for the years ahead and when the Corporation is planning its operations for the forthcoming year. The Corporation will also need the approval of the Council if it wishes to undertake certain activities. A significant degree of accountability to the industry will be achieved through the required inter-action of the Corporation and the Council. To complement this, the annual report of the Corporation is to be presented to a meeting of the Conference at large and the Chairperson of the Corporation will report on the activities of the Corporation and answer questions arising. It may also be appropriate for the Chairman of the Council to report to the meeting on the Council's dealings with the Corporation, but that is a matter for the Council. It would be desirable for this meeting to be open to all persons involved in the Australian dairy industry. The proposed legislation provides for accountability to Parliament in the normal way through the tabling of an annual report. It should be noted that the legislation is to be tightened to require that the activities of any subsidiary companies that the Corporation may be permitted to form must fall within the functions given to the corporation by the Parliament. In regard to Asia Dairy Industries, an already existing subsidiary of the Corporation, the Corporation will be required to ensure that the company only undertakes activities that are specifically allowed for by the legislation. It is also proposed that the Minister may in exceptional circumstances give directions to the Corporation. Where this is done, the directions are to be tabled in the Parliament within 15 sitting days unless there is a commercial or national interest reason why the direction should not be disclosed. Powers Subject to certain restrictions the Corporation is to be empowered to do all things that are necessary or convenient to be done in connection with the performance of its functions. In general, the Corporation will be subject to less Ministerial control in operational matter than it is under current legislation. However this reduction is to be matched by new corporate and annual operational plan requirements and by the greater legislated interface between the Corporation and the Council of the Conference. I say ``legislated interface'' because much of what is in the proposed legislation is in fact occurring now without it being a legislative requirement. There are to be two restrictions imposed on the power of the Corporation to deal in diary produce. The first, which is in line with past practice, is that the Corporation's trading activities-in the broad-are to be approved by the Council of the Conference. The second is that Council and Ministerial approval is to be required where the Corporation wishes to engage in transactions that it anticipates will result in a loss. Loss-making sales involve a cross-subsidy from other dairy industry industry activities, and hence have the potential to thwart the objectives of the new marketing arrangements. Loss-making sales should not be absolutely ruled out because they may be necessary in exceptional circumstances. However they need to be controlled, and for this reason industry and Ministerial approval is needed. The Corporation will retain the power to make loans to assist manufacturers hold stocks of their dairy produce. Such loans have become a part of the Dairy Industry, allowing the farmer to be paid for his milk soon after its delivery. The requirement for all loans to be secured will continue. The Government has been advised by the Corporation that one factor to influence the Corporation's decision on the rate at which loans can be made is the ability of the Corporation to meet any losses arising from a borrower's default should the security, on realisation, fail to cover the debt. As the reserves of the Corporation are relatively low the Government has decided to advise the Corporation that it should, until otherwise advised, determine loan rates on the basis that the Commonwealth would, if needed, be prepared to supplement the Corporation's Reserves by up to $10 million. There is no provision covering this in the Bills-an appropriation will be needed if ever this ``guarantee'' has to be called upon. Corporate and Annual Operational Plans The Corporation will be required to prepare, and update each year a corporate plan covering 3 to 5 years ahead. The Corporation will also be required to prepare operational plans annually that are consistent with the Corporate plan. The Council of the Conference is to be consulted during these processes. Both plans will require Ministerial agreement. Membership of the Corporation The Government's policy is that Statutory Marketing Authorities should be constituted on corporate lines and objective selection procedures used to seek out high calibre persons for appointment. The reasons for taking this approach, rather than an approach that constitutes Statutory Marketing Authorities on the basis of industry sector representation, are given in the policy paper of Reform of Commonwealth Primary Industry Statutory Marketing Authorities that was tabled in this House recently. Consistent with this policy, the Bill proposes that the Australian Dairy Corporation should be restructured to include a Chairperson, a Government member, the Managing Director and eight other appointed members. Members in the last category are to be chosen by a Selection Committee that comprises a Chairman who is selected by the Minister and four other members nominated by the Council of the Australian Dairy Industry Conference. The Selection Committee is given the task of selecting a Board that collectively possesses a range of specified skills or experience. Export Control The Bill provides for kinds of dairy produce to be prescribed by regulation as controlled dairy exports. Export of controlled dairy produce will only be permitted by the Corporation or by licensed exporters. The regulations may prescribe conditions to be complied with in relation to the export from Australia of controlled dairy exports. Compliance with GATT-International Dairy Arrangement minimum prices will be made a condition of export. Under current arrangements export licences are issued by the Minister. This Bill provides for their issue by the Corporation. Criteria are provided for their issue, suspension or cancellation, and decisions are appealable. The Bill provides that the Corporation may require licensees to consult the Corporation about their export intentions and performance. This provision will assist the Corporation in the discharge of its functions generally and may allow the Corporation to co-ordinate the activities of exporters to their individual and collective gain. It will also facilitate co-operation between the Australian and New Zealand dairy industries in third markets as provided for in the Memorandum of Understanding between the two industries pursuant to the Australian New Zealand Closer Economic Relations Trade Agreement. The Minister for Primary Industry is aware of a concern expressed by some exporters that they may be commercially disadvantaged by being required to disclose to the Corporation their intentions in regard to specific market opportunities. To deal with this concern the legislation will require the Corporation to consider, in its planning process, the circumstances, if any, in which licensees will be required, in consultations with the Corporation, to disclose details of intentions in relation to specific possible future export sales. Since this consideration will be part of the planning process, the industry, through the Council of the Australian Dairy Industry Conference will have to be consulted. The Bill also provides for the Corporation to give directions to licensees in relation to matters specified in the Act or specified by regulation. However, the Corporation may not issue directions unless all licensees have been given 14 days notice and the Council of the Conference has agreed to the directions being given. Directions will need to be given by the Corporation if certain business, now exclusively handled by the Corporation with the agreement of the Conference, is to remain so. Collection of Levies This Bill provides for the collection of levies which are needed to finance the operations of the Corporation including the market support and promotion arrangements and to provide an industry contribution for research purposes. The proposed legislation follows existing legislation for the collection of research and promotion levies and stabilization levies. Provision has been made to allow the delayed collection of the market support levy. Delayed collection is possible because export of dairy produce will occur some time after the delivery of milk used in its production. Delayed collection may be desirable at the commencement of the market support arrangements in order to assist industry cash flow. Financial Provisions Part VII of the Bill deals with financial aspects of the ADC activities and updates current provisions having regard to the increase in autonomy that is to be accorded to the Corporation. A number of matters warrant brief mention: The means by which the Corporation can raise money are to be extended to include a wider range of contemporary financial instruments. A specific provision is made to enable the Corporation to engage in futures trading within appropriate guidelines. Investment in the short-term money market of money which is temporarily surplus is provided for. To assist the better management of its moneys, the Corporation is to be empowered to make short-term loans from one fund that it administers to another fund that it administers. Such loans may only be made to meet a temporary deficit in the receiving fund. A provision is included which requires the Corporation to credit any surplus and debit any deficit, stemming from sales it makes in its own right, to the market support fund. The legislation provides for the appointment of a commercial auditor in lieu of the Auditor-General. The appointment of a commercial auditor will require the agreement of the Joint Parliamentary Committee of Parliamentary Accounts. Part VII of the Bill also establishes four funds under which significant areas of Corporation activity are controlled and accounted. These funds are the Dairy Industry Fund, the Promotion Fund, the Market Support Fund and the Supplementary Market Support Fund. The Industry Fund The Industry Fund is to be established as the successor to the Dairy Industry Stabilization Fund. The Dairying Industry Stabilization Fund, or ``DISF'' as it is commonly known, is a longstanding fund administered by the Corporation. At 30 June 1985 the accumulated funds of the DISF amounted to about $5.5 million of which $1.9 million comprises the value of investments in various companies and $3.6 million is in liquid assets. Government policy has been that the moneys of the DISF are to be used for the benefit of the dairy industry at large. Accordingly the practice has evolved whereby, before any Ministerial approval is given to expenditure from the Fund the Australian Dairy Industry Conference is consulted. The net effect of transforming the Dairying Industry Stabilization Fund in the Dairy Industry Fund is to specify in legislation the purposes of which the Fund may be used and to replace the requirement for Ministerial approval with a requirement that expenditures from the Industry Fund be approved by the Council of the Australian Dairy Industry Conference. The Conference supports the approach that is being taken. The Promotion Fund The provisions in this Bill are essentially similar to those of current legislation. The Market Support Fund and the Supplementary Market Support Fund The market support arrangements provided for in this Bill are proposed to apply to production on or after 1 July 1986. Central to the proposed new marketing arrangements are market support payments and supplementary market support payments. These are payments to be made by the Australian Dairy Corporation on export of all dairy produce. The making of such payments will improve the return on export, and mean that a domestic sale would have to be made at a higher price than would otherwise be the case for the domestic sale to be as profitable as an export sale. In this way the system will provide support for the domestic price structure. The funds for the making of market support payments and supplementary market support payments will, apart from any Commonwealth contribution by way of underwriting, come from the industry. The Market Support Fund The market support fund can be regarded as the continuing element of the new market support arrangements. Key transactions are the payment into the fund of a market support levy, which is a levy raised on all milk produced, and the expenditure of fund moneys as market support payments. Products eligible for market support payments are to be milk, cream, and dairy products declared for the purposes of the Act to be dairy produce by the Australian Dairy Corporation in the Commonwealth Gazette. The intention is that, subject to practical considerations, all products made from or containing milk or a constituent part of milk should be eligible for market support payments. The criteria adopted by the Corporation in deciding how far to go in declaring products to be dairy produce is to be stated in its corporate plan. For each product that has been declared to be dairy produce the Australian Dairy Corporation will publish rates of market support payment and supplementary market support payment. Payment will then be made by the corporation at these rates to the manufacturer of the dairy produce on presentation of proof that export has occurred. However, special rates will apply in certain circumstances-I will mention these shortly. The rate at which market support payments will be made will be the rate ruling at the time of export unless another rate has been guaranteed by the Corporation. In this regard, the Bill provides that the Corporation may determine, on application by a person prior to export, that the market support rate for a particular export will be the rate ruling at the time of application rather than the time of export. This facility should assist exporters in making sales by providing them with a firmer basis on which to make an offer to a potential buyer than would otherwise be the case. Any decision of the Corporation not to guarantee a rate for a particular export will be reviewable under standard Administrative Appeals Tribunal procedures. The Bill provides for the standard rate of market support payment to be determined in one of two ways depending whether the product is prescribed or not. For prescribed dairy produce, the rate will determined as a percentage of the estimated average export price for the kind of dairy produce concerned. For other dairy produce, rates will be determined by the Corporation having regard to the rates established for prescribed dairy produce. The Bill provides for the Corporation to decide which kinds of dairy products should be prescribed dairy produce. The criteria adopted by the Corporation in this decision are to be stated in its Corporate plan. Hence industry will be consulted. Initially, it is expected that prescribed products will include those products which are now prescribed for stabilization and export pooling purposes. For each kind of prescribed dairy produce the market support rate is to be 30 per cent of the estimated average export price, unless a different percentage is determined by the Corporation. This level of assistance has been accepted by the Government as a reasonable medium term support level having regard to industry assistance considerations and the objective and strategy for the Australian dairy industry that I have already talked about. It should be noted that the 30% has been established in relation to estimates of average export prices under the export pooling system that has operated for many years. These estimates relate to a concept designed to reflect the value added in the process of producing the dairy product but exclude the value added in packaging, transport etc. It is anticipated that the Corporation will, initially at least, compile estimated average export prices under the new arrangements on this basis also. Should the Corporation consider that there is good reason to change radically the basis on which estimates of average export prices are to be compiled, the appropriate percentage to be applied in calculating market support rates would need to be considered by Government. The Corporation will be required to reduce the percentage rate should it judge that a 30% rate will not be able to be sustained having regard to the funds likely to be available for market support purposes. The Corporation may reduce the rate for other reasons also provided that the Council of the Australian Dairy Industry Conference agrees with the reasons for wanting to do so. Let me now briefly mention special rates of market support payment. These may be paid in certain circumstances. These circumstances include where a foreign country has imposed quantitative restrictions on exports from Australia and where necessary to conform with international trade commitments. Special rates may also apply to exports under agreements entered into before 25 February 1986 where the products concerned are sourced from production on or after 1 July 1986. The last mentioned provision is necessary so that agreements entered into before the announcement of the new arrangements are not disadvantaged. Special rates of market support payment may also apply for underwritten products. Underwritten products will be the products that have been traditionally underwritten-that is butter, cheese, whole milk powder, skim milk powder and casein. The market support arrangements for these products will work on a ``pot holing'' principle-when the export price falls below a specified figure the amount of market support payment will be increased above the level that would be calculated using the 30% rule. More specifically, ``pot holing'' will apply when the estimated average export price for any of the underwritten products is below 85% of what would be expected if export prices for the product concerned were on their longer term trend line. Where this ``pot holing'' is to apply, the market support rate will equal the difference between 110% of the longer term trend value and the estimated average export price. Funds for ``pot holing'' will be drawn from the market support fund. Supplementary Market Support Payments The legislation provides for supplementary market support payments to assist the transition from current arrangements. Supplementary market support payments will be made whenever a market support payment is made. As with market support payments, supplementary market support payments for prescribed dairy produce will normally be determined as a percentage of the estimated average export price of the product concerned, with the percentage being the same for all products. Special rates of supplementary market support may also apply in certain circumstances. Supplementary market support rates will decline over time as the product levies which provide their funding are reduced. Initial rates of product levy and supplementary market support payment will be determined in line with a recommendation from the Australian Dairy Corporation that the theoretical domestic price support values under the new arrangements on 1 July 1986 should slightly exceed the theoretical domestic price support values (referred to as the DVLP) under current arrangements. The recommended increases are 5% in the case of butter and 8% in the case of cheese. The Government has accepted this recommendation in order to assist a smooth transition from current to new arrangements. Underwriting The Commonwealth will continue to underwrite average export returns for the traditionally underwritten products-butter, cheddar-type cheese, skim milk powder, whole milk powder and casein. Currently underwriting applies in relation to the average export price received in respect of a year's production. The underwritten price is 90% of the estimated average export price received for production of the most recent three years including the year in question. A somewhat different basis for underwriting will apply in the future. The average export price received in respect of a year's sales will be underwritten. The underwritten price will be 85% of the value that the Bureau of Agricultural Economics estimates would have obtained for the year in question if export prices were on their longer term trend line. The change in the basis for underwriting has been made for a number or reasons. The new method will align better with the proposed new market support system, in particular with its orientation towards sales rather than production, and with its ``pot holing'' element. It also remedies a difficulty with the ``90% three-year-moving-average'' approach, namely, that underwriting can be triggered when prices are declining but still relatively good in absolute terms, but may not be triggered during a progressive decline into a price trough. The new basis also makes sense against the current outlook for international trade prices of an extended downturn before restoration of more normal price levels. The change in the basis of underwriting is expected to work to the benefit of the Australian dairy industry. Financial Impact The impact of these Bills on net Government expenditure is expected to be minimal. The Australian Dairy Corporation will reimburse the Commonwealth the cost of collecting the new market support levies. The cost of collecting all other levies will be met by the Commonwealth as it is under current arrangements. Appropriation of moneys for underwriting purposes is not provided for in these Bills. Other Matters There are two other aspects that I would draw to the House's attention. The first is the ``sunset'' clause providing for cessation of the market support arrangements after six years. Further legislation would thus be required for the arrangements to continue beyond June 1992. One other aspect is a new provision concerning the liability of the Corporation for Asia Dairy Industries or any prescribed subsidiary companies. This provision makes the Corporation liable to meet any liabilities of ADI and any prescribed subsidiary that cannot be met from the subsidiary's assets in the event that the subsidiary is wound-up. Should the Corporation ever be in this position, the cost of meeting the subsidiary's undischarged liabilities would become a charge against the moneys of the Corporation and could be expected to require a higher rate of Corporation levy than would otherwise be the case. The Australian Dairy Industry Conference has accepted this as a reasonable proposition in relation to Asia Dairy Industries. No prescription of any other existing company in which the Corporation has a shareholding is proposed. Future Development and Review I have already noted that the Australian Dairy Corporation is to have considerable discretion in the management of the market support system. This will allow the system to develop further in the light of the ex- perience gained in its operation. The planning process will ensure that industry is consulted and ultimate Government control will be maintained. The Government will monitor the development of the system carefully and proposes to undertake, with the Corporation and the industry, major reviews in 1988-89 and 1991-92. I commend the Bill to honourable senators. DAIRY PRODUCE LEVY (No. 1) BILL 1986 The purpose of this Bill and the complementary Dairy Produce Levy (No. 2) Bill is to impose various levies. These levies are required to finance the operations of the Australian Dairy Corporation including its activities in promoting dairy produce, to finance new market support arrangements and to raise moneys from the dairy industry for dairy research. The Bill imposes two types of levies-levies on milk fat produced on or after 1 July 1986, and levies on certain types of dairy products produced on or after 1 July 1986. Levies on Milk Fat There are four milk fat levies-the Corporation levy, the promotion levy, the research levy and the market support levy. The Corporation levy, the promotion levy and the research levy are to replace levies for similar purposes which are currently imposed on milk and butterfat under the Dairying Industry Research and Promotion Levy Act 1972. Under the new levy arrangements, the amount of levy payable by a producer will depend on the amount of milk fat contained in his milk. Under current arrangements where a producer delivers whole milk to a processor, the levy is calculated at a rate per litre regardless of fat content; only where the producer delivers cream is the levy based on fat content. The change to a standard milk fat basis arises from a decision to base the market support levy on milk fat and the desirability of having a standard base for all levies on milk. The Bill provides a clause to cover the situation where it has not been possible to ascertain the milk fat content. This clause should only have to be resorted to for a small proportion of Australian production since most milk payment systems require the recording of milk fat content. The Bill specifies maximum rates for all milk fat levies with the operative rates to be set by regulation. For market support levy the maximum rate of levy is to be 45 cents per kilogram of milk fat, which is equivalent to 2 cents per litre for milk of average fat content. In the case of the research levy, the maximum rate specified corresponds to the maximum rate of 2.5 cents recently set in the Dairying Industry Research and Promotion Levy Amendment Act 1986. The maximum rates for the promotion and Corporation levies are respectively 5.5 cents per kilogram fat and 2.5 cents per kilogram fat. In prescribing operative rates of Corporation, promotion, or research levy, regard will be had to any recommendations by the Executive Council of the Australian Dairy Industry Conference. The market support levy is to be imposed in order to provide funds for the making of market support payments. These payments have the effect of supporting the domestic price structure for exportable dairy products at a level higher than would otherwise prevail. As a consequence, manufacturers of exportable dairy produce are able to pay a higher price for their milk than would otherwise be the case. This tends to establish a base price for milk with premiums above this price being established in particular uses. As market support payments thus underpin the entire structure of milk prices, it is equitable that the market support levy apply across all milk production. However, a particular concern of some States is the possible impact of the market support levy on market milk producers if it were being imposed at a time of significant disruption or change in that sector. To address this and other concerns about the impact of the market support levy, the legislation provides for the possibility of a suspension of the levy and hence market support payments. Any State Minister with portfolio responsibility for the Dairy Industry may notify the Commonwealth Minister for Primary Industry that the levy should be suspended. In the event of such notification, urgent advice will be sought on this matter from the Council of the Australian Dairy Industry Conference. This advice is to be received by Australian Agricultural Council, considered, and a decision taken within 60 days of the notification being received by the Commonwealth Minister. At the expiration of the sixty days, unless Australian Agricultural Council, by majority decision, has resolved that the levy should not be suspended, the levy is to be suspended as soon as practicable. The market support levy is to be imposed on milk fat. This is, in part, because overseas experience shows that levy avoidance through ``de-watering'' of milk could be a significant problem if the levy were cast in ``per litre'' terms. It also makes sense in that the rate of payment to the producer for his milk generally varies in direct proportion to the milk fat content. The operative rate of market support levy will need to be a rate sufficient to finance the operation of the market support payments system. In prescribing a rate, regard will be had to any recommendation from the Australian Dairy Corporation. Dairy Products Levy Levies on certain dairy products are required to finance supplementary market support payments. Effectively, this levy will be imposed only on domestic sales of the product concerned. Levies will not be imposed on other than those products which are currently subject to stabilization levies, and within this group only for products where a levy is considered necessary at the start of the new arrangements to support the domestic price for the product concerned. On current estimates of likely export returns, a levy will be required only for butter, butter oil and cheddar-type cheese. For butter, the levy required is likely to be of the order of $600-$700 per tonne, for cheese $250-$300 per tonne. The levies imposed on dairy products are to be reduced over time. Levies imposed on 1 July 1986 will be maintained at their initial value throughout 1986-87 and then reduced in six monthly steps. The first reduction will occur on 1 July 1987. The intention is that all levies other than on butter and butteroil should be eliminated by 1 July 1989, and that the rate of levy for butter and butteroil should be halved by then. The future of the levies on butter and butteroil is to be reviewed in 1988-89. Levies will be set by regulation. Levies on dairy products imposed by this Bill will apply to production on or after 1 July 1986. Stabilization levies will not apply to production after 30 June 1986. I commend the Bill to honourable senators. DAIRY PRODUCE LEVY (No. 2) BILL 1986 The purpose of this Bill is to complement the Dairy Produce Levy (No. 1) Bill by imposing certain levies on the import of dairy produce that has been exported from Australia and subsequently imported back into Australia. The Bill is necessary to close off an opportunity to exploit the market support arrangements that would otherwise be possible through an export/ import procedure. Two levies are imposed. The levy on exempted dairy products is designed to re-impose a levy in respect of which an exemption was given on export of the product. The levy on supported dairy product is designed to avoid re-imports of Australian dairy products from obtaining the benefit of the market support payments made on export as well as the supported domestic price. Levy is payable by the importer. I commend the Bill to honourable senators. DAIRYING INDUSTRY RESEARCH AND PROMOTION LEVY (TERMINATION OF LEVY) BILL 1986 The Dairying Industry Research and Promotion Levy Act 1972 imposes levies on whole milk or butterfat produced in Australia and sold by the producer of the whole milk. These levies are used to fund the general expenses and the promotional activities of the Australian Dairy Corporation and to assist dairy research. The Dairy Produce Levy (No. 1) Bill provides for new levies to raise the funds for these purposes. These new levies will apply to milk fat produced on or after 1 July 1986. The purpose of this Bill is to limit the imposition of the old levies to production occurring before 1 July 1986. I commend the Bill to honourable senators. DAIRY INDUSTRY STABILIZATION LEVY (TERMINATION OF LEVY) BILL 1986 Stabilization levy is imposed on the production of prescribed dairy products. It is proposed that stabilization arrangements should cease to apply at the end of the current production season on 30 June 1986. The purpose of this Bill is to limit the imposition of stabilization levy to production occurring on or before 30 June 1986. I commend the Bill to the honourable senators. DAIRY LEGISLATION (TRANSITIONAL PROVISIONS AND CONSEQUENTIAL AMENDMENTS) BILL 1986 This Bill is one of six Bills, whose purpose is to establish new market support arrangements for the Australian dairy industry. Apart from clause 10, all provisions of the Bill are in the nature of transitional or amending provisions consequent upon the enactment of the proposed Dairy Produce Act 1986 and the other related legislation. Clause 10 is necessary to correct a typographical error in the Dairy Produce Act 1924 that came about when amendments were made to the Act in 1978. This error has only been detected recently and the Act has been administered over the years as it was intended to operate. The effect of the error is to make nonsense of the sub-section of the Act that enables advance payments to be made from the dairy produce export pools. Honourable members will note that the Bill provides that the amendment shall be deemed to have taken effect on 1 July 1978. The Bill provides for the repeal of the Dairy Produce Act 1924 (as amended) and the Dairy Produce Sales Promotion Act 1958 (as amended). These Acts govern the operation of the Australian Dairy Corporation whose future operation is to be governed by the proposed Dairy Produce Act 1986. The Dairy Produce Act 1924 also provides for export pooling, which it is proposed should be terminated at the end of the current production season on 30 June 1986. The Bill provides for the continuation of those provisions necessary to allow the finalisation of current export pools in the normal way. The Bill provides for the repeal of the Dairy Industry Assistance Act 1977 and the Dairy Industry Assistance Levy Act 1977. These Acts, which deal essentially with market milk, have never been operative. The proposed Dairy Produce Act 1986 will provide for the membership of the Australian Dairy Corporation to be reconstituted. It will not be possible for this to be done on 1 July 1986. Consequently this Bill allows for the members of the Corporation who hold office on 30 June 1986 to continue in office until the membership of the Corporation is re-constituted. This is likely to occur on 1 October 1986. The Bill also provides for current export licences, which are due to expire on 30 June 1986, to continue in force until 30 September 1986. The Australian Dairy Corporation will issue an advice on how licences may be renewed or a new licence issued well before 30 September 1986. The Bill provides a number of other transitional or consequential measures that should be self-explanatory. I commend the Bill to honourable senators. Debate (on motion by Senator Reid) adjourned. The PRESIDENT —I have received the following message from the House of Representatives: MR PRESIDENT,...Message No. 356 The House of Representatives returns to the Senate the Bill intituled ``A Bill for an Act to amend the `Customs Act 1901', the `Excise Act 1901', the `Spirits Act 1906' and certain other Acts'', and acquaints the Senate that the House of Representatives has agreed to the amendments made by the Senate with consequential amendments, including an amendment of the title, as indicated by the annexed Schedule. The House of Representatives desires the concurrence of the Senate in the consequential amendments made by the House of Representatives. JOAN CHILD SPEAKER House of Representatives, Canberra, 26 May 1986 Motion (by Senator Grimes) agreed to: That consideration of the Message in Committee of the Whole be made an Order of the Day for the next day of sitting. Senator BUTTON(Victoria-Minister for Industry and Commerce)(10.25) —I move: That the Senate notes that Wednesday, 28 May 1986 marks the 25th Anniversary of the foundation of Amnesty International and records its continuing support for Amnesty's efforts in the promotion and protection of human rights. Amnesty International is 25 years old today. It is appropriate that the Senate mark that anniversary in this way, as the concerns and work of the organisation are no less important today than they were when the movement was founded in London. Beginning from one person's sense of outrage and injustice at the seven years imprisonment of two Portuguese students, Amnesty International has now grown to over 3,400 local groups in 55 countries and individual supporters, members and subscribers number over half a million. Amnesty's work is not centred on one political view. Despite the varied background of its membership its central concerns have remained the same-to seek the release of all prisoners of conscience, to ensure fair and prompt trials for all political prisoners and to abolish the use of torture and the death penalty. To those ends Amnesty International has established an annual Prisoners of Conscience Week to highlight the plight of those incarcerated and tortured around the world for their political beliefs. Amnesty works by trying to bring the maximum pressure to bear on governments which engage in these practices. The focus has remained on the plight of the individual prisoner. A world-wide campaign to expose and end the use of torture as a tool of state policy was launched by Amnesty International in April 1984. This coincided with one of the most notable achievements of the United Nations which on Human Rights Day on 10 December 1984, adopted the Convention Against Torture and Other Cruel, Inhuman or Degrading Treatment or Punishment. The text was inspired by the 1975 declaration against torture. As well as its work on securing the release of individual prisoners and its efforts in international organisations such as the United Nation, Amnesty has also tried to help in opposing the return of refugees to countries where they are likely to become prisoners of conscience. It provides relief aid to the families of prisoners. This anniversary of Amnesty International is also an appropriate time to recognise the dedication to Amnesty's aims and work of the late Alan Missen, formerly a senator in this place. The work and objectives of Amnesty International are fundamental to the progress towards a more free democratic and civilised world. To many the world seems now a frightening place where the plight of the prisoner of conscience is no less than it was 25 years ago. The work of Amnesty International has helped to bring to the world's notice the appalling record of governments around the world in according basic human rights to prisoners of conscience. As a member of Amnesty International I want to mark this anniversary not with any sense of satisfaction among those of us who are members at what has already been achieved, but in the sense that after 25 years, despite great efforts, there is still far to go. Senator CHANEY(Western Australia-Leader of the Opposition)(10.29) —On behalf of the Opposition I support the motion which has been moved by the Leader of the Government in the Senate (Senator Button) noting the twenty-fifth anniversary of the foundation of Amnesty International and recording the Senate's continuing support for Amnesty's efforts in the promotion and protection of human rights. I do so both as Leader of the Opposition and as a member of Amnesty International. Amnesty has enjoyed very wide support in this Parliament, and the Australian Parliament set a precedent for the rest of the world in the formation of the Parliamentary Amnesty Group. Others around the world have followed or are in the process of following the lead set here. It is peculiarly appropriate that politicians should take an interest in the work of Amnesty International because many of the prisoners of conscience with whom Amnesty is concerned have become prisoners because of their practice of politics. In this century it is involvement in the political process that usually gives rise to persecution. Historically, involvement in religion was probably more important in attracting fanatical retribution. Religion continues to provide a fruitful source of persecution in the world today. But in this century politics is probably pre-eminent and we, as practitioners of politics in this very peaceful country, are properly concerned about the fate of our fellows around the world. The record which Amnesty presents us all with reminds us that in a lot of the world transfer of political power is still a matter of the use of force. It is a continuing reminder of the positive values of the democratic system we enjoy in Australia and the relatively high freedom, and freedom from persecution, that we enjoy in this country. I am grateful that the Leader of the Government in the Senate (Senator Button) has referred to Alan Missen's role in Amnesty in this Parliament. It has been a very important role, and I think all of us remember his great zeal whenever an issue of human rights arose anywhere in the world. No one could ever have thought that the passion which he brought to bear on this subject related in any way to the particular creed, colour, religious affiliation or anything else. It was a totally open application of the principle that all individuals are entitled to freedom and to fair treatment. Nearly half of the 159 members of the United Nations hold prisoners of conscience. Currently, there are reports on the use of torture in more than 60 countries around the world. In more than 50 countries people can be held without trial or charge, and in 34 countries the death penalty continues in force, many for crimes, or so-called crimes, that are politically related. So the work of Amnesty certainly remains ahead of it although a lot has been achieved in its first 25 years. Unfortunately, there seems to be no shortage of people rushing to continue the practices of the past. The only other thing I wish to say is that Alan Missen's contribution was also a reminder of the contribution of the founder of Amnesty International, and a reminder that a single individual can make substantial changes not only to the lives of those who are immediately involved with him in a family sense and in his community but also to people around the world. I think it is worth remembering that the founder-I am advised by Senator Christopher Puplick who is very heavily involved in this area-was a Catholic lawyer of Jewish descent, born of English and Russian parents who took the first step that resulted in this great international organisation being founded. One of the least healthy aspects of life in Australia at the moment is that we find people who believe that they cannot change aspects of the system that they think are oppressive or wrong. It is important to remember the contribution of people like Mr Peter Benenson and, more recently, of our colleague Senator Alan Missen. There is no excuse for anybody in our sort of free society to sit back and accept that what is wrong cannot be changed. We are reminded by Amnesty generally that the work of all individuals can contribute to the solution of some of the problems in the world which we find objectionable and often beyond our comprehension. Senator COLLARD(Queensland-Leader of the National Party of Australia)(10.33) —On behalf of the National Party of Australia I support the motion that has been moved by the Leader of the Government in the Senate (Senator Button) and is also supported by the Leader of the Opposition (Senator Chaney). I suppose we are in an age when we constantly look to the great technological advances that have been made over recent times. It is unfortunate that in looking at those technological advances we seem to equate them with the advances of civilisation as such, when in reality the opposite is almost true. For centuries now people have been denied what we almost flippantly say is their human rights. They have been denied them for many reasons other than for just breaking the law of their land. Even in Australia, where we are almost geographically isolated, we become quite blase about human rights and almost gloss over the fact that in other countries things are not quite as easy as they are in this great country of ours. At this time I think it is quite significant that we have reached this twenty-fifth anniversary and it is a fitting time to remind ourselves-each and everyone of us-of what we take for granted, but more importantly to remind ourselves of the fact that that cannot be taken for granted in many other countries of the world. Both Senator Button and Senator Chaney have alluded to that fact. Not only should we be reminded of it but we should make a conscious effort to do all that we can to bring those situations to an end and to inculcate in people of other nations the fact that we have human rights and that they should not be taken lightly and certainly should not be taken away for the reasons they have been taken away in many countries. Mention was made of the contribution of former Senator Alan Missen. Those of us who have served in this place over the last few years-in other words at a time when Alan was amongst us-know that many are members of Amnesty International but I think we will always associate in our minds Amnesty with the efforts of our late colleague, Senator Alan Missen. He bore the torch higher than anybody else, if other members of Amnesty would excuse my saying that. I am sure that they will understand. With all our advances civilisation as civilisation has not advanced. Until such time as human rights are recognised right around the world we have a tremendous task ahead of us. In that role I see Amnesty International as the international conscience of us all. Long may it do its work. I hope, as all of us would hope, that in the not too distant future it will not need to do that job. Senator MASON(New South Wales)(10.36) —I rise to bring the enthusiastic support of the Australian Democrats to this motion. Speaking for my Party and as Vice-Chairman of the parliamentary group of Amnesty International, I thank the Leader of the Government in the Senate, Senator Button, for moving the motion and I thank those honourable senators who have supported it in such warm terms. I think there are very good reasons why this should be an important action and I appreciate greatly, as does the whole of the parliamentary group of Amnesty, the moving of this motion in the Senate. Amnesty's profile has increased considerably during the 25 years of its existence, especially in more recent years. It makes world news regularly on the matters it brings forward and that happens for a significant reason. Amnesty is perhaps not the only organisation which raises issues of human rights and political prisoners but I think it is the most effective one and is seen as such. It is also seen as non-political, unbiased and as an organisation which goes to consider- able efforts to back up what it says with information which can be justified. That is very important and is a basic reason why Amnesty is attended to when it speaks and is also, of course, an important reason why, as an organisation, it deserves the support of the Senate. Amnesty is seen by the media throughout the world and the public as a watchdog which has a unique status. Like any other organisation it is just as good as the people who make it up. It is fortunate that it has as members throughout the world, including Australia, many people of considerable integrity and considerable idealism, who are deeply dedicated to the ideals of personal freedom and who are prepared to back up those thoughts and ideals with some kind of action. It is also important that an organisation such as Amnesty needs to be protected from the influences that undoubtedly seek to suppress or to silence it. That was the main theme I wanted to mention briefly at this time. Political persecution flourishes in an atmosphere of secrecy which is indeed necessary to it. Individual citizens of any country have been placed in situations in which they lose all real freedoms when that secrecy is allowed to flourish. It makes it too easy for authority to oppress, to destroy and to break down individual efforts, as we know from many celebrated cases that have come up over the years. It is interesting to look back and to see how many of those cases which became world news were brought to the attention of the world by Amnesty. As has always been the case, as one goes back through history, governments have chosen to break dissidents on the wheel and to break them secretly. With the development during the nineteenth and early twentieth centuries of the ideals of democracy and of individual human rights, there seemed promise of a new era in the world that would assert the importance of individual freedoms and make them paramount. Unfortunately, that has not been the case. As Senator Chaney said, the world's record now is appalling and is not getting any better. It has become just too easy for authoritarian governments to decide to push their point of view and suppress any dissenting point of view by imprisoning people, by torturing them and by doing it in secrecy. It is worth going back to the basic truism that progress can come only through dissent. If one were to quell any kind of dissent and shut it up so that only one point of view prevails, one would have societies that wither on the vine, become less effective and, worst of all, become dedicated in the course of ordinary human nature to the preservation of and increase in the privileges and wealth of small elite groups rather than of whole communities. So dissent in any society, as we in this place recognise only too well, is absolutely essential. There is much evidence that the letters and publicity generated by Amnesty, which perhaps in themselves seem small things, have a remarkable effect. Of course, these actions are organised to help political prisoners and their families in a number of countries. I have a feeling that those who persecute others in the conditions of secrecy that we deplore so much want desperately to preserve that secrecy. They do not want to be exposed as torturers. They do not want their brutality to be known to the rest of the world. In brief, I think that they are ashamed of it and I give them credit for that. In saying that, I raise another very ugly spectre. I do not believe that torture, brutality and false imprisonment are sponsored by monsters, by creatures who are not really human beings but who live sadistically for brutality. If that were so, the world would be a much simpler place than it is. But that is not so. I believe that torture is probably a profession-there is some evidence of this-carried out by people who go home at night to their wives and families and eat a healthy dinner. If that is the case, the need for Amnesty and its support becomes even more urgent. Therefore, there should be public exposure of these people and of the evils they inflict or sponsor. Of course, if one follows that line of thought, the key point is the word `sponsor'. There again, I suspect that in many countries where there are gross abuses of human rights, where there is torture and imprisonment of political dissenters, those who have overt political power tend not to notice it. It is too easy for them to think that it is a dreadful, appalling thing that is going on in their society but to say: `I will just duck out on it, walk around it and not really know anything about it'. As we know from the years in nazi Germany and the dictatorships in Europe and other places, many people who lived through those societies felt that they had no involvement whatsoever in what was going on. Indeed, they were quite comfortable to have no knowledge of what went on. Again, that is a good reason for Amnesty to act, being as it is in a position to bring to the clear light of day and to expose, in whatever countries these abuses occur, the fact that those things are occuring and to nail home to those people who exercise overt political power in those countries the fact that they are responsible directly for those actions. I believe that, once that responsibility is brought home to them, they will look at it. I believe that that is why the actions of Amnesty and the publicity generated by the letters that Amnesty writes to governments have such an effect. They do have a very considerable effect. My final point is perhaps the most important one and bears directly on this motion. Amnesty is an organisation that many people would like to shut up or suppress. There is no doubt about that. It flies directly in the face of the deliberate of perhaps non-deliberate actions of many governments in almost half of the world, as Senator Chaney has said, which use brutality and secrecy to suppress their people. On that basis, it is vitally important that this motion that the Senate records its continuing support for Amnesty's efforts be passed. It is of incalculable value that it was moved in the first place. I ask all honourable senators to support it, as I am sure in good conscience they can and will. On that basis, I commend it to the Senate. Question resolved in the affirmatve. Consideration resumed from 27 May. GROUP E Department of Resources and Energy Proposed expenditure $2,408,000 Attorney-General's Department Proposed expenditure $23,568,000 Department of Special Minister of State Proposed expenditure $18,365,000 Department of Foreign Affairs Proposed expenditure $20,527,000 Department of Defence Proposed expenditure $290,651,000 Senator Sir JOHN CARRICK(New South Wales)(10.45) —I rise to speak on the Estimates for the Department of Resources and Energy, because debate in the Estimates Committees in recent weeks has shown that the Government has failed to understand the central nature of safeguarding the resources, specifically energy supplies, of this country. I do so also because in the community which at the moment is facing an enormous peril-heading towards a banana republic as the Government says-because of its high costs of production the Government is further aggravating cost structures in Australia. The Government has learned nothing from the oil and energy crisis of the 1970s. It has done the very reverse. It has gone the other way. In the 1970s three great principles were laid down and certainly were implemented by the Fraser Liberal Government: The first was that one should conserve energy so that one would not run out or be dependent upon imports; the second was that one should convert away from precious energy to other sources; and the third was that exploration and development must be given priority. Running through the whole of the evidence given to the Senate Estimates Committees was the very perversion of those goals. For example, back in the early 1980s a projection of an increase in oil demand throughout Australia was made by the department of the day and it was indicated that we ought to move to increase supplies by about half a per cent a year, or slightly more. Our demand for oil is increasing by just under 2 per cent a year even though our reserves are falling. That compares with the United States of America which is managing, by conservation, to increase demand by, I think, 0.6 per cent. Whenever we look at the need to conserve energy we find that the reverse is happening. The previous Government as a leader in the field laid down a system whereby government vehicles should be converted to liquefied petroleum gas, a simple operation which is cheap and very efficient for commercial vehicles. Not only has the program not gone on; it has gone in a reverse direction. That is ridiculous when one considers the taxi fleets in Canberra, Melbourne and to a lesser extent in Sydney which are efficiently operating with an 80 per cent or 90 per cent use of LPG. Australia has a surplus of LPG and could therefore convert more vehicles to its use. At a time when our oil stocks are declining the Government is doing nothing to be a leader. There was an attempt under the Fraser Government to convert about 3,000 government vehicles a year to LPG-if my memory serves me correctly. The figure that I remember, which may need correction, is that the conversion number is in the hundreds, perhaps 300. That is an absolute nonsense. The reason that I say these things is not simply to be nit-picking on a department or a government; this country is facing peril, as the Government has said, and it will deteriorate into a Third World position unless we are very careful-into a banana republic, as the Government has said. A government which knows that anything which imperils our cost of production adds to the dangers has a duty to save costs. Yet the program aimed to preach conversion and conservation throughout industry and to preach it to government departments is at the very most lukewarm. International energy agencies and other bodies have made it clear and nations have proven that we can save 30 per cent of our energy sources, including petroleum energy; we can save not only the precious, scarce and non-renewable fuels but also valuable money. One would think that running through the whole Department would be an urgency to preach to the Australian people to get costs down. After all, that is the message that needs to be said. The reason that we have a trade deficit is not only the fall in primary product prices and mineral prices but also the fact that our manufacturers at home cannot compete on costs with the flood of imports. If we are to find jobs for the unemployed and overcome Australia's problems we need to get costs down and productivity up. The Department and the Government have the capacity and ability to save by bringing costs down. I have heard nothing and seen nothing of a drive to get a 30 per cent saving by energy conservation. Australia has a great ability to produce electric power in abundance but we have great cost burdens including overseas debts because of the cost of building power stations. The best way to save capital debts on power stations is to save the necessity of building the next power station; in other words, to use electric energy as best we can. I recall that three or four years ago there was an electricity crisis on the east coast, particularly in New South Wales and Victoria. The crisis was causing blackouts in New South Wales. All that was necessary for the New South Wales Government to maintain electricity supplies to the people was that the installations should be working at 60 per cent capacity. The power stations could not be made to function at that capacity. Maintenance and industrial problems were such that the stations functioned at less than 50 per cent capacity. Snowy Mountains supplies had to be drawn on and there was juggling between States. We now have new power stations at a huge capital cost. The ability in New South Wales to provide power means that it must draw on less than 60 per cent of installed capacity. Overseas, it is considered good practice to operate at 80 per cent of installed capacity-in other words, capital is being put to work. I see and hear nothing of a clarion call by the Government of the day saying: `Let us get a saving, a conservation, in every way'. It is no good saying: `Oil is cheap, therefore let us use it. We have coal in abundance; let us use it'. They are not the issues. Costs in Australia are keeping 600,000 people out of work and are lowering living standards. One of the greatest paradoxes of our time is that there is industrial protest today about a wage case when we ought to be considering the 600,000 people who are unemployed; not that the haves want to have more so that the numbers of have nots can be increased and have less. This is extraordinary. This is the confrontation society that Charlie Fitzgibbon talks about and that I have talked about. It is an ugly society. Unless governments and Ministers stand up and show the people of Australia a lead in getting costs down, we are in for a very serious situation indeed. There is no evidence of massive conservation. I am aware of the various plans such as the national industry energy management scheme and other plans which, on paper, sound good. I walk around Canberra at night and see a massive misuse of electric power in buildings. I see that the program that was put into place to try to save energy in government buildings is being given only lip service. Yet we are being told that social security spending must be cut because governments do not have money to back up their obligation to help the poor. This is a monstrosity in itself. Let us consider the current situation. We have been exporting our oil. Why have we been doing so? It is not because we have a surplus but because the balance of payments is in such a desperately poor state that we are willing to sell our precious oil, which we will run out of, at whatever price we can get overseas, just to try to palliate the balance of payments. Yet the Government has said that by 1991-these are government figures-Bass Strait oil production will fall by half, that is, it will fall from 400,000-odd barrels a day to 200,000-odd barrels. The Government has predicted that towards the end of the century Australia will need something like 900,000 barrels a day or more. In other words, the Government is saying that, whereas today, with some 400,000 to 440,000 barrels of oil a day, Australia is relatively self-sufficient at the light end of the barrel and needs to import only at the heavier end, eventually we will be in utter peril and will have a very serious shortage of the light end of the barrel. We will have to do one of two things. Either we will have to go without and experience the same kind of crisis as was experienced in the 1970s by other countries or we will have to import oil at a cost of billions of dollars. The nonsense of it is that the Government has before it a table which shows that, unless it does something drastic in terms of exploration in Australia, exploration will fall away. That is not a prediction by some outside interest but a prediction by the Government. I seek leave to incorporate in Hansard a table showing predictions by the Bureau of Mineral Resources regarding the number of exploration and development wells-a table which I think the Government has seen. Leave granted. The table read as follows- The BMR's estimates of 1986 activity are as follows: BMR 1986 estimate (as at Jan. 1986) BMR 1986 estimate (as at March 1986) 1985 Actual Exploration Wells Onshore ... 206 130 226 Offshore ... 32 28 43 Sub-total ... 238 158 269 Development Wells Onshore ... 69 29 75 Offshore ... 29 21 17 Sub-total ... 98 50 92 Total Wells Onshore ... 275 159 301 Offshore ... 61 49 60 Grand-total ... 336 208 361 Preliminary exploration and development figures for the 1st Quarter 1986 compared with the 4th Quarter 1985 and the 1st Quarter 1985 are as follows: 1st Quarter 1985 4th Quarter 1985 1st Quarter 1986 (preliminary) Exploration Wells Onshore ... 61 57 42 Offshore ... 7 10 12 Sub-total ... 68 67 54 Development Wells Onshore ... 11 8 9 Offshore ... 6 3 4 Sub-total ... 17 11 13 Total Wells Onshore ... 72 65 51 Offshore ... 13 13 16 Grand-total ... 85 78 67 Petroleum Division 4 April 1986 Action Officer: Mike Hitchens Extension No: 8748 Senator Sir JOHN CARRICK —Let us attempt to understand the nature of this crisis. The BMR estimated in January that in 1986 the number of on-shore exploration wells would be 206. In March it modified that estimate to 130. Last year the number of on-shore exploration wells was 226. The BMR estimated in January 1986 that the number of off-shore exploration wells for 1986 would be 32. In March it modified the figure to 28. Last year's figure was 43. If one goes through the table, whether one takes the number of exploration wells, the number of development wells or the total number of wells, one finds that the estimate now is that this year we will have virtually half the activity of the previous year. The BMR's March estimate for the total number of on-shore wells was 159 on-shore wells compared with 301 wells last year. Its March estimate for the total number of off-shore wells was 49 compared with last year's figure of 60. The grand total is 208, the March estimate, compared with 361, last year's figure. So it goes on-a picture of potential crisis. Yet nothing at all has come forward from this Government to increase exploration and development as a matter of policy. That in itself is an outrage. Although we have a balance of payments problem now, consider the balance of payments problem Australia would have if in five years time we needed to import oil, the very oil we have exported. The Minister will probably tell us that really it adds up to only six months supply or something like that-a lovely kind of euphemism. If my figures are right, we will be down on our knees praying to save our overseas balances. Because of the need to conserve, but primarily because of the need to reduce costs and employ people, the Department of Resources and Energy, its Minister, the Minister for Resources and Energy (Senator Gareth Evans), and the Government must concentrate on conservation, conversion and exploration and, above all, on saving costs wherever costs can be saved. Senator GARETH EVANS(Victoria-Minister for Resources and Energy)(11.00) — Senator Sir John Carrick canvassed a great many matters in his remarks. We could have a very long debate on those issues, but let me just make a few short points in reply, not least because that is all I think I am physically capable of at the moment. Senator Sir John Carrick —Perhaps we could have a statement by you at some other stage. A written statement would be handy. Senator GARETH EVANS —I make it clear that the Government has embarked upon the Energy 2000 exercise, which has produced a series of 10 discussion papers analysing all aspects of the Australian energy scene as we see it, both in the present day and through to the end of the century, in which exercise a lot of emphasis was given-I think quite properly, as Senator Sir John Carrick emphasised-to conservation issues. It is the Government's intention to follow up those discussion papers with a major conference, at which all interested-State and private sector, governmental and political interests-will be represented and to follow that up in turn with a major government statement at the end of the year or perhaps early next year. That kind of exercise is a response-a very genuine response-by me and by the Government to the kinds of concerns which Senator Sir John Carrick has articulated. Many shorter term responses will need to be made and are being made. I will be making an announcement later today about a further import parity price adjustment because we recognise the need to maximise returns to on-shore producers in order, in turn, to keep exploration incentives going. Many shorter term policy responses of this kind will have to go on being made, but the important thing is to maintain our sense of bearing and direction as to the overall energy scene. I readily acknowledge that we must not be led by the prevailing massive slump in world oil prices into any sense of apathy about the need not only to find new liquid fuel resources in this country but also to conserve very vigorously what we have. Whatever the overall situation may be in the world at large, the reality is that in Australia we face a situation of declining self-sufficiency as a result of Bass Strait drying up over the next few years. The predictions, as Senator Sir John Carrick indicated-although there is also predicted by the Bureau of Mineral Resources, at reasonable levels of probability, a self-sufficiency situation which is not quite as grim as Senator Sir John Carrick makes out-are that if we do not discover any new oil at all we will be down to self-sufficiencies of the order of 42 per cent by the early 1990s; but there is a 50 per cent probability at least of that self-sufficiency being in the 60 to 70 per cent range by that period and at least of around 50 per cent by the end of the century. But it is important, I readily acknowledge, to maintain exploration activity and exploration incentives. The Government has been looking very carefully indeed at what incentives it might be possible to give. A paper published just a couple of weeks ago addressed all these issues in the context of the short term problems of the present producers and the present, in particular, on-shore exploration scene. We very carefully weighed the possibility of providing tax incentives or tax breaks of one kind or another and various other ways of giving a boost to the industry, with results that I have announced and given reasoned justification for. I do not think much more is to be gained by swapping rhetorical barrages on this occasion. I simply make it clear that I acknowledge the force of the point that has been made and indicate that the Government has the policy issues involved well and truly in hand. A couple of other specific matters deserve some mention. As to conservation measures in particular, I do not think the Government's continued commitment to the national energy management program or the national energy awards under the national industry energy management scheme and so on should be dismissed quite as lightly as Senator Sir John Carrick did. We have maintained spending in real terms on those programs, notwithstanding quite a lot of pressure to reduce the spending on those programs by others in the Government who have taken a more short-sighted view as to the need to maintain them in a lower cost energy environment. New conservation initiatives have been taken in the past few months, with the five star building rating program, to which the Prime Minister (Mr Hawke) has actively and visibly lent his name and reputation. There has been the gas appliance fuel efficiency labelling exercise, in which I was involved very publicly a few months ago. There is a continued emphasis on appliance labelling, which is a matter of State reaction now being discussed and implemented through the Australian Minerals and Energy Council. There is continued emphasis on vehicle fuel consumption efficiency and the continued publication of the fuel guides by my Department, notwithstanding some very unfortunately sceptical and cynical responses by some motoring journalists earlier this year to that publication. There has been a continued willingness to devote research resources to energy conservation issues and a continued attempt, not always completely successful, to urge energy efficiency and economy measures upon those departments within the Government's jurisdiction. I readily acknowledge Senator Sir John Carrick's complaint about lights being on in the evenings in buildings around Canberra. It is a complaint regularly made by me. I am told that it is largely a fault of the switchings and installations that were put in in an era of much less energy consciousness than we have now. Slowly we are hoping to convert some of those buildings. The difficulty is always to find the seed money up front to produce savings down the back. Senator Sir John Carrick would be well aware from his occupancy of this portfolio how difficult some of these things can be. I make the point that we are not ignorant or indifferent to these considerations; we are simply governed by practical constraints which afflict any government. Finally, on the subject of oil exports, it is the case that the Government is happy to see oil being exported at the moment from Bass Strait, in particular as a method of alleviating our very difficult continuing balance of payments situation. With that in mind, to offer some incentive for such exports to take place, we announced a couple of weeks ago an increase in the excise rebate for such exports with results that, notwithstanding the initial reaction from the industry, I think will bear fruit in the months ahead. The arithmetic does add up and offers some incentive for exports to take place; whether at the rate achieved last year remains to be seen. It is the case that any export of indigenous oil involves a depletion of our resources at a faster rate than would be the case if we were not exporting it. That is perfectly true, but two factors need to be borne in mind. The first factor is the question of relative volumes to which Senator Sir John Carrick adverted. It is the case that even exporting at the very high rate that was accomplished all through calendar year 1985, at the end of the day that amounted to less than six months call on our reserves. I think that point ought to be frankly acknowledged and the decision made, as it has been by the Government, as to whether it is better on the whole to save up those six months worth of reserves for some uncertain future when the balance of payments situation confronting the country might be worse than it is today, but then again might well be substantially better, or whether it is appropriate and sensible to take advantage of the market opportunities that exist and put that oil out into the market. The Government came down on the side of the latter approach because of the second consideration which is always relevant here; that is, the question of encouraging exploration activity as a result both of giving to the producers an increased cash flow and a great capacity, accordingly, to pour money back into exploration and also encouraging an environment in which those minded to explore will know that they will not be constrained by government policy from taking market advantage of that. This is particularly important in the context of the North West Shelf. It was important to the development by the Broken Hill Proprietary Co. Ltd of the Jabiru field that it was given undertakings by the Government that it would be able to export the oil in question. Complicated questions of national interest balancing are involved in judgments of this kind. It is not simply a crude matter of saying that we have just this particular bucket of oil in existence which is absolutely finite and will not be added to, and that any taking of a cup out of that bucket for other than domestic use is, for that reason, a wrong thing to do. A much more dynamic situation than that operates in this particular exploration and production area and governments have to make judgments about what combination of policies offer the best return to the nation as a whole, given its overall economic situation at the time and which offer the best package of incentives to oil industry people to get out and find the liquid fuel resources that the country so obviously needs. Senator Sir JOHN CARRICK(New South Wales)(11.12) —I thank the Minister for Resources and Energy (Senator Gareth Evans). I point out that I am well aware of the publication `Energy 2000'; indeed some of the figures I quoted were from that publication. I do not argue that the diagnosis is not on paper; the diagnosis has been put on paper by both the Fraser and Hawke governments. My point in rising is to say that, knowing the diagnosis, there is no vigorous attempt to cure. Indeed, no voice is being heard. I know of no message in terms of clarion calls to the people of Australia to tell them what is happening and to seek their help in conservation and conversion. I wish to examine what the Minister has said. He has said that it is a difficult situation to decide whether to export oil to help the balance of payments now or to keep it in the ground for the future. Two things need to be said about that. Exporting oil at a time when Australia is getting a relatively low return because of low oil prices in this world is unfair to the Australian people by not giving them value for one of their most precious and non-renewable resources. If Senator Walsh were here and he had a monetary lapse of good humour, he would be talking of replacement costs, resource rentals and the inherent value that ought to be given to the people. That is not happening at the moment. The Minister has said, I acknowledge, that the prediction is that unless we get very substantial new finds, our oil sufficiency now, which in terms of the lighter grades-not the heavier, not the bitumen or fuel oil grades in the petroleums-in one sense is of total sufficiency, but in an ordinary measurement is 75 per cent or maybe a little higher, will fall to 41 per cent by 1991 or 1992. Then the Minister said that the Bureau of Mineral Resources has said that there is a 50 per cent chance that it might not be as bad as that. Nobody can lead this country into the next five years on the basis that we have a 50 per cent chance that it might not be as bad as 41 per cent. Let me tell the Committee what 41 per cent is. The other day the erstwhile world's best Treasurer, now of a Third World country, said that the balance of trade was a perilous thing and would lead us into all sorts of dire circumstances. If we fall to a 41 per cent level in 1991 and we need to import 30-odd per cent even to reach our present self-sufficiency level, we will have to find $3 billion to $4 billion, depending on the price of oil at the time-$3 billion to $4 billion at a time when we are arguing about a deficit increase of $1.4 billion which has put us into an ulcerous state. What a nonsense situation it is that we can be feeling happy, complacent, about the fact that we have a 50-50 chance of dropping to a level of 41 per cent in 1991. Nobody believes it will be 50 per cent or 60 per cent. The BMR itself would indicate that we will have a disastrous fall in our capacity to supply the light end of the barrel. Therefore, by 1991 we will have either to import oil at a very high price and so completely distort the balance of payments again or we will have to go without oil. There are a dozen different ways to overcome this problem. The Minister-with great respect to his laryngitis; I am sorry for that-did not address himself to any. For example, nothing has been done about using liquefied petroleum gas-a logical solution which is in the Minister's own hands. In fact, the reverse is the case. The Government could convert substantially the Commonwealth fleet, including post office vehicles and all those vehicles that do long miles. After all, his Department is full of documentation about the good sense of doing that. Instead, the Minister has that policy in reverse gear. But have I heard another important thing? Have I heard any statement by the Government or the Minister about the quite exciting New Zealand development in which Australia was something of an informal partner, peeping over the shoulder of the Maui Mobil gas development? Have I heard at all what has been happening? If that project does have some disabilities, we ought to be told, because although it looks as though Australia will run short of oil, it does not look as though we will run short of natural gas for at least some decades. At the very worst, we can run automotive vehicles on natural gas. We can convert natural gas into methanol and run vehicles on that, or mix it with petrol, or we can convert natural gas to petroleum and run vehicles on that. Whatever the cost may be-we have had no statement on this-the public of Australia is entitled to know where such proposals stand in regard to this 41 per cent self-sufficiency level in 1991. We are in an incredible situation. Australia is one of a handful of countries on earth-I said this yesterday-that have massive physical resources of minerals and a massive capacity to generate electricity in an unlimited way and to combine those capacities. We need to be sure we can turn the wheels, that we have the automotive power to do so. Nothing is appearing in print or in public statements to suggest any kind of urgency on this at all. Fundamentally, I rose today to expouse a point to which the Minister did not direct himself. The real crisis in Australia is the cost of production. We have been talking about the symptoms, such as the balance of trade and government overspending. The real problem is that our costs are too high. What is the Department of Resources and Energy doing to get costs down? What is being done by way of a crash course in conservation, a crash course in conversion? These kinds of things are fundamental to getting jobs for people. Australia is able to produce virtually all the electrical power it needs. We know that the whole of the crisis of the 1970s occurred in other countries because they could not do that, because they had to import the means of generating electric power. Yet we cannot, with the cheapest coal we can get from our open cut mines, with power stations on site at the coal mines and with none of the pollution problems of the rest of the world or the need to cart coal across the world, use that electric power economically to compete with the rest of the world. There is something drastically wrong with a country, and something drastically wrong with the elements of government, if here in Australia, with an abundance of electric power stations-as I have said, an oversupply of installed capacity-we cannot hook manufacturing on to the end of it. There is something wrong when we cannot take the minerals and process them, or struggle to do so. Yesterday I referred to the fact that Australia ships iron ore-50 per cent of it just common dirt-to Japan in one lot of ships and coal in another lot of ships, and Japan puts it through its steel mills, rolls it out in flat plate and sends it back to Australia for us to make motor cars out of it. The steel is cheaper than we can make it in Australia. There is something terribly wrong with Australia in that regard. We have the physical resources but we do not have the direction, the drive and the will to do it. I have pointed out that we export more than 50 per cent of the world's exported alumina. We are in fact God-given in our supply of bauxite, which we turn into alumina, and yet we struggled hard for years to get the Portland alumina plant going. With all the brown coal capacity in the world, we struggled hard to turn alumina into the base metal when at whatever price it is today-say $1,000 or $1,300 a tonne-it could be out there, up front, in a normal projection, altering the balance of trade completely. The capacity for Australia to increase its production of the smelted metal, aluminium, and export that metal could in itself do as much as almost anything to overcome our balance of trade problem. The whole purpose of saying what I am saying is to indicate that there appears to be no urgency about this; there is no directionalism, no telling the Australian people that the costs of production are the killers. In every way the Government is saying it will fix it with consumer price indexes, M3s and balances of payments or by trimming something off here or there. The fact of the matter is that we cannot do that at all. The only way that Australia will be able to employ people and maintain living standards is to get productivity up and costs down. We can do that without savaging the worker; we can do it by the worker and the employer co-operating. The Minister pointed out that he had put out a paper entitled `Energy 2000'. I quoted from it. In fact, that paper foresees the possibility that oil consumption in Australia could skyrocket from the present 613,000 barrels a day to as high as 980,000 barrels a day by the turn of the century, although it estimates a little more conservatively that it will be nearer 800,000 barrels a day. It was that paper that said that Bass Strait production, which now provides more than 80 per cent of our present domestic output, will halve by 1991. But what did the Australian Petroleum Exploration Association have to say a few days ago on this whole matter? I quote from the speech of its Executive Director, Mr Orchison: Oil demand in Australia from now to 2000 is likely to be 3.7 billion barrels. Despite record exploration activity since 1981, crude oil and condensate reserves fell over the past five years from two billion barrels to little more than 1.7 billion barrels. More than 4,000 wildcat exploration wells and many hundreds of appraisal wells will need to be drilled over the next 15 years, but our oil search is collapsing in the wake of the fall in prices. He goes on, far more importantly, to talk about the fact that we are facing the reverse face of the oil crisis of the 1970s. He said this: A re-run of the OPEC-dominated events of 1973 and 1979 is a factual possibility-with almost 60 percent of the free world's oil reserves in four countries: Saudi Arabia, Kuwait, Iraq and Iran. I wonder whether the Minister and his Government saw an article in yesterday's papers where Sheik Yamani was reported as saying that he thought that in a decade or so those countries would be providing something like 75 per cent of the free world's demand for oil. I think we have excellent relationships with Sheik Yamani and Saudi Arabia. I think he is a very civilised man but I do not think any country in the free world should put itself into a bind. I simply rise to point out the dangers we are moving into, both for Australia and for the world, if we are complacent and think that because there is an oil glut today and we have no crisis we can waste the oil, and do not need to convert. We cannot just go ahead and think: `She'll be right, mate; a string of promises in a Budget will fix it'. That is not what will fix it. Only by co-operation between management workers and the Government in terms of increased productivity will we solve our problem. Senator MacGIBBON(Queensland)(11.26) —I would like to raise a point that came up in the Estimates Committee which dealt with the Department of the Special Minister of State for the provision of office word processors in the electorate offices of senators and members. Some while ago a decision was taken by the Department of the Senate to provide personal computers in the offices we have here in Parliament House. A Digital decmate 3 is in the process of being provided to all honourable senators and, I believe, to honourable members as well. Through the Estimates Committee I made an inquiry of a witness as to when the same sort of word processing capability would be provided in our electorate offices. I was told that the equipment was out for tender and that the aim of the Department was to maximise Australian industry participation in this program. I am all in favour of supporting Australian industry. I think that is common sense, particularly when we have the acute trading account difficulties that we have. The facts of the matter are that a decision was made to put a certain word processor into our Parliament offices. I do not know what the capital investment would be but it would be well in excess of $1,500,000. Not only have we bought those computers and installed them in this Parliament House but also we have made a very big investment in staff training. We all have three staff members and the training program for that computer course, in its various stages, would probably extend over eight to 10 days per person. In man hours involved we have a very big capital investment in training our staff to use the equipment. On further questioning, as reported on page 129 of the Hansard of the Senate Estimates Committee E on 10 April 1986, the witness said that in the tender specifications that had gone on to industry: . . . industry will be asked to respond on three levels of compatibility to ensure that we can optimise the support and training between the two systems. It is quite clear that the Department is considering providing a system other than the system we have. I think that is just economic and managerial madness. We have to have the same system in our electorate offices as we already have in Parliament House. We cannot have incompatibility. We cannot have records on floppy disks or files that cannot be brought down from our electorate offices and put on a machine in our Canberra offices. In the fullness of time, we cannot have machines in our electorate offices that will not talk and link up electronically with the systems we have here. Above all, we cannot have two different training schedules for our staffs. It is just a nonsense to go down that path. I bring this to the attention of the Committee because most people are not aware that the Department of Administrative Services is looking at an entirely different system from the system we have in place at present. I think the system we have is a good system. It is probably the best system that is available at present. It is a modern generation word processing system and I think we have no alternative but to put the same system into the electorate offices of senators and members and if we want to go to a different system we should do so in the next generation-in 10 or 15 years time. Senator GARETH EVANS(Victoria-Minister for Resources and Energy)(11.30) — As was said by the departmental witness in the Estimates hearing, the Department of the Special Minister of State is aware of the need for systems being installed in electorate offices to be compatible with those in Parliament House. In the tenders that are now out and about, the Department is seeking to ensure a level of compatibility that may be not total but certainly is commensurate with the user requirement on the one hand and on the other hand the Government's objective of Australian industry participation. The levels of compatibility that are perceived as being necessary are first of all information interchange-that is to say, the transfer of data by diskettes-and, secondly, systems appearance to users, which is the functional interface of the keyboard, its layout, its features and so on such as the word processing software which enables migration to and from systems in electorate offices and in Parliament House. Again, the word processing system installed in the electorate office system must have a high level of compatibility with the most frequently used features of the Parliament House word processing software. There is an intention in the way in which the tender documents are framed and the way in which the exercise has been progressed to ensure the maximum possible degree of compatibility. To ensure absolute identity of systems in the way that Senator MacGibbon is insisting would be to ignore the requirement that I think most of us in this place would agree with, that is, to absolutely maximise Australian industry participation in this exercise. There has been consultation with parliamentary officers about this. I am advised that the Secretary of the Department and the President of the Senate (Senator Douglas McClelland) have had discussions concerning information systems and the President has expressed on all our behalfs his satisfaction with the way things are going and the level of consultation. Officers of both the Department of the Senate and the Department of the House of Representatives reviewed the specifications of the tender prior to its release as to its coverage of the compatibility issues in the way I just mentioned. The Department of the Senate advised verbally that it was satisfied with the contents of the document and had no problems with its release. Senator Peter Baume —Orally. Senator GARETH EVANS —The Department of the House of Representatives advised-I acknowledge the interjection `orally'; pedants of the world unite-in a letter of 30 April that the document gave `appropriate consideration to the overriding compatibility requirement'. I think those various considerations do answer the points that Senator MacGibbon has made. Senator MacGIBBON(Queensland)(11.32) —I would like to raise a matter in relation to the Department of Foreign Affairs. In division 315, subdivision 4, item 04, there is an increased expenditure of $2m for the administration of the United Nations-the parent body and not one of its agencies. I would like to raise a matter of caution here for the Australian Government. I refer to the evidence given at page 137 of the Hansard of Estimates Committee E of 10 April 1986-that since 1974 the United States of America has paid 25 per cent of the budget of the United Nations and its specialised agencies, but the Kassebaum Amendment laid down that a ceiling of 20 per cent should be placed on the budget contribution from the United States. Given the size of the United Nations budget that 5 per cent is a very significant reduction. The Gramm-Rudman-Hollings Act, which commits the United States legislature to balancing its budget by 1991, starts to operate this financial year. That will effectively reduce the 20 per cent figure to an even lower figure as all expenditures of the United States Government are cut back. From the discussion the Committee had with the witness I was not convinced that the Government was aware of the risk that exists in Australia being asked, along with all the other contributors, to make up the shortfall of the contribution by the United States to the budget of the United Nations. I am a supporter of the United Nations. I have grave reservations about some of its agencies, particularly the United Nations Educational, Scientific and Cultural Organisation which clearly can only be disciplined by not being funded for some years to bring it back to the path on which it was founded. It has strayed very far from that and it is not overstating the case to say that there is good evidence of corruption in the way that some of its funds have been administered under its present Director. But since from now on the United States of America and some European powers will not fund UNESCO, it will be funded out of the United Nations central budget. Demands on the central budget will rise and the United States contribution will fall significantly. I believe that the Australian Government is not fully aware of the liability we have in this direction and I do not believe that liability should be met. Although I am a supporter of the United Nations and had the privilege of serving as parliamentary adviser there three years ago for three months, the organisation has a great deal of inefficiency and kidney fat within it and need some financial discipline imposed on it. I ask the Australian Government not to consider requests for increased funding for the United Nations in the foreseeable future until it puts it affairs in order. Senator GARETH EVANS(Victoria-Minister for Resources and Energy)(11.36) — The only response I can make is that the United Nations is still debating its budget at the moment. The situation has not changed from that which was outlined by Mr Mott, from the Department of Foreign Affairs, in the Estimates Committee hearing on 10 April. As for Senator MacGibbon's policy prescriptions for the Government, we will take them on board and give them such weight as we think they deserve. Senator Sir JOHN CARRICK(New South Wales)(11.37) —I return briefly to the subject of oil energy. One of the fundamental ingredients in the costs of production today-and costs of production are the evil that is keeping us out of world markets and keeping our unemployed in that state-is the cost of freight flowing from the cost of fuel. What has been happening in the cost of fuel has been that the Government, which first was utterly abusive of import parity pricing and said that it was simply a tax office at every bowser, has not only embraced it but learnt to add more tricks to it. The Government has gone further than that. It has done something which I do not think ordinary people in the community understand. It has taken the excise factor of the price of a litre of petrol and indexed it to inflation. It is not necessary in any Budget for the Government to indicate to the public that it is putting up the excise, increasing the price of petrol. This happens automatically. The Treasurer (Mr Keating), the most vituperchative opponent of import parity pricing and of what he called the unduly high price of petrol, has done better than that. He has raised the price more and more. He is the man who is alleged to be right, but has never yet got one of his policies through. He has failed at tax summits and failed at everything he has done. He now should be put in perspective as the man who has completely reversed, done a double somersault, and we now have not just the tax commissioner but a tax investigator at every bowser. Let us have a little look at what is happening. The Australian Automobile Association in Victoria did an analysis of what happens at the petrol pump and who gets what share. It is interesting to see that for every litre of petrol bought at the petrol pump in Victoria the Government takes 53.11 per cent. Senator Teague —That is more than half. Senator Sir JOHN CARRICK —Yes, more than half. Let us look not only at that 53 per cent but also at what is happening and what is likely to happen. If one takes a litre of petrol in Victoria, at 52.5c, which includes a Victorian Government franchise fee which may vary, it is indicated that out of that sum the retailer gets 4.2c-not a very big amount. The oil company, with its storage and distribution, gets 11.2c. Incredibly, the oil producer, whom one would think would get a large amount, gets 5.1c-or 10 per cent. But what about the Federal Government? The Federal Government gets excise duty of 15.8c, crude oil levy 11.4c, royalties 0.7c. It gets 27.9c out of 52.5c, and the Victorian Government comes along and takes 4.1c in royalties. The important thing to look at in percentage terms is that of the Federal Government's 53 per cent, excise duty is now 30.1 per cent. I predict, sadly, that it will go up and up, as indeed the crude oil levy goes down, unless the Government can find some other means. What has happened is that the Treasurer, having failed once again at the tax summit to get his option C involving a broad based indirect tax, is getting a broad based indirect tax by stealth and creep through the excise duty at the petrol pump, and so that is rising. The Government says: `We have got to have revenue'. The Minister says, `We cannot give you all the advantages of the overseas fall in oil', although, in Opposition, every day the voices of the Australian Labor Party here were raised saying, `Give us every cent of the drop in price'. But now the Labor Government says: `No we cannot do that because we need the money'. Why does it need the money? It forgot to tell us that in its first Budget it increased expenditure by a couple of billion dollars so, to pay for its expenditure, the people have to suffer by not getting this amount. We are seeing here a built-in cash register for the Government-steadily, steadily, by indexing of inflation which is running at 9.2 per cent at present. Up it will go and the Government will shift the burden so that government revenue is steadily increased. We will get that kind of broad based indirect tax there. That in itself would be just a breach of faith, one of the Government's broken promises by the dozen, if it were not more serious. What is more serious is that we are facing a crisis in costs of production. Above everything, the farm community is facing an enormous crisis with falling overseas prices and rising costs in Australia. The big costs to the farming community are freight. The Government has made some petty gesture of on-farm discounting of fuel-a fiddling thing in itself. The real cost of freight is in every kind of commodity that moves to and from the farm. The Government had the chance in Australia to reduce the consumer price index by at least another one per cent if it had given the full fall of overseas prices. In fact it elected not to do that. It elected to put on an excise and therefore to increase costs of production-to do the very reverse of what should be done. This should be understood by the Australian people. It is no good a government saying `We need the money'. A government which is a big spender, which year by year has increased its expenditure by more than the average 2 per cent of the Fraser Government-which was the lowest spending government for many years-has to look to the waste of its expenditure before it starts to put costs on people. It is crazy to punish people by indirect taxation for the Government's own inadequacies and mismanagement. That is what is happening at present, bit by bit. In the area of fringe benefits the Government is seeking to pretend that it will force the wicked employers who incur its class hatred-they are set up as an Aunt Sally which the left wing has to knock down all the time because it needs confrontation as its role-to pay for a benefit of the employee. In the long run it will be passed on through the cost of production to everybody in the community. So we hear all the rhetoric to the effect that a handful of 10 to 20 per cent are getting fringe benefits and 90 per cent are not and that we should weep about that. What is happening now is a skilful arrangement between the Australian Democrats and the Government-a complete piece of trickery in itself-which will, in the end, cause the tax to be passed on to the ordinary people, the pensioners, to everybody else. It is a very comforting device for the Government; a device which means that by a deferral of taxation-- Senator Gareth Evans —Mr Chairman, I raise a point of order. Indebted as we are to Senator Sir John Carrick for ranging at large over a number of issues, I suggest that he be drawn back to the topic of this debate. Senator Sir JOHN CARRICK —Mr Chairman, I would like to speak to the point of order. My point was that the price of fuel and the price of freight was such a heavy ingredient in taxation that it is exacerbating the cost of production today, and that the Government was not focusing on the real error-the cost of production. I am delighted that the point of order was raised because it gives me a chance to repeat my point that an indirect tax on the petrol pump was doing exactly this. I pointed out that this was in parallel to what is happening in the proposal for fringe benefits. Rather than wandering at large we are at the petrol pump, we are at the indirect tax, we are at the insidious means of transferring to the ordinary person a cost. I put it to you, Mr Chairman, that there is no point of order. The CHAIRMAN —There is no point of order. These debates traditionally have been wide-ranging. The Department under review is the Department of Resources and Energy and Senator Sir John Carrick's remarks are relevant in regard to resources and energy. He may link them, if he wishes, to the fringe benefits tax but not too much. Senator Sir JOHN CARRICK —I will endeavour to observe your ruling, Mr Chairman. The fact is that the whole of my remarks is aimed at the increased costs of production. The whole of my remarks is aimed at the fact that the more burdens the Government puts on the taxpayer, the more costs go up. If the Government defers taxation for two months, in the short term it will help the Government to get its deficit in place for August this year, but it plays a dirty trick because it puts up taxes to the ordinary person, and in the end all this becomes an extra burden. So what looks like a nice little arrangement is, in fact, an attack once again on ordinary people. I repeat that the failure of the Government to observe import parity pricing-which was its stated policy-and the action of the Government to involve an excise which is now indexed, and which is creeping up and up, are contributing very significantly to the unemployment we have in Australia today and to the very grave disability of farmers and miners. It is dishonest because it is a series of broken promises. The Government promised to pass on these prices. I simply say that every time someone goes to the tax bowser-Mr Keating may join me in this because he was a most ardent proponent of this before-he will observe that this Government has learnt more tricks about how to put the Tax Commissioner at the tax bowser than any previous Government, and that the excise duty itself, ticking away, will rise and rise and will exacerbate costs and will exacerbate unemployment. It is within the capacity of this Government to have reduced the consumer price index by one per cent which would be in itself an enormously important thing and it would have overcome quite a few of the difficulties. It failed to do so. It went on its way simply because a socialist government wants to grab money. It does not understand that its job is to get off the backs of people and let them have a fair go. Senator GARETH EVANS(Victoria-Minister for Resources and Energy)(11.50) —I am indebted to Senator Sir John Carrick for raising the whole question of indirect taxation of fuel because it enables me to put on the record some facts about Australia's performance in this respect, comparatively speaking, which are not well understood, not well appreciated, and not often acknowledged. The reality is that not only are overall petrol prices in Australia lower than all but two other comparable countries, namely the United States and Canada, but also the Australian level of indirect taxation-that is to say product excise tax on petrol-as a proportion of total price compares very favourably indeed with other Organisation for Economic Co-operation and Development countries. The taxation component in the Australian retail price of petrol is currently 43 per cent. This compares with an OECD average of around 52 per cent on the basis of the latest information available to my department. Senator MacGibbon —What is it in the United States? Senator GARETH EVANS —I am happy to say that in the United States it is a little lower than Australia. It is true that in the United States product tax is only 22 per cent. In New Zealand it is less than ours. In Canada it is less than ours. In Japan it is a little less at 40 per cent, but that is against a background of a petrol price of $A1.10 per litre. But every other country in the OECD has a higher rate than Australia's 43 per cent. The average, as I said, is 52 per cent. For example in France, the taxation component is 87 per cent; in Italy it is 78 per cent; in the United Kingdom it is 66 per cent. To complete the list, in the Netherlands it is 65 per cent; in Germany it is 63 per cent; in Greece it is 60 per cent; in Austria it is 55 per cent, and in Spain it is 44 per cent. Comparatively speaking, Australia is a middle to light ranging taxing nation so far as petroleum prices are concerned. The percentage is one thing and the total price of the product at the end of the day is the other consideration. As I indicated, in terms of total price, the Australian product is right down there at the bottom of the scale, jogging along with Canada and the United States. The prices on which these figures are calculated are 49 cents per litre in Australia; at the moment 46 cents in Canada; and 40 cents per litre in the United States. So Australian petrol prices have been kept much lower than could have been the case had we not chosen to keep product excise levels at a moderate level. It is the case, as Senator Sir John Carrick pointed out that, since the decline in world oil prices which as a consequence of our import parity pricing policy led to a substantial reduction in the price of indigenous Australian crude oil which in turn led to a massive drop in crude oil excise revenue, in response to that and to that revenue decline we have imposed in recent months compensating product excise increases-not as to the whole amount in each case of the lost crude revenue; back in March it was only a partial recoupment-which cost the Government out of the Budget in the coming financial year something over $400m. That was a deliberate attempt by the Government to inject some competitive advantage into the economy, to reduce the consumer price index below that which would otherwise be the case, and to give the consumer and the economy as a whole some fillip from that. But the reality is, as was explained at the time, it is simply impossible, with a price effect such as this coming pretty much out of the blue certainly as to its scale and as to the time frame within which it occurred, for any government to cope with revenue losses of that order of magnitude. As a result we have imposed significant compensating excise increases. But we have not been alone in doing that, and that point also needs to be acknowledged. The United Kingdom Government, the ideological shrine at which the Opposition worships, has in fact increased petroleum product excise by a quite substantial amount in its recent Budget. So too has Italy, Denmark, Spain and Switzerland. Each of those countries have imposed recent product excise increases to compensate their Treasuries for the lower returns they were getting as a result of the lower overall prices. The final point I make is that there is no question of stealth in the way in which the Government has applied this particular tax, nor will there be any question of the Government taking windfall gains as a result of it. I am announcing today-if the Press release has not already gone out-an increase in the import parity price for June to reflect some recovery in the market over the last four weeks. There will be a compensating reduction in the product excise to counter the increase in crude excise that will flow from that particular IPP. Senator Sir John Carrick —What will be the net result? Senator GARETH EVANS —It is revenue neutral. The price increase will be around 0.3c per litre, which will have a CPI effect of 0.4, I think, which is pretty small. However, that will give something like a 20 per cent price increase to producers-in particular, on-shore producers. The Government has been quick to respond to the needs of producers and to offer the exploration incentives that we spoke of earlier. The particular point I make here is that we are honouring the promise that we made earlier this year that there would be no attempt to hang on to product excise increases in the event of an upward movement in the import parity price and, as a result, an upward movement in our crude excise receipts. That is exactly what we have done, and the move will be fully revenue neutral. I do not in any way suggest that in the longer term it may not be necessary to have greater reliance on product excise as a result of declining indigenous production and the sort of Bass Strait phenomenon we spoke of earlier. That is a revenue problem with which this Government, as would any government, will have to wrestle in due course. It may be that in due course there will have to be a greater shift to product taxation. However, I think it is important to acknowledge the Government has not sought to wring the petrol consumer dry, despite the temptation to do so when one looks at comparative taxation regimes in other countries. There may be some opportunity to increase product taxes over time but it is not an opportunity that this Government has sought to grasp at the moment because it acknowledges the desirability of keeping these fuel input costs as low as is compatible with reasonable revenue returns to the country as a whole. Senator Sir JOHN CARRICK(New South Wales)(11.57) —I must state that every argument that the Minister for Resources and Energy (Senator Gareth Evans) advanced just now to support his case was rejected by him and the Australian Labor Party when in Opposition. The Fraser Government pointed out that Australia was the third lowest petroleum producing country in the world and that the tax intake was as the Minister stated. The Labor Party, including the Treasurer, Mr Paul Keating, and the Minister, said then that that is no argument at all; nor is it. The argument is about whether the Government will pass on totally import parity price adjustments. Let us not now turn to an argument that the Minister rejected out of hand. The fact of the matter is that what the Government has done today is a breach of its election policies and a breach of its import parity policies. The Government is now trying to scramble for any kind of argument, all of which it rejected in the past, to justify its actions. I can only say that the Government does not have legs on which to run. Lawyers are paid to take a brief from both sides but this really takes all the gall there is. Senator GARETH EVANS(Victoria-Minister for Resources and Energy)(11.58) — Might I just correct one error of fact in what Senator Sir John Carrick had to say. I do not think the present Minister for Resources and Energy ever went on record then as saying anything about petrol prices in any context whatsoever. The first interest I took in this subject was when I assumed the portfolio. Senator VIGOR(South Australia)(11.59) —I cannot let the very long presentation of Senator Sir John Carrick go by without stating that the saving of energy and the need for specific measures to introduce and handle new forms of energy must be a very important part of any energy policy for a country. The Australian Democrats support the conservation view. I do not know whether we would agree much further in the area of hitting the Government on the petrol excise, which I believe introduces, to some extent, a conservation attitude towards this type of scarce resource. However, we agree on not exporting a scarce resource, a non-renewable resource, such as petrol. I am worried that a number of specific questions which Senator Sir John Carrick raised in that area are being completely bypassed by the Minister for Resources and Energy (Senator Gareth Evans). In deference to his sore throat, I will cut down the amount of my questioning in this area. However, I cannot let the opportunity go by without asking him to say specifically what the Government is doing about cutting down the wastage of energy within the Public Service. What specifically is the Government doing about transferring its very large fleets of cars and trucks and those of the statutory bodies which come under its control to liquefied petroleum gas, which is available to a much greater extent within Australia? What is the Government doing to introduce, say, alcohol as an additive to fuel to cut down the use of the non-renewable component of fuel? It is important that the Minister tell the country what the Government's plans are in this area. In Queensland sugar producers are currently screaming that they are going out of business. We could be using the `mountains of sugar' in a very effective way to produce alcohol. It may be more expensive but it would keep some people in business and would improve our employment prospects. Fuel will not be at the same price indefinitely. The current situation seems to have been induced basically by the Iran-Iraq war and the fact that people in those areas need to get more revenue. We also seem to be in the business of trying to get revenue by selling cheap oil to the world. I believe that we should be conserving oil. The next specific matter which I think we should be looking at is the area of low impact technology. What is the Government doing about encouraging solar ponds and the use of the sterling cycle in getting energy out of very small temperature differences? Is the Government supporting any projects on this in Australia? We used to be way ahead on solar energy use because we have a lot of that resource. Currently we are dropping back because we are relying more and more on just ripping out of the ground those mineral and energy resources about which Senator Sir John Carrick talked and on using electricity to subsidise the aluminium industry to a very large extent at the expense of the Australian taxpayer. What is the Government doing about low impact energy? What is it doing about using some of our arid land where oil bearing weeds are growing and extracting oil of the higher fractionating types which are not available in our underground gases? I do not wish to continue very long. I would like to hear the Minister's response to these matters. What is the Government doing about cogeneration? Cogeneration is a technique which allows people to produce electricity on their own property from wind and local resources and feed it back into the network for the benefit of the community. It is producing lots of power in California and Portugal. What are we doing about developing these new sources of energy so that when the price of oil goes up, as it inevitably will because resources are running out, we will have to have an indigenous energy producing industry that we can export to the world? It is the lack of vision in this area of both the major parties which has resulted in our balance of payments going down the gurgler. We are not exporting dynamically. It is not so much a matter of cost. We can probably afford to pay for the labour if we just use our imagination and the resources and intelligence of the people of Australia, which are enormous, to develop facilities and new and exciting ways of saving energy and producing energy. I ask the Minister to respond. Senator GARETH EVANS(Victoria-Minister for Resources and Energy)(12.06) — Whenever I am backed into a corner at a social function, as I often am, by someone talking about getting methane from pig poo or ethanol from beetroot, I always know that the person is an Australian Democrat. Senator Vigor's contribution today was in the finest spirit of his Party's tradition in that respect. It is important that we have regard to renewable sources of energy, solar energy and all the other forms with which Australia is potentially very well endowed. But one has to maintain a healthy sense of realism and proportion about what likely contribution those energy sources will ever be capable of making to the national economy as a whole. The sorts of figures that have emerged from our studies are retailed in the `Energy 2000' series of booklets, with which I would be very happy to supply Senator Vigor, and indicate that even on the most optimistic assumptions of the contribution of these energy sources, we are still talking of the order of only one per cent or at most two per cent of our national energy needs. As a result it is just the case that these things will not be the answers to the nation's prayers, although they can make a very useful, indeed, marginal contribution. As to some of the other matters raised, there is quite a detailed description in the Department's annual report of the national energy management program and what we are doing with Commonwealth buildings and vehicles and so on. I will ensure that a copy of that and any other material that is available is sent to Senator Vigor. On the particular issue of the Queensland sugar industry and fuel alcohol, Senator Vigor ought to be aware, if he is not already aware, of a recent publication of my Department which addresses in very considerable detail both the technology and the economics of that issue and comes down, regrettably, against the viability, from any rational economic perspective, of that particular fuel source option. I will make sure that Senator Vigor gets a copy of that so that he can belabour me with some alternative version of it in the future. The issues raised by Senator Vigor of solar ponds and everything else are not things that the Government is ignoring. We continue to support research into these things through the national energy research, development and demonstration program. There are still incentives for research, apart from that program with the 150 per cent research and development write-off provisions that the Government has introduced. It is important that activity in these areas continues but do not let any of us be under some romantic illusion, as regrettably all too many people are in this area, that somehow these alternative energy sources will constitute the basic answer to the country's energy problems, and in particular to the fundamental problem of liquid fuel which has been the subject of Senator Sir John Carrick's earlier contributions. Senator MacGIBBON(Queensland)(12.09) —I wish to refer to the estimates for the Department of Defence and to make a general observation about the witnesses from that Department who appeared before Estimates Committee E. I base those observations on eight years continuous experience on Estimates committees in the Senate, both for the annual Budget and for Additional Estimates. It is with regret that I have to say that from my experience in my time in the Senate the Department of Defence provides the worst witnesses. I suppose I have dealt with the majority of departments over the years and the best witnesses have been those from the Department of Resources and Energy. While I am criticising people, I would like to give an accolade to a department whose behaviour before the Senate has been exemplary, in my experience. My criticism of the Department of Defence is not something that has come to my notice or consciousness in the last couple of months. It was apparent quite a few years ago. The other point I would like to emphasise is that it is certainly not one of the faults of the Labor Government. The attitude has been in existence in the Department for quite a few years. I have been told by senior people in the Department that the staff of the Department get together weeks before an Estimates committee and actually rehearse what the Department's line shall be in reply to questions. That is unconscionable. Certainly we expect witnesses to support a departmental position that has been agreed after consultation, but we do not want rehearsals and we do not want 100 per cent departmentally correct answers. The effect has been that far too many witnesses who have appeared before us have given us answers that are obstructive, evasive and at times misleading-in an intentional way-and some of the witnesses have been inaccurate. I will not embarrass the senior person involved by naming him but in the Hansard of the last hearing at least one head of a division made a statement, in good faith-my recollection is that the Hansard does not report him inaccurately-that is wrong in detail. It probably does not matter much at the end of the day but I am surprised that witnesses should make mistakes before such a committee and not correct themselves. It is wrong that witnesses can appear before a committee of the Senate with these attitudes. The attitude of the Department of Defence is an adversarial, almost gladiatorial, one. Witnesses try to see what they can hang on to and conceal when they appear before the Senate Committee. Surely the attitude ought to be one of frank openness and readiness to answer the questions of the Senate. I do not want to deal with the civilian component of the Department of Defence. In my judgment it is too large and, quite frankly, beyond redemption. Until we get a Minister who will get in there, kick a few tails and set a few priorities, we will not improve the civilian component. When staff of the Department of Defence appear before Estimates committees they come in like a thundering herd. About 50 or 60 civilian and senior service witnesses come in and just about fill the Senate chamber. My greatest concern is about the service personnel. As I made the point that only some of the answers that are obstructive and evasive, so it is only a percentage-very definitely a minority-of the service personnel appearing before the Senate who do not have a helpful attitude. Quite bluntly, we are looking at people who are more politically oriented than they are soldiers; I use that word in a broad sense to cover all three Services. I am not saying for one moment that these service witnesses with a political bent are operating in a party political sense. They are not doing that in any way; they are not openly Labor, Liberal or anything like that. They are political in the sense that they are defending the positions, as they see them, of the Department of Defence and they adopt an adversarial role. Such people are in the minority but, regrettably, that minority is increasing year by year. They are as evasive as their civilian counterparts. They should be frank, open and direct with the Senate. When they are not open, frank and direct in their answers, inevitably the Senate has to doubt their integrity and professional competence. It is a tragedy. They are not the sorts of service personnel I want to see rise to the senior levels of the Australian Services. They are a discredit to the very fine men we have as Chiefs of Staff of the three Services in Australia. General Sir Phillip Bennett, the Chief of the Defence Force, Admiral Hudson, the Chief of Naval Staff, General Gration, the Chief of the General Staff and Air Marshal Newham, the Chief of the Air Staff, are all people of great integrity. In all the dealings that I have had with them on various committees in the Parliament, they have given frank, honest and open answers. I believe they would be horrified if they came in here and saw the way that some of their one-star, half-colonels and officers of similar rank behaved before the Senate at a Senate hearing. It is part of the Australian parliamentary tradition that Parliament controls the Services. There is no argument about that. But we seem to have reached the stage where the Department of Defence believes that it can control everything and give no information to the Senate. Senator GARETH EVANS(Victoria-Minister for Resources and Energy)(12.15) —I asked the Department of Defence representatives to give me their perceptions of the quality of the performance of the honourable senators before whom they appeared. They felt constrained by a sense of discretion, not to mention the traditions of the Westminster system, from doing so. I do not doubt that Senator MacGibbon has felt some frustration from time to time about the absence of quick or what he perceived to be responsive answers to questions but it is unfortunate that he should have tarred with such a comprehensive brush all the witnesses who have come from that Department over recent times. It may be that some individuals are less forthcoming than others. Some institutional reasons and part of the culture of that Department-if I may put it that way-may make it less responsive perhaps than are some others to questions of this kind. As the Minister responsible for answering questions on defence I acknowledge that often I have some difficulty in obtaining quick answers through the office of the Minister for Defence (Mr Beazley) from the Department to the sorts of issues of the day that are likely to arise. This problem is simply a function of the sprawling size and complexity of the Department and the provisions and lines of responsibility within it which make some people feel constrained from perhaps being as forthcoming as they are able. It ought to be appreciated that despite the large numbers of witnesses who come to Estimates hearings from the Department of Defence, both from the civilian and military sides, they represent only a very small proportion of the total senior bureaucracy in the Department. It is difficult to combine the general policy and operational oversight responsibilities that people have with the requisite degree of detailed knowledge of matters that might arise during the hearings. I am told that the difficulty that the Department has faced is in avoiding having unmanageable numbers of officers present. To have an appropriate range of officers able to deal with any conceivable question that might come up, we would probably need three or four times the number that we have. That sometimes contributes to answers not being as available as one might think appropriate. Beyond that I can say nothing. I am sure that the Department and the Minister will take on notice what Senator MacGibbon has said. It is a little unfortunate that he chose to be quite as scathing in such a comprehensive fashion because many individuals who have been witnesses over the years from that Department have not justified any of the criticisms levelled so comprehensively against them. Senator Sir JOHN CARRICK(New South Wales)(12.18) —I want to make a couple of comments on the Department of Defence. First, I will specifically comment on the program that was announced last year and the several million dollars allotted, as I recollect, to increase the number of Australians in the Reserve. Reserve numbers had fallen very substantially from about 32,000 to the lower 20,000. It was presented in the last Budget and in the previous Estimates Committee that a very specific and carefully nurtured program was being developed to raise the level to about 28,000 in the short term. We queried at the time the very nature of the glossy program. I do not want to be invidious but some would doubt whether a benign Prime Minister hopping out of a helicopter, whatever his politics, may have an attraction to urge young people to join the Reserve. Both sides of the Parliament directed questions on the nature of the program but it was staunchly defended, as one would expect. What has happened? Rather than any increase in the Reserve, numbers have fallen over the months by about 500 or 600. That is drawing from memory. That ought to be a matter of very serious self-criticism by government and a matter of statement and of public debate. It is true that in two world wars what was then called the militia was the basis from which an army could expand, particularly to get its noncommissioned officers and junior officers very quickly. That was very important when there was time during perhaps the first year of a war to put together an army. How much more important is this now when everybody agrees that there will not be any time if an emergency occurs? The forces one has at the point of an emergency are what one will have to deal with the emergency. It is much more important now that our reserve forces in size, equipment and morale be at a maximum state of readiness. There is talk of some integration between the permanent army and the Reserve. For my sins and to my great pleasure I spent a fair part of my life in the militia. I would welcome that decision very much. The sooner that Russell Hill recognises the imperative need to depend in the end very largely upon part time soldiers, sailors and airmen for the community's assistance at a point of crisis, the better off we will be. I do not make that point in a subjective way. A program set out with great expenditure and glossy television advertisements has failed miserably. One must ask: How does this happen? For example, how does it happen at a time when many fine young men are unemployed and have time to do jobs. It is not good enough simply to say: `But the reserves are selective and put a test on those who will come in'. Unhappily, in the unemployment pool there are many fine people who would have the qualities to be amongst our reservists. They are not joining. When the Government in a mean and miserable way put a tax upon Reserve earnings it said that this would not hurt and that everything would be all right. What a silly thing to have done, and what a silly thing not to have repaired. Whether it was important in terms of money is not the thing. It is a psychological situation. I stress that it is vital that the Government look at what has happened in the past six months and at the reasons why people are not coming forward to join the reserves. Let us look at this against the background that there is leaked to us time and time again a series of ideas which suggest either some kind of `fortress Australia' or that the only threat is that somebody will land on our shores and we will have to act with immediacy. I took no comfort when as a member of a Senate committee quite a long time ago I asked about the Operational Deployment Force at Lavarack Barracks in Townsville. I asked what was the state of immediacy of readiness. I was told what has to be a vital piece of information: That if there were an emergency along our coastline within seven days we could put a company group into action. I tell honourable senators, as one who is not bad at sums, that a company group probably comprises between 120 and 150 people. I am not talking about 150,000 people or thousands of people. We were told calmly that within seven days we could get a company group into action. That is a very interesting situation, provided the enemy is compliant, provided one can say to one's opponent: `Would you mind waiting please because we have a logistic difficulty?' What a piece of nonsense! Why have an Operational Deployment Force unless it has a sense of immediacy? I think officers told us that within a fortnight or so they could get together a battalion-probably 700 or 800 people. Yet there is a brigade in Lavarack Barracks. The defence forces are always organised for peacetime, sadly enough, from 9 a.m. to 5 p.m. In saying that I make no reflection on the defence forces. I have a very great affection for the defence forces and understanding of the importance of the Department of Defence, although I must say that I share some of the reservations Senator MacGibbon put forward. The fact is that if, at the most, we have to deal with terrorism, with all sorts of incursions, in an immediate way we have to have a well equipped Reserve and an Army that is ready to move. It has to be capable of rapid movement by air and land. On land it must have the protection of modern, up to date armoured personnel carriers-not the obsolescent carriers we have now. Our soldiers, our troops, deserve protection. The trouble is that we are being told a series of things by way of brainwashing. No doctrine I have heard regularly in the Parliament and in the community is more erroneous than the doctrine of perceived threat. Every time we have a defence debate the doctrine of perceived threat is trotted out by the Defence Department, the Army or other bodies. We have been told-we are being told now-that Australia faces no threat for 10 years, that we will have 10 years warning. The other day I looked up a statement made in the other place some eight months or so before World War II by Prime Minister Curtin, a good man. To paraphrase him, he said that anybody who argued then for an increase in armaments was as wrong as could be. Of course, eight months later the world was involved in a slaughter which cost 40 million lives. I do not quote Mr Curtin in an invidious way. I quote him to highlight the error of those who think that the telescope is sufficiently good to perceive the threat. That misunderstands the opponent. Why would an opponent present a threat which was so perceivable that he started with a disadvantage? That is a nonsense. What is most important to remember is that the lead time to get together trained troops and hardware is longer in terms of years than the optical power of any telescope. It takes some four years to train an army sergeant and, probably, eight years to get a naval destroyer from the time of ordering. If there is an emergency we will be able to deal with that emergency only with what we have at the moment. In the immediate years ahead our capacity to deal with emergencies will be the capacity we have now because the lead time is so enormous. We are constantly brainwashed with the idea of perceived threat. Nobody has been right in the past. Honourable senators should read William Pitt to see his mistakes, or Lloyd George or Curtin. The whole of history supports the truth that the theory of the perceived threat is as wrong as hell and has cost literally hundreds of millions of lives throughout the world. Nobody is going to present the threat to us on a plate. Nobody is going to give us a lead time. Yet we are being told that now. We are being told that the only threat to us will involve some kind of stray incursions up north and that what we need are small bodies of troops. If that is so, we had better smarten up. What we will need more than anything will be a first class Reserve-up to date, and immediately ready to take part. We do not have that Reserve now. I ask the Government to consider the calamity that has befallen us. I conclude with a couple of remarks that no doubt will be embroidered later in the Senate. During the Estimates debate last year a number of questions were asked about the nature and cost of the intention of the Army and the Department of Defence to transfer an Initial Training School to Bathurst-Orange. I do not comment on the matter because a Senate committee will do so at another time. However, I note that the Government has decided not to proceed with the proposal. I ask the Minister for Resources and Energy (Senator Gareth Evans) to let this Committee know the total cost of the whole of the investigation of the Bathurst-Orange proposal-it will not be at hand now-including the cost of the impact statement by Dames and Moore. I also ask the Minister to take on board, when the land acquisition is being considered, the damage done to the people of Bathurst over them and denying them freedom of movement. I do not trespass on the Senate inquiry which is another matter. I ask only for information on this matter. Senator GARETH EVANS(Victoria-Minister for Resources and Energy)(12.31) —I will take on notice the question about Bathurst-Orange and refer the honourable senator's remarks in that respect to the Minister for Defence (Mr Beazley). As to the question of the Reserve, it has to be said that recruitment and retention in the Army Reserve are matters of continuing concern to the Government. The most recent figures available, to the end of April this year, show a continuation of the increased recruitment and lower wastage this year compared with 1984-85. Recruitment is running over the comparable period, 1985-86 to 1984-85, at an increase of 2,875 or 105 per cent. Wastage is down by 1,720 or 22 per cent. The overall strength as at 30 April was 23,246, which is an increase of 71 over the number at the end of the previous month. The target is not 28,000 or 32,000 but 26,500. Senator Sir John Carrick —In the short term. Senator GARETH EVANS —In the short term. It is acknowledged that there is a shortfall in relation to that target but the trends, as I say, of recruitment and wastage are encouraging. As to the larger issues raised by Senator Sir John Carrick, I have to say that there is no particular perceived problem about the Defence Force's capacity at the moment. There has been a very substantial increase in that capacity as far as capital equipment is concerned over recent years, with a greater increase, it has to be said, under the Government than under its predecessor. It is important that that program continue, and it will. The question of capacity is distinct from the question of readiness, which Senator Sir John Carrick also referred to in a number of his remarks. The readiness of a force is conditioned by current perceptions as to the requirements to be made of that force. That question is being squarely addressed by Mr Dibb in his report shortly to be released which will, in turn, be considered in very great detail by the Government. Beyond that, I do not think it is necessary or appropriate for me to reply. Senator VIGOR(South Australia)(12.35) —I do not have Senator MacGibbon's long experience of Estimates committees, but I have been to a number of Estimates committees in my short time in the Senate, to the discomfort of the Government, as I have been investigating reasonably thoroughly the figures and claims which have been made by the Public Service. Indeed, I think the Government should be very happy about that if it took its job seriously. I felt particularly unsatisfied about the Department of Defence. That was not helped by the attitude of the Minister for Resources and Energy (Senator Gareth Evans), who insisted, after I had asked my first question, that everything else be put on notice. Although the questions were put on notice and despite the fact that the Department has had much time to consult as many people as it wanted, I have received a number of non-answers in this area. This is very serious because the Department of Defence has put in a bid for an amount of $290m in the Supplementary Estimates. I have looked back over the history and it is by far one of the largest amounts that have appeared in Supplementary Estimates. I was quite innocent when I started this process, but since examining the figures and the information that have been given to me, I have been appalled at what is happening. Part of the reason for seeking this large amount of money is a heavy reliance on the purchase of materiels from overseas. In a defence environment this is a serious problem. In a war, the lines of communication are the things which are attacked and we are becoming more and more dependent upon extremely long lines of communication. That is just one aspect of it. I believe it is important that the Senate and the Parliament as a whole should examine what we are getting for our money. I have not been able to get any reasonably sensible answers on this. I give notice to the Department of Defence that at the next Estimates Committee hearing I will be expecting answers to these questions. At this stage it is not the case, but if we go about things sensibly we can develop high technology industries and achieve a real measure of self-reliance, rather than just being a little piece of a jigsaw in a large world alliance. As a parliamentarian I owe it to the people of Australia to make certain that their money which is being spent on defence-it is a large proportion of the Budget-is being spent sensibly. If we look only to purchases from overseas, we will create major unemployment and balance of trade problems. These are all avoidable things. If we intend to have a strong and independent Australia which can stand on its own against any threat-I agree with Senator Sir John Carrick in terms of the pernicious doctrine of perceived threat-we must be prepared to develop an indigenous industry which is able to service the surveillance technology and small arms support technology within Australia. The evidence that was given to me at the Estimates Committee-what little I managed to glean-suggests that we will have to put a lot more effort into the area of purchasing of defence equipment. There seems to be an enormous reluctance to choose Australian products. I ask the Minister what is the Government's policy in this area of choosing Australian products when Australian products can be chosen. It is the policy of the Australian Democrats to have affirmative action for Australian industry. That policy should be espoused also by the Government, unless it is working for overseas multinational companies, which is one possible theory. I refer to the various reports of the Auditor-General and their follow-up by the Joint Committee of Public Accounts in its 243rd report, entitled `Review of Defence Project Management'. The report refers to the fact that time after time there have been mentions of major cost overruns, major delays in getting programs ironed out and major problems with management information systems. I know that it is a very demanding business to defend this country. I wonder, considering the answers I have had and the administrative bungles, whether we are in good hands in this area, but I have no alternative but to trust it. I believe that the information on our requirements should be available in a timely fashion. For us to be totally in control of our purchasing policy local industry must be told very early what is expected by the Department of Defence. We should not have to depend completely on going overseas, looking at what is available and writing a tender that corresponds exactly with the goodies that we have been shown by some foreign arms dealers. Costly decisions should not be made at the last minute. We are probably overspecifying a number of the weapons systems that we are getting, according to the Auditor-General's report. How is a parliamentary layman such as I able to judge that? What types of procedures does the Government have for looking independently into the morass of defence purchasing to be able to give some understandable report to us? I interviewed officials of the Auditor-General at a briefing the other day and they said that a lot of the auditing in Defence is done internally. When I have tried to ask questions about it, I have found that basically the auditing on each of the systems is done overall. How much time is that system up and available and what are we getting for the money? I have asked questions, to which I have not had answers, on the physical stocks of spare parts. Something over $1 billion for the year was spent on sundry equipment and spares over the whole of the armed forces. Admittedly that was broken down into a few individual projects, but it was not broken down in terms of the levels of spares and the efficiency and effectiveness of these areas. I turn to the offsets program, which is supposedly a means by which we buy foreign equipment and get those companies to produce things here in return. The offsets have to be arranged and monitored properly. I asked questions about that and the answer I was given was that no records were kept before 1980. There seems to have been a peak of offsets arrangements in 1982 at $572m. We are still holding unfulfilled offsets of approximately that amount, despite the fact that only very small offset commitments have been put in the meantime. Our record in this area is pathetic. There is a major adverse report from the Auditor-General on offsets generally. The Government had to tighten its administration of offsets by setting up a central offsets recording section. That was set up last year, and I applaud the Government for doing that, but we have not seen any results from it. Can the Minister tell me how effective that has been? The information that was provided to me by the Minister yesterday shows that there is a current outstanding offsets obligation of approximately $600m. Consideration interrupted. Sitting suspended from 12.45 to 2 p.m. Senator BUTTON(Victoria-Leader of the Government in the Senate) —by leave-Mr President, I inform the Senate that Senator Gietzelt will be absent from the chamber for Question Time today. Any questions which would normally be directed to Senator Gietzelt in relation to his portfolio or to those he represents in this chamber should be directed to Senator Grimes. Senator CHANEY —My question is addressed to the Leader of the Government in the Senate. Will the Government be making any changes to its fringe benefits tax proposals as they apply to cars, or in any other way? Senator BUTTON —I think it is common knowledge amongst those literate senators who read the newspapers that there have been discussions about the fringe benefits tax on motor cars, and certain propositions, if I can put it in that terminology, have been advanced. The Government has not yet considered those propositions as a Government, but will do so very shortly. I personally assure the Senate that if such propositions are put, I will oppose them, because that seems to be the best way of getting them accepted. Senator McINTOSH —I direct my question to the Minister for Education. What is the Commonwealth's view on Press reports which indicate that the Western Australian Government intends to legislate to change the Western Australian Institute of Technology into a third university in Western Australia and rename it the Curtin University of Technology? In particular, would the proposed change of status entitle WAIT to a higher level of Commonwealth funding? Senator RYAN —I have noticed Press reports and indeed have received other information from Western Australia that the Western Australian Government intends to change the name of WAIT, by legislation, to the Curtin University of Technology. Its motives for taking this sort of unilateral action can only be guessed at. However, as far as the Commonwealth is concerned, there has been no agreement to this course of action. The Commonwealth has a responsibility for funding higher education institutions, and it has the responsibility to take a national perspective in relation to the balance between the two higher education sectors and in the provision of higher education through all States and Territories. There has been no formal submission by the Western Australian Government seeking the Commonwealth's agreement to this course of action, and even if such a formal submission were to be forthcoming I very much doubt that the Commonwealth, as far as the national perspective is concerned, would afford such a proposal a very high priority. The funding of WAIT under any name will be at the college of advanced education level. It is simply not possible for a State government unilaterally to decide to change the funding of an institution from the CAE level to the higher level afforded to universities because of their research functions. I do not think that the course of action that the Western Australian Government has decided upon is sensible. I note Press reports that other institutions in Western Australia have also expressed their concern about it, and the Australian Vice-Chancellors Committee equally has expressed concern about unilateral action of this kind. I hope that the Western Australian Government will reconsider its course of action. I should say, for the benefit of those honourable senators who are not familiar with the Western Australian Institute of Technology, that the remarks I am making in no way detract from my recognition that it is an outstanding institution. It is an institute of technology of first class standing; its reputation is very high, its teaching standards are very high and it has engaged in some interesting initiatives, including the establishing of an external studies course, for a Bachelor of Business Administration, in Singapore. All of these things are to its credit, and it is a very creditable institution. But the question of the relationship between the sectors is an important one. A balance must be maintained and it is not acceptable to the Commonwealth that any State should unilaterally seek to change that balance without the agreement of the Commonwealth. Senator Dame MARGARET GUILFOYLE — I direct a question to the Leader of the Government in the Senate. I am sorry to hear he is so discouraged about his cars. I refer the Minister to his comment on the Sunday program on 18 May when he said the prices and incomes accord would be on the agenda of the economic conference involving Federal and State governments, the unions and employer organisations. Following yesterday's Government-Australian Council of Trade Unions meeting at which Mr Willis talked about the possibility of some adjustment to wages policy, will the Government be putting any submission to the meeting aimed at achieving a more flexible accord? Is it still the Government's intention, as stated by Mr Willis last Wednesday, to seek a reopening of the national wage case if anything substantive comes out of the meeting? Finally, will the Minister advise what other matters the Cabinet has decided should be on the agenda for the meeting? Senator BUTTON —Senator Dame Margaret Guilfoyle is right; I did say on the Sunday program that the prices and incomes accord would inevitably be on the agenda for that meeting, and aspects of the prices and incomes accord will be. It goes without saying that if we are participating in a committee which is an advisory committee on prices and incomes, it is likely that prices and incomes will be discussed, and they are the substance of the accord so inevitably that is the case. I think, if I got the honourable senator's question right, that she then asked whether the Government will be seeking more flexibility in the accord. I remind the honourable senator that there is a degree of flexibility about macroeconomic effects on the accord already in that there is a provision for those matters to be discussed in the event of a significant change in the macroeconomic environment, and whether or not a more flexible accord for the longer term will be on the agenda has not been determined at this stage. Insofar as seeking a reopening of the national wage case is concerned, all I can say is I think that is unlikely because any policy responses to the current trade situation will, of necessity, be over a period. The agenda has not been finalised yet so I cannot answer these questions with great specificity, as the Prime Minister sometimes says. If Senator Dame Margaret Guilfoyle wants to recycle the question later in the week, I might be in a better position to answer in more detail. Senator JONES —Has the attention of the Minister for Finance been drawn to a set of researched figures drawn from the Australian Bureau of Statistics and other reliable sources which show that at the beginning of this month in 18 key areas of the economy Queensland had the worst results of any State in six, the second worst results in six and was below the Australian average in 14? To what extent is this appalling economic performance of the Queensland Government, and in particular the Premier and Treasurer Sir Johannes Bjelke-Petersen, holding back the rest of Australia? Senator WALSH —Mr President-- Senator Walters —Why don't you talk about your own deficit? Senator WALSH —About what? I am aware of the facts to which Senator Jones has drawn attention because a newsletter circulated in Queensland by Senator Jones fell on my desk the other day. It contains some very interesting information about the Queensland economy and expresses his distress that a State with the great potential that Queensland has is, because of the way in which it is being misgoverned, dragging the rest of the country down. It shows, among other things, that the unemployment rate in Queensland for the most recent available month was 9.2 per cent, which is equal to the highest of any State and a great deal above the national average of 8 per cent. Queensland also has the lowest average weekly male earnings figure of $384, which is 7 per cent below the Australian average of $413. In spite of that advantage in the employment market situation-the employment potential that the Opposition is always talking about, that if wages were lower employment opportunities would be much higher-Queensland still has equal to the highest unemployment rate of any State and an unemployment rate significantly higher than the national average. It also has the highest rate of industrial disputes, which is a comment on the success of the confrontationist tactics pursued stubbornly by the Queensland Government, and the number of working days lost per thousand employees was almost double the national average. It also has the highest growth rate in the number of bankruptcies for 1984-85, the most recent year for which figures are available. There were 15.7 per cent more bankruptcies in Queensland in the last financial year, while the Australia-wide figure fell by almost 4 per cent. The figures for fixed capital expenditure are also very poor compared to the national figures most recently available for a 12 months period, and the number of new residential buildings commenced in the December quarter of 1985 dropped by 9 per cent in Queensland. Finally, Senator Jones asked me whether it is possible to state the degree to which the dismal economic performance in Queensland is holding the rest of Australia back. I think it is an impossible exercise to do that in any precise way but the figures speak for themselves. There can be absolutely no doubt that the dismal performance of the Queensland economy has retarded quite significantly the economic progress which the country as a whole would otherwise have made. Senator HAINES —Is the Minister for Community Services aware of the increasing number of homeless young people in all States in Australia who are forced to sleep each night in abandoned cars, bus shelters and other less than salubrious quarters? Is the Minister aware that there are a number of migrant hostels maintained by the Government in various States in Australia which are left unused for much of the year? Has the Government considered using these vacant premises to house homeless young people? If it has not, will it now consider the matter or, alternatively, will the Minister say why such accommodation could not be put to what appears to be a very good use of providing destitute young people with a roof over their heads? Senator GRIMES —I am aware, as is anyone in the Senate who served on the Senate Standing Committee on Social Welfare which looked at this problem, that there are too many homeless young people in Australia who live in cars and other unsatisfactory accommodation of that type. I do not know that Senator Haines can back up her statement-I do not know that anyone can back up the statement that she makes-that there are increasing numbers of homeless youth. It is an assertion that is often made and it is an assertion that I cannot deny or affirm. The use of migrant hostels and other buildings of this type has been considered by government authorities and, in fact, was considered by the Senate Standing Committee on Social Welfare. In general there are buildings owned by particularly State governments which may frequently be appropriate for this purpose. In fact, in New South Wales the State government I believe at one stage made houses available, particularly houses that it was holding for future highway or freeway development, for homeless young people. Buildings also were used that had previously been used for young people in charge. The problem with migrant hostels by and large is that they are in inappropriate places for young people. They are frequently out in the suburbs where young people by choice simply do not want to be. In making them satisfactory for accommodation by this group of young people there is a great danger of their ending up institutional forms of accommodation. Of necessity there would have to be much more discipline and control than these young people are frequently willing to accept, but I certainly will take the matter up with the Minister for Immigration and Ethnic Affairs, who I think is still in charge of those hostel buildings that are still around. The important thing is that we provide two types of accommodation. The first type is the refuge or shelter-type short term accommodation. I think it is the judgment of most people that there is probably enough of that type of accommodation around. What is really needed is medium-term and long term accommodation which is affordable and accessible and which in the first place provides young people with assistance to develop their living skills so that they can cope with this sort of independent type accommodation. Some of the State authorities, particularly those in South Australia and Victoria, are assisting in this regard. I think all State authorities should assist in this regard so that we can get these people into more permanent and more normal type accommodation than would be provided in migrant hostels or other institutional type accommodation. Senator COOK —Has the Minister for Finance seen an article in the West Australian newspaper on 16 May 1986 headlined `Policeman: MP incited group'? If he has, is it true that the article reports the conviction of a bankrupt farmer, Mr James Butterfield, for remaining on the premises of the Merlin Hotel after being warned to leave, and for resisting arrest during the course of a demonstration? Will the Minister consider an act of grace payment to Mr Butterfield to cover the fine and court costs, given that he was apparently incited to break the law by a Federal member of parliament? Should the fate of Mr Butterfield give pause for thought to people who might consider taking the advice of Mr Hassell and Sir Joh Bjelke-Petersen to also break the law? Senator WALSH —Deplorable though the recent incitement by Mr Hassell and the Premier of Queensland to law breaking may be, I do not think one could put a retrospective application to it, but it is certainly correct, as Senator Cook's question indicated, that the police evidence given at the hearing of the charges against Mr Butterfield, as reported in the West Australian, was that the Federal Opposition spokesman on small business, Mr Wilson Tuckey, had been inciting farmers during a demonstration at the Merlin Hotel. That evidence was apparently given by Sergeant Glen Miller, who was reported as saying that Tuckey was the loudest and most vocal of the group. Having been present for some of that incident, I can confirm that Tuckey was the loudest and most vocal. The second loudest and most vocal was a Mr McNee, who at that time was the Liberal Party of Australia Member of the Legislative Assembly for the seat of Mount Marshall, who promptly lost his seat about two weeks after that event. I think it is regrettable that the ratbag right example set by Mr Tuckey on that occasion has subsequently been endorsed by his State leader, Mr Hassell, and also by the Premier of Queensland. Senator Chaney —Mr President, a point of order: I have seen a report since yesterday's Question Time in which Mr Hassell made it quite clear that he is not advocating breaches of the law. Since the Standing Orders protect members of State parliaments from allegations which are unparliamentary, I think it is appropriate that I should take a point of order at this stage because it is not apparently accurate that Mr Hassell has advocated any breach of the law; rather, he has made it quite clear that whilst he strongly opposes the tax, he is not in favour of the law being broken should the tax be put in place. Therefore, I think that the Minister should be cautioned on this point and should not make allegations of that nature against a member of the Western Australian Parliament. Senator Walsh —On the point of order, Mr President: Senator Chaney is correct in saying that that was reported in yesterday's West Australian; but at the end of last week, and specifically last Friday, Mr Hassell was advocating defiance of the law. He has subsequently changed his mind. I am glad to see that, although whether it is because of moral conviction or persuasion or political expediency is another matter. The PRESIDENT —I will rule on the point of order. Standing order 418 refers to offensive remarks rather than inaccurate remarks. Bearing in mind what the Minister has said, I rule against the point of order, but I ask the Minister in answering to bear in mind what I have said on standing order 418. Senator WALSH —Certainly, Mr President. Senator Cook asked me whether I would consider making an act of grace payment to Mr Butterfield because his offensive behaviour was incited by the member for O'Connor. There are no rigid rules governing the granting of act of grace payments. There are, however, guidelines, and in my judgment to use the act of grace provisions for that purpose would fall well outside the guidelines which I have followed since I have been in this office, and which I think both my predecessors followed in a similar way. I think that the decent thing to do in the circumstances, given that Mr Tuckey incited the behaviour which cost this unfortunate Mr Butterfield a $180 fine, would be for Mr Tuckey to pay the $180 out of his own pocket. I also hope that the West Australian Liberal Party might note this incident and its implications. I believe that if the Liberal Party re-endorses Mr Tuckey it will lose the seat of O'Connor because Labor preferences will ensure that he is so removed, even though in following that course of action long-standing Labor Party precedents in directing preferences towards Liberals in Federal elections would be broken. That is a custom which I have supported vehemently over many years. The long-standing policy of the West Australian Labor Party, a policy of which I have been a firm supporter, I would support changing for this particular reason. I hope that that sort of warning might assist those in the Liberal Party who are currently engaged in the power struggle to oust the present leadership-the Hassells, the Tuckeys and all the rest of them-and put someone decent like Senator Chaney in their place. Senator WALTERS —My question is addressed to the Leader of the Government in the Senate. I refer to the seven Ministers-Senator Gietzelt, Mr Howe, Dr Blewett, Mr Kerin, Mr Uren, Mr West and Senator Grimes-who, according to a leaked document reported in the Australian, wrote to Mr Hawke refusing to co-operate with the Prime Minister's demand to identify areas in their departments that could have cuts. We then have the Minister himself, Senator Button, distancing himself from the fringe benefits tax-- The PRESIDENT —Order! Will the honourable senator ask her question? Senator WALTERS —I am just coming to it. The PRESIDENT —I hope that she will do so at a point early in time, or I will have to ask her to sit down. Senator Chaney —I raise a point of order, Mr President. I cannot hear the question because of the noise on the other side of the chamber. I ask you also to give Senator Walters a chance to ask her question by calling Government senators to order. The PRESIDENT —Order! I ask all honourable senators to remain silent while they await Senator Walters's question. Senator WALTERS —As I say, Senator Button has distanced himself from the fringe benefits tax-- The PRESIDENT —Order! Will the honourable senator ask her question? Senator WALTERS —Seeing that the Cabinet is so divided over Government policy and, indeed, there is such a barney going on-- The PRESIDENT —Order! I ask Senator Walters to ask her question, or I will call the next question. Senator WALTERS —Will the Minister please inform the Australian public which side in Cabinet is likely to win, and what form of taxes the Australian public can expect in just four weeks' time? Senator BUTTON —I do not know whether Senator Walters has been overseas for a lengthy trip and has come back and culled through her old newspaper clippings in dredging up this question, which was asked by other senators in different forms some months ago. The so-called letter from the seven Ministers might have roused a flutter in Senator Walters's breast, but it did not rouse one in many other breasts. It is the habit or custom, whoever is in power, at Budget time for Ministers to seek to protect the various interests they seek to represent in the Budget process. I wrote a letter to the Prime Minister about similar matters, and I am sure that other Ministers did. As usual, my letter did not get as much publicity as some of the others. I do not think anybody took any notice of my letter, and I am very aggrieved. I am sure that a lot of Ministers wrote letters of that kind, and I would not attach any great significance to that. Senator Walters asks which side is winning in some mythical confrontation she sees taking place in the Cabinet room. There is no confrontation, either mythical or real, taking place in the Cabinet room. There are a number of difficult issues which have to be grappled with. They will be grappled with. When the Cabinet has determined its position on these matters, we will make an appropriate announcement, and Senator Walters will be able to ask a question about it, if she can. But she may well be speechless. Senator TATE —My question is directed to the Minister for Industry, Technology and Commerce. Is the Government aware of a proposal by my good friend and colleague Mr Ralph Jacobi, the member for Hawker in another place, regarding the establishment of a joint parliamentary committee on business regulation, whereby the Parliament could put under scrutiny the relationship between government regulation and the health of the trading and commercial ventures and enterprises that are so essential to the well-being of Australia? Does the Government see merit in such a committee being established and, if so, will it take such steps as are necessary to ensure that this long term project by the honourable member for Hawker comes to fruition? Senator BUTTON —I am glad that he is Senator Tate's good friend. I have never been sure about that. Let me say that Mr Jacobi has been persisting for a long time with the importance of establishing a joint parliamentary committee on business regulation. The Government welcomes that approach. About a year ago the Government, in response to representations, specifically from the Business Council of Australia but from other organisations as well, set up in my Department what is known as the Business Regulation Review Unit, which is dedicated and devoted to trying to reduce the level of business regulation and more importantly-- Senator Hill —It is not making much progress. Senator BUTTON —Let me finish the answer and then Senator Hill can have a go. More particularly, the Unit is dedicated and devoted to trying to reduce the lack of uniformity between State and Federal regulations, which is probably the greatest burden the Commonwealth has in respect of regulations generally. That Business Regulation Review Unit, which is a small group, is not only monitoring existing regulations or regulations coming up in the current context but also seeking the removal of unnecessary regulations which have been put in place in the past. It has been supplemented in its work by a voluntary arrangement with a number of business organisations. There are already business representatives on secondment working in the Business Regulation Review Unit and that will, I believe, in time produce very satisfactory results. Senator Hill interjected that it has not done much so far. I think he ought to ask me a question about that when I can give him an answer which is a long list of successes or partial successes. It is a slow process in a federal system. The initiative sponsored by Mr Jacobi for the setting up of a joint parliamentary committee on business regulation is one that we regard as totally complementary to the action which the Government has already taken. The important thing is to establish an environment for change in relation to regulation and over-regulation. For example, if the Business Regulation Review Unit were successful in creating an environment for change within the Public Service and within the community and if there were a joint parliamentary committee which seriously got down to establishing an environment for change amongst some of the thickheads who have been interjecting on the other side of the chamber, that would be an immense improvement in attitude and would be very beneficial to this country. We welcome that initiative. Senator PUPLICK —The Minister for Industry, Technology and Commerce will recall that on 18 February I asked him: When may the Senate expect to see the legislation to give formal authorisation to the Government's decision to allow the 150 per cent tax deduction for private sector investment in research and development . . . He will also recall that he replied: . . . the answer to the first part of the question is 8 May. Why was the legislation not presented on 8 May as the Minister indicated? Was his answer simply in error or is there some other reason? When will the legislation be presented? Will it be before 30 May or will it be later, in which case it will not be possible for it to be passed until the Budget session? If the legislation has to wait until August, or later, what is the position for tax deductions in the current financial year for people who have taken the Government at its word and are expecting a tax concession which was, after all, announced by this Government on 29 May last year? Who is specifically responsible for this incompetence? Senator BUTTON —I do not recall saying that on 18 February, for which I say thank God after listening to the rest of the honourable senator's question. I do not recall actually saying that, but I am confident that I did say something like that at about that time. The honourable senator asked whether my answer was misleading or in error. The answer is clearly that it was in error. I am hopeful that the legislation will be introduced in the House of Representatives this week. A number of delays have occurred and they have mainly been in drafting and because of the enormous task which the parliamentary draftsmen have had in relation to tax legislation generally. There were also a number of technically difficult things in relation to definitional problems and so on in this particular piece of legislation. I am hopeful, as I said, that it will be introduced this week in the House of Representatives. Senator Puplick asked what contingency arrangements are in place in the event of the legislation not being passed by both Houses of the Parliament by 30 May or whenever-the important point is before 1 July. I have been conscious of this problem. We are quite satisfied that appropriate arrangements can be made in respect of those companies to which Senator Puplick referred and which acted in good faith on the basis of the introduction of the tax concession from 1 July 1985. Those mechanisms will be implemented if that becomes necessary. I am very conscious of the delay, but I assure the honourable senator that the legislation is going ahead and that it will apply from 1 July 1985 in respect of all its effects. Senator MAGUIRE —Has the attention of the Minister representing the Treasurer been drawn to recent Department of Social Security information on the number of unemployment beneficiaries in the various States of Australia? Has the Minister also noted the release of a report by the Queensland Liberal leader, Sir William Knox, which indicates that the Queensland economy is in a very bad way? Does this confirm that there is now a bipartisan Liberal and Labor position on the parlous economic condition of the Queensland economy? Senator WALSH —In regard to the latter part of the question, I do not think one could say that there is a bipartisan view of the condition of the Queensland economy in the sense that that term is normally used, because it is normally used-at least as I understand it-to describe the attitude of the Labor side of politics and the non-Labor side of politics. Although there is clearly agreement between the Liberal Party and the Labor Party in Queensland on the appalling state of the Queensland economy, so far as I know the National Party has not yet acknowledged that and lives in a fool's paradise and deludes itself into believing that reality is something other than what it really is. That can be ascribed to the particular, peculiar and unique state of Queensland politics in that the Liberal Party and the National Party are not in government or in opposition together-the National Party Government is alone, I suspect to the greater disadvantage of Queensland than if there were a National-Liberal Party coalition. That report on the Queensland economy from the Liberal Party which was published by Sir William Knox, its parliamentary leader, confirms the other report from the Department of Social Security to which Senator Maguire's question refers and also the economic statistics which have been the subject of a number of questions in the Senate from, in particular, Senator Jones and Senator Maguire. I will give some of the details of those statistics. In Queensland in March 110,000 people were receiving unemployment benefit, a figure slightly higher than the figure in Victoria, yet Victoria's labour force is two-thirds larger than that of Queensland. So Victoria has two-thirds as many people in the labour force but has a slightly lower number of people on unemployment benefit. Queensland, the third largest State in terms of population, is the second largest in terms of unemployment. It is also interesting to note that Australian Bureau of Statistics data reveals that in only three months out of the 31 months for which data has been published since the last Queensland election, Queensland has had an unemployment rate above the national average. For example, when Sir Johannes Bjelke-Petersen announced the 1983 State election only slightly under 15 per cent of Australia's jobless were in Queensland; now, more than 18 per cent of Australia's jobless are in that State. It has just under 16 per cent of the labour force. It was customary for the Queensland Government to blame southern dole bludgers, to use its term, for Queensland's unemployment problem, but, like most of the claims that come from that State Government and from the Premier in particular, it is incompatible with the facts. The latest published information indicates that Queensland has recorded a net interstate population loss in the 20 to 34 age group, which is the most active of all labour market age groups. The unpalatable fact is that more than 5,000 people in that age group left Queensland for other States during 1984-85 because they realised, far from being dole bludgers, that the opportunities for getting a job were better almost anywhere else in Australia than they were in Queensland, and that the opportunities for getting jobs were certainly better in any of the other mainland States. They are voting with their feet and are showing what they think of the Queensland Government's economic management. Senator SHEIL —I direct a question to the Minister for Education concerning the answers to questions I have been asking about the Chis- holm Institute of Technology in Melbourne and its $2m expenditure on the purchasing of a shopping centre. In answer to my question on 11 April the Minister stated: The Government encourages institutions to undertake activities which will enhance their flexibility in meeting the needs of their students. Activities such as that undertaken by the Chisholm Institute deserve the support of the Government and I have no intention of reducing Commonwealth funding to the institution. In her news release on 1 May 1985, the Minister stated: The new approach recognises that all schools have capital needs and makes an appropriate allowance for capital spending which ensures a reasonable balance between capital and recurrent spending and reduces the possibility of schools directing income to capital projects in ways which affect their entitlement to recurrent funding. I ask the Minister: If she reclassifies schools to reduce their current grants because of their spending in capital projects on the one hand, why is she maintaining total funding for the Chisholm Institute on the other hand? Senator RYAN —I will have to give a very long answer indeed to explain to Senator Sheil that the system and basis for Commonwealth support for higher education institutions is quite different from the system and basis for Commonwealth support that flows into government and non-government schools. I think Senator Sheil is under some misunderstanding with regard to the way in which the recurrent needs of non-government schools are worked out. Certainly an allowance is make in the formula for capital expenditure, which is expenditure on essential educational facilities. No school is disadvantaged in any way by raising funds, either from fees or any other form of fund raising, to provide for essential capital facilities. So really no comparison can be drawn between a school raising funds, through fees or some other means, for essential capital facilities which does not affect its recurrent funding category and the situation where an autonomous higher education institution, which by the way operates under State legislation, takes steps to ensure that it will have income available to it in addition to the recurrent and capital funding it has available to it from the Federal Government. Recurrent funding for higher education institutions is in terms of places. Institutions are funded for a certain number of places and at a certain rate depending on whether the places are in less expensive courses, such as legal studies and business studies, or more expensive courses such as engineering and high technology courses. I do not think there is any point to be made by drawing any comparison with or contrast between the way in which higher education institutions are funded by the Commonwealth and the freedom that those institutions have to pursue other sources of income and schools funding, which is on a very comprehensive formula and certainly takes into account the capital needs of schools. It does not penalise schools in any way for raising funds to provide those capital facilities. Senator BLACK —Has the Minister representing the Minister for Primary Industry seen the Opposition's rural policy document which was released last week? If so, will he give the Senate an indication of the likely cost of the proposals contained therein? Senator WALSH —I have not actually seen the document, but I have a summary of it, which was leaked last week by either the Liberal Party mole or one of the Liberal Party moles. Senator Ryan —The same one who leaked the education policy. Senator WALSH —I am not sure whether it was the same mole who leaked the education policy because he has not been leaking-- Senator MacGibbon —Mr President, I raise a point of order. The Minister is attempting to answer a hypothetical question insofar as the document has not been released. The PRESIDENT —Order! There is no point of order. Senator WALSH —As always, Mr President, your ruling is correct although Senator MacGibbon is equally correct in drawing attention to the fact that the document has not been officially released. However, it has been unofficially released by one of the Liberal Party front bench back stabbers who, seething with discontent as are a number of other members of the front bench, wants to get rid of the present Leader of the Opposition. I am not sure whether they want to resurrect the former leader but they certainly want to get rid of the present one. That is the reason they have been leaking documents one by one as they come out. This has created a situation so serious that the Liberal Party felt obliged to dump six of the documents in one hit last week. The PRESIDENT —Order! Will the Minister come back to Senator Black's question? Senator WALSH —Certainly. I apologise, Mr President; I was distracted by the spurious point of order raised by Senator MacGibbon. It is quite clear that the document is extravagant and of course absolutely incompatible with the repeated calls from various members of the Opposition, particularly Senator Baume and Senator Messner, to reduce government spending. The document promises to increase expenditure in the agricultural area alone by in excess of $500m per annum. Senator Elstob —How much? Senator WALSH —It promises an increase in expenditure of $500m just in the agricultural sector. For example, the document comprises a promise to rebate all the fuel excise paid by farmers. No doubt that would solve any income problem which a farmer living close to a major town would have because he would be able to buy petrol for $14 a drum less than the market price for drum fuel and about $20 a drum less than the market price for fuel out of the bowser and then flog it off to everybody in the nearby town and split the $20. It would certainly solve those particular farmers' income problems but it would, of course, exacerbate the revenue problems of whatever government happened to be in power by something a good deal more than the direct and assessable cost of rebating that excise to farmers. That means rebating to farmers excise on petrol. Anybody who knows anything about agriculture-I had more than 20 years direct experience in it-knows that the amount of petrol used on farms in agricultural production is negligible. So this is a straight out proposition to squander about $137m by giving a rebate for which there can be no logical or economic justification; it would also set up a huge black market to boot. Even in the heyday of McEwenism in the 1960s-when McEwenism was running rampant-the coalition governments of that period would not cop that rort. But it is being promised by this most irrespon- sible leader that the Liberal Party has ever had. Among other promises were full fuel freight equalisation, extension of the rural adjustment scheme, removal of the sales tax on wine, removal of the excise on brandy, the abolition of export inspection charges, tax benefits on income equalisation deposits, first year write-off for expenditure on water conservation and the removal of sales tax on oils and lubricants. I think I could do no better than to summarise this as a wish list of political promises which was the sort of term that the Leader of the Opposition used a couple of weeks ago in his speech at the National Press Club. He said that he was not there to deliver a wish list of political promises. That is precisely what he is doing in this policy area as in so many other areas. It would blow out the deficit-- Senator Chaney —Mr President, I raise a point of order. I have not sought to have this question declared out of order because the Minister is making a public comment on matters which relate to public policy for which he is responsible. He is continually misrepresenting the status of the paper which it is known-it has been published-has not been approved as a policy document. It has been drafted as a policy draft for discussion. I think that the Minister is continually misrepresenting the status of the document when he is answering the question. The PRESIDENT —There is no point of order. I ask the Minister, in completing his answer, to bear in mind that he was asked to comment on the cost of the items. Senator WALSH —The total cost of the items is above $500m. If one were to throw in the promise to abolish the assets test that amount becomes almost $700m. Incidentally, let me correct a slight error I made a while ago: `a shopping list of political goodies' was the phrase that Mr Howard used. He said that that is exactly what he would not deliver but that is what he has done. In view of Senator Chaney's repudiation of that document as a policy document, I invite Senator Chaney, Mr Sinclair, Mr Hunt, Mr Howard or any other Opposition person in a senior position, who cares to clarify this point for us, to state which of the specific promises I have read out the Opposition will repudiate and which it will stick by. Senator HILL —My question is directed to the Minister representing the Minister for Employment and Industrial Relations. I refer to the refusal of mine workers at Broken Hill to comply with an interim award handed down by Justice Fisher. Is the Government aware of the effect this industrial dispute will have not only on Broken Hill but also on Broken Hill Associated Smelters which employs some 1,480 workers in Port Pirie and which, of course, is reliant on ore from Broken Hill? What action will the Government take to ensure compliance with the award noting that it has condemned businessmen for advocating breaches of the law in recent days and that the Government subscribes to our highly centralised industrial relations system and the strict application of our rigid award system? Senator WALSH —As I understand it, the earlier part of Senator Hill's question is quite correct, that is, that if the mines at Broken Hill were to close there would be serious employment ramifications in South Australia as well as in Broken Hill. But I am not sure that the unions are actually breaking the law. I do not claim to be an expert in this area but, as I understand it, they may be behaving recklessly or foolishly but are not actually breaking the law. So that part of the question, if I am correct, is not applicable. As to the more general question, I have no briefing on this so I can do nothing better than refer it to Mr Willis to see what comments he has to make. Senator SIBRAA —My question is directed to the Minister representing the Minister for Foreign Affairs. I refer to South Africa's raids on three of its neighbours, Botswana, Zambia and Zimbabwe, all members of the Commonwealth. What is the Government's view of the Eminent Persons Group process? What action will the Government take to indicate to South Africa Australia's attitude towards these raids? Senator GARETH EVANS —The Government has condemned the raids in the strongest possible terms. The Cabinet will consider the implications of the raids and of other developments in South Africa at an early date. Mr Fraser has been in touch with the Prime Minister to discuss the work of the Eminent Persons Group. The two of them have agreed that the South African Government's action has seriously damaged the prospects of the EPG but that it would be premature for the group to abandon its work at this stage. The only way that any hope for negotiations can be sustained is for the South African Government to take decisive, credible action in indicating to South African blacks and to world opinion that it is sincerely prepared to dismantle the apartheid system. There is very little time left to take such action. In the event that the EPG mission fails, tougher concerted international action will be necessary against South Africa. As it has to date, the Government will play an active role in pursuing that objective. Senator ARCHER —I direct my question to the Minister representing the Minister for Science. Can the Minister confirm that there has been no response to the report of the industrial property advisory committee inquiry into the Australian Patent, Trade Marks and Designs Office, despite its having been with the Government for almost two years? Can the Minister confirm that the present delay in the processing of patent applications is 33 months, and two years for trade-marks? Can the Minister confirm that the cost of registering a patent in Australia is now almost the highest in the world? Does the Minister agree that the Government is pursuing a contradictory approach to industry policy when on the one hand it provides incentives for research and development and then places on industry the dual burden of high costs and enormous delays when it comes to register new products and processes? Senator BUTTON —I was not specifically aware of the delay to which Senator Archer refers. I will refer his question to the Minister for Science and ask for some explanation for the delay. If what the honourable senator says is correct, I agree with him if the implication in his question is that there seems to be an inconsistency between the practice in the Patent, Trade Marks and Designs Office and the Government's general initiatives in this area. I recollect a conversation quite recently with an officer of the Patent Office in which, as I recall it, he told me that delays were of that order but that that was not abnormal in the history of the Patent Office. But that may be wrong. If I may say so, the question warrants a detailed answer from the Minister and I will seek that and give it to Senator Archer. Senator BOLKUS —My question is to the Minister representing the Minister for Foreign Affairs. Is the Minister aware of allegations that the Government of the Union of Soviet Socialist Republics has a policy of not accepting medicines posted from the West, and that attempts by Australian-Ukrainians to mail medicines to their Soviet counterparts in the wake of the Chernobyl nuclear disaster have proven unsuccessful? Can the Minister indicate whether the Australian Government knows the reason for any such policy and whether any action can be taken by our Government to assist those suffering in the affected areas? Senator GARETH EVANS —The Government is aware of difficulties that have been experienced by members of the Australian-Ukrainian community in attempting to send medicines to friends and relatives in the Union of Soviet Socialist Republics. It is our understanding that, as a result of regulations introduced some years ago by the Soviet authorities, all imports by mail of medical supplies into the USSR are banned. The Australian Government is investigating the implications that this ban may have for those affected by the Chernobyl accident and will certainly keep in touch with Ukrainian community organisations that have expressed concern. Senator CHANEY —My question is directed to the Minister for Industry, Technology and Commerce and follows his light-hearted suggestion that he would oppose changes to the fringe benefits tax to try to achieve a better success rate. I ask: Is it a fact that the Ford Motor Co. of Australia Ltd, General Motors-Holden's Ltd and Mitsubishi Motors Australia Ltd have all made representations on the basis that, if the tax proceeds, there will be a significant downturn in vehicle sales for the remainder of 1986 which will lead to a shedding of a significant number of employees. Is it also a fact that the automobile component manufacturers, the retail motor traders and affected unions have made similar representations concerning their industries? Can the Minister tell the Senate what number of jobs he believes could be lost if the tax on the motor vehicle industry is implemented in the way proposed? Senator BUTTON —I have answered this question, wheeled forward in different guises, about 25 times this year, and I will have another go at it. I have no doubt that all of those people have made representations to Government, to the Opposition, to the Australian Democrats and to everybody else that they can bump into in the pub or anywhere else, about the effects of the fringe benefits tax. But, as I have said on numerous occasions, some of the prognoses and predictions by sections of the automotive industry about the effects of the fringe benefits tax are quite bizarre. I refer particularly to the sorts of predictions that have been made from time to time by the Australian Automotive Dealers Association and which were made prior to the South Australian election, I recall. I have said on a number of occasions in this place that there will be a downturn in vehicle industry production in 1986. That is not surprising because 1985 was a record year and 1984 was another record year-basically a response to good economic management. There were record years for the automotive industry in 1984 and 1985 and there will inevitably be a downturn in 1986. That will be exacerbated by a number of things-a pull forward of orders of vehicles into the last quarter of 1985 as a result of the introduction of unleaded petrol from 1 January 1986. Senator Chaney —We all know this. I asked you specifically what is the effect of the tax. Senator BUTTON —High interest rates in the first quarter of 1986 will also have a detrimental effect on the motor vehicle market, as will in some ways the effect of the devaluation. Senator Chaney interjects and says that he knows all this and that what he wants to know is what the effect of the tax will be. As I have said on a number of occasions, I cannot quantify the effects of the tax. I have said on many occasions here-I do not change what I say-that I believe the tax, in the context of 1986 and the other factors that I have mentioned, will have a detrimental effect on the vehicle industry if the tax is not changed and on employment in the vehicle industry, but nothing like to the extent that has been suggested in some of the utterances from the various bodies to which Senator Chaney referred. Senator CHANEY —I ask a supplementary question. The answer really illustrates why the matter has been raised with the Minister more than once. I did not ask him whether he accepted the predictions of the various bodies that he mentioned. I did not ask him about the effects of other factors on the car market. I specifically asked the Minister to tell the Senate what number of jobs he believes could be lost if the tax is implemented, that is, what number of jobs could be lost because of the tax and the tax alone? Senator BUTTON —No, I cannot and I will not because I am not as stupid as some honourable senators opposite. I have seen some of them wander into this place and say: `If the entertainment deduction is taken away, there will be 11,000 or 14,000 jobs lost in the restaurant industry'. I have seen the stupidity of all that. I sit opposite Senator Messner, who told us last year that if there were a wine tax there would be an enormous loss of jobs in the wine industry. I have sat opposite him for two years during these ludicrous predictions from him as the Opposition's spokesman on finance. I will not go down that silly track with those opposite. I do not know the answer. I will not be in the business of speculating. Senator Messner —Does Mr Bannon know? Senator BUTTON —If those opposite are very impressed with Mr Bannon's figures they can rely on them, but they should not rely on mine because I will not give any. Senator FOREMAN —I ask the Minister representing the Minister for Employment and Industrial Relations whether he saw the report in the Australian newspaper on 26 May 1986 entitled `Kennett calls for study of luxurious dole system'? In that report the Victorian Liberal State Opposition leader, Mr Kennett, stated that Australian taxpayers were asked to support the nation's unemployed, who were the beneficiaries of the world's most luxurious benefit scheme. Mr Kennett went on further to advocate the creation of a task force that would `be empowered to recommend a system that would require those on the dole to contribute constructively to the community through community work'. I ask the Minister: Is this unwarranted attack another attempt to blame the unemployed for their unfortunate plight and is it further evidence that the Liberal Party has nothing but abuse to offer the unemployed? Senator WALSH —There are two voluntary schemes-one has been in existence for some time and the other has either commenced or is about to commence-under which the unemployed are given the opportunity to do community work. As I understand it, that is not what Mr Kennett was proposing. He was proposing some sort of compulsory requirement as a precondition for receiving the unemployment benefit for people to do community work for some time. That was a bit nebulous. Mr Kennett was recycling old Liberal Party obsessions and snake oil remedies. His proposition ignores the fact that in order to implement that sort of scheme on a compulsory basis an enormous number of resources have to be put into organisation, supervision and so on. It also raises the question that if the work concerned is of real community value and not of the shifting sand from one heap to another and then back in a wheelbarrow type of work for work's sake, why has it not been done already in the public works area? Mr Kennett's suggestion is a variant of the one floated four or six months ago by the Leader of the Opposition, Mr Howard, who came out with a magnificent idea of forcing the unemployed to go to educational classes for three days a week. This was presented, although that is hard to believe, as a cost saving measure. If all the recipients of unemployment benefit were forced to spend three days a week in educational institutions, and taking the lowest per capita cost education institutions for people in that age group-the technical and further education colleges-that idea would add $600m a year in outlays on TAFE education. That is how much Mr Howard has considered the question. I suspect that Mr Kennett has given it about as much consideration. Mr Kennett's suggestion ought to be treated in much the same way by the Government as has been Mr Howard's. Senator BUTTON —In Question Time on 8 May, Senator Bjelke-Petersen asked me a question about her passion-fruit people, as I think she called them. I provided an answer but I undertook to get further information. Specifically, the honourable senator asked whether passion-fruit pulp was being dumped or being allowed into the country under some preferential agreement. Examination of recent import trends for passion-fruit products indicates that there was a surge of imports of passion-fruit juice from Brazil in late 1985. These imports were entered at the general rate of duty and to date there has been no complaint of dumping lodged with the Australian Customs Service. Concessional arrangements apply to imports of passion-fruit products through schedule 2 of the South Pacific and Regional Trade and Economic Co-operation Agreement, which provides for the duty free entry into Australia of 100,000 litres of passion-fruit pulp per annum. However, there has been no increase in imports under the concessional duty from the South Pacific. The surge in imports has come from Brazil. No dumping complaint has been made against imports from Brazil. I remind the honourable senator that if an industry feels that it is adversely affected by imports it can seek a reference to the Industries Assistance Commission for variation of the level of assistance. In conjunction with the Department of Primary Industry, the Department of Industry, Technology and Commerce is looking at the possibility of having a reference on the fruit and fruit products industry which would take into account the needs of the passion-fruit processing industry. Mr McKechnie, the Queensland Minister for Tourism, National Parks, Sport and the Arts, wrote to me about this matter and I have replied today in similar terms to the answer which I have given the honourable senator. The PRESIDENT —I draw the attention of honourable senators to the fact that a number of questions today have been quite lengthy and a lot of detailed information has been given in them thus, in many instances, requiring in return long answers by Ministers. I ask honourable senators to look at the length of their questions and the amount of information given in them so that a greater distribution of questions will be able to be allotted at Question Time. Senator MESSNER(South Australia) —by leave-I give notice that, contingent upon clauses 5 to 9 inclusive, 19 to 26 inclusive and 44 to 47 inclusive of the Taxation Laws Amendment Bill 1986, or any of those clauses, being negatived in Committee of the Whole, and the Bill being read a third time, I shall move: That so much of the Standing Orders be suspended as would prevent Senator Messner moving a motion to refer the proposed provisions contained in those clauses to the Standing Committee on Finance and Government Operations. Senator VIGOR(South Australia)(3.08) —I move: That the Senate take note of the paper. Foreign investment in enterprises in Australia continued its upward trend last year and reached almost $10,000m for the year. Borrowings accounted for 86.7 per cent of all this foreign investment. I seek leave to incorporate in Hansard table 3.1 of the report of the Foreign Investment Review Board to illustrate this. Leave granted. The table read as follows- Table 3.1 INFLOW OF FOREIGN INVESTMENT IN ENTERPRISES IN AUSTRALIA, 1974-75 TO 1985-85 1974-75 to 1978-79 annual average $m per cent 1979-80 $m per cent 1980-81 $m per cent 1981-82 $m per cent 1982-83 $m per cent 1983-84 $m per cent 1984-85 $m per cent Direct investment Corporate equities... 69 5.2 34 1.1 529 8.7 -134 -1.4 391 4.4 206 2.5 118 1.2 Undistributed income... 599 44.7 1017 33.0 829 13.7 358 3.7 -586 -6.5 555 6.7 565 5.7 Branch liabilities... 51 3.8 70 2.3 188 3.1 608 6.4 574 6.4 -784 -9.5 64 0.6 Intercompany indebtedness... 164 12.2 205 6.7 272 4.5 399 4.2 68 0.8 602 7.3 433 4.4 Borrowings... 55 4.1 210 6.8 570 9.4 1111 11.6 448 5.0 1429 17.3 1372 13.8 Total(a)... 939 70.1 1538 49.9 2388 39.4 2342 24.5 895 10.0 2008 24.4 2552 25.6 Portfolio investment and institutional loans Corporate equities... -10 -0.7 710 23.0 1307 21.5 659 6.9 858 9.5 584 7.1 143 1.4 Borrowings by public non-monetary enterprises 410 30.6 536 17.4 447 7.4 1164 12.2 2171 24.2 2036 24.7 3137 31.5 other 297 9.6 1925 31.7 5383 56.4 5064 56.3 3616 43.9 4118 41.4 Total(a)... 400 29.9 1543 50.1 3679 60.6 7206 75.5 8092 90.0 6236 75.6 7399 74.4 Total(a)... 1339 100.0 3081 100.0 6068 100.0 9548 100.0 8988 100.0 8244 100.0 9951 100.0 (a) Totals may not add due to rounding. Source: ABS: Foreign Investment, Australia, 1983-84 (Cat. No. 5305.0), Foreign Investment, Australia, 1984-85, Preliminary (Cat. No. 5304.0). Senator VIGOR —This is a disaster for Australia's future balance of trade as repayments, interest payments and dividends paid abroad will continue to rise. Australia's high interest rates domestically exacerbate the problem. This continued high inflow of foreign money artificially supports the Australian dollar at a level which makes our exports more and more uncompetitive on world markets. Approximately 71 per cent of the total expected foreign investment approved in 1984-85 will be spent on the acquisition of existing businesses. Less than 30 per cent will be invested in new business. In real terms, foreign takeovers of existing businesses have continued to rise, from less than $1000m in 1977-78 to about $2,200m in 1984-85. Most of these take- overs are in the service industry-hotels and accommodation-and in the finance and insurance industries where we have introduced 16 new banks. The major reason given by local businesses selling out to foreign interests was liquidity problems, a demonstration of the bankruptcy of the Liberal-Labor monetary policies of the last 10 years. In fact, the major reason is the failure of the policies of successive governments. As these takeovers were associated with only a small proposed expansion of business output, it is obvious that high local interest rates and poor management were mainly responsible for the loss of Australian equity in its businesses. We will need to face the problem of buying back the farm. Foreign investment in the manufacturing and mining industries is declining. I seek leave to incorporate in Hansard table 3.3 of the report to illustrate my point. Leave granted. The table read as follows- Table 3.3 INFLOW OF FOREIGN INVESTMENT IN ENTERPRISES IN AUSTRALIA, BY INDUSTRY, 1975-76 to 1984-85 1975-76 to 1979-80 (annual average) $m per cent 1980-81 $m per cent 1981-82 $m per cent 1982-83 $m per cent 1983-84 $m per cent 1984-85 $m per cent Mining... 154 8.8 1,324 21.8 1,728 18.1 2,710 30.2 81 1.0 333 3.3 Manufacturing... 463 26.4 1,493 24.6 2,812 29.5 1,155 12.9 1,396 16.9 1,014 10.2 Electricity, gas & water... 126 7.2 303 5.0 1,053 11.0 2,463 27.4 731 8.9 1,171 11.8 Wholesale and retail trade... 567 32.3 1,345 22.2 1,113 11.7 557 6.2 1,855 22.5 2,089 21.0 Transport and storage... 144 8.2 91 1.5 551 5.8 327 3.6 168 2.0 144 1.4 Finance, property and business (a)... 220 12.5 1,242 20.5 1,952 20.4 1,415 15.7 3,502 42.5 4,855 48.8 Other... 80 4.6 270 4.4 339 3.6 361 4.0 511 6.2 346 3.5 Total (b)... 1,755 100.0 6,068 100.0 9,548 100.0 8,988 100.0 8,244 100.0 9,951 100.0 (a) The amounts shown for this industry group includes relatively minor amounts of equity and borrowings which are invested through small nominee companies and which cannot be classified to industry. (b) Totals may not add due to rounding. Source: ABS: Foreign Investment, Australia, 1983-84 (Cat. No. 5305.0), Foreign Investment, Australia, 1984-85 Preliminary (Cat. No. 5304.0). Senator VIGOR —I thank the Senate. This table reflects the fact that the industrial production boost to the economy in 1982-84 is fast waning under the continued mismanagement of various governments. Of the total $1,050m spent in taking over Australian manufacturing businesses, only a further $50m will be spent on additional development. We must ask ourselves whether these takeovers are really in the national interest. Investment in mining is also declining. Peak investment was in 1982-83 and was 17 times higher than that of seven years earlier, and in two years averaged only 1.3 times the figure of 10 years ago. On the other hand, finance, property and service businesses are being bought out holus bolus. The funds involved in buying out were 22 times more in the last year than was the case 10 years ago. A large part of this increase is due to the entry into Australia of foreign banks. Our balance of trade deficit is growing exponentially. Our overseas markets are being eroded by our closest allies who are flagrantly breaching the General Agreement on Tariffs and Trade agreement on trade practices and protectionism. The Government is fiddling about with fringe taxes and fringe issues while the whole of our trade is going down the drain because the investment that is coming into Australia is buying up our businesses and not creating new productive capacity. All of this is obvious from the report. I commend a very close reading of the report to Government members. Senator MAGUIRE(South Australia)(3.13) —The 1984-85 report of the Foreign Investment Review Board is a report of the body, established in 1976, which is charged with the responsibility of screening foreign investment proposals for Australia. It not only examines proposals put forward by investors but also advises the Government on courses of action that should be taken in respect of those proposals and makes recommendations in the ultimate case as to whether foreign investment proposals for Australia should be allowed or disallowed. One of the Board's important guidelines is to work for high levels of Australian equity and participation in new investment projects in this country. One of the perspectives taken by conservative politicians in Australia is that foreign investment is vital to our economy. On a number of occasions in recent years conservative politicians throughout Australia have indicated that the ability of our country to attract foreign investment was a sign of economic health, economic confidence and economic well being. We have seen scaremongering campaigns in recent Australian elections when allegations have been made by conservative politicians that the election of a Labor government would scare off investors in our country and that all kinds of proposals would be scrapped as a result of the election of a Labor government. In 1984-85 the Board considered some 1,286 proposals for investment in Australia. Of those proposals, some 1,252 were approved and, of those approved, 482 were subject to some sort of qualification. Total expected investment foreshadowed in those proposals was around $4,600m-a very substantial sum. The services sector was the leading area of foreign investment activity, both in terms of the number of proposals approved and total investment expenditure. There was also increased foreign investor activity in Australian manufacturing industry. As I have pointed out, conservative politicians make great play of foreign investment in our country. I want to highlight some figures which appear on page 54 of the latest annual report of the Foreign Investment Review Board and which relate to new investment, which is the most important economic element of foreign investment in our country and which has the potential to add to wealth and productive power, as distinct from investment known as `consideration' which involves simply the buying and selling of existing assets, whether they be shares, real estate or whatever. New investment is much more important. It is very interesting to look at the table which appears on page 54 of the report and which indicates that in Queensland there has been a massive slump in new investment by foreign investors. For example, according to the 1983-84 annual report, there was $499m of new foreign investment in Queensland. In the current year under review, 1984-85, there was a mere $207m of new investment. So the foreign investment proposals for that State have been more than halved in a 12-month period. Queensland now receives some 13 per cent of new investment proposals from overseas, which compares with its 16 per cent share of Australia's population. So, on the criteria used by conservative politicians, certainly a lack of confidence in the Queensland economy is being shown by foreign investors. They are staying away in droves. Foreign investment in Queensland has been more than halved in a 12-month period. This reflects the very poor economic climate in Queensland, which is exemplified by a whole range of economic indicators. Senator SIDDONS(Victoria)(3.18) —I rise to congratulate the Foreign Investment Review Board on its 1984-85 report. The report is very detailed and sets out clearly the degree of foreign ownership of our industries in this country. The question of whether we are going to allow our industries to be taken over by foreign interests has been an issue since 1970. In fact, it was on that issue that I first became involved in politics. The establishment of the Foreign Investment Review Board undoubtedly was a milestone in slowing down the degree of penetration by foreign interests in Australian wealth-producing industries. The Board is doing a valuable job. One would hope that the present Government is giving the Board the degree of support and encouragement its important task requires. One wonders about this from time to time because the Government has brought down guidelines which, to some degree, lessen the effect and authority of the Foreign Investment Review Board. There is no room for complacency about this issue whatsoever. If we turn to the report we find that over the last decade, for instance, Australian ownership of our mining industries has dropped from 50.5 per cent to 49.6 per cent. One may say that that is not a big reduction in Australian ownership over a decade. I say that there has been no turnaround. We are not yet buying back the farm. That seems to me to be the important issue. Why should more than 50 per cent of our mining enterprises be owned by foreign interests? Australians defend the country. One would think that the minerals in our soil should belong to Australians; yet 50 per cent of those minerals belong to foreign interests. Is that a good situation, with our balance of payments the way it is? Thirty per cent of our exports are going to pay the interest bill on money we have borrowed and a lot of that money is being used to take over our wealth producing industries. One would have thought that the overwhelming percentage of our manufacturing industries should be owned by Australian capital. Who should own the means of producing in this country? This report says that there has been a slow-down in the penetration by foreign ownership of manufacturing, but still only 67 per cent of our manufacturing industries are owned by Australians. Senator Robert Ray —Superannuation will help that. Senator SIDDONS —Thank you, Senator Ray. I was about to come to that. The Australian Democrats are supporting an initiative of superannuation for all. This will release enormous amounts of money in the form of savings of Australians, which, if we are far seeing enough, could be invested in buying back the farm. I hope that that will be done. If it is not, we can be sure that Australians will be colonised just as surely as they were in the beginning. Why defend the country if all that has to happen is that foreign money comes into this country and buys out our ownership of it? Senator WATSON(Tasmania)(3.21) —When one examines the high level of approvals compared with the total number of applications, one could well ask why we have the Foreign Investment Review Board today, because it is departing very much from the original charter under which it was set up. Given the Australian Labor Party Government's attitude of lack of interest and concern for small business and for the ownership and control of Australian resources and businesses, it is not surprising that we find another instrumentality being manipulated by the Government. I refer to the Foreign Investment Review Board, which is losing its independence and is becoming quite impotent as far as the discharge of its responsibilities is concerned. Given Australia's chronic balance of payments situation, we are becoming increasingly dependent upon an inflow of debt capital and equity capital, which means that the ownership and control of Australian resources is moving increasingly overseas, outside the control of ordinary Australians. The great disappointment is the very low ownership by individuals of shares on the Australian stock exchanges. We should well ask: Where is the fulfilment of the Labor Party's pledge of buying back the farm? Its policies of deregulation and everything else are certainly encouraging overseas capital and enterprises to buy into the most profitable of Australian resources. One alarming feature at present is the take- over battles that are taking place in Australia. The extent to which foreign funds are flowing into Australia, albeit at times to finance some of the millionaires of Australia in their battles to take over Australian major companies, is frightening. The consequence of their action in borrowing abroad is to raise the debt repayment problems even further, to put us further into hock. I believe that the time is not far off before some of these giants in their takeover battles will bite off more than they can chew. We will find in a very short while that they will have to sell off large chunks of big Australian enterprises simply to meet their debt obligations. I think this will be a major tragedy. There is a view, however, that the presence of the Foreign Investment Review Board actually discourages equity investment in favour of debt capital. When one examines the track record of the FIRB, it seems to be letting in all enterprises, except one or two which do not seem to be politically desirable. In relation to its past track history, that record does not apply. It concerns me that some enterprises have been allowed into this country for the purpose of exporting their partly produced products to their overseas subsidiaries. What is happening now is that a lot of these enterprises which were allowed in on a restricted basis are expanding their tentacles at the expense of small, privately owned companies in Australia. We are seeing an increase in the debt repayments because companies are investing in Australia and creating a debt repayment situation, regardless of the profitability of the enterprise. I believe that this is detrimental to Australia. I am one who would favour increasing the ownership and control of resources by Australians for the benefit of all Australians. Senator DURACK(Western Australia)(3.26) —I take this opportunity to make some comments on the report of the Foreign Investment Review Board in relation to investment in the mining and minerals exploration industry. The report reveals the deterioration that has occurred in that industry and its attractiveness to foreign investment, bearing in mind that we are talking about investment in the ownership of Australian resources in the minerals and exploration sectors. The number of proposals for investment fell from 173 in 1983-84 to 132 in 1984-85; a decline of nearly 25 per cent. Investment in those projects fell from over $1 billion in 1983-84 to $450m in 1984-85. Investment in new projects fell from $250m to $150m; a decline of 40 per cent. Those figures show an alarming decline in the attractiveness of investment in the Australian mining industry. A combination of factors is involved there, but largely it is due to Australia's high and still increasing costs, particularly labour costs, increasing regulation and increasing taxation. A further example is the fringe benefits tax proposals of the Government which will further add to the costs and will act as a further disincentive to investment in the mining industry. One thing that stands out like a beacon in this report is that virtually the only major investments-even though investments are declining-in new projects have been in the gold mining industry in the period under review. It is further to be noted that the Government is proposing, and I think hoping, to introduce a tax on the gold mining industry before very long. It set up an inquiry into the industry last year when the Western Australian election was coming up, obviously for political purposes. It is to be hoped that that report will indicate reasons why the industry should not be taxed, but I fear that whatever the report may reveal the Government is hell bent on taxing that industry. It would be consistent with this Government's attitude to the mining industry. The Government sees it as simply a never ending source of revenue. So for those reasons, amongst others, there has been a decline in the attractiveness of the industry. As soon as the Government sees a profitable mining industry, such as the gold mining industry, it is hell bent on recovering further revenue from it. I do hope that the Government will ponder this matter in the light of the startling statistics that appear in the report and completely reject any notion of taxing that industry. Senator LEWIS(Victoria)(3.31) —The Senate is debating the 1984-85 report of the Foreign Investment Review Board. I want to say just a few words before adjourning the debate. I point out first that the Board is not involved in an examination of investments being made by Australians when they are borrowing overseas to finance Australian takeovers. I refer in particular to the current proposals by Mr Holmes a Court and the Bell organisation. The Foreign Investment Review Board, as I understand it, is not involved in any examination of where he is obtaining the funds for the proposed takeover. The Board's first function is: to examine proposals by foreign interests for investment in Australia and make recommendations to the Government on these proposals; The rapidly changing outlook for industry and investment in Australia generally requires a revision of our attitudes toward foreign investment. Clearly a policy appropriate for the 1970s with its climate of companies virtually queuing up to invest in Australia is not necessarily right for the late 1980s. Moreover, it is becoming increasingly apparent that existing foreign investment policy discourages direct investment and encourages overseas borrowing, thus adding to the level of our overseas debt. A strong case therefore exists for either scrapping or significantly scaling down our existing foreign investment restrictions. This issue is receiving close attention in the Opposition's policy review. The now thoroughly discredited Treasurer, Mr Keating, has actually got around to admitting what economists have being saying for a long time, that is that the Australian economy is now in crisis. That admission provides a strong argument for the Foreign Investment Review Board adopting a more flexible and relaxed policy. Let me give the Senate an example. If I have a business which I think is worth about $4m in assets but is in fact on its way to going broke and some foreign company likes to come in and offer me $6m, of course it is to my advantage and to Australia's advantage for me to sell the business to this company, as it may be able to use its expertise to make the business profitable, and I have $6m firstly to pay off my liabilities and secondly to go on and invest in some other project in the nation. It is not that the foreign company comes in and closes down the Australian organisation, sacks Australian workers or does anything like that. In fact, the foreign investment in Australia encourages this economy to grow, not to stagnate as has been suggested by some previous speakers in this debate. I put it to the Senate that the immediate relaxation of foreign investment restrictions would help to stimulate direct investment from abroad and the capital inflow would help to reduce our overseas debt. I seek leave to continue my remarks later. Leave granted; debate adjourned. Debate resumed from 8 May, on motion by Senator Aulich: That the Senate take note of the report. Senator ROBERT RAY(Victoria)(3.35) —I congratulate the Joint Select Committee on an Australia Card for the work it has done in compiling its report. Some of these joint committees are valuable exercises because of the data they accumulate, and the access they give to the public on some of these issues does much to develop views on these subjects. However, I have to say that when it comes to the actual analysis of the data and the coming up with the recommendations the results tend to be predetermined. Any time we set up a select committee members of such a committee take in their existing prejudices; they look for evidence to support their views, and that is what comes out at the other end. That is why I am not particularly fazed that this Committee has brought down a majority report opposing the Government's proposed Australia Card. I think quite often those pre-existing views come through. Senator Puplick —They did in the minority report, too. Senator ROBERT RAY —Looking at the personnel on the Committee, I could have told Senator Puplick months ago that he would oppose the Australia Card. Such a dilettante, fairy floss civil libertarian is impelled to oppose the Australia Card. There is no doubt of that. I also had no doubt that even one of my colleagues, who was very voluble on the issues before he was put on the Committee, would continue to oppose the introduction of an Australia Card. Senator Archer —And vice versa. Senator ROBERT RAY —I have no doubt that vice versa applies. At least I give credit to a couple of the members, who may have had pre-existing views, for turning up to all meetings. It is unforgivable for members not to turn up to meetings. I refer particularly to one member, who shares committee membership with me on another committee and never turns up there and barely turned up to this Committee yet he has come out with conclusions that are supposed to have some credibility. I am not a blunt enough person to mention the person's name. One regrettable aspect was that this Committee leaked like a sieve. Committee members shot their mouths off on the issues well before the report came down. It is obvious that the report was leaked substantially to the newspapers. This is a period in which a lot of civil liberties are under attack. We must acknowledge that. With the sorts of views currently being expressed on telephone tapping and other things, one would not normally embrace a proposal that some people might argue has a potential to inhibit people's civil liberties. But I stress that identity cards like the Australia Card exist in many other free and democratic societies around the world. They also exist in totalitarian societies. I just make the point that a national identification system is not necessarily totalitarian, and is compatible with a free and democratic society. I also warn that unless the Government takes some action to set up a national identification system, a ramshackle de facto identification system will emerge in this community. With the increasing use of computers, with the use of all sorts of credit cards and card identification, a ram- shackle de facto system is already evolving, with no protection for the individuals concerned. The key word in this debate is protection-not just protection of civil liberties but protection of the average citizen in this country. Australia's citizens have to be protected against things like tax evasion, against cheating of the social security system. Every time the social security system is cheated it falls into more and more public disrepute and the victims, those who are in need of social security, are then open to ridicule as being some sort of bludgers or cheats. No government can stand by and watch that continue. I believe also, on the question of illegal immigration, that a proper national identification system would reduce the number of illegal immigrants in this country. Everyone in this chamber has had people ask why they cannot get a relative or an employee into the country. One of the reasons is that there are 60,000 queue jumpers in Australia already. Senator MacGibbon —You could put a one in front of that, at least. Senator ROBERT RAY —We do not really know how many are here, do we? They are all queue jumpers. They all come here unscreened and they do not meet any of the criteria. The people we are penalising are those poor people who go through the system, apply properly and maybe miss out by one or two points. That has to be stopped. I was rather impressed by some of the evidence which went to the issue of having a smart card which contained certain central data information and which could have optional information put on it by the holder of the card. That has great ramifications in the medical area. People such as me who are allergic to penicillin could have that information put on their Australia Card so that at any particular time that medical information could be released if a particular key code was used. I think that would be a marvellous thing and I note the support from some of the medical profession for this proposal. Let us come to the guts of the argument. Why have a photo? It all goes to the question of how much integrity the card would have. I have noted that at least the majority report argued for a tax file card number but, having read some of the evidence which the Committee looked at, I am not convinced that that card would have enough integrity. It would run the danger of being forged or misused. Senator Haines —What do you think the Australia Card is going to have? Senator ROBERT RAY —An Australia Card with a photo would tend to have far more integrity than a card with a tax file number. We are facing a situation where it is possible, as argued in the minority report, that the Government would receive something like an extra $8 billion over 10 years. That is a fairly revealing figure. I also think it reveals why some parts, but not exclusively all parts, of the Opposition would be very keen to stop an Australia Card. The civil libertarian argument tends to be a smokescreen. What the Opposition really wants to do is to put as much pressure as possible on this Government, deprive it of as much revenue as possible and then see what the gas cooker comes up with. By cutting us off at both ends, by arguing continually for increased expenditure across a whole range of areas and then trying to cut off all avenues of raising money, the Opposition thinks something has to give somewhere, which will give it the opportunity to sneak back into government. I want to move on to two or three other points. No national identification system could be tenable if the bureaucrats were just allowed to go out and organise it without the Government putting some key protections in place. I am a very strong supporter of the concept of a national data protection authority that would oversee the Australia Card and similar cards and protect the privacy of individuals. If the Government does go on with the proposal for an Australia Card and in fact gets it through both chambers, it is essential that certain restrictions be placed on its use; that is, that it will not be compulsory to carry it at all times, that it has no direct police function at all-- Senator Haines —So far. Senator ROBERT RAY —Not so far. There is always the thin end of the wedge argument, is there not? It is always the good little scary thing to bring up. If Senator Haines is really going to argue that this is going to have a police state function, she is arguing that fundamentally society in this country has changed, and I do not believe it has. I am critical of the report in one area. That area relates to the restricted use of the card. I urge very strongly for one more extended use of the card over and above the recommendations of the minority report, and that is its use by the Australian Electoral Commission. We already have an agency in this country which collects names, nine million of them, gives them a number, not a unique number, records people's addresses and publishes those details. It seems to me that if we had an Australia Card we could well have more integrity in the electoral rolls in this country by giving the Electoral Commission access to the system. Senator Puplick —It specifically rejected it. Senator ROBERT RAY —It may have specifically rejected it, but it is not infallible. That is why we determine the electoral laws and that is why Senator Puplick has to put submissions to joint committees, as he once did, on how to reform the electoral laws. I should have thought that he would understand that. We determine what the laws are and what is best. The Commission may have rejected it. It may not have given it proper consideration. But I would say that it is very logical that a group that collects nine million names should also have access to this system. In winding up my remarks, I congratulate all members of the Committee on the work they did, especially my colleague Senator Aulich, who I do not think missed a meeting. I know that he undertook a very heavy workload. If this Committee had been a royal commission the report would have been another two years down the track and it would have cost $5m. Instead, we sent eight parliamentarians away to investigate this matter. They got this massive report done in record time and they came up with a very poor majority report and a brilliant minority report. Senator HAINES(South Australia)(3.45) —I detect not only certain vested interests in the comments of Senator Robert Ray but also a sort of defensive cynicism as well. Senator Puplick —Factional loyalty is a lovely thing. Senator HAINES —As Senator Puplick says, factional loyalty is a wonderful thing but it does not always mean that the views of Senator Robert Ray are necessarily those of the majority of members of his Party. There was, of course, an indication of that when the majority report came down because it was not a majority report that consisted of the views simply of members of Opposition parties; it consisted of the views of members of all parties, including the Government party which were represented on the Joint Select Committee on an Australia Card. The terms of reference were set up late last year on consultation with all political parties and they covered a wide range of things, including the costs of introducing and operating the system which the Minister for Health (Dr Blewett) was then advocating and which, despite all the evidence that should have sent him down a contrary track, he is still advocating. The terms of reference covered the likely effectiveness of the proposed system as far as combating things such as evasion of and fraud against the tax and welfare systems, the method of obtaining positive identification of the individuals who were applying for the card, abuses of civil liberties and invasions of privacy and, more importantly, the comparative cost effectiveness of alternative proposals that would just as well combat the evasion of and fraud against the tax and welfare systems that I think everybody in this place, in the other place and in the community generally is so opposed to. The Committee went on to look at other things, such as whether the card or an alternative should be universal and/or compulsory, what sort of facilitation of data linkages would be allowed and what protections there would be in that area. As Senator Robert Ray said-it is probably the only valid comment he made in his entire 10 minutes-the Committee put in quite an heroic effort, as did those people who made submissions to it and appeared before it. The evidence before the Committee was overwhelmingly that not only was an Australia Card of the sort proposed by the Government and by the Minister for Health not necessary but also that there were other ways of achieving an end or at least a mitigation of fraud against the various systems we have in this country that would be more cost effective, less invasive and less open to abuse than the system that the Government was talking about. The Government believes, probably rightly, that it has the general public on its side, mostly because the public was not party to the sort of information the Committee was and because the public, even more than the Australian Labor Party, is more subject to the prejudices that are spread around this place. Social security fraud and overpayment and tax fraud, as all the evidence before the Committee indicated, come mainly from the understatement of incomes-for example, from not declaring income in the cash economy and from the non-declaration of interest. Aside from that, the only major component was outright criminal defrauding and that, practically everybody said, was not going to be touched by something like an Australia Card since the confirmed criminal, whether he is a dedicated professional or just an enthusiastic amateur, is going to have the resources and the inclination to get around the system. As far as the main losses are concerned-that is, losses from the cash economy and from the non-declaration of bank interest-most witnesses pointed out what I would have thought was patently obvious, that is, that the cash economy is not going to be picked up simply by having everybody processed and given a card with or without a photograph, thumbprint or computer chip in the top left hand corner. There are a great many people in this chamber as well as in the community who hire people and pay them cash to do a variety of things, such as cleaning houses, mowing lawns and putting up pergolas out the back. In most cases they pay them in cash. It is known who they are, where they live and what their telephone numbers are. The mere provision of a card is not going to make the person who receives the cash necessarily declare it, and the Government knows that as well as the rest of us. In regard to the non-declaration of interest on bank accounts, the majority report recommended a high integrity tax file number which had to be appended to bank accounts and used for other financial transactions, applications for jobs, social security payments and so on. It would settle, as the Australian Taxation Office admitted, a large amount of this simply by adding the incentive to declare interest earned by insisting that those bank accounts which did not have a tax file number appended to them would suffer a fairly hefty withholding tax. There are indeed other measures which do not have the sorts of invasion of privacy problems through data linkages that the Government proposal has. People in the community argue that those who have nothing to hide have nothing to fear. One sometimes wonders whether they know how much information is on file in government departments that they would prefer other people not to know. There is information on everybody's health problems going back into the past. There is information on the sort of education we have had, where we have travelled overseas, our ethnic background, how much money we have and where we have it, what social security payments we are on or have been on in the past. All that information is stored already in various government departments. At the moment it is accessible only by accredited officers within those departments and under very rare circumstances some exchange of information is permitted, but it is fairly heavily overseen with protections. Once one moves into the sort of system that the Government is proposing, it would be much easier to exchange that information not only with other departments but with the State governments which want to get involved. I am sure that there are large numbers of people in the community who have had health problems of one sort or another but who do not need to have that spread around the community or given to a State Public Service Board when applying for a job. The logistical problems of the proposal which the Government is planning to go ahead with willy-nilly, notwithstanding the evidence contrary to its statements and the likely problems it will hit when the proposal reaches the Senate, are enormous. For a start, it is useless having an Australia Card or any other form of national identification system which is based on identifying data which, to begin with, is of low integrity. We all know the problems that arise with the ease of access people have to birth certificate information which is not their own, to which they are not entitled and which they can use to have passports, drivers licences and other items supplied. We have recently in this place had to tighten up the passport legislation simply because of the problems in the births, deaths and marriages registries in this country. Until those are fixed up, there is no point whatsoever in moving to a national identity system in this country which of necessity will be low integrity. The logistics involved even in getting the births, deaths and marriages up to scratch are quite horrendous. It will take months simply to get the hardware and the appropriate software organised and in place. That is assuming that the Minister for Health is right and that States are infinitely bribable and will go on with this proposal anyway. It then takes another minute per entry. I presume that we are not starting from 1986, and that if we want to get these up to scratch, we will have to go back at least 70 years. If we are looking at social security and tax fraud, heaven only knows how long that will take. It will then be necessary to process 10 to 12 million Australians, at 10 to 15 minutes an interview and photograph and that little exercise will take between 18 months and two years. Therefore, the logistics and costs are enormous. It would be far simpler, more sensible and just as effective to take the majority report in hand, to make the integrity of the tax file number higher and to rationalise, nationalise and computerise the births, deaths and marriages system. Senator Robert Ray —What does the Taxation Office say about that? Senator HAINES —The Australian Taxation Office recognises that a high integrity tax file number under its suggestions would raise as much money as would an Australia Card without a photograph. Its objections were minimal at best. I understand that my time has expired. Senator RICHARDSON(New South Wales)(3.55) —I support the remarks made by my colleague Senator Robert Ray. Senator Haines —Surprise, surprise! Senator RICHARDSON —I support his remarks often within and without the Parliament, and I do so again today with pleasure. I have read with interest the speech made by Senator Puplick in this place on this issue, and I have just listened with even more interest to Senator Haines. Although I congratulate both honour- able senators on their capacity to dress up the impossible in the nicest way, I must say that both speeches add up, as have previous speeches by them in this place, to yet another defence of the tax avoidance of Australia. Once again, we see another opportunity ready to be thrown aside and cast away because they cannot let anybody get near their friends in the industry. Senator Puplick —I raise a point of order, Mr Deputy President. I believe that the Standing Orders afford to both Senator Haines and me some degree of protection from the comment of being friends with or having friends in the tax avoidance industry. The remark is improper and I think that it should be withdrawn. Senator Grimes —Further to the point of order: I would be the first in normal circumstances to support Senator Puplick in this regard, except that on numerous occasions in this place remarks of that type from the opposite side have been accepted, and I dare say will continue to be accepted until we change the Standing Orders. That being the case, I submit that the Chair is bound to ignore the point of order. The DEPUTY PRESIDENT —Order! It would be improper for a member of parliament to be a friend of tax avoiders. Therefore, the imputation is out of order and Senator Richardson should withdraw it. Senator RICHARDSON —If that be your ruling, Mr Deputy President, I withdraw. I would hate to give offence. However, If I may continue my remarks, when the crunch comes there is no doubt that some people in the Australian Democrats and all members of the Liberal Party and National Party have shown a propensity over time to defeat legislation introduced by the Government that attempts to get at the heart of the problems of tax avoidance and tax evasion. Once again when the crunch comes we are seeing yet another example of this. Senator Haines said that the mere provision of a card would not affect the cash economy; it will not necessarily make people declare income. That of course avoids the obvious. The obvious thing is that right across our economy people have been lining up for jobs in clubs, shops and all sorts of places under false names and a huge amount of revenue is thereby avoided; thousands and thousands of Australian have managed to avoid their responsibilities. That is one area where an Australia Card would have an immediate and sure effect. Straight away the Government would get the revenue to which it is entitled, and ordinary wage and salary earners across the country would start to shoulder only a fair burden and not the burden of the bludgers who infest this community. Having used the word `bludgers', as somebody else did earlier in the debate, I turn to the politics of the dole bludger syndrome. If one goes back over the last six years, one sees that it was started with somewhat of a flurry and fanfare by Malcolm Fraser, that eminent person. It was continued by Mr Peacock and Mr Howard. Mr Ian Cameron, a member of the National Party, in an extraordinary and fascinating speech in another place, took it to new and even greater depths. Having heard all that one can only come to the conclusion that the syndrome of talking up to the Australian electorate the fact that people who are unfortunate enough to be on the dole are in some way an improper encumbrance upon us has become an article of faith among the Liberal and National parties. The problem is that no one really knows how true this is. One can only ever get estimates as to how much money is being earned improperly from people on false names getting the dole. There is plenty of anecdotal evidence. We have all heard stories of young men going to the beach who manage to get on a surf board every day while collecting seven or eight dole cheques a week, but the reality is that we have no proof. The only way we will ever find that proof is to ensure that there is a proper identity card, with a photograph. People will have to produce that card before they get the dole. If and when we get that, we can find out the truth of all the accusations that the Liberal and National parties have made over the years. I suspect, at the end of the day, while we will certainly find that there has been social security fraud, it will turn out to be nothing like the volume those parties have been suggesting. I agree with what Senator Robert Ray said. It was pretty obvious from the evidence and from reading the transcript that most of those committee members who went into this Committee did so with preconceived views. I do not necessarily object to that. Senator Puplick is one who holds strong views and he is entitled to them-so am I. Before that Committee started there was only one member of that Committee, Senator Haines, about whom I was unsure. So I had to look through the evidence and the progress of the inquiry to determine the thought processes which would bring Senator Haines to her conclusions. I have to say that Senator Haines did manage to fool me. I missed it again. I have been one of those who have accused the Australian Democrats over the years of jumping from one popular issue to another in that tawdry exercise of chasing votes. Having watched Senator Haines and her colleagues do this for so long, I assumed that because of the overwhelming popularity of the Australia Card she would be with it. I was tempted to go through the will-we or won't-we exercise, that the Democrats often do, to try to work out whether Senator Haines would support it. But in the end, I thought no, it will be the popularity of this issue that will get Senator Haines's hand in the air. At the end, when we looked at the result, Senator Haines chose to ignore what two-thirds of the Australian people have been saying for two years, and that is that any honest citizen has nothing to fear from an Australia Card with a photograph on it, particularly the card recommended by the minority report. Two-thirds of Australians believe in it. It is because two-thirds of Australians believe in it that this Government has absolutely no fear of bringing the legislation into this Parliament. If Senator Haines is really going to call herself a member of the Democrats, she should pay some respect to the democratic process. If ever the democratic process cried out in this country, it is now. Senator Haines —Government by opinion poll; is that what you are after? Senator RICHARDSON —We do not have to go to opinion polls; it does not matter whether we go to board luncheons or to trade union groups-in Senator Haines's case I suppose it is whether she goes to a meeting of Friends of the Earth, but in my case I try to travel wider. In travelling wider I discovered that the one thing that unites and concerns Australians at the moment, from the highest to the lowest, from those who dig ditches to those who chair boards, is those people in this country who are bludging and not paying their fair share. They all agree that the card is the only way in which we can begin to tackle the problem. I do not, and nor do the members who signed the minority report, pretend that this is the only answer. The only way we will start to address the problem is to bring in this card. It is for that reason that I commend the minority report to the Senate and hope that more and more honourable senators will come to realise that that is the only way to go. Senator AULICH(Tasmania)(4.04) —in reply-I rise, having waited a few seconds for honourable senators on the other side to speak on this debate. It is very significant that so far we have had Senator Haines from the Australian Democrats, and Senator Puplick on the other side, and that has been it. No one else on the other side of the chamber has been prepared to debate this issue, despite the obvious chances they have had and despite the fact that some in the other House have been prepared to have their say. Those opposite have come to this chamber but have not been prepared to debate. One wonders why that is the case. I look at the role of select committees first. It is important that we have a resume of what the Joint Select Committee on an Australia Card was about. We were asked to examine in brief a proposition that was designed to combat illegal immigration, social security fraud and tax cheating; basically the proposition was to give us a fairer system in those particular areas. As everyone knows, select committees always encourage articulate and often powerful and public spirited groups and individuals to come forward. That happened on this occasion with most of the major groups in the community being prepared to come forward and give evidence. Some of it was very good and some was superficial, but all in all the Committee had a pretty fair coverage of most of the major issues. It is a pity that a number of members of the Committee were prepared to close their eyes before the Committee was set up and during the conduct of the Committee inquiry itself. There was evidence right down the line that these people were not prepared to be moved by the evidence in front of them. That was disappointing to me personally because at no stage am I on record publicly as either supporting or opposing the Australia Card concept. I assiduously avoided giving that impression during the conduct of the inquiry simply because the public is entitled to know that people who are chosen to be on select committees are prepared to keep their eyes open, to at least open their minds to the evidence that comes before them. But on a number of occasions we had a number of committee members prepared to put themselves on public record, in the newspapers and in the electronic media. I guess in the long run that affected the credibility of the Committee as a whole. As I said, I am personally disappointed about that particular process. There is another group which did not have a say and that is a group which often does not get a say on select committees and in this Parliament as a whole. I refer to the ordinary Australians, the people who struggle to bring up their kids decently, who want to provide their families with a satisfactory style of life and who do not want to be ground down by the system-those who expect a fair go. Those people are the ones who are not heard here. They are the ones who are ignored almost as a matter of principle by the Liberal Party of Australia, the National Party of Australia and some of the Australian Democrats which say, in effect, and I have said it before-that what ordinary Australians think does not matter. I say to those parties that they do count. They do have strong opinions about a fair go and they overwhelmingly support, as all the polls indicate, the concept of an Australia Card with a photograph. Why? They support the proposition because they are not fools. They see the evidence of enormous tax cheating that has been occurring in this country for the last decade. They know that significant groups of people are evading tax through artificially contrived schemes. They know that enormous amounts of money are being made from illegal activities, such as drug importation and insurance and banking frauds. They would have read about the Costigan reports, the Stewart Royal Commission of Inquiry into the Activities of the Nugan Hand Group, the McCabe-Lafranchi report, the reports of Special Prosecutor Gyles and other reports that have gone into these particular problems and indicated the massiveness of these illegal activities and the sort of money that is being evaded and hidden away in this community. The ordinary pay as you earn taxpayers or small business people know that they are shouldering the tax burden while others evade their proper responsibilities. They elected this Labor Government to do something about it. They elected us to provide them with a series of proposals to change that. One of those proposals which has come forward as part of the package of tax reform is the Australia Card proposal. Senator Puplick, to look at a couple of specifics, asked us to examine our consciences, and to examine the figures that were before the Committee. He indicated that the minority report had included, in its assessment of the revenue of $8 billion over 10 years, a figure of $1.2 billion saved by the Department of Immigration and Ethnic Affairs. The honourable senator has seen this as an example of unwillingness on our part to include rubbery figures in our final estimates about the revenue from that Card. In response to that viewpoint, our view, as a minority group on the Committee, was clear and unequivocal. It is this: First, we have assumed that Immigration and Ethnic Affairs figures may well have been generous, but counterbalancing that there is a very good reason to believe that social security fraud may have been much higher than that indicated by the Department of Social Security in its submission. I doubt whether there is one honourable senator in this place who will stand up and guarantee that the current figures for social security fraud are accurate. Is there anyone who believes that the fraud so far discovered is in fact the end of all that; that there is no more to discover. I suggest that there is a counterbalancing of the underestimation in the Department of Social Security versus the over-estimation in the Department of Immigration and Ethnic Affairs. Secondly, we have also assumed that the real value of an Australia Card, in relation to the combating of illegal immigration, is its preventative value, its deterrent value. If an illegal immigrant cannot get a job, cannot claim health care, cannot claim unemployment benefits, the attractiveness of Australia as a country to provide a haven for illegal immigrants will diminish. So it is this deterrent role that we regard as its key value, not its revenue. Ask the workers in the field and the trade unionists what they think of illegal immigration, of people who are prepared to come into this country and work at below award wages, and who are prepared to work in conditions that are not acceptable by the vast majority of Australian working people, let alone the trade union movement. I believe that they will then understand why there is such support for an Australia Card in the community at large. I return to my original thesis that the Australian community does know about the tax evasion that is going on in this country; it does know about social security fraud and it wants us to do something about it. This Government is doing something about it. We are in the process of altering the tax laws to ensure that fairness and equity are the principles that underpin our tax and social security systems. The Australia Card is an essential part of that reform, a fact which is conveniently forgotten by those on the other side of the chamber who seek to excise the Australia Card from the package of total tax reform. At this stage it is important to finish on this note. There are people who have indicated that they have had enough of tax evasion, of social security fraud and of struggling on the limited incomes that many of them have. They are now saying to this Parliament: `Do something about it. We support the Australia Card concept. We support what the Government is doing in its tax reform measures'. I believe it is about time that those on the other side of the chamber, who so cynically and hypocritically oppose the Australia Card for purposes of their own, ought for once to find themselves in line with what the Australian community wants and let this Senate as a whole reflect what that community wants. Question resolved in the affirmative. Consideration resumed from 7 May, on motion by Senator Coates: That the Senate take note of the report. Question resolved in the affirmative. Consideration resumed from 7 May, on motion by Senator Coates: That the Senate take note of the report. Question resolved in the affirmative. Consideration resumed from 7 May, on motion by Senator Georges: That the Senate take note of the report. Question resolved in the affirmative. Senator McINTOSH(Western Australia) —I table further 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 MICHAEL BAUME(New South Wales) —by leave-The report of the Australian Meat and Livestock Corporation, cancellation of order No. M4/83, relates to the export of chilled beef and chilled veal to the United States of America and Canada. It is a document of six words stating that order No. 4/83 is hereby cancelled. The recommended retail price for people acquiring this order is $2. I commend the Government for its enthusiastic observance of the precepts of the Waste Watch Committee in refusing to allow waste to proceed and to ensure that it recovers the cost of such orders. However, it seems to me that if the cost of putting out a six word order at approximately 30c a word, involving a retail price of $2, affects the cost of producing this document, obviously the Government should look at its cost structure. I simply make the comment that it seems extraordinary that such a detailed order involving six words should be available to the public at a cost of $2. Senator GEORGES(Queensland) —by leave-I give notice that, on the next day of sitting, I shall move: That the Senate take note of the Report of the Select Committee on Animal Welfare on Dolphins and Whales in captivity, tabled on 29 November 1985. I seek leave to give the reasons for that if I may. Leave not granted. Senator COLSTON(Queensland) —by leave-On behalf of Senator Tate, I present the eighth report of 1986 of the Senate Standing Committee for the Scrutiny of Bills concerning Bounty and Subsidy Legislation Amendment Bill 1986, Customs Tariff Amendment Bill 1986, Departure Tax Collection Amendment Bill 1986, Excise Tariff Amendment Bill 1986, Fringe Benefits Tax Assessment Bill 1986, Futures Industry Bill 1986, Grape Research Levy Bill 1986, Grape Research Levy Collection Bill 1986, Parliamentary Commission of Inquiry Act 1986, Superannuation Legislation Amendment Bill 1986, Taxation Laws Amendment Bill 1986, Tobacco Charge (No. 1) Amendment Bill 1986 and Tobacco Charge (No. 3) Amendment Bill 1986. I also lay on the table the Scrutiny of Bills Alert Digest No. 9 dated 28 May 1986. Ordered that the report be printed. Consideration resumed. GROUP E Deparment of Resources and Energy Proposed expenditure $2,408,000 Attorney-General's Department Proposed expenditure $23,568,000 Department of Special Minister of State Proposed expenditure $18,365,000 Department of Foreign Affairs Proposed expenditure $20,527,000 Department of Defence Proposed expenditure $290,651,000 Proposed expenditures agreed to. GROUP F Department of Veterans' Affairs Proposed expenditure, $34,217,000. Department of Transport Proposed expenditure, $5,199,000. Department of Aviation Proposed expenditure, $7,560,000. Department of Territories Proposed expenditure, $16,830,000. Department of Local Government and Administrative Services Proposed expenditure, $19,253,000. Senator REID(Australian Capital Territory)(4.19) —I want to raise a matter relating to the Parliament House Construction Authority although the aspect of the issue to which I wish to refer is not a problem of the Authority specifically. I refer to the construction of the flag-pole which I understand has now been deferred for about 12 months. To go back a little, the problem with the flag-pole relates to the increase in the size of the Parliament House because it is from 1984 that the site has run into particular difficulties and it was then that the Government reached an agreement with the Trades and Labour Council of the Australian Capital Territory to provide accommodation for workers on the Parliament House site. The Government says that it has done this; the Trades and Labour Council says that it has not done it adequately. As a consequence the erection of the flag-pole has been banned. That has gone on from about November until now and to date has cost the Authority approximately $400,000, as I understand it. Let me point out again that the Parliament House Construction Authority is virtually an innocent bystander on this issue. The dispute is between the Government and the Trades and Labour Council. With the costs escalating as a consequence of the ban on the flag-pole, the Authority had to make a decision and it has now done that. The fact is that, while the large crane remains in its present site, other work on the building cannot proceed. The big crane has to remain on its present site to erect the flag-pole. As a consequence, a considerable amount of the construction and finishing work is being held up. If a decision is made, as it has been, to remove that crane and proceed with the completion of the building, that will enable other things to be done. It will also mean that the Authority will have to make other arrangements for the erection of the flag-pole at a later date. I understand that to hire a crane large enough to erect the flag-pole once the building is virtually completed will itself cost approximately $200,000. What is possibly the largest crane in Australia will have to be dismantled screw by screw, brought from Victoria to the Australian Capital Territory and reassembled on the site. This will mean that a considerable amount of the landscaping will not be able to go ahead and other external finishing on the building will not be able to be completed. That landscaping and finishing work will have to be done at a later stage, again at considerably increased cost. I suggest that the total cost of this dispute between the Government and the Trades and Labour Council will probably amount to $1m. What I would like to know from the Minister is what the Government is doing to end this dispute with the Trades and Labour Council which is causing this escalation in the price of the Parliament House building. We all know that it is a costly building. Most of us understand the present cost set-up and know why it is so. Only the Australian Democrats cannot work that out and follow the reasoning behind what has occurred. This specific issue of the dispute between the Government and the Trades and Labour Council, which has gone on now for such a long time, will clearly be responsible for about $1m worth of increased cost on that building. In fact, it may even be more by the time it is all completed. As I have indicated, the Authority has decided to proceed and to put off the erection of the flag-pole for what may be another 12 months. Apparently that is the only way it can avoid the escalating costs at present. But I want to know when the dispute will end, when the Authority will be able to get on with the work that has to be done and when these absurd wastages of cost will come to an end. Senator GARETH EVANS(Victoria-Minister for Resources and Energy)(4.23) —I am not able to contribute much by way of an answer to Senator Reid's remarks on this subject. The position taken by the Parliament House Construction Authority has been made public. On the face of it, it is a fairly extreme course and one that obviously will be very costly in the long run. But it has been born of frustration with the inability to solve this dispute and the mounting costs from not being able to get access to the central interior part of the building while the crane is sitting there unutilised. Obviously the matter has reached a point of absolute lunacy. I fully accept what Senator Reid has said in this respect. I do not know how the matter will finally be resolved. I gather the dispute is about workers' housing. It ought to be capable of resolution. I will seek further advice from the Minister for Territories (Mr Scholes) and try to contribute something further to the debate at another time. Senator LEWIS(Victoria)(4.25) —I wish to raise matters relating to the lease of certain land on Bowen Island in the Federal territory of Jervis Bay. On 15 April 1985 the Minister for Territories, Mr Scholes, agreed to a recommendation by Mr B. H. Pratt, Assistant Secretary, Land Management, Australian Capital Territory Parks and Conservation Service, that the Minister note the observations made by that officer, recognise the unacceptable record of tenancy by the lessee and approve that, in the interests of expediency and to minimise the anticipated lengthy and unproductive representation which was likely to ensue, further discussion with the lessee be confined to formal notice of lease termination approximately six months prior to the expiry date of 31 December 1985. I seek leave to incorporate in Hansard a copy of the Minute Paper signed by Mr Pratt and Mr Scholes-I have shown this to the Minister for Resources and Energy (Senator Gareth Evans), who is in the chamber-on which has been typed a rebuttal by Mr Pratt of each of the points made by the tenant of this area of land. Leave granted. The document read as follows- Subject: BOWEN ISLAND-JERVIS BAY TERRITORY MINISTER PURPOSES To advise you on the implications of termination of the lease on Bowen Island in Jervis Bay on 31.12.85 and to recommend that a letter be sent to the lessee giving formal notice of lease termination approximately 6 months prior to that date. BACKGROUND 2. Bowen Island in Jervis Bay is 51 ha in area and is in a largely unspoilt natural condition with the exception of a holiday development on its western side which includes the only safe landing point. It has significant scientific, conservation and educational values and is entered in the Register of the National Estate. Features include: coastal vegetation which has developed in isolation from many influences present on the mainland; a number of archaeologically significant prehistory sites in the form of kitchen middens and rock shelters; highly fragile penguin and shearwater rookeries; interesting relics of the Second World War in the form of gun emplacements and bunkers; intrinsic scenic features of cliffs, rock shelves and isolated beaches. Rebuttal of Point 2 Apart from penguin rookeries which exist equally within and outside the lease, all other features mentioned occur outside the lease area. The penguins are generally hardy birds which we know easily co-exist with us, which is supported by their continued increase in population from 300 breeding pairs to over 1500 breeding pairs. This is a result of our providing protection from cats, dogs, tuna and lobster fishermen. Hence, most of the major features attributed to Bowen Island already fall under the Department's ability to manage this area. This has not been made clear in this report. 3. Fullers Agencies (Aust) P/L (principal Mr Malcolm Fuller), obtained a lease over the island in 1953. 4. In 1967 the Commonwealth-owned improvements on the island, including the jetty, were sold to the lessee and a new lease for ten years giving tenant rights in the improvements was granted. They are presently valued at $86,000. There are seven residences within the lease area, four of which were constructed for defence purposes during the Second World War. One of these is used to house a caretaker who resides permanently on the island. The remainder are used as holiday venues by Mr Fuller and a consortium of associates. Rebuttal of Point 4 Valuation was not made in accordance with our tenant rights, so is not correct and substantially under value the real cost to the taxpayer. A professional valuer, McCann Valuations of Canberra, has put the figure at $400,000. 5. The adjacent Jervis Bay Nature Reserve was declared in 1971 and it was intended to include Bowen Island in the reserve on termination of the lease in 1977. This action was recommended by the House of Representatives Standing Committee on Environment and Conservation in 1975 and the Department's intention to do so was reiterated in the Jervis Bay Draft Development and Management Plan published in 1979 (Appendix A), which formed the basis for departmental management policies at Jervis Bay. The Committee also supported the intention of the Department to not grant renewal of the lease when it expired in 1977. As a preliminary to lease termination, the unoccupied portion of the island was withdrawn from lease in 1974. The lease now covers 4.65ha on the western side of the island. 6. Mr Fuller however, pressed for renewal of the lease and made extravagant compensation claims for the area withdrawn. As part of the terms of settlement of this claim, tenant rights on the island, and a new lease, to expire in 1985, was granted in 1979. The new lease incorporated stringent environmental conditions designed to ensure that the lessee met his responsibilities for occupancy of an environmentally significant and sensitive area. A copy of the lease is attached (Appendix B). Rebuttal of Point 6 By what measure does this officer state our claims to be extravagant. This seems to be a statement by an officer to give the Minister a biased opinion against our current claims. Stringent conditions within the lease have been met. The Department itself has failed to remove exotic flora despite our requests and which, under the lease, we are banned from removing. 7. Notwithstanding this agreement and Mr Fuller's claims of environmental awareness and appreciation of departmental management objectives for the area, he has failed to achieve acceptable standards of tenancy. The more significant incidents on the Island during the period 1974-1984, some of which are continuing, include: the improper use of firearms; improper disposal of garbage and sewage and accumulation of refuse; removal of and damage of native vegetation; damage to penguin and shearwater rookeries; irresponsible fire lighting requiring departmental attendance; cultivation of undesirable introduced plant species; inadequate maintenance of grounds; keeping of dogs on the island. Rebuttal of Point 7 This officer's accusations are strongly denied by ourselves as having no basis, and we have been refused any opportunity to defend these accusations. This officer's intention is clearly to damage our good record of management. The lessee has not since 1980 received any advice from the Department to alter any management of the Island, which shows clearly this officer's intention to deceive. 8. The only provision within the lease for control of these activities is termination, which is considered to be an extreme measure for any one incident. The lessee was advised in writing on 1.12.80 of deficiencies in his management of the lease area and this had led to a slight improvement in recent years. However, a recent inspection indicates that the situation is still far from satisfactory and unacceptable to the Department. Rebuttal of Point 8 The officer is quite incorrect to mislead the Minister that the only recourse the Department has available is lease termination. Under the lease document the following sections provide options the Department has at it's disposal to correct any matter. Section 4 (R), 4 (T) and 4 (V) provide for collection of money as a result of the lessee's failure to maintain the leasehold to the Department's satisfaction. The problems noted by the Department during the inspection reports of November 1983 and 4th April 1984 were not conveyed to the lessee for his attention. This failure by the Department to perform was not indicated as it should have been to the Minister. Since 1980, the Department has not, at any time, expressed ``it's dissatisfaction'' of our management, however, if the Department had made any suggestions for improvement we would have been happy to discuss them. 9. The lessee was advised in writing in 1980 that before consideration of lease renewal after 1985 could be entertained, satisfactory observance of the present lease conditions must be undertaken (Appendix C). He was advised also that should the lease be renewed its size would be reduced further. Rebuttal of Point 9 The advice received in 1980 from the Department was in our opinion completely rectified to the Department's satisfaction at the time. The advice included: Removal of rubbish: now completed as reported in the Departmental report on 20 June 1985, ``substantially eliminated'' ``a distinct improvement in grounds maintenance''. Exotic plants were to be removed only under the guidance of the Department as they were suitably experienced, however, the Department has neglected this. It should also be noted that we made a further representation to the Department in 1981 to give guidance at our cost to remove the bamboo, this was not answered. 10. Following the introduction of the Nature Conservation Ordinance in 1982 it became possible to incorporate leases within reserved areas. Consequently action is being taken to declare the whole of Bowen Island, the lease area included, as part of the Jervis Bay Nature Reserve. Rebuttal of Point 10 The officer failed to make clear that under the nature conservation ordinance in 1982, the Department was able to achieve many of its aims for Bowen Island whilst the leasehold could be continued. 11. The ACT House of Assembly recommended in May 1981 that the lease section of island in question remain under lease unless a resident ranger could be placed on the Island. The Department agrees with this approach and has indicated that on termination of the lease it will station an appropriate officer on the island to supervise public use. A subsequent Report of the Assembly in 1984 again indicated support for the termination of the lease. Rebuttal of Point 11 Simply, this paragraph makes it clear in the Minister's mind that the Department is to station a full-time ranger upon Bowen Island. This is untrue as there is no plan by the Department to place any full-time ranger on Bowen Island. It does not make it clear that the ACT House of Assembly recommended that our lease be renewed if a full-time ranger was not to be appointed to the Island. This misinformation would certainly lead to the Minister making an unsatisfactory decision. 12. Also attached are: Attachment D-Lease inspection reports of 24.4.84 and 21.11.80 Attachment E-History of lease administration Attachment F-Relevant ministerial and departmental correspondence Attachment G-Map of Bowen Island Attachment H-Photographic Report RECOMMENDATIONS 13. It is recommended that you: (i) note the above information (ii) recognise the unacceptable record of tenancy by the lessee; (iii) approve that in the interests of expediency and to minimise the anticipated lengthy and unproductive representation which is likely to ensure, further discussion with the lessee be confined to formal notice of lease termination approximately 6 months prior to the expiry date of 31.12.85. B. H. Pratt Assistant Secretary Land Management ACT Parks and Conservation Service Agreed GORDON SCHOLES 15/5/85 REBUTTAL OF POINT 13 ``Recommendations'' The Minister has been recommended to make a decision without giving the lessee any hearing in order to correct any misinformation provided in this report. Such a recommendation can only be viewed with suspicion of an intention to mislead the Minister to make an incorrect decision. Senator LEWIS —Firstly, I want to be careful about any criticism of Mr Pratt. Mr Pratt made a number of recommendations and allegations of which we on the Estimates Committee had some difficulty in ascertaining the veracity. But, of course, we were not cross-examining Mr Pratt. I am not saying that his allegations are right or wrong. I make no criticism of Mr Pratt for performing what he saw as his duty in making the report to the Minister. However, perusal of the rebuttals set out on the paper that I have just incorporated will indicate that the tenant of this area of land has considerable criticism of what Mr Pratt reported to the Minister. At the Estimates Committee hearing doubt was cast on a number of the matters that Mr Pratt recommended or mentioned; in particular, for example, we could find no evidence that the tenant had an unacceptable record. But that is as may be within the duties and responsibilities of an officer of the Public Service. My concern is with the Minister's ready acceptance of that report. What has been established is his failure to give the lessee any opportunity to answer the accusations made by Mr Pratt in this report. It is clear when one reads the report that nothing from the tenant is set out. Mr Pratt made a series of allegations; that is obvious in the report. I would have thought that anyone with any sort of an impartial mind who had read the report would wonder whether the tenant ought to be asked whether he wished to rebut those allegations. I take, for example, Mr Pratt's report about the background of Bowen Island. He talks about Bowen Island in Jervis Bay as having 51 hectares, being a highly fragile penguin rookery and a number of other things. That implies that the lease is for the whole of Bowen Island. But the truth is that the lease relates to only 4 1/2 hectares of the 51 hectares. As far as reference to the highly fragile penguin rookery is concerned, that might appear to indicate that in some way or other the tenant damaged the highly fragile rookery. On a quick, busy Minister's reading of the report, the Minister may have thought that the rookery is being damaged. The truth is that the rookery has grown during the occupancy of these tenants from 300 breeding pairs of penguins to over 1,500. That is the sort of statement by Mr Pratt to which the Minister clearly has not really applied his mind. I criticise the Minister for his failure to give the lessees any opportunity to answer these accusations, either then or since. I claim that the Minister has denied them natural justice. It may well be that in some higher court of the land it will eventually be established that the Minister has denied the lessees natural justice. As I understand it, the tenants deny the accusations contained in the report by Mr Pratt and present a very persuasive argument that if they had an unacceptable record of tenancy that that would have been documented and communicated to them. There is no evidence of this being the case, of their having been written to by the Department and being told that they ought to do some particular thing or correct some behaviour. The report talks about the growth of certain unacceptable plants, exotics, oleanders and other such plants on the island, but they are growing in the area which is not subject to lease-on land that the Department controls. There really seems to be some reason for the Minister to meet these lessees to give them an opportunity to present their case and to reassess the action which the Department has taken. The Minister will not do that. I wrote to the Minister on 4 March and sought a report from an independent source in view of the disturbing allegations contained in the representations made to me. The Minister has not yet responded to my letter. It may very well be that the long term objectives for the island might require termination of the tenancy but to my mind the Department has failed to indicate what departmental objectives cannot be achieved while the tenants remain and whether these objectives could not be achieved by phasing out the lease over a much longer period. I indicated the other day to one of the occupiers that the appearance from the mainland of houses erected on the island was a bit higgledy-piggledy and suggested that they could be painted the same colour or have some work done along those lines. It was pointed out that there has been no such suggestion from the Department. The tenants are completely under the control of the Minister and the Department in that the Minister fixes the terms and conditions of the lease. The area is only 4.5 hectares out of 51 hectares and that area could be reduced even further because the tenants are really interested only in occupying the houses and the immediate surrounds of the houses and in having access to the beach and the jetty. If the Minister or the Department had perhaps required them to effect repairs to either the houses or the jetty, or to repaint or otherwise improve the outlook, the tenants could have done that quite easily and the area of land being occupied may have been reduced. I am informed that there is no penguin rookery under any of the houses, and that the houses have been there for upwards of 40 or 50 years. The penguins rook around the houses and in the kikuyu grass. It is interesting that the Department keeps talking about removing growth which is non-natural from the area. The most important growth which covers the entire island, in particular the area under the Government's control, is kikuyu grass. The cost of removing it would be enormous. The tenants do not have to leave the island for the Government to start that program if it wishes. The penguins rook in the kikuyu grass which protects their nests. If the Department intends to remove the kikuyu grass, the Department and the Government will be interfering with the penguin rookeries. I asked Mr Turner, the Assistant Secretary of the Department, whether there was any evidence that penguins had not flourished during the lease. He conceded that the penguins had flourished. The Opposition asks the Minister why it is intended to waste this money by ejecting these people. After all, they provide a full time caretaker for the island, making sure that people do not go there and have picnics and toss beer cans and rubbish around the place. The caretaker protects the island from that sort of public vandalism. The Department can achieve its objects without ejecting the tenants. A much more sensible proposal would be to have negotiations with the tenants instead of taking them to court as the Government has done. The Minister is refusing to answer questions on the basis that the whole subject is sub judice because the Department has taken out ejectment proceedings against these people. The Minister says that he cannot talk or write about the matter. I would have thought that any sensible litigant-and as a former practising lawyer that is the sort of advice that I would have given to my client-ought to be trying to effect a compromise. As far as the responsibilities to the Australian people of a Minister of the Crown are concerned, I would have thought that a sensible Minister would seek a compromise because it is clear that the path that this Government has decided to take under the guidance of the Department clearly will end in the higher courts of the land: These tenants will not just vacate. They will defend the proceedings brought in the Magistrates Court in the Australian Capital Territory. If they fail there they will appeal to higher courts. As I said, eventually they have every chance of winning their case on the basis that they have been denied natural justice. The sensible thing for the Minister would be to negotiate some compromise and achieve what the Department wants without having to put a permanent ranger on the island. He should allow the tenants some extra period of residence while making it perfectly clear that at the expiration of that period they would voluntarily relinquish their lease and resign. No doubt some compensation could be agreed upon during the negotiations. That would have been the sensible thing for the Minister to do. Senator GARETH EVANS(Victoria-Minister for Resources and Energy)(4.39) —I will ensure that the Minister for Territories (Mr Scholes) sees the text of the remarks made on this subject by Senator Lewis but I think his response would be along the lines of the material available to me which is that the lease on block 6 of Bowen Island in the Jervis Bay territory expired in December 1985 and has not been renewed. The decision not to renew the lease is in accordance with the recommendations of the House of Representatives Standing Committee on Environment and Conservation. The former lessee, Fullers Agencies (Australia) Pty Ltd is, as has been said, disputing the Minister's decision not to renew the lease and has not vacated the land. Action to recover possession has therefore commenced in the Australian Capital Territory Magistrates Court. It would not be appropriate to canvass matters relevant to the legal proceedings. As to the Minister meeting Mr Fuller to discuss the request for the case to be reviewed, the Minister's position is that he gave very careful consideration to the future of Bowen Island when he made his decision not to renew the lease and when considering subsequent representations from Mr Fuller. His view is that the arguments for and against a private lease on Bowen Island have been more than adequately canvassed and no useful purpose would be served in pursuing the matter further. Senator REID(Australian Capital Territory)(4.40) —Quite frankly, I do not regard the answer given by the Minister as adequate. It is the sort of answer we were given at the Estimates Committee hearing. The Minister for Territories (Mr Scholes) has had considerable time since then to have a close look at the matter and be in a position to tell us a bit more about it. Any taxpayer in this country is entitled to know what is being achieved by this action of the Government and how much it will really cost, which will be considerably more than the amount contained in the estimates for this year and which will be an ongoing cost. We have not had an adequate explanation as to why this action is being taken and why the Fullers could not have been left in possession of the island and asked to do some of these things, which they probably would have done. We have not been told why the Minister would not talk to the Fullers and try to seek another solution. I would like to know what the likely legal costs will be which we, as taxpayers, will have to bear as a result of this stupidity and which, as I said, will be ongoing costs. We are told that there will be a full time ranger on the island, but that that will not really cost anything because there is a spare ranger there now who can do the work. That is also quite absurd. If one thinks about the financial implications of the whole Bowen Island exercise to get back about four acres, one will realise that it is an enormous expense at a time when such expense is not warranted. No explanation has been given as to why the things that the Department of Territories thinks ought to be done could not have been done by the tenants who were on the island. Who benefits from this action? We are entitled to know. I am sick of being fobbed off with the sort of explanation that is being given. It almost sounds as if the legal action was embarked upon when it was, merely to provide the excuse to hide behind that the matter is now before the courts. Given the legal costs that will be involved-let us face it, there is little likelihood that the matter will not finish up in the Federal Court of Australia, anyhow-we are entitled to have answers to some of these questions. Senator GARETH EVANS(Victoria-Minister for Resources and Energy)(4.43) — Apart from the answers that were given at the Estimates Committee hearing, a series of further written answers to questions has been circulated to Estimates Committee members. They address some of these matters of cost and, in particular, the question of the stationing of a ranger on Bowen Island. It is advised that a ranger will be stationed on the island once vacant possession is available. I believe that a number of the other matters Senator Reid is concerned about are specifically there addressed. As to the larger question of budgetary allocations for this matter, the view that is taken by the Department of Territories is simply that a responsible approach will be taken within the budget that is available to the Department as a whole. It is a question of using resources in accordance with priorities. To that extent the Bowen Island matter will simply have to take its place in the queue. But there is a full understanding, as I am advised, of all the issues that have been raised. Nothing new has been put into the debate on this occasion. The Minister for Territories (Mr Scholes) has fully considered all the material that has been put before him and raised in this place. His response is as I have communicated it. Senator MICHAEL BAUME(New South Wales)(4.45) —Some matters emerge from this issue, quite apart from those already raised about the extraordinary behaviour of the Department of Territories and the Minister for Territories (Mr Scholes) in their relationship with the lessees of Bowen Island. One matter emerges from the very question the Minister for Resources and Energy (Senator Gareth Evans) has just raised, that is, the matter of expenditure priorities. I must say that, as Chairman of the Opposition's Waste Watch Committee, I am intrigued to see that the Government has amongst its priorities the spending of $640,000 this financial year to get rid of the Fullers from Bowen Island-the people who have been doing an outstanding job in conserving and preserving this area. I correct myself: That $640,000 includes some other expenditures relating to the purchase of improvements on withdrawn leases. But the bulk of the money-as I understand it, the great majority of it-relates to this specific matter. The Government considers that Australians' money should be spent, at a time like this, on what is a totally unnecessary, wasteful and absurd proposition which cannot be defended adequately, which has not been defended properly to the Committee and regarding which questions are still being pursued by honourable senators, without a proper response being given. If the estimates are accurate-that there is to be an increase of $326,000 in the original estimate of $314,000 to go this year towards the purchase of improvements on withdrawn leases-it seems to indicate that the $400,000-odd claim that has been touted as the claim the present lessees will have is, perhaps, close to the truth. I note that during the Estimates Committee hearing the public servants involved said that $150,000 of the additional amount probably relates to Bowen Island on top of whatever was the initial amount allocated. But at this stage we are not sure what that amount will be because it is subject to litigation. However, let us assume that around $400,000 is to be wasted this year on a procedure which is totally unnecessary if the stated objectives of the Department are really what the Department is all about. That is the essential issue. Are the stated objectives what the Government and the Department really seek? If the objectives are the great list of things officers gave to us of improvements and so on that had to be made, such as the cutting down of bamboo which has been proceeding anyway, nothing in the present lease arrangements prevents the Government from doing them without this kind of massive expenditure. The Department tells the Government that these things are absolutely essential, that they must be done and that they have such a priority that the kind of money involved is a minimum of $400,000 and the allocation, as I said, is up to $640,000. What does this additional expenditure achieve that could not be achieved in terms of the Department's objectives? That is a question the Department has not answered. It will not discuss these matters with the people concerned and is behaving in a totally arrogant and unpleasant way, not only to the lessees but also to honourable senators. It may well be that this supplementary estimate of $640,000 is largely bunkum anyway and will not be spent because litigation is proceeding. In my mind there is no way this money will be spent by 30 June because these matters will not be resolved by then and may well not be resolved for a long time. I can assure the Department that, as Chairman of the Opposition's Waste Watch Committee, I will be looking very closely at the Department's expenditures to make certain that the money allocated for this purpose is not diverted to some other purpose. I must admit that I have very little confidence in the departmental advice, following what we have seen so far. I am also very concerned about the discussion of whether, if the Government gets rid of the lessees-who, as I have said, have looked after this area so successfully that the penguin population has increased significantly-it will require the stationing of a full time ranger on the island at considerable cost. I am not certain of the running cost of maintaining a ranger on the island, because the Department ducked the question during the Estimates Committee hearing and said that a ranger would be provided out of the existing strength of the staff of rangers in Jervis Bay. That staff looks after an enormous area, public usage of which has been increasing enormously. The demands on that existing staff will continue to increase. Yet we have had this phoney response that someone can be diverted-someone who is already overworked and is already handling an enormous increase-without any additional cost to the taxpayer, into an additional task of being a full time ranger on Bowen Island. The answer given was that the priorities will just be rearranged. I would then expect the Department to start pressuring the Government, if it behaves as most departments seem to, for an additional staff member after this position has been established, because of the phoney response that as there are more and more tourists in the rest of the area, therefore there is a need to increase the staff in the rest of the area; having sought to fool the Senate by saying that there would not be any additional cost whatsoever and that the Department would simply divert one of the existing staff. I find the whole arrangement to be most unsatisfactory. I have to declare an interest. I have been to Bowen Island; I know the lessees; and I have had the privilege of staying there and of watching the fairy penguins come ashore in the evening. I have seen what an outstanding job has been done by these people; a job being done for nothing as far as the Department is concerned. The Department now seeks to do that job at public expense, at a capital cost of between $400,000 and $640,000, basically to achieve nothing that could not be achieved without the expenditure of any of this amount. Until the Government tells us exactly what can be achieved or what cannot be achieved in the present situation, the Senate would have every right to be particularly concerned about this unnecessary expenditure, which will do nothing either for the penguins or for the island, at a time when the Government is preaching expenditure restraint. Senator GARETH EVANS(Victoria-Minister for Resources and Energy)(4.52) —I am not sure that I can add very much more to what has been said earlier, but a couple of points should be made. The first is as to the suggestion that the Department of Territories somehow is having to justify a cost of $400,000 to buy out the tenants. It should be clear from the documentation that has been provided that the only sum that has been earmarked for this purpose is $150,000, $90,000 of which is to purchase existing improvements and the remainder is to demolish various buildings, repair the jetty, and so on. It is the case that a figure of $400,000 is in circulation, being the valuation provided to the lessees by a private valuer, but that is a contested valuation and it is not to be assumed that the payout will be anything like that order of magnitude. It is the case that the $90,000 that has been allocated for this purpose will not now be spent, as a result of litigation, in this financial year, but in other respects the situation is as I have described it. As to the question of the rangers and the additional allegedly wasted cost involved in stationing a ranger permanently in this location, I am advised that rangers are now already involved in the Bowen Island administration in a limited way and the change is not as radical as is being suggested by those on the other side. Apart from this, the matter simply has to rest as I have indicated. Senator Sir JOHN CARRICK(New South Wales)(4.53) —I want to pose some questions and make some comments on the Department of Aviation, essentially in relation to the Government's decision to build a new airport at Badgerys Creek. I do so against the background that I have sought information on the nature of the airport at Badgerys Creek and have received a quite ambiguous reply. Fundamentally, it is important to understand, against this background, that the Minister for Aviation (Mr Peter Morris), in a letter to me by way of written answer, made the following statement: Decisions as to what role the second airport will initially fill have of course yet to be taken. I have to say that that is rather quaint. The Government has made a decision to acquire Badgerys Creek and a massive decision to displace a whole lot of people who do not want to leave the area, but it does not know why it wants the airport. So I will ask a few questions and I invite the Minister for Resources and Energy (Senator Gareth Evans) to secure an answer to them. I refer to Badgerys Creek and the fact that the Minister said he does not know what role it will have. I will come back to that in a moment. I ask the Minister: When has the Government decided that the construction of the airport will start? That must be a simple question to be answered, otherwise the Government would not have made the announcement and sought to acquire the land. Will it start in the next year? Secondly, when is it proposed that it will be finished? This is a fundamental question particularly in relation to the functioning of Kingsford-Smith Airport. The answers to all of these questions must be known, otherwise the decision would not have been made and it would not have proceeded. What is the estimated cost to the Commonwealth for this? What is the estimated cost to the New South Wales Government with regard to all the ancillary activities? Has there been any agreement by the State Government to undertake that cost? Has there been any financing arrangement between the Commonwealth Government and the State Government? Specifically I ask: Has any work been done in relation to the direction that shall be taken of freeways from the airport towards the city and, therefore, what areas will be acquired and what properties are in peril? Does the area include a buffer zone and what is the buffer zone? In other words, is the Government planning to protect the airfield from encroachment of development? Is the environmental impact statement, on which no doubt the committee made its decision, available for us to see? I understand the difficulty, in that I have asked a lot of questions, but I am not seeking the answers now. I specifically invite the Minister to consider this situation: The Government has indicated that it proposes to amend the Commonwealth Lands Acquisition Act and was to have done so in this session, but I understand that it will do so in the Budget session. I have been advised in another Committee that a number of decisions have been taken-for example, a review from the decision will be provided to the Administrative Appeals Tribunal at least that has been advised by the Government to another committee. I understand that the primary delay in investigating this legislation relates to whether the amending legislation should include a provision for injurious affection. The Minister will understand the significance of injurious affection to an area which is to take a main airport; that is to those whose properties will not be acquired but who are on the fringe of acquisition. I hope that all these questions will be answered specifically, because the people of Badgerys Creek are suffering from this at the moment. In drafting the legislation will the Government very seriously take into account injurious affection and solatium, which the Minister would understand can be specific in an area such as this? Above all, will the Government take into account the loss of value of a property from the moment a freeze is put on until the moment that it is sold? It is ludicrous to have an acquisition under which the value that the Government pays is the value that the user would get commercially at the point of payment. That is a nonsense because, for example, in the Cobar area at this moment properties have halved in value simply because of the freeze. Taking those questions on acquisition together, I ask specifically: Will the Government refrain from acts of acquisition, if it has it in mind at this moment, until the benefits, if any, accruing from the amended Act can apply to these people? Will it, in amending the Act, take in those details to which I have referred? Specifically, I want some other answers. Airfields have four main purposes. Three commercial categories of aircraft use them. First of all, they are used by intrastate aircraft; that is, aircraft flying, for example, from Dubbo to Sydney, from Sydney to Narrandera, or between various other parts of the State. At least 50 per cent of the commuter aircraft carry passengers who go to an airport specifically to get onto either an interstate aircraft or an international aircraft. That is of great importance in planning any airport. So, for a start, we can identify intrastate commercial aircraft. We can identify interstate commercial aircraft. I remind the Minister and the Committee that many passengers on interstate aircraft are on those intrastate aircraft in order to go to, say, Dubbo from Melbourne or to get onto an international aircraft. That is very common. I now draw attention to international aircraft and the need for people to be able to get onto interstate and intrastate aircraft from the first point of entry into Australia. Of course, there is then general aviation, a term that takes in, generically, anything from crop dusting to recreational or private flying. Let me rejoice in the Government's description of what is likely to happen. I find this to be an Alice in Wonderland situation. Here we are with a Government saying it will build this airfield, so it must know what it is going to do. Otherwise, why would it acquire property? Let me read to the Committee the two choices. I refer to two paragraphs from a letter of the Minister for Aviation, Mr Peter Morris, of 4 April. He says: One of the findings of the SSA Site Selection Programme was that there seems no good reason why the principles which appear to direct traffic distributions between multi airport systems in metropolitan centres overseas would not equally apply to Sydney. If so, we can look forward to Sydney (Kingsford-Smith) Airport (KSA) essentially catering to commercial and business activities, and the second airport more characteristically accommodating leisure travel and other activities which cannot be accommodated at KSA. I now ask the Minister what is meant by catering for leisure travel. Is not overseas travel, travel between States and intrastate travel leisure travel? The letter goes on with a lovely kind of blandishment: If this occurred the split would then generally be leisure/business . . . In other words, one airport has leisure and the other has business, rather than international, interstate or intrastate aircraft, et cetera. We must not worry about that; we have this leisure/business breakup. The letter continues: This specialisation results in little need to travel between the two airports. I have some news for the Government. Airports 30 to 40 miles apart with a major international city between them will be absolutely isolated from each other by three or four hours of travel and endless delays. For the Minister responsible for the Government's action to freeze land at Badgerys Creek to give this reply is a nonsense. But it becomes far more than that-and the questions I have asked so far have received no specific answer-because now the authorities are saying that Sydney (Kingsford-Smith) Airport must be dealt with and dealt with quickly, with immediacy, because it is dangerously overloaded and there are risks of accidents if the pressures keep on. The Government need not have had any doubt about that because the Major Airport Needs of Sydney Committee has said that over many years and only the Wran Government has stood in the way of its sensible report being considered. But here we have an airport-Kingsford-Smith Airport-which cannot wait for another airport to be built. We must not forget that when the other airport is built, it will be going in for leisure traffic, not for any of the commercial business flights that most people use. At the very least, an airport of any major standard will take 10 years to construct, with all the freeways and everything else. The fact is that there was never a choice between either doing something at Kingsford-Smith or having another airport; there was always the necessity to look towards Kingsford-Smith as well as having another airport. The real urgency is this: What specific action is the Government taking, in the light of this authoritative knowledge that it now has, to overcome the bottlenecks that are occurring day by day at Kingsford-Smith Airport and to overcome the dangers of accident as a result of too great a volume of air traffic, other than simply shifting international aircraft to other capital cities? That is in fact what has happened. They have been shooting off to Melbourne and Brisbane, despite the fact that most international travellers have Sydney as their central point. I have risen on this matter simply to say that I believe that the people of Badgerys Creek have been done a grave disservice. Frankly, I do not believe for a moment that the Government intends to build this second airport. If it does, it can answer my five or ten specific questions. We will then know when it will start and finish and its cost and usage, and we will know that it has the agreement of the State Government. We will know all these things. Also, the Government will have adjusted the situation to deal with people decently, honestly and fairly under the Lands Acquisition Act. I emphatically ask that the questions I put in the consideration of these estimates be given answers in the immediate future so that the people of Badgerys Creek and surrounding areas can understand specifically their problems. They are suffering a hardship now by way of loss of property values and loss of manoeuvrability for themselves, and they deserve a better fate. The TEMPORARY CHAIRMAN(Senator Colston) —Order! Senator Sir John Carrick asked five or ten specific questions, although I did not count them. I remind the Committee that we are debating the estimates of expenditure of several departments, and if specific questions like this are to be asked it might be best if the honourable senator asking them were to tie them in with the specific estimates that we are looking at. Senator Sir John Carrick —I specifically said to the Minister that I was not asking that he respond to them now but that he take them on notice. It is the custom in this place to be able to make a speech, under this heading, on the very framework of aviation. If Kingsford-Smith Airport-the focal point of aviation in Australia-is not part of these estimates, then, with great respect to you, I do not know what is. The TEMPORARY CHAIRMAN —With great respect to Senator Sir John Carrick, the role of the Committee of the Whole has changed over the time that he and I have been here. We were not able to make speeches of a second reading nature in the past. I thought that the honourable senator wanted answers to those questions at this stage, but, if he does not, that is fine. Senator PUPLICK(New South Wales)(5.09) —I also wish to raise a couple of matters under the vote for the Department of Aviation. Firstly, it has been drawn to my attention, as I am sure it has been drawn to the attention of other honourable senators, that the aviation cost recovery program the Government is pursuing has got to the stage where it is likely now to have a severe effect upon the operation of general aviation in this country. Some colleagues of mine, such as Senator Townley and Senator MacGibbon, who are closely associated with the problems of the aviation industry will undoubtedly be aware of the extent to which the Government's pursuit of its policy in terms of aviation cost recovery is posing particular problems for general aviation. I note that there is a view expressed by people in the general aviation sector of this country that the sorts of charges which are being imposed on things such as the way in which individual pilots have to comply with increased licencing and increased reporting arrangements and the costs attached to those may well lead to a situation in which fewer pilots will lodge flight plans if there is considerable penalty attached to doing so, and that that will have a substantial and detrimental effect upon the safety standards which have previously been so very much a feature of the Australian aviation industry. In order to illustrate the charges to which I referred under the cost recovery arrangements, I seek leave to incorporate in Hansard a brief document prepared for me by the General Aircraft Association which I had previously shown to Senator Gareth Evans when he was the Minister on duty. Rather than take the time of the Senate going through those charges, I believe it would be more convenient if permission was given to incorporate that document. Leave granted. The document read as follows- Jan 18, 1986 GENERAL AVIATION UNDER THREAT . . . SUMMARY Here is a short summary of the situation regarding cost recovery. PLEASE DO ALL YOU CAN TO MAKE THE FACTS WIDELY KNOWN. PROPOSED COMMENCEMENT DATE: 1st July, 1986. RECOVERY TARGET: In 1983/84 General Aviation is supposed to have cost $152.1m. This amount (substantially increased by inflation) is to be recovered in full after a 10 year phase-in period, commencing 1st July, 1986. PROPOSED LANDING CHARGES: These will commence on 1st July, 1986. Commonwealth aerodromes (incl capital city secondary aerodromes): $9.50 per landing. Aerodrome Local Ownership Plan aerodromes: (i.e. with Councils) $8.60 per landing. Hoxton Park and Camden will be charged the same as Bankstown. These proposed charges are the minimum for an aircraft with a maximum take off weight of 1500 Kgs or less. This is pro-rated, i.e. 2 x the charge for 3000 Kgs, etc. Computer facilities are nearing the testing stage to be ready for the 1st July implementation date. The Department of Aviation have called for operators to volunteer to help in testing the accuracy of the new system. Initially flight strips will be the basis for levying the charges. Therefore only aircraft lodging flight plans will be charged (over 50 miles). However, it seems likely that as staff can be allocated from within the Department of Aviation other methods will be employed to ensure wider collection of landing charges. It seems likely that all users of Commonwealth and Aerodrome Local Ownership Plan aerodromes will eventually have to pay landing charges. INCREASE IN OTHER CHARGES. Charges will be introduced or increased for almost all services provided by the Department of Aviation. A sample of the proposed charges are below: Eventual cost (in 1983-4 dollars) 1986-87 charge $ $ Flight Crew Licences Student Issue... 46.00 5.00 Renew... 42.00 5.00 Private Issue... 46.00 15.00 With test... 222.00 35.00 Renew... 39.00 5.00 Commercial Issue... 46.00 15.00 With test... 222.00 35.00 Renew... 39.00 5.00 Instrument Ratings Class 1, 3 or 4 Issue... 5.00 5.00 With test... 178.00 20.00 Renew... 4.00 4.00 With test... 176.00 20.00 Charges will also be made or increased for issue of Aeronautical Information Supplements documentation, endorsements of licences, examinations, Licensed Aircraft Maintenance Engineer licensing, registration and certification of aircraft, and operational standards surveillance among others. A summary of increases in charges for some of these items is listed below: INCREASE IN CHARGES 1986-87 Flight Crew licensing, 600 per cent Licensed Aircraft Maintenance Engineer licensing, 5300 per cent Registration & Cert. of A/C. 64 per cent Operational Surveillance 470 per cent Adjustment to Air Navigation Charges. As an offset to the introduction of landing charges etc the Air Navigation Charges will be reduced by 50%. Industry's acceptance of Bosch Report. The Department of Aviation is basing a lot of its assumptions on the industry's general acceptance of the Bosch report, much of which was critical of the Department of Aviation and favourable to General Aviation. However, the Department of Aviation has now seen fit to modify and selectively implement sections of the Bosch report in a manner detrimental to General Aviation without allowing for further negotiations. The changes made by the Department of Aviation effectively negate the industry's acceptance of this report. SAFETY: I believe the Department of Aviation has overlooked the fundamental question of safety. Fewer pilots will lodge flight plans if there is a considerable penalty attached to doing this. The system will be deprived of the valuable traffic advisory service now provided to Instrument Flight Rules, Regular Public Transport aircraft, etc., with consequent reduction in protection for these aircraft. Also, Department of Aviation action will be less effective and considerably more costly. The final result: Destruction of the Industry as we know it. General Aviation will become the province of the very rich. The valuable contribution played by General Aviation to the lives of tens of thousands of Australians will cease to exist. Don't forget the jobs of many thousands of workers in the industry, government employees included! For further information-Ring General Aircraft Association: Senator PUPLICK —The other point that I raise-Senator Ryan undoubtedly will roll her eyes in horror at this-is the question of inwards duty free shopping. On this occasion I draw attention to the fact that, the decision having now been made for inwards duty free shopping in Australia, the Department of Aviation has now produced a pamphlet entitled `Lighten your load-buy on arrival'. This pamphlet has been issued by the Minister for Aviation (Mr Peter Morris) and it encourages people to buy on arrival when they return to Australia. This has been sent out in several thousands to travel agents throughout Australia to distribute to people when tickets are issued, suggesting that they wait until they return to buy their alcohol, tobacco and perfume, which are the three products which are available at this stage on re-entry into Australia. I find it passing curious that the Commonwealth Department of Aviation spends money to urge Australians to shop at shops owned by non-Australians and ignores the idea of purchasing goods from Australian-owned and operated stores. The only `buy on arrival' shops available at the moment are owned by foreign companies. They are owned by foreign companies which have an employment practice of not employing Australians at senior managerial levels but, in fact, of bringing to this country foreign nationals to manage and operate their particular activities. It is extraordinary to me that the Commonwealth should spend money to urge Australian travellers to effectively boycott Australian-owned premises in order to buy at foreign-owned premises. As I have said repeatedly in this place during numerous interventions on the question of inwards duty free shopping, I have no doubt that this is part of a long term and concerted campaign by the Department to squeeze out the independent off-airport duty free operators. The Department dislikes these people because they have stuck up for the traveller at the expense of the bureaucrats in the Department of Aviation. All of the history demonstrates that the Department of Aviation has put every possible impediment in the way of the independent off-airport duty free shop operator. The off-airport duty free shops have had to go to the High Court of Australia, in the case of Sterling-Nicholas v the Commonwealth, in order to protect themselves. Their only support has been that support provided to them by legal means. The Department has attempted to kill them off at every possible turn. It has been extraordinarily successful. As a result, duty free purchases at Australian off-airport duty free shops are the cheapest in the world. For instance, information in the Sydney Morning Herald on 29 April this year, on 24 October 1984 and back in 11 April 1983 has consistently shown that Australian off-airport duty free shops are the cheapest and, indeed, the best in the world. Yet the Department, having now introduced this inwards duty free shopping arrangement against the recommendations of the Customs Service and against the recommendations of the Industries Assistance Commission, is now using Commonwealth revenue to try and drive the independent off-airport Australian-owned shops to the wall in favour of those shops which are on Commonwealth property-those shops which pay lease arrangements to the Commonwealth and which already have received favourable deals from the Commonwealth. They were granted their inwards duty free concessions without competitive tender. The Commonwealth is now attempting to drive Australian operators out of business by spending public money to the commercial benefit of non-Australian organisations. I think that is a disgraceful situation. I think it is indicative of the level and standard of behaviour of officers in the Department of Aviation and in the Department of Sport, Recreation and Tourism, who have been the main proponents of this idea. I believe there are many thousands of people employed in the duty free industry in Australia who will be disappointed, to put it mildly, to learn that the money they pay in tax is now to be used by the Commonwealth to conduct a propaganda campaign to the detriment of Australian industry and in favour of commercial operations which are owned by foreign companies whose profits are repatriated out of the country and which pursue an employment policy which ensures that Australians are not employed in top managerial positions within that organisation. Senator VANSTONE(South Australia)(5.17) —I wish to return briefly to the estimates of the Department of Territories and in particular to the matter of Bowen Island. I realise that Senator Lewis, Senator Reid and Senator Michael Baume adequately canvassed a number of matters, but some of them in very short form seem worth repeating because there did not seem to be an adequate answer offered, either today or on the many opportunities the Department has had in the past to supply satisfactory answers. The first question I raise is who benefits by what has happened at Bowen Island? No one has convinced me or other senators I have spoken to that the public benefits by this move at Bowen Island. Nobody has convinced me that the lessees benefit-the lessees are the last people to believe that they will benefit-by being kicked off the island. The second question I ask is what is being achieved by sending away the lessees, who occupy only a small portion of the island? What harm have they done that requires that they be sent away? In fact, photographs made available to members of the Estimates Committee seemed to show that, since the lessees have occupied the portion of the island they leased, there has been a substantial improvement in the environmental aspects of the island. In my view, there has not been an adequate explanation of the cost of removal of the kikuyu grass. Apart from the financial cost, there has been no explanation of what will happen to the penguin colony. At the Estimates Committee, it was asked how the kikuyu grass would be removed, given that it is in that grass that the penguins nest. The answer given was `very carefully'. Everybody laughed at the time and I suppose at the time it was a bit of light relief in a long day, but it does not seem to me to be an adequate answer to say that the kikuyu grass will be removed very carefully so as not to disturb the penguin colony. After all, if this move is genuinely being made to conserve and preserve the natural environment, and the penguin colony is a part of that, I would have thought that satisfactory estimates would have been made about what will happen to the penguin colony if the Government or the Department goes ahead with their plans. I am led to believe that tests have already been undertaken to determine the effectiveness of various poisons to deal with the kikuyu grass. I am further led to believe that a passing remark from an officer involved in these tests put an estimate up in the millions of dollars over an extensive period to rid the island of kikuyu grass. I say `a passing remark' because I understand that is all it was. It was not a well thought out and researched estimate. We have been given no indication from the Department of the full cost of returning the island to the state it wants it to return to, and in particular the dollar cost of removing the kikuyu grass and the environmental cost to the penguin colony. Will the Minister undertake to make available all advice received by the Department with respect to the Government's plans and what effect it will have on the penguin colony, and in particular to make available whatever advice the Department of Arts, Heritage and Environment offered to the Department of Territories? When that advice is made available, Opposition senators may be able to alter their view. Their view at the moment is that the priority given to this project, in tough economic times, must be queried because there is a cost outlay with a limited benefit, if any, in removing the lessees from a small portion of this island. I concur in the views of my fellow senators that the answers thus far have simply not been adequate. Senator VIGOR(South Australia)(5.22) —I also wish to question the estimates of the Department of the Territories. A statement was presented to the Estimates Committee and incorporated in its proceedings as to why the Minister for Territories (Mr Scholes) was not prepared to answer questions on Bowen Island and on the Ouvea issue. At the outset I want to reject the claim by the Minister for Territories that the question relating to the stay of the crew of the yacht Ouvea at Norfolk Island in July was somehow outside the Additional Estimates. The New Zealand police had facilities made available to them by the Administrator and, for all we knew, overtime bills might well have gone up markedly, just as they did for the Australian police who were stationed on that island. However, of more moment to me is the inability of the Press and other media to get any comment from the Administrator. If such material had been available on the public record one would not have to spend time in the Senate trying to get it. In this case an act of international terrorism took place in New Zealand and there was an involvement by our Government days later on Norfolk Island. I believe that members of parliament, such as I, have a responsibility to ferret out exactly what involvement we had. I would like to hear some comment on that matter by the Minister. The same problem, however, seems to have existed in other areas of the answers from the Department of Territories. One such noticeable area is that of Australian Capital Territory housing. For a time the media were highly and irrationally excited by the community housing expansion program, CHEP, in the Australian Capital Territory. In August the Minister for Territories announced his intention to appoint a consultant to examine alternative forms of public housing in the Australian Capital Territory. That idea has been undermined, I believe, by the Department and in fact bombed by Cabinet. However, we have no information on this and I seek some guidance on the subject from the Minister. We are now apparently to have a consultancy, under the auspices of the Department, to look into the whole matter. We do not know what terms of reference are involved, what degree of public input there will be into the process, or what steps the Government has taken to get the Department of Territories to align its practices with the Commonwealth-State Housing Agreement. All these matters need to be answered in the interests of public knowledge and of the people of Canberra. Even more serious in this area, it seems that some of the information provided to the Committee by the Department of Territories indicated that there are real administrative problems in the Department. We have heard at length of the Bowen Island litigation, which was commented upon also in the formal report to the Senate by the Estimates Committee. We also have the case of the Belconnen Mall in which information was withheld. In the Estimates Committee hearing we had to ask a vast number of questions. A briefing I was due to have was cancelled at an hour's notice by the office of the Prime Minister (Mr Hawke). Subsequently it was reinstated, but a number of written questions had to be put to the Department, hence, in the process, wasting resources and energy. We have also clear indications before the Committee that the Department did not properly read the Nuclear Activities (Prohibition) Ordinance passed by the House of Assembly in 1984. It claimed that the ordinance would have prohibited the use of uranium in medical research. I can see no way in which the Department could come to such a strange conclusion. I saw nothing dealing with this in the copy of the ordinance that I had. It seems to me that this shows up a severe problem in the legal section of the Department of Territories. I believe that, as long as this is not cured and sorted out properly, the Australian Capital Territory will continue to have major problems. It seems also that the answer given about legal action in relation to enforcing a Supreme Court order in Torrens Street omitted a number of facts that local residents believe to be highly relevant. This type of slipshod answer is not what we expect from a department. I believe that the matter has been taken to the Ombudsman for the second time in over a decade. I understand that local residents collected evidence because the Department was showing no inclination to do so. The Department did not answer that part of my question in the Estimates Committee. I believe that it should, on notice from here, be asked to answer by the Minister, or some undertaking should be made that the question will be answered. I understand that the Australian Government Solicitor said that a prosecution for contempt could be undertaken. I hope that the Minister will not hide behind the problem of sub judice in avoiding the question yet another time today. I know that the local residents have collected all the excuses given in the past, and this has systematically shown that there was a change in pattern as each excuse came to the end of its available lifetime. It is no wonder that the Government is acting to try to improve the land administration section of the Department of Territories. It is extremely important, if we are to continue to pay out large amounts of money and the Territories Department is to grow by adding a whole lot more sections, that the problem of administration should be solved. The National Capital Development Commission indicated in an answer that it would be reviewing the current lease ordinances relating to the Australian Capital Territory. Will that be an internal process only, or will the Government ensure that there is scope for submissions from the public and public hearings so that a work- able system can emerge-one whose principles will actually be adhered to? Actually getting contact is a real problem for the people in Canberra. We are now going through a process of getting self-government. The same Department will be running it. If the Government does not accept the electoral system that is being proposed by the Senate, we may not have self-government and the Department will be running it on its own. This would be a real problem. Information supplied to the Committee indicated that as at 31 March 1986 the aggregate arrears for land rent and rates on commercial leases amounted to $1.37m. Recovery action on over half that amount has been suspended or has not actually commenced. In fact, I was interested to read in last weekend's newspapers an advertisement about legal action being taken in relation to rates. Does this mean that there will be concerted recovery action in the case of the commercial leases, or are we just going to hit the individual citizens whose rates are behind the times? Is the Government moving to regularise the involvement of the National Capital Development Commission in areas of the Australian Capital Territory outside those set aside for it in its legislation? What is happening? We do not know. No such information is available. What progress has been made on determining the parts of the Australian Capital Territory that will continue to have national standing and funding to match the status of a national capital? When will that information be put to a local governing body for discussion and possible amendment? When will we get a local body? I also note the Australian Capital Territory self-government proposals exclude Jervis Bay. We have no indications, currently, as to how Jervis Bay will be handled. Will it be handed over to the Department of Defence or will it still be managed by the Department of Territories? I think that is an easy enough question to answer. What will happen to any current leases? Senator Robert Ray —What is the answer? Senator VIGOR —I wish I knew. Senator Robert Ray —You said it was easy. You can't even get the easy ones tonight. Senator VIGOR —That is what I am trying to say about the Department. Will current leases be terminated like the leases on Bowen Island? Will the Government be making a detailed statement on its intentions for Jervis Bay, particularly its use as a nuclear port or as a defence facility? When will we hear about this? All of these questions are essential to an understanding of what is happening within the Department of Territories. We are told by the Minister, particularly in relation to the self-government legislation, that there are great difficulties in getting the legislation drafted. In fact, a briefing supported this. In September 1981 Senator Gareth Evans was told that there were eight drafting staff in the Attorney-General's Department who worked on Australian Capital Territory matters. Estimates Committee E was told that discussions were continuing with the Department of Territories over the transfer of these drafting staff. How many staff are now involved in the drafting process? When is a transfer likely to take place? What are the impediments to this transfer? It is important, if we are to get effective management of the Territory and an effective interface between whatever the new body is and this Parliament, that that drafting facility be available and that the administrative problems that I brought up be investigated. I ask the Minister to comment on the general matters which I have raised. Senator LEWIS(Victoria)(5.34) —I realise that the Minister for Education (Senator Ryan) is reeling from the questions asked by Senator Vigor. While she is seeking some instructions and trying to find some answers to the very pungent and telling questions which Senator Vigor has asked the Department, I wonder whether she could also ascertain something about the titles to land on Christmas Island. The departmental officers will be aware of my concern over this matter. The situation is that the phosphate mining on Christmas Island is running down, and it is to be hoped that some private enterprise will take place on the island. It is extremely difficult for any private entrepreneur to establish any form of business without being able to get some title to the land that he or she wishes to occupy, even if it is for a term of only a few years. There is a market gardener on Christmas Island who has been in possession of an area of land for nearly three years. He has done a wonderful job in endeavouring to provide some island grown fruit and vegetables for the population on the island. Senator Robert Ray —Does he import fertilisers? Senator LEWIS —I will explain to the honourable senator that it is not as easy as that. Apparently, one of the great difficulties is that the island is full of fertiliser but is not full of soil. One cannot really grow things in fertiliser. The great difficulty is getting soil which is suitable for growing food. This fellow has put in a lot of work into this area. He has put in an irrigation supply and has done a lot of work to clear the land, but he is still waiting for a title to the land. I do not know what the Department of Territories is on about. Maybe it wants to produce a survey of the whole island which, I think, would be totally unnecessary. What is needed at this stage is a survey of some of the areas which might be made available to the public to enable some private entrepreneurial action to take place on the island for the benefit of Christmas Island, for the benefit of the Department of Territories, and for the benefit of this nation. I hope that that has given the Minister an opportunity to obtain some instructions from the Department as to progress in surveying the island or parts of the island. I ask a very simple question: When can we expect titles to be available to issue for the land on Christmas Island? Senator RYAN(Australian Capital Territory-Minister for Education)(5.37) —I have some advice from departmental officers. I remind Senator Lewis that it is advice and not instruction that Ministers seek from officers. In respect of Christmas Island the new land lease arrangements are almost finalised. Some entrepreneurs are already starting up. The issues raised by Senator Lewis's questions are agreed to be important and are high priorities in the Department of Territories. The Department agrees to the point made by Senator Lewis about the survey. In relation to a number of matters raised by Senator Vigor, we inform him that Jervis Bay will continue to be administered by the Department of Territories. There will be no change in the leases at Jervis Bay. The Minister for Territories (Mr Scholes) has already issued a statement on this. Senator Vigor asked a number of questions and concluded by asking generally what the attitude of the Government is to these matters. I think the best way in which I can help Senator Vigor is to refer his remarks to the Minister. I am sure the Minister will respond to them. Senator LEWIS(Victoria)(5.38) —I tried to interject. I do not know whether the Minister for Education (Senator Ryan) thinks she will get away with it, but of course I am going to stand up and ask her what is almost finalised? What on earth does almost finalised mean? We have been hearing that for at least two years. Would the Department of Territories be prepared to give a date when the title situation will be finalised? Senator RYAN(Australian Capital Territory-Minister for Education)(5.38) —The Department of Territories is waiting on a draft of the legislation from the Attorney-General's Department. Senator TOWNLEY(Tasmania)(5.39) —I want to say a couple of things about the Department of Aviation. First, it is quite notice- able, having watched the estimates for many years, that the cost of aviation services in this country is continuing to rise. We see almost $8m-- Senator Robert Ray —It has to pay for all your accidents. Senator TOWNLEY —I have not had an accident for a long time. The cost in these votes is almost an additional $8m. These costs are being criticised by a lot of people associated with aviation. As was mentioned earlier by Senator Puplick we have seen recently an attempt to levy charges on general aviation. I believe that that had not been thought through properly because when I questioned that in the Estimates Committee, the departmental officers did not seem to quite know how it would be done, particularly in regard to some of the smaller aircraft. I am pleased to see that the Minister for Aviation (Mr Peter Morris) has held up the application of those charges for a year so that an examination of just how to do it and how much to charge can be made. I thought that was something on which to commend the Minister, and I do so. However, for a little airline such as Airlines of Tasmania Pty Ltd the charges would have amounted to something like $360,000 per annum. That is no small amount for a small airline that serves Tasmania very well. I would like to let the Department know, via the Minister, that this is something that senators from Tasmania will be keeping an eye on as time goes by. The main point I want to make is that, instead of continuing to impose extra costs on the community, there seems to be a need for the Department to attempt to reduce its expenditure. One area I can think of is pilot training. Some millions of dollars are spent on it. I have noted that expenditure on it has increased periodically since the time I have been a member of parliament. Millions of dollars are spent on pilot training mainly so that the pilots who are trained can examine other pilots. I have always wondered how somebody who, for argument's sake, is trained for eight hours a year in a jumbo examines somebody who is flying 400 hours a year in a jumbo. It seems quite crazy. If one questions this with the Department it brings up the matter of safety. That is something for which the Department of Aviation has been well known for many years. If one looks back at some committee inquiries one will see that that is always what it falls back on. One needs to be a fairly brave Minister to say `we will take the risk' because if something happened the Minister would be in trouble. I believe it is one area in which we could save quite a considerable amount of money. I was wondering whether pilots have to declare their training as a benefit they get from their employment. From a tax point of view, it seems that they might well have to do so under the new tax legislation because it is probably a part of their contract of employment and it certainly makes them much more valuable people in the aviation industry than they would otherwise be. Maybe that is something the Department should look at. Senator Reid —The employer will have to pay it. Senator TOWNLEY —I know that the employer would have to pay the tax. I agree with the honourable senator. In the case of all government departments the employer does pay the tax. If the Department of Aviation has to pay that tax, that is all the more reason for this being one of the areas which it should examine very closely. I ask the Minister: What happens when an individual offers to help the Department to save money? Today on page 21 of the Australian was the headline `Department wastes $100m a year on archaic rules'. I will read some of the article: Entrepreneur Mr Dick Smith has accused the Department of Aviation of wasting at least $100 million a year by insisting on enforcing outmoded and ridiculous air traffic regulations which often reduced safety instead of improving it. Mr Smith, who flies his own helicopter, said the Federal Government had offered him the chairmanship of the Bicentennial Authority but he had turned it down because he would rather save public money than spend it. That is pleasant to see. At last someone is trying to save a bit of money. The article continued: `But when I told the Government that it could save at least $100 million a year by updating archaic aviation regulations, they did not want to know . . . Does the Department have some kind of mechanism for getting help or experience from those people who have worked in the industry, especially somebody as successful as Mr Dick Smith has proven to be in the areas he is well known for-electronics and aviation? If he is prepared to offer help, there should be some mechanism whereby this help can be accepted. No doubt there are many other people-retired airline pilots and such people-who could well help this Department to save some money. I will not go into the areas in which Mr Smith said money was wasted. I am sure that the Department and the country are at a stage where they have to look carefully at any money that is spent. I hope that the Department can accept the offer of a gentleman such as Mr Smith to assist it. Senator VIGOR(South Australia)(5.35) —I would like to ask some very short questions on the Department of Veterans' Affairs. At the hearings of Estimates Committee F the Secretary to the Department of Veterans' Affairs pointed out that in the financial year to 28 March 69.04 per cent of the entitlement claims were successful at the primary decision level and 52.04 per cent at the assessment level. Some 70 per cent of the entitlement cases and 65 per cent of the assessment cases taken to the Veterans' Review Board have been successful this year. This is a large proportion of successful cases. The whole point is that a fair proportion of the unsuccessful cases go on to appeal and are successful. The Secretary indicated that steps are being taken at the early stages of the process to get extra information from applicants relating to their change of status-for example, totally and permanently incapacitated status-so that it will be possible to avoid the large number of appeals and the appeal process which results from original decisions being, it appears, wrong. If we are to save a large amount of money for the taxpayer and a large amount of heart ache for the people who are applying for benefits from the Department of Veterans' Affairs it seems very important that we should try to get it right at the start. In relation to this, I ask: What are the specific steps that have been taken to get extra information? Can I have some indication from the Minister for Education (Senator Ryan) whether officers are making primary decisions on the information supplied on the existing forms? Are new forms available which make certain that all the information is to hand when a case is considered? Is the telephone being used to get extra information and to communicate with the veteran? How are we improving the process of communication between the Department and beneficiaries? As the Veterans' Affairs Department is a service department, it is very important that this service be delivered as effectively as possible and that money be spent on giving the benefits rather than on very drawn out processes of appeal and counter appeal. I would like to know at this stage what new procedures are in place and what the Department is planning to do to further improve them. What types of cost benefits does it expect from the steps that the Secretary described? Senator RYAN(Australian Capital Territory-Minister for Education)(5.49) —In response to Senator Townley's queries on aviation, the costs of the estimates are mainly in respect of wage increases which have been partly offset by reductions in staff numbers. The Department of Aviation has been reducing costs attributable to the aviation industry by 2 per cent a year. Apparently the honourable senator is not aware that the cost of flying training is not attributable to the aviation industry for cost recovery purposes. His reference to Mr Smith's views that the Department could save $100m a year by changing the regulations is hard to understand since the cost of the Department's regulatory functions is only $40m a year and in any event there is continual consultation with the private sector about these costs. In response to Senator Vigor's question, the new determining system was introduced from 1 January last year. The determining officers have the opportunity to seek additional information by means of correspondence, the telephone or medical examination. The times taken for processing are steadily improving at the primary level. The specific steps are being taken to further improve the timing of this testing. Proposed expenditures agreed to. Remainder of Bill-by leave-taken as a whole, and agreed to. Bill reported without requests; report adopted. Bill (on motion by Senator Ryan) read a third time. Consideration resumed from 8 May. The Bill. Bill agreed to. Bill reported without amendment; report adopted. Bill (on motion by Senator Ryan) read a third time. Senator MAGUIRE(South Australia) —I present the 246th report of the Joint Parliamentary Committee of Public Accounts entitled `Income Maintenance Programs-Response to Report 213'. The 246th report contains the Department of Finance minute on the Committee's two hundred and thirteenth report. Ordered that the report be printed. Senator MAGUIRE(South Australia) —by leave-The Committee's report No. 213, tabled on 16 November 1983, examined the administration of Commonwealth Government income maintenance programs. That report considered a range of programs having relevance to income maintenance. The types of programs included income replacement programs, for example, unemployment benefits; income supplement programs, for example, tertiary allowances; and programs subsidising expenditure by individuals, for example, free medical services and home purchase assistance. Income maintenance programs were defined as those programs transferring cash to individuals or organisations for the purpose of improving social welfare. I believe that expenditure on the programs examined within this report totalled some $14,000m annually-a very large amount. Departmental submissions to the Public Accounts Committee covered a broad spectrum of programs. Replies on a total of 127 programs were received from 10 departments. That was a surprisingly large number of income maintenance programs. In fact, between the drafts prepared of the original report, more programs were identified, finally totalling 127. Many trees were seen, comprising a very large forest indeed. In its analysis of material contained in the submissions, the Committee concentrated on patterns of administrative practice rather than on the detail of individual programs. The Committee was concerned to identify whether departments pay adequate and joint attention to the ways in which they acquire areas of policy responsibility, exercise management control and evaluate program results. The Committee believed that by improving administrative practices, the results of the programs could be enhanced. The Committee made a number of general findings on aspects of administration which it considered would go some way towards addressing the pressing issues facing policy formulators and administrators. While the Public Accounts Committee is satisfied that there have been some improvements in the manner in which some programs are administered, it does not accept the arguments put forward in several responses, particularly as regards the need for legislative backing for programs and proper evaluation of program performance. In fact, a number of programs identified in the report have no legislative backing. I seek leave to have the balance of my speech incorporated in Hansard. Leave granted. The speech read as follows- One of the most important innovations affecting the administration of social welfare programs post-dates the Committee's Report. The Financial Management Improvement Program (FMIP) was initiated by the Department of Finance and the Public Service Board in mid 1983. The Program is designed to direct closer attention to some of the issues raised by the Committee, including the clarity of administrative objectives for programs and the evaluation of practices and programs. The Committee notes that of the ten departments who responded to its questionnaire the Departments of Defence, Health and Immigration and Ethnic Affairs are involved in the pilot program for FMIP and have begun to apply its objectives to their respective operations. The Committee notes that FMIP is designed to complement the range of government financial reforms, including the consolidation of appropriations, the integration of financial and staffing decision making and program budgeting. Departments should not rely solely on these reforms, which are intended to be introduced progressively and improve financial management systematically. I turn now to some of the Committee's perceived shortcomings in the response. Originally, the Committee suggested that, in addition to the then proposed Ministerial review of the Department of Employment and Industrial Relations, there should be a Joint Management Review conducted by the Public Service Board and Department of Employment and Industrial Relations to consider the Department's priorities, efficiency and effectiveness. The Committee rejects the response tendered by the Department of Employment and Industrial Relations. The unqualified confidence claimed by the Department in its administrative ability is clouded by the Public Service Board's agreement to a `Reorganisation of the Department's structure which represents a significant strengthening of its management capability'. One of the recurrent themes in the Committee's report was the necessity to have objectives for programs clearly specified. The Committee suggested that there be an external review mechanism, such as a Task Force, to consider current operations and fundamental innovations. The Committee accepts that the budgetary reforms announced in April 1984, including program budgeting and improvement in public sector financial management may be of assistance in clarifying organisational and evaluation processes. The Committee is also pleased to note that there have been specific, external reviews of programs, including reviews of the repatriation system and the Income Security Review. I have referred to a lack of legislative backing for some programs. The Committee acknowledges the need for administration to be able to respond flexibly to a range of circumstances. For this reason, a balance must be struck with broad legislation supported by more detailed administrative instructions, to permit managers to exercise the necessary discretion to respond flexibly and swiftly within the law to a variety of circumstances. In this report the Committee reiterates its view that the formulation of program legislation is a valuable exercise and suggests that those administering authorities which do not already have such legislation in place should give the matter further attention. The Committee rejects the responses from the Departments of Health, Aboriginal Affairs and Immigration and Ethnic Affairs that their need for flexibility militates against the use of legislation. The broad or `umbrella' legislation which the Committee proposed would permit flexibility, while at the same time fostering careful articulation of objectives and improved administration. The Committee is less than understanding of the inaccuracies in responses tendered, for example, that the establishment of the Surveillance and Investigation Division within the Department of Health is one of that Department's program measures to enhance monitoring and evaluation. This Division was in fact transferred to the Health Insurance Commission in May 1985 some five months before the Finance Minute was presented to the Committee. In addition, the response by the Department of Employment and Industrial Relations in relation to its recommendations for legislation for labour market programs is not accurate. The Kirby Report, to which the Department referred, made no recommendations concerning legislation for labour market programs, although one recommendation suggested legislation and a sunset clause for the proposed Council for Employment and Training. It is the Committee's opinion that the Department takes an unreasonably general interpretation of the Kirby Report on this matter in an attempt to suggest a favourable outcome. While the Public Accounts Committee accepts that possible reforms to correct anomalies and deficiencies in programs would require Government involvement, it does not consider that it in any way diminishes the need to have such matters drawn to its Minister's or Parliament's attention. I commend the report to honourable senators. 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 Ryan) read a first time. Senator RYAN(Australian Capital Territory-Minister for Education)(5.57) —I move: That the Bill be now read a second time. I seek leave to have the second reading speech incorporated in Hansard. Leave granted. The speech read as follows- The purpose of this Bill is to address legal and administrative needs which have become evident in the operation of the Wildlife Protection (Regulation of Exports and Imports) Act 1982. The Act, which came into force in May 1984, consolidated, into a single piece of legislation, the previous conservation controls on the import and export of plants and animals. The Act enables Australia to meet international obligations for the protection and conservation of the world's wildlife listed in the appendices to the Convention on International Trade in Endangered Species of Wild Fauna and Flora. It also controls export of native Australian plants and animals and their products, and the import of live animals other than some aquarium fish and domestic stock. The Act is a major element of the Government's nature conservation program. It received the support of all parties when introduced into Parliament in 1982. Mr President, the amendments proposed by this Bill can be grouped into four categories: To make controls on export and import of certain wildlife more appropriate to their status and the circumstances under which they enter trade; to simplify and improve administrative procedures which have proved, in practice, to be unnecessarily complex; to clarify and tighten certain enforcement provisions; to increase protection for those who provide information leading to the institution of proceedings under the Act. Although a main purpose of the Act is to implement the objectives of CITES, at present it does not provide for the import of specimens acquired before CITES came into force, or acquired before the species in question came within the scope of CITES. Experience with the present Act has shown that a more flexible approach can be taken where the applicant for a permit to import a pre-CITES specimen is a private individual. The Act will be amended, therefore, to allow permits to be granted to individuals under certain circumstances to import pre-CITES specimens that are personal or household effects, gifts or inheritances. The Act contributes to the conservation of Australian native wildlife through both prohibitions and regulated trade in certain species, consistent with their conservation status. For example, existing provisions allow trade in live fish which are captive bred or taken in accordance with an approved management program. Amendments will bring the export of invertebrates into line with the provisions regulating live fish exports. These amendments will in no way weaken the protection afforded to invertebrate species, and will enable, for example, the export of cultured giant clams to other countries in the Indo-Pacific region to assist in the re-establishment of seriously depleted wild populations. Before the Act came into force in May 1984, persons departing Australia to live in another country and wishing to take certain categories of legitimately-acquired pets with them were required to have resided in Australia for at least 3 years and to have owned the pet for at least 2 years to be eligible for an export permit. The Act increased the period of residence to 4 years and the period of ownership to 3 years. Amendments will provide for export applications to be considered on the basis of the previous criteria for owners who purchased pets before the Act came into force in the expectation that the previous criteria would continue to apply. It should be noted that this concession will only be available until 30 April 1987. The primary purpose of the Act is to regulate legitimate trade in wildlife and to combat illicit trafficking in wildlife, particularly endangered wildlife. It is essential that the maximum resources and effort be directed to that purpose. Therefore considerable attention has been paid in this Bill to making administrative procedures streamlined and more efficient. Current provisions which require extensive consultations between the designated authority and overseas authorities, but which add little to wildlife protection, will be removed. Regular importers and exporters of prescribed specimens (for example scientific institutions importing specimens for research to develop biological control agents) will not be required to make individual applications for each shipment, and will receive a single authority subject to regular reporting of shipments. Release of biological control agents will still be subject to control under the Act. I take this opportunity to inform the Senate that the Government will move an amendment to clause 16 of the Bill. The Minister has made it clear that the Government has no intention of relaxing controls over the export of live native vertebrate fauna, and the amendment which I foreshadow will remove any possibility that clause 16 could be used to circumvent the strict controls currently applying under the Act. Duplication in the existing procedures, for gazettal of information on permits and authorities by the Minister will be eliminated. Provision will also be made for inter-change of material between approved zoological organisations and scientific organisations. The responsibilities and options available to the Government and individuals who bring wildlife products into Australia will be clarified with respect to surrendered and seized specimens. Amendments will be made to distinguish between commercial exports and the export by private individuals of legitimately-acquired non-Australian pets, of species listed in CITES. Provision will be made for the designated authority to delegate routine administrative tasks. There is strong evidence that the rich rewards available to wildlife traffickers have led to the involvement of internationally organised criminals. The amendments will allow Australia to participate more effectively in the existing international network of experts and agencies involved in the detection and prosecution of wildlife trafficking offences. Existing provisions for the certificate of an analyst to be taken as prima facie evidence in a court of law will be strengthened by extension to allow admission in court proceedings of certificates of identification made by a suitably qualified person appointed by the Minister. Provisions will also be made to enable the exchange of specimens between the Australian Scientific and Management Authority and overseas counterparts, for the purposes of comparative identification, education and training of inspectors and to facilitate investigation by Australian and overseas authorities of wildlife offences. The Act provides severe penalties which are appropriate to the high potential rewards involved in wildlife trafficking. Nevertheless, experience has shown that certain provisions need to be tightened. Particular amendments are required to: Prevent traffickers from escaping prosecution by surrendering specimens after they have been detected, or in circumstances where a quarantine officer is obliged to destroy seized specimens; Clarify the powers of inspectors to search baggage and goods, to seize personal property which they believe has been involved in an offence, and to seize documents and invoices as evidence of an offence; and Clarify the powers of inspectors to seize articles containing prohibited specimens. Other amendments will protect the confidentiality of the source of information leading to a prosecution. Mr President, the Wildlife Protection (Regulation of Exports and Imports) Act 1982 is an important piece of legislation which plays a central role in the protection of Australia's wildlife and contributes significantly to protection of the wildlife of the world. The amendments proposed in this Bill will make it even more effective. It is with pleasure that I commend the Bill to the Senate. Debate (on motion by Senator Reid) 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 Ryan) read a first time. Senator RYAN(Australian Capital Territory-Minister for Education)(5.58) —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 will replace the Local Government (Personal Income Tax Sharing) Act 1976 and provide for continuation of a Commonwealth program of general purpose financial assistance for Local Government in the States and the Northern Territory. The Minister for Local Government and Administrative Services explained on 10 April that the Government following consultation with the States and Local Government, had accepted the overall finding of the National Inquiry into Local Government Finance that the Commonwealth should maintain a program of general purpose support for Local Government but that the character of the program should be changed in certain respects. This Bill gives effect to those changes which are necessary to bring about a gradual improvement in the effectiveness and equity of the program. I am particularly pleased to be able to introduce this legislation which consolidates past achievements and lays the foundation for future progress. The Whitlam Government developed the first Bill which provided for Commonwealth financial assistance for Local Government. The Grants Commission Act 1973 was an historic breakthrough in inter-government financial relations. It created the precedent for direct Commonwealth involvement in the field of Local Government. To the credit of the Fraser Government, our initiative in 1973 was built upon and improved through the introduction in 1976 of the Local Government (Personal Income Tax Sharing) Act. The main improvements related to the provision of funds for every council and the introduction of a system for allocation of funds by Local Government Grants Commissions in each State. This Bill introduces some changes designed to bring stability, clarity and accountability to the allocation of untied grants to local councils. Fundamentally, it represents continuation of a bipartisan commitment to the development of Local Government. The Hawke Government is active across a number of fronts in strengthening Local Government capabilities and in fostering cooperative inter-government relations. We recognise the important contribution that Local Government makes in its own right and through its involvement in Commonwealth-sponsored programs to social and economic development. We value the diversity, decentralisation and responsiveness of Local Government. We understand how Local Government has been evolving as a sophisticated, multi-functional level of community government in Australia. In this regard, we have sought the participation of Local Government on the Economic Planning Advisory Council. We have upgraded the Office of Local Government for the purpose of strengthening links and improving information exchange among the three spheres of Government. We have participated actively through the Local Government Ministers' Conference on inter-governmental Task Forces concerned with the role of Local Government in Economic Development and in Community Development. We have sponsored over the last three years through the Local Government Development Program some 400 projects designed to spread the best ideas and practices throughout the Local Government system. We have launched a series of National Awards for Innovations in Local Government and we have pursued the Constitutional Recognition of Local Government. These various initiatives come together for the mutual benefit of the Commonwealth, the States and Local Government. For all concerned, past barriers to communication and consultation are breaking down. Cooperation and trust is building up. From the Commonwealth perspective, and in the light of the fact that Federal Government expenditure flowing to Local Government exceeds $1 billion, the improving relations allow us to achieve more cost-effective returns for the nation's investment in the Local Government system. Over half of that Commonwealth contribution to Local Government is in the form of untied grants. This Bill provides for continuity and growth in the provision of these grants but in so doing it establishes a new basis for the provision of funds. Under the Act that is being replaced, the grants for local government were tied to a percentage of personal income tax receipts. This formula led to great variations in funding from year to year and created difficulties in local government's relationship with the States. No such linkage will be provided in the new Act. Instead the Bill provides for a base level of funding that is equivalent to the level of funding received by local government in the States and the Northern Territory in 1985-86 plus an adjustment to bring Northern Territory per capita payments into line with those in the States. This provides a base figure of $540.9m. The Bill provides that the actual payment for local government in 1986-87 shall be this base figure multiplied by either the increase in the consumer price index for that year or by the percentage change in Commonwealth general purpose payments to the States, whichever is the greater. The payment calculations for 1987-88 shall be the same as those for 1986-87. For all subsequent years payment calculations will be based simply on the percentage change in Commonwealth general purpose payments to the States. That is, Local Government will be treated no less favourably than the States in terms of periodic adjustments to the funding level of the program. These new financial arrangements will provide a stable financial base from which local government will be able to plan with a greater degree of certainty than under the previous arrangement. The volatility that characterised the previous tax sharing arrangements will be eliminated. As under the previous Act, the Bill provides for the payments for local government to be made to each State in one lump sum early in the financial year. If the estimates on which the grants are made turn out to be incorrect there is provision for a subsequent adjustment to be made to the grant. This would normally occur through an adjustment to the following year's grant. Such an adjustment might be necessary if, for instance, the rate of inflation turns out to be lower than anticipated. Each State's share of the total grant will, from 1989-90 onwards, be equal to that State's share of the Australian population. In the two years before then, the shares of each State will be gradually changed from the present relativities to a population basis. As a result of these changes Victoria and South Australia will increase their share of the grants. The other states will reduce their share but in such a way that there will be no reduction in the payment to any of these states in money terms from one year to the next. The principal objective of this program is to provide financial assistance to those local councils who are most disadvantaged with respect to their ability to raise revenue and to provide services. In attaining this objective, the States will be required to allocate funds in such a way as to equalise each local council's ability to undertake its functions with respect to the average standard performance of other local councils in the State concerned. At the same time the Government recognises that Local Government, as a whole, has a restricted base from which to raise revenue to finance its expanding functions. Because of this the Government has ensured that every council continues to receive benefits under the program. The legislation provides that the grant received by any council will be at least the amount it would have been entitled to if 30 per cent of the funds available to each State had been distributed among local councils on a straight per capita basis. In each State a Local Government Grants Commission will continue to be responsible for determining the allocation of funds among local councils. A new requirement is that eventually each Grants Commission must have at least two members who are, or have been, associated with local government in that State. The Bill requires that these Grants Commissions hold public hearings and that at least once every three years they publish a report setting out details of the methods they use in recommending allocations among local councils. The Grants Commissions are also required to observe principles that are established under the Act for the purpose of allocating amounts among local councils. It is recognised that these principles will take some time to develop and to put into effect. Consequently the Bill allows five years for the introduction of such principles. In the meantime Grants Commissions are required to observe the methods of allocating amounts used under the preceding Act or, alternatively any agreement that has been reached between the responsible State Minister and the Commonwealth Minister. The development of principles for the purpose of allocating funds between local councils is designed to bring an element of uniformity between States without requiring that every State adopt exactly the same principles. It is intended that these principles will be drawn up by each State in accordance with the purposes of the legislation and submitted to the responsible Commonwealth Minister for approval. This submission is required by 1 July 1987. In the event that a State refuses to draw up principles or draws up principles which do not accord with the purposes of the Act, there is a fallback power of the Commonwealth Minister to determine the principles for that State. The Bill provides for the varying, revoking and reviewing of the principles. The review mechanisms will enable the principles to be kept fully up to date with improvements in the practices of the Grants Commissions and with their understandings of the results of their distributions. A State will not be entitled to a payment in any one year unless the responsible Commonwealth Minister, is satisfied that allocations of funds have been made in accordance with approved principles or in accordance with the alternative arrangements outlined above. The new Act will result in a redistribution of funds provided under this program to the more needy councils. This is one of its prime objectives. The Government however is concerned to ensure that changes are made gradually so that councils will have time to adjust to the new arrangements. It is for this reason that the Bill provides for up to five years for changes to occur in the equalisation arrangements and in the method of calculating per capita entitlements. It is for this reason also that the changes in State shares of grants are to be phased in. The Bill is different from its predecessor in that it provides for an important role for local government itself to participate in establishing the principles which will govern the allocation of funds between local councils. It also provides for local government to be represented in any review of the Act that the Minister may require after 30 June 1992. This Bill provides important advances on the arrangements that were introduced under the Whitlam Government and improved upon by the Fraser Government. It will provide continuity and certainty for an important element of Local Government finance while at the same time providing for a more equitable distribution of funds than has previously occurred. I commend the Bill to the Senate. Debate (on motion by Senator Reid) adjourned. Debate resumed from 8 May, on motion by Senator Grimes: That the Bill be now read a second time. Senator PETER BAUME(New South Wales)(5.59) —The Senate is debating the Social Security Legislation Amendment Bill 1986, an omnibus Bill which makes a number of changes to social security and compensation legislation. The Opposition does not oppose the Bill but, on behalf of the Opposition, I will move an amendment to the second reading, similar to that moved by my colleague in another place, which seeks to condemn the Government for some of the features of the Bill. The amendment is not being circulated. I move: At the end of the motion, add: ``, but the Senate condemns the Government for- (a) implementing the amnesty for the clients of the Department of Social Security who have received overpayments as the proposal: (i) establishes a double standard, (ii) disadvantages honest clients, (iii) undermines the work of Departmental field officers, (iv) sabotages field investigators' morale, and (v) provides no guarantee that overpayment and fraud will not occur in the future, and (b) its economic policies such as the capital gains tax and the prohibition on negative gearing which have increased the cost of housing and rent necessitating extending the rent subsidy to the long term unemployed.'' At a time when poverty is increasing and after three years of broken promises in the social security and community services area I want to use this opportunity to say a few words about the direction and effectiveness of some of the Government's social security policies. First, some of the provisions in the legislation are straightforward. We do not object to them. The decision that there should be a bar on the payment of unemployment, sickness or special benefits to full time students who are eligible in principle for an education allowance is an appropriate step by this Government and we support it. The change in the treatment of lump sum compensation payments for sickness beneficiaries is one in which we support the Government. A change in the rate of benefit that applies to legally-married but permanently separated unemployment beneficiaries is very technical but once again we support the Government for a sensible move. While the Opposition does not oppose these provisions it has some concern with other features of the legislation. First, we are concerned with the way the social security amnesty has been conceived and conducted. We are concerned not with the principle behind the youth homelessness allowance but with some of the consequences which may flow from it. This is associated with some of the provisions for rent assistance for the long term unemployed. We are concerned about the style of the amendments to the Compensation (Commonwealth Government Employees) Act 1971. The amendment which I moved on behalf of the Opposition draws attention to some of those concerns. Let us look at these in turn. We are unhappy about the social security amnesty because we are not sure that it is the right way to deal with fraud and abuse of the social security system. I acknowledge immediately before Senator Grimes does it by way of rebuttal later that many of the overpayments which are discovered are the result of genuine error. I comprehend that they are the result of a failure to notify a change in circumstance without any intent to defraud. Such errors can be taken care of. We are concerned about that group of people which has sought to defraud the social security system, to obtain payments to which the people are not entitled and in some cases to obtain multiple payments. Senator Grimes will recall the celebrated case of the gentleman who received 37 payments and was finally found out and brought to court. Senator Grimes —He is not covered by the amnesty. Senator PETER BAUME —Senator Grimes tells us that person is not covered by the amnesty. We are concerned about the whole matter of fraud and fraudulent behaviour in social security. For example, we are concerned that anyone engaging in that activity is cheating his or her fellow citizens. Even though that group is a minority in ripping off the social security system it is ripping off every taxpayer. My son who is an apprentice is paying tax. I resent the idea of a tax paid by him going to someone who is cheating the system, often quite knowingly. People who take advantage of the system to the detriment of the majority of honest, genuine and needy social security beneficiaries are cheating the rest of society and making it more difficult to provide adequate relief for those for whom the system was designed. The Auditor-General regularly draws our attention to these abuses, as do our friends and other parliamentarians by anecdotal experience. It is rather sad that one of the features of the Australian ethos is that people knowing about abuses are often prepared to do nothing about them. The responsibility for the health of the social security system belongs to every one of us. We should not just scapegoat the Department of Social Security by saying: `It is your job'. I generally tell people who say to me that they know someone who is doing the wrong thing to give me their names. People generally will not. They know about such situations but they will not say who is responsible. If they did tell me I would advise the Department of Social Security and expect action to be taken. I am sure that the Minister for Social Security (Mr Howe) would agree and would have the same expectation. People tell me that they come into contact with social security fraud in their day to day lives. I support the system and programs, all the way from Franklin Roosevelt's moves in 1933 and the ethos of using the resources of society to respond to need. What worries me is that this kind of activity makes it more difficult for us to respond and legitimise the kinds of activities in the social security area that we think proper for a just and compassionate society. We are concerned about the social security amnesty because it creates different circumstances between classes of beneficiaries. For example, those covered by the amnesty who have received overpayments may be able to go scot free and avoid any consequences that they might otherwise attract while other beneficiaries who have not ripped off the system, who have operated properly and observed the rules and regulations, will not enjoy the extra benefits. They can see that their fellows have not only received benefits to which they are not entitled but also will now have the benefit of the amnesty to protect them. There are equity issues concerning the different classes of beneficiaries which are not addressed by the way the amnesty was conceived or enacted. We do not see it as being fair and thus are unhappy about it. The Minister, Mr Howe, has actually admitted that the way the amnesty has been presented represents a double standard in behaviour for one group of beneficiaries against another. Yet he is prepared to legislate for the amnesty and press on with it. It is unfair that the large number of people who have to rely on welfare to sustain themselves and their families and who do so within the rules-the people who report changes in their circumstances and find that their benefits are reduced but who do so because those are the rules-now sit back and watch those who have not done so and who have taken advantage of the system and now use the amnesty to gain a personal advantage which they would not have had without it. I acknowledge that the amnesty will enable the system to be cleaned up to some extent. Nevertheless, there is injustice in the way that the amnesty will operate and that concerns us. Our question is: Is it just and right? Is it what the community expects from a welfare system which draws very heavily upon the resources of society? The Department is the largest spender of money of any Commonwealth Department. The annual budget is $17 billion with about 30 per cent of the total budget going to the welfare and benefit system. One of the characteristics of that system needs to be that it be honest and honestly administered and where people do not observe the rules, that appropriate recoveries be made. I am concerned that if we lose confidence in our welfare system as is happening in society, in the end that may limit our capacity to extend welfare in the future to those who continue to need it. I make it clear that the Opposition understands that this amnesty will be put in place. When we come to government we will introduce modifications to the welfare system. We hope to improve the system, to increase benefits to help respond to unmet need. But there is one thing we will not do. We do not intend to introduce more amnesties and where we can find any deliberate fraud or any deliberate misuse of the system we will respond to it with severity and rigour. I am talking about intentional misuse of the system. We think that society would expect us to do no less. We would expect in government that the Department of Social Security and the Department of Community Services-particularly the Department of Social Security-would assist the Government in policing the system. We would like to think of the Department of Social Security as a department with a good auditing record as well as a good giving record. I refer to the proposal to provide a young homelessness allowance. This allowance and rent assistance for the long term unemployed will help respond to a major cause of poverty among the young, but it raises some problem of its own. I have a friend, Theo Van Gestal, who, I am sure, is known to the Minister and who works with the St Vincent De Paul Society and is stationed in the Parramatta area. When he first went to the Parramatta office-he had previously been in Liverpool, and before that in Sydney-he discovered very quickly that each night 300 to 400 young people were sleeping rough in the far western suburbs of Sydney-maybe more. He discovered that the extent of homelessness amongst the young was appallingly high and greater than anyone has understood. I understand that the Senate has investigated this matter and has confirmed the extent of youth homelessness. Too often it occurs in the context of a broken family, often with poor coping skills, where a mother may find a new partner and then find that it is impossible to keep in one house herself, the new partner and the children. Sometimes, particularly if children are going through a difficult adolescent stage, the solution, unfortunately, is that the children are kicked out. In that kind of circumstance, I am not opposed-I do not think anyone would be opposed-to the Government's desire to respond to homelessness. However, a problem arises. Senator Chaney has said quite often that behaviour follows the money. On the one hand, the availability of this benefit will help to meet a real need. I do not argue with that at all. I ask the Minister: To what extent might the benefit help other young people to leave home in what are less than crisis circumstances? The Minister has said, and I agree with him, that he will try to ensure that the benefit is paid only in genuine, forced cases of homelessness. I understand that, but it is going to be rather hard to police. Honourable senators will know that adolescence is often a fairly turbulent time. They will know that many teenagers talk about walking out of the family home and that quite often there is a fair amount of emotional thunder and lightning during the time when teenagers are around. I submit that often it is a fairly close run thing as to whether or not children leave home. When one looks back five or six years later one realises that the crisis was temporary and has passed and a completely different circumstance arises. I ask the Minister-again, I am not opposing the provision of the benefit at all-whether he has considered the possibility that the benefit, in responding to a need, may actually help create more youth homelessness. Exactly how does the Government intend to go about trying to restrict the benefit to those cases which it calls genuine cases and not to cases which it might regard as temporary, avoidable or frivolous? I also draw attention to the cost of housing in Australia at present. As I say, we do not object to the provision of assistance for obviously needy people. But we are concerned that the cost of housing now is higher than it need be, not least as a result of the policies of the Government in a number of areas. The Labor Government said that it was launching an attack on the rich by ending negative gearing-a method of buying property, often rental property. The Labor Government has now introduced capital gains tax legislation which is to be debated in this place soon. Both these moves, inter alia, have had the effect of forcing landlords out of the rental market, reducing the creation of new rental property and stock and, as a result, have forced up rents, especially in my city of Sydney, where rents are skyrocketing. If someone wants to rent at the moment, it costs the earth. It costs more than it cost a year or so ago. It will continue to cost more because, with a capital gains tax and the end of negative gearing, fewer and fewer people will wish to get into the provision of rental property. One cannot just expect the public sector to take it up because the public sector does not have the capacity. Further, the situation has been made worse because the monetary squeeze has been so great that interest rates have risen to very high levels. They have risen to their highest real level in 50 years. So up went the cost of buying a house. If people who might otherwise have been in the market for home purchase now find that they cannot afford to buy a house, they, too, come back to the rental market. Not only is there a lack of rental accommodation, but also more people are seeking rental accommodation because they can no longer afford to buy. It is common knowledge now that a Liberal Government will repeal Labor's capital gains tax. We will see that interest rates are reduced. We will do this not least by massively reducing government expenditure and, by so doing, we will reduce government borrowing. Senator Chipp —Will you repeal the fringe benefits tax? Senator PETER BAUME —The honourable senator should be patient; he should wait and see. Senator Chipp —It is a fair question. Senator PETER BAUME —It is not a question which I am in a position to answer. I say: `Be patient'. The honourable senator will have an answer. Senator Haines —What about the capital gains tax? Senator PETER BAUME —I have said that we will repeal the capital gains tax. We will do so the moment we get into government. We think the rental assistance measures would be less necessary if Australia had had a coalition government for the last three years because we would not have had the measures we have had which have had the effect of driving people out of the home purchase market into the home rental market and, at the same time, making rental much more difficult. The legislation before us makes changes to the Compensation (Commonwealth Government Employees) Act 1971. We think this Act needs to be rewritten completely to forge a new direction for compensation for Commonwealth employees because the present system is not working. The amendments which are contained in this legislation should be withdrawn until such time as the Act can be completely revised. Let me deal with a few of the problems we have in relation to compensation under the Compensation (Commonwealth Government Employees) Act. The last annual report of the Commonwealth Commissioner for Employees Compensation shows that there were 60,000 successful compensation claims which led to compensation payments to government employees of $157m. That $157m was more than twice the compensation paid out in the last year of the former Government. We expect a further blow-out in compensation payments to Commonwealth employees for the current financial year. We know that more than $121m of that $157m has gone to officers of the Australian Public Service who have a total incapacity to work. That is an extraordinary figure for incapacity, an extraordinary extent of incapacity. There were 60,000 claims from a work force in departments and authorities of about 530,000 people. Of those claims, 45,000 people had claimed total incapacity. That represents an incredible claim rate of about one person claiming total incapacity for about every 12 employees in the Australian Public Service. One in every 12 employees of the Commonwealth Government has made a claim for total incapacity to work under the Compensation (Commonwealth Government Employees) Act. Being an officer of the Commonwealth Public Service, we know, is hazardous; the hours are long and the conditions must be terribly onerous. But it must be an extremely high risk occupation if there have been 45,000 claims for total incapacity in a work force of just over half a million people. It is an extraordinary figure. I find it almost impossible to believe that this level of incapacity can in any way equate with what is going on in the wider community. I cannot really believe that employment in the Commonwealth is so much more dangerous than employment in the private sector, so we obviously have a problem in relation to this whole question of Commonwealth compensation. Either there has been a sudden surge of some epidemic disease in the Commonwealth Public Service leading to a one-off requirement for total incapacity claims, or there is something systemic that is leading more and more people to regard themselves as totally incapacitated. There have been 45,000 claims in the past year. No doubt the Government will address that. I turn now to say a few words in the time left to remind people that when this Government came to office it made a number of promises in the area of social security; promises about which people should be reminded. In relation to income support programs, the Australian Labor Party, in its 1983 policy speech, promised: We are committed to raising over a three-year period the basic pension rate from 22 per cent of average male earnings . . . to 25 per cent. Labor has been in office for more than three years and that promise remains unfulfilled. In December 1985 the pension was $97.90; still nowhere near the 25 per cent level. That promise has not been honoured. In 1984 the Labor Party was rather more circumspect, when it said: . . . we will continue to work towards the goal of raising the basic pension rate to 25 per cent of average weekly earnings. They are fine words and that is something that it can say it has done, even if it does not get there. In relation to the rate of unemployment benefit, in 1983 Labor promised: Unemployment benefits will be progressively increased until adult beneficiaries reach equality with single pensioners. In November 1985, the last figures I have, the rate of unemployment benefit was $88.20 and the rate of pension was $3 more than that; another promise not honoured. In relation to the family income supplement, in 1983 Labor made the promise that it would: . . . reform . . . the family income supplement . . . by relaxing the income test so that the supplement is reduced by only 25 cents for each extra dollar of family income. That was a promise, in other words, to alter the taper to make the withdrawal rate less severe for people who earn some other income. To date there has been no change in the rate of taper of the income test. That is another promise which has not been honoured in the area of social security policy by the Labor Government in the time it has been in office. In relation to the consumer price index adjustments, in 1983 the Labor Party promised: Pensions will be adjusted on the basis of the immediately prior six months CPI movement to cut the present lag of four months to one month. I have to report that pensions are still adjusted on a twice yearly basis, in May and November, in line with the CPI figures for the previous six months to December and June. In other words, the lag is still there, exactly as it was; that promise has not been honoured. Finally, I draw attention to some of the promises in the area of taxation. In 1983 the Labor Party promised: . . . immediate reductions in income tax for almost six million Australian taxpayers. I remember the Labor Party saying those fine words. It said: A taxpayer without dependants earning $225 a week, for example, will get a tax cut of $4.76 a week. I tell the Senate that, with fiscal drag, the tax cuts have never materialised and we now face the prospect of a further delay in the promised tax cuts later this year. Poverty is increasing in this country. We keep hearing about the increases in poverty and about the extra imposts upon our citizens. I need look no further than the statements of the Minister for Social Security, Mr Brian Howe, in talking about poverty in Australia. He has said: And poverty-especially among women and children-remains a matter of pressing urgency . . . The increasing recognition of this poverty amongst women-what has been called the feminisation of poverty- I agree with the Minister there- forces us to think about poverty and powerlessness in different ways. Mr Gerry Hand has told us that poverty in Australia has increased during the three years of the Labor Government. A member of the Labor Caucus has said that poverty has actually increased since Labor came to government. Of course, this is part of the pre-Budget manoeuvring to try to ensure that the money is not cut out of the social security budget to the detriment of pensioners and beneficiaries. Mr Howe conceded that the social welfare benefit system is `woefully inadequate'. The Western Australian Labor Government has placed social welfare near the bottom of the political agenda. The report of the Carter Inquiry into Welfare and Community Services in Western Australia has been pigeon-holed. Almost no action has been taken on its recommendations, yet close to a quarter of a million Western Australians live in poverty, according to the Western Australian Council of Social Service. Both the former Minister for Community Services, Keith Wilson, and the current Minister, Kay Hallahan, have given welfare reform a low priority. People concerned with welfare in Western Australian find it hard to establish contact with them. Duncan Graham, the welfare writer for the National Times and the head of the Carter review, Bishop Challen, are two good examples of critics of the Western Australian system. Bishop Challen complained about what was happening in that State and the result was that the Community Services Board, of which he was the Chairman, was axed. After that Board was axed, the Vice-Chairman of the Board, Moira Rayner, said: Those of us who have worked so hard to reform the antiquated welfare system in this State- that is, Western Australia- have been shocked and saddened by the action which removes the only independent advisory body able to act as a check on the Department, advise the Government on the Department's policies and establish links with the community. The point I am making is that in a nation where we have Gerry Hand telling us that poverty is increasing and welfare continues to be an urgent matter for people whose lives depend on the adequacy of what they receive, the Western Australian Labor Government has failed to meet the aspirations of moderate members of the community. I return to the Bill and say that the Opposition will not oppose it. The Opposition's proposed amendment raises its concerns about the amnesty and other matters in the legislation. I ask the Minister to respond to the concerns I have about the homelessness allowance. Otherwise, the Opposition will assist in the passage of this legislation. Senator ZAKHAROV(Victoria)(6.28) —The Social Security Legislation Amendment Bill makes a number of changes to the social security arrangements, many of which will remove present anomalies. I will speak to just one of those amendments which will introduce a new element into social security. The provision of a young homeless allowance is something which has long been needed and for which I have been campaigning longer than I have been in the Senate. I am delighted that it will apply from 1 July. This allowance will apply to 16 and 17-year-olds who are homeless and without support. The allowance will be at a level which equates with the tertiary education assistance scheme allowance, which is currently just over $73 a week. It will be in the form of a supplement to any benefit to which the young person is entitled, to bring the allowance up to that level. In other words, it is not something which will be received on top of other benefits, as I have heard some people claim. There are no firm figures or even very reliable estimates of the young people who are in need of this allowance. In fact, some people even claim that the numbers involved are not significant. I was pleased to hear Senator Peter Baume imply otherwise. Some people would say those numbers are not significant, compared to, say the needs of older people who are homeless or need help. But this group has not really has any provision made especially for them in the past, and society has tended to ignore their existence believing, as I have heard it said here and elsewhere at times, that children-note the word `children'-should be at home until they form a new family of their own or at least until they are 21. That view totally ignores reality, particularly the reality of households where I am sure none of us would wish young people to stay. Young people who are homeless usually do not have the knowledge, the experience or the support that even a woman leaving a violent marriage may have, because they are young. Until now they have been doubly disadvantaged by not having any safety net which allows them to live with some minimal security if they cannot remain with their parents. As I said, there are no reliable figures available but we do know that youth refuges in most parts of Australia cannot cope with the demand for places-and they see only the tip of the iceberg. Figures for refuges do not necessarily reflect the overall picture, as those seeking emergency accommodations are sometimes accommodated in other ways for a short period, such as in friends' houses. So the demand for medium and long term accommodation is much greater than it is for refuges. Because what opposition there has been to the introduction of this allowance seems to be centred on the belief that it will actually encourage young people to leave home, I point out that very strict conditions will apply, ensuring there will be no abuse of this provision. I point out, too, that these conditions are much stricter than even, for example, those that apply to the tertiary education assistance scheme which, unfortunately and possibly unavoidably, is widely abused by parents who falsify their tax returns. These conditions are, first, that the young person must be living away from home for one of a number of reasons, these being either that the parents, or neither parent if the parents are not living together, will allow the young person to live at home or domestic violence or incestuous harassment or other such exceptional circumstances that make it unreasonable for the young person to live with his or her parents. That is the first condition. Secondly, the young person must not receive continuous support from either parent or from any other person acting as a long term guardian. That is fairly wide. Thirdly, the young person must not receive continuous income support from any government source, State or Federal, other than a benefit. All those three conditions must be met for the allowance to be granted. I do not think it could be made much stricter. Those who think this payment will be an incentive to leave home have obviously never been in that situation for themselves. It is simply much cheaper to live at home, quite apart from the benefits which derive from a supportive home and family. This is a second best for those who do not have the option of remaining at home. In the debate in the other place an Opposition member said that the amendment would mean that parents prone to reject their children would have no reason to give them a second thought. It is a tragic fact that some parents do not give their children a second thought. The same member went on to talk about parents who ignore court orders for maintenance. He seemed to believe that the government was responsible for both these evils. I am sure he will be pleased to learn that the present Government is planning to do what no other Government has done in the past-that is, to make sure that maintenance, where an order is made, is paid, as announced by the Minister for Social Security (Mr Howe) last week. Parents have a legal as well as a moral obligation to look after their children to the age of 18 years, but many do not meet that responsibility or put intolerable conditions on it. I will come to that point in a moment. I worked for a number of years as a student counsellor in a secondary school, so I am speaking from experience. Some young people, as Senator Baume mentioned before, leave home for what, to an outsider anyway, may seem trivial reasons-such as a row about which boyfriend they are allowed to go out with or which clothes they are allowed to wear to school. But these young people usually return home fairly soon, particularly if there is someone available to act as an intermediary between parents and son or daughter. This amendment is designed to help those whose reasons for leaving home, or being thrown out of home, are much more serious-young people who have no reasonable alternative. To begin with the least dramatic examples, some parents want their sons or daughters to leave school or to stay at school, and make that a condition of their remaining at home. I recall the case of a girl of about 16 who left school against her parents' wishes and was then locked out of the house. We had to get police help to enable her to collect her clothes and personal belongings. On the other hand, there are parents who refuse to maintain their children at home if they do not leave school. Unfortunately this particularly happens with girls, because some parents believe that education is wasted on females. As another example, family break-ups can lead to either a new, blended family or a series of surrogate parents with conflict between the young person and the adults. This situation can become intolerable on both sides and lead to an inevitable break. Many young people are subjected to domestic violence, or are traumatised by witnessing it being inflicted on a parent or younger sibling. Then there are the young people who are themselves the victims of incest, in some cases over a number of years until they are old enough and courageous enough to make the break and get out of the house. Some young people I know had friends to turn to, if they were lucky, or their friends' parents or house sharers were willing to take them in. The alternative in the district where I worked were the railway station waiting rooms, the carriages in the railway siding at night and, for those small enough to get in, the bins for donated clothing. Other young people have told me that they walk the streets at night so that they can sleep in the daytime when it is warmer. The places where these young people congregate can then become a recruiting ground for prostitution and crime, and drugs can offer to the lonely and depressed a solace, especially if dealing in drugs offers a young person the income that he or she would not otherwise have. The young homeless allowance is a safety net, consistent with this government's policy of enabling all Australians to live with dignity, their basic needs being met. It follows the Government's increased funding for youth refuges this financial year and is part of the progression towards youth-related allowances for young people who are not in employment. As one with many years experience of working both professionally and informally with young people, I am proud to be a part of a government which is seriously addressing the problems faced by young people. The amendment will not affect vast numbers of young Australians but for those it does affect it could well save their futures or even, if we look at the statistics for young suicides, their lives. Senator HAINES(South Australia)(6.38) —The Social Security Legislation Amendment Bill before the Senate tonight is an interesting Bill because of the range of issues it covers and the number of problems it seeks to correct. The sorts of issues it covers begin with the question of the granting of an amnesty on unintentional fraud-certainly not the sort of instances that Senator Peter Baume mentioned occur from time to time; that is, people picking up cheques in 37 different names or otherwise deliberately defrauding the system. Nobody in their right mind would want people like that to be given any sort of amnesty. But there is from time to time a necessity to provide an amnesty to people who for one reason or another, sometimes through misunderstanding the system or through no fault of their own, have been part of what appears to be a fraud against the system. They deserve, in fact need, whatever assistance and benefit of doubt that governments can give to them. The Bill also provides for access of students to various benefits and for ways of assisting young homeless people by way of an additional allowance. It is wide reaching in regard to the number of people it covers and it is far reaching in relation to the potential effect that various sections of the legislation can have on the people who are covered by the legislation. That is not to say that it is not without its problems. The Bill covers a wide range of departments and that means that considerable headache can be caused to likely beneficiaries who are trying to find their way around the various new sections in the legislation. The involvement of the Department of Education, for example, as I have been made aware in recent weeks, has caused some problems for likely beneficiaries or for current beneficiaries who may have their benefits jeopardised. I have been concerned over recent weeks at the difficulty that I and my colleague Senator Macklin, who is the Australian Democrat's spokesperson for the portfolio of education, have had and that, indeed, the Parliamentary Library had when we finally turned to it to get hold of a definition of what would appear to be a fairly simple thing-what is a full time student. There appears to be nothing in any piece of legislation that we could locate that actually defined it; yet, that definition of the legislation and its impact on the community is vital, I would suggest, to the understanding of the Parliament and the public, and certainly to the understanding of the people affected by the legislation. I would have thought that such a key element of the legislation as the definition of full time students, which in fact is a heading to one significant clause in the legislation, would have been made. These sorts of definitions deal with beneficiary's incomes, maintenance and education allowances, and need to be much better defined than we have had defined to us. I say now to the Minister and to the officials present who are presumably from the relevant departments that if we cannot get some clearer definition of just what exactly a full time student is, we are going to contemplate moving an amendment to oppose clause 33. It is quite ridiculous to have the sort of gobbledegook that is in clause 33 about full time students when nobody seems to know just exactly what a full time student is regarding access to the tertiary education assistance scheme, unemployment benefits or any other sort of benefit under this or any other piece of legislation. In addition, I have been approached by a number of organisations concerning the provisions of this Bill that relate to the so-called young homeless allowance. This Bill provides for an increase in the level of income support received by unemployment, sickness or special beneficiaries who are 16 or 17, who are single, who are without dependents, and who are classified as homeless. Clause 28 of the Bill provides for a new section 112 (4e) which defines a homeless person as one who, first, has not lived with either parent for a period of six weeks, either due to parents not allowing them to do so or because of domestic violence, incestuous harassment or other such exceptional circumstances. I am not quite sure how everybody is supposed to prove that or how capable the people they are expected to tell this to are of assessing the likelihood of these things having occurred. The second definition of a homeless person is a person who is not in receipt of any other continuous support from parents, other guardians, of course, or any other government source. New sections (4f) and (4g) define the increase in benefit with the effect that the allowance takes this homeless rate of unemployment benefit, et cetera, up to the independent level of TEAS. I must say that the Democrats are delighted that the Government has finally responded to the demands that we and other concerned groups in the community have made over the years for the extension of assistance for rent and housing beyond the supplementary assistance which has been available to certain beneficiaries but which has not until now been extended to the large number of unemployment beneficiaries, many of whom are in very grave need of this sort of assistance. Sadly, of course, as Senator Baume indicated in his speech a little while ago, these moves are essentially band-aid measures in the face of the major problems of unemployment and housing-problems which are facing this Government and which it has yet to actively address. I must, however, take up Senator Baume's comments about the fact that negative gearing across Australia in the months since that legislation was mooted has caused a considerable drop to the private rental sector. In fact, the figures on rental vacancy rates do not hold this to be true to any real extent in any capital city except Perth, where the relative rates for January and February this year are considerably lower than the relative rates for January and February last year. I suspect that has less to do with negative gearing than it has to do with preparations for the America's Cup. In Canberra, for example, the rates have gone up significantly in the 12 months since January and February 1985. They have gone up in Adelaide in the same period. In Adelaide in January 1985 the monthly vacancy rate was 2.5 whereas in January of this year it was 3.1. In Brisbane in January 1985 it was 3.9 and in January of this year it was 4.2. In Canberra last year it was 0.3 which is extraordinarily low given that 10 times that amount is accepted as an adequate monthly average vacancy rate, and it was 2.7 in January of this year. Perth, as I said, dropped significantly. Sydney dropped marginally and Melbourne dropped marginally, but there certainly has not been any significant drop across the country in monthly vacancy rates in the private rental market. Senator Peter Baume —Do you think next year might produce a change? Senator HAINES —If one looks at the monthly vacancy rates across any given year, they bounce up and down, and the variation is anything up to point five of a per cent. When talking in terms of between 1 per cent and 3 per cent, 0.5 per cent is not particularly significant. It happens on an annual basis because of seasonal problems. If what people are arguing at the moment is that the January, February and March figures are an indication that negative gearing is making it harder for people who need to get housing in the private rental market, I suggest they look closer at those figures because there is no real justification for it in any city other than Perth. As I have already said, I really suspect that there are other outside reasons, slightly damper reasons, for that happening. While the general principle behind this particular amendment is something that we believe is laudable, there are certainly shortcomings concerning the youth homeless allowance in the form it is provided for in this piece of legislation. The definition of homelessness provided in clause 28 (2) is particularly narrow, which in many ways is appropriate, as has already been indicated tonight, but it in fact fails to allow for adequate account to be taken of emotional and psychological factors which may make a home environment intolerable and, in fact, in some instances, dangerous for a young person. The attempted exclusion by clause 33 in the Bill of students from access to various benefits would have the effect essentially, at least as far as my interpretation of it is concerned-it is a fairly tortuous clause-of denying special benefits to homeless students who may currently have access to income support through other avenues or, in particular, who would like to have access to income support through this particular benefit but for a variety of rather prolix reasons expressed through this Bill may not. The consequence is going to mean some incentive for some students in this group to be forced to discontinue their study through lack of support. Organisations such as the Australian Capital Territory Youth Accommodation Group have also brought to my attention, as I imagine it has also brought to the attention of Senator Baume and no doubt members of the Government, a number of other problems associated with this Bill. These include the six week waiting period prior to the payment of benefits during which special benefit was previously available to young people who wished to study. Another area is the inevitable administrative problems which will be involved in the co-ordination of the responsibilities of the departments of Education and Social Security in this area. I repeat that Senator Macklin and I-we have a joint interest in this Bill-have had some difficulty in collating the various definitions that are needed from those two departments. Furthermore, the Department of Education is not necessarily staffed with personnel with the counselling skills that would be appropriate and necessary for dealing with the young people who have suffered the domestic violence, incestuous harassment or other exceptional circumstances which are required by the Bill. It has also been put to me that the Department of Education is proposing to investigate young people's claims of homelessness by writing to ask their parents whether they have been telling the truth about domestic violence, sexual harassment, incest and so on. That strikes me as a most peculiar way of going about helping students who seem to me to be in a most awful psychological and emotional state anyway. That may or may not be correct, but it certainly is the information I have been given. I should be delighted to find out that the Department will use some other touchstone to find out whether these students are accurate when they make allegations about having to leave home because of those three criteria. So, very real concerns have been raised, including one relating to the secrecy provisions contained in clause 5 with regard to the information given by students to departmental personnel. Those secrecy provisions are considered to be inadequate. The attempt in clause 33 to abolish the access of full time students to benefits is a matter that is also of considerable concern to us, and to the students who perceive that they will have much more limited access to a benefit that they consider is essential to their continuing with a course of study. Many students who in the broadest sense may be eligible for an allowance but who through no fault of their own, such as their parents' income, are disqualified from eligibility for those allowances will now find themselves without any adequate avenue of support to enable them to undertake study-either to begin it or to continue it. Senator Grimes —Are you suggesting that there ought to be an alternative education allowance? Senator HAINES —No, I am not suggesting that, although we have suggested for a long time-and this Government to its credit has come to accept-that the levels of the tertiary education assistance scheme allowance and the unemployment benefit have been considerably out of kilter. Students who are attempting to go through a post-secondary course, presumably not just to improve their minds but to improve their value to the community, ought to have ready access to a reasonable level of benefit, whether it is the unemployment benefit or the TEAS allowance. It does not matter what it is called, so long as they have access to some benefit that allows them to continue that field of study without an additional impediment being put in their way. The main people with whom I have had dealings are an Australian Capital Territory group who wrote to me saying that they were concerned that the legislation putting the youth homeless allowance in place would pass through Parliament without any real consultation with those groups. I am sure that in a moment the Minister will tell me how much consultation did take place with the groups concerned with this legislation. The letter said: It quite clearly will make it harder for young people to stay in full-time study if they are not supported by their parents. That is, that the contents of the legislation will make it harder. The letter continued: At the moment the Social Security Act 1947 makes provision for the payment of Special Benefit to these young people and this is supported by recent Administrative Appeals Tribunal decisions. Income maintenance is a Commonwealth Government responsibility. The Commonwealth has clearly abdicated its responsibility for the 6 week waiting period, during which it intends to do nothing and hope that these young people drop out of the education system. I hope that that suggestion made by my petitioners is not true and that the Government is not hoping that people will drop out of the education system. I imagine that the Government acknowledges, as we do, that we need all the help we can get in the next few decades and well-educated people are an asset to any country. The letter continued: State and voluntary welfare agencies will once again cop the brunt of a Commonwealth cost-cutting exercise in welfare. The letter included a copy of a letter that had been sent to the Minister for Social Security (Mr Howe) and his reply, which the group judged to be unsatisfactory, and I must confess so did I, because it was a rather patronising attempt to mollify and soothe people but did not address any of the issues they raised. The reply simply said: . . . the government has sought to deal with the very difficult underlying social issues involved in youth homelessness and the outcome is a most innovative example of social policy. I do not know that the people who have been writing to me doubt that it is an innovative attempt to come to grips with the issues. They are arguing that it might not be a particularly successful one. The group's letter continued: It is clear that it is going to be an administrative nightmare to involve the Department of Education in the implementation of a welfare-based scheme when they have no expertise and no resources. The group put to me a number of other issues, including problems of the eligibility criteria, the whole question of proof of domestic violence and sexual harassment and the capability of officers to judge that, the question of the six-week waiting period, the adequacy or otherwise of the level of benefit, and the problems I mentioned earlier of what they perceive as lack of consultation. I trust that the Minister will be able to inform me that there are no problems in that area. I certainly hope that is the case, because it would appear that the Senate is not in a position to make any amendments to the legislation to correct some of the problems these people see as existing. The other major area covered by this legislation is the social security amnesty. Again, I applaud the Government for taking socially responsible and sympathetic action in this area. The recognition by the Government that many ordinary people have real difficulties with the complexity of the social security system and the attempt to avoid ongoing overpayments in cases where the Government has not been able to find the staff to correct them in any other way are overdue. We accept that that is the position. We certainly do not expect-I do not think anybody expects-the sort of person who deliberately defrauds the system, the sort of person mentioned by Senator Peter Baume, to be given any sort of amnesty at all; but in the social security system we are dealing with a lot of elderly people who can get themselves caught up in a treadmill unwittingly, through no fault of their own, and who need to be dealt with by these sorts of extraordinary measures from time to time. In fighting the problem of social security fraud the Government has drawn the distinction that must be drawn between those who systematically rip off the system and those who, because of the inadequacy of the benefits or their lack of understanding of how the system operates, are more or less pushed into a position of receiving overpayments to which they are not entitled. The other action the Government ought to take is to increase staff in the Department of Social Security. The Government acknowledges that inadequate staffing has led to the problem, and the problem has led to the need for this proposal to clear the decks before the Department can get on with its job. But it offers no long term increase in staff as a method of catching the systematic cheats. I acknowledge that the Government has a problem here. The people who scream about the problem of fraud and overservicing will be exactly the same people who scream if the number of public servants in the Department of Social Security is increased in order to stop the fraud and overpayments. Debate interrupted. The ACTING DEPUTY PRESIDENT(Senator MacGibbon) —Order! It being 7 p.m., under sessional order, I put the question: That the Senate do now adjourn. Senator VALLENTINE(Western Australia)(7.00) —I wish to address some remarks to the port safety scheme concerning the visits of nuclear-powered warships to Western Australia. Since all my remarks will be directed to that document, I seek leave to table a copy. Leave granted. Senator VALLENTINE —This copy of allegedly a draft document, which would be better called a secret document, has unofficially become available to me. It was first ordered in 1976 by the then Minister for Defence, Mr Sinclair. Since that time 67 nuclear-powered vessels have visited Western Australian ports. Some 10 years later that document is still in a draft form. The document is quite extraordinary, more for its omissions than for what it contains. There are three blank sections which are of great significance to the public. After 10 years and 67 nuclear-powered warship visits, these sections are still blank. They are part 4, an evacuation plan; part 6, the issue of potassium iodate tablets-to be prepared; and part 7, a public information plan-to be prepared. These pages are absolutely blank. It has taken some 10 years for the relevant authorities to get even that far. This document is dated November 1984. Evidently, some work has been done on it since then but it is the most recent copy I could manage to get. Decontamination procedures are not even mentioned in this document. There are many confusions contained in the document. I will list just some of those. For example, it is very unclear as to whose responsibility it is to remove an immobilised nuclear-powered warship. In section 3-3, sub-section 73 (j), the Commonwealth Government is given this responsibility. In section 4a-3, sub-paragraph a14, the Fremantle Port Authority is delegated the task of removing the warship. In another section, section 3-4 (76f), the Royal Australian Navy is given the task of removing a leaking vessel, contaminating the area of the port as it goes, to a safe area away from the population centres. There is also confusion in the emergency procedures. For example, the State police are given control of the evacuation of the public from a threatened area. In another section the State Emergency Services are given the duty of arranging emergency powers. Another section deals with the implementation of controls and restrictions of foodstuffs. That is given over to the Department of Health. One would think that one organisation ought to have all those duties to perform. There is no single organisation which has those duties, so I believe there is a great overlapping of tasks and a confusion of responsibilities which in an emergency situation would be untenable. Unless it was a well practised program-for example, a fire drill or a cyclone drill-there would be absolute chaos if these so-called safety plans had to be put into operation. The document does contain prepared statements in the event of an accident, with varying degrees of urgency. If it were a serious accident, the report handles it this way: As a result of the radiation accident aboard the nuclear powered warship USS ..............., it is considered advisable, as a precautionary measure, to evacuate residents within the following areas ................ There could be many suburbs in the coastal strip in Perth and Fremantle which would need evacuation in the event of a serious accident. I quote again from the document: Police and State Emergency Service officers are on duty in the affected areas to notify and assist those people required to be evacuated. If requested, please leave your homes and places of work in an orderly fashion. Arrangements have been made for transport, for the collection of the incapacitated and for the subsequent security of the evacuated area. Take only that which you deem essential for a 48 hour absence. Yet, as I mentioned, there are no evacuation plans listed in the document. Since this document was released to the Western Australian media a week ago my office has had calls from fire brigade officers, from members of the Pharmaceutical Council of Western Australia and from State Emergency Services workers, all of whom say that they are unaware of any emergency procedures to deal with a nuclear accident. If the professionals are not trained, one wonders what would happen in the event of an emergency. The people who would have to to deal with such a critical situation do not have any training for it; they do not know what to do. So if an accident occurred there would be total chaos. I would like to outline various responses we have had to this document being released. First, from the Government. The Minister for Defence (Mr Beazley) very unwisely talked on a radio talkback program in Perth last Tuesday and exposed the total inadequacy of this plan. He said quite categorically that there are three things which the Federal Government is doing to regulate this situation. First, it is conducting 24-hour radiation monitoring whenever these warships are in port. That is not questionable and it is certainly the least that can be done. The second thing the Government would do is remove the vessel to a safe anchorage. The place where the nuclear-powered submarines tie up in Western Australia is Cockburn Sound. There is a very narrow channel into Cockburn Sound. For a warship to get out of that channel, presumably leaking its radioactive contamination all the way, it has to go right past the coastal strip, right past the population centres, to get to whatever would be a safe anchorage. That was the second thing that Mr Beazley said the Government would do. The third thing that he said the Government is doing is monitoring the situation around the clock when the ships are in port. His No. 1 and No. 3 items are absolutely identical. If there was a list of three, he could not even remember the third item. It shows what a total farce it is for the Commonwealth Government to invite these ships in and then not to follow through and make sure that adequate emergency procedures are in place. In the State Government's response, the Minister for the Environment, Mr Hodge, said that more work had been done on the document since November 1984, the date on the document I have just tabled, and that it would be presented to Cabinet soon. I remind the Senate that that is 10 years and 67 nuclear-powered warship visits later. The decision then would be made about whether to let the public know what is in the document. I think that that is an outrageous statement. That was the only statement that the State Government made on that matter. What a cheek! People have a right to know what is in that document and they must demand that information. The Ministers for Environment, Health, and Emergency Services in Western Australia were all invited to give the Government's view to various media outlets in Perth last week. All declined. That is typical of the Burke Government. If an issue arises which it does not want to deal with it just goes silent and it is very difficult to get a public debate on the issue. However, there has been a certain amount of public debate on this issue because other people have been prepared to speak when the Government Ministers have remained silent. In the response from the Public Service we heard from Mr Jim McNulty, the Executive Director of Public Health, who announced that he had brought in a store of 50,000 potassium iodate tablets about five years ago. In the statement he made he was really saying: `Do not worry, folks. That is okay. We have this store on hand'. He also admitted that he was not sure about how those tablets would be distributed. There are many questions that need to be asked in the face of such a pathetic response. Are those potassium iodate tablets out of date by now if they were bought five years ago? Where are they stored? Who has access to them in an emergency? Does Mr McNulty seriously believe that 50,000 potassium iodate tablets would be enough to prevent thyroid problems for the hundreds of thousands of people who might be affected in the coastal strip in the case of an emergency? Potassium iodate tablets must be distributed immediately radiation occurs, or they would be useless. So, if there is not that distribution process ready to go into place smoothly, those 50,000 tablets-pathetic as that stock would be-would be totally useless. Those tablets could only help with one of the three types of radiation damage from which people could suffer in the event of a nuclear accident. There is nothing that can be done to alleviate the problems caused by caesium 137, which attacks muscle tissue, or strontium 90, which attacks bone tissue. Even if the public did feel some sense of security about Mr McNulty's statements that potassium iodate tablets were in store, the public needs to know that that would deal only with a possible one-third of the problem, only one of the three types of radiation sickness that could result. Therefore, I believe that it is a gross irresponsibility for the Director of the Department of Health to try to placate the public's worries by saying: `All's well folks, we have 50,000 of these tablets hidden somewhere'. The United States Consulate in Western Australia, Mr Steve Ecton, also made a response. He replied to the publicity by defending the United States Navy's safety record. In other words, he is saying: `Don't worry, folks, an accident will never happen'. This is a little like the man who jumped out of a twentieth storey window and who was heard to say as he floated past the tenth storey: `Well, so far so good'. It is more by good luck than good management that we have not had a problem with a nuclear-powered, or for that matter a nuclear-armed, ship in an Australian port. Until now we have been lucky. But we have news for Mr Ecton. Accidents do happen. Of course, in this situation we hope that they will not. For example, crews of three nuclear-powered vessels failed their safety tests in 1985. I quote from the West Australian of Tuesday, 30 April 1985: The crews of three US Navy nuclear-powered warships recently failed annual tests of their ability to operate nuclear reactors safely, according to Defence Department officials. . . . . The officials said the crews of the aircraft carrier Carl Vinson-which last week visited Fremantle-and the guided missile-cruisers California and South Carolina failed the tests. . . . . The test, known as the operational reactor safeguard examination, has been administered each year since 1967 by a board of four officers, one a former commander of a nuclear-powered ship, and the other three engineers who have served aboard nuclear-powered ships. Naval officers said a typical test, which would run from two to five days, was designed to check every aspect of operation, including training, maintenance and administration. The test also included casualty drills. In 1985 crews on three United States naval ships failed the test, so that is not very reassuring. A report released by a private research group-the Fund for Constitutional Government-published in the West Australian on 21 July 1983 stated: US Navy ships have leaked radiation at least 37 times since they began using nuclear reactors, contaminating coastal and inshore waters off Japan, Britain and the United States on more than a dozen occasions. Two United States submarines-Thresher and Scorpion-have also been lost at sea and there have been many more accidents with nuclear powered vessels of both the Soviet Navy and the United States Navy. However, here we are concerned about United States ships because they are the ones that come into Australian ports. Mr Ecton also said that nuclear reactors on board warships were safe and that they were not as dangerous as the one which has had such a bad problem in the Ukraine. However, I believe that nuclear reactors on board warships are more dangerous than ground-based reactors for several reasons. The 352 reactors on board those Navy ships have no independent monitoring facilities. A test to which I referred earlier was carried out by that Navy, and the same is true of the French Navy, the British Navy, the Chinese Navy and the Soviet Navy. They manage their own affairs. Defence departments are notoriously secretive about what goes on inside their environs so there is no independent monitor, nothing like the International Atomic Energy Agency. Of course, many people think that that agency is inadequate but there is not even anything like that agency to keep check on the operation of the nuclear navies. There is no heavy containment dome around any of the 352 reactors on board nuclear naval vessels. If there were they would sink. They are contained in steel containers but if there were a melt down that would rapidly melt and the reactor core would go through a hole in the bottom of the ship and also blow out of the top; so, there is no heavy container dome on any of those ships. The nuclear reactors have to be compressed into a very small space because space is extremely limited, particularly on submarines. These reactors are mobile and therefore they are liable to collisions, as are all ships. So there is that problem as well. Reactors also use highly enriched weapons-grade material, therefore contamination relative to the size of the generators is more dangerous than what came out of the Chernobyl nuclear reactor. Finally, this document deals only with nuclear powered warships. Ships bearing nuclear weapons, which tie up right alongside Fremantle harbour and in other Western Australian ports, are not even mentioned. This document does not even pretend to deal with nuclear weapons accidents which can also occur while ships are tied up in port. I do not want to scare people by suggesting that nuclear weapons can accidentally explode. Unless they are triggered they will not explode but they can suffer piercing accidents and they can also be involved in fires on board ship. Their radioactive contamination can leak out if there are those kinds of accidents on board the ships when they are tied up in ports. I believe that all State governments which receive visits from nuclear armed and nuclear powered warships should release their port safety plans to the public in each State. People have the right to know the risks that are involved and they have a right to know what precautions the State emergency services have ready in the event of an accident. This port safety scheme was drawn up by a committee consisting of a member of the Royal Australian Navy, the Fremantle Port Authority, the Premier's Department, the State Police, the Australian Federal Police and State emergency services. If all of those groups, working together for 10 years, have still failed to come up with a plan, I believe that we are taking far too great a risk by even allowing warships to come into our ports. Obviously the so-called experts are not ready in the event of an accident. As I have said, we hope that one will not happen, but if it does happen, there will be chaos. I believe that the Federal Government, which invites these hazardous ships into our ports, should do one of two things: It should come clean with the public, admit the risks, make public the emergency plans and actually practise those emergency plans. It should make sure that there is a store of potassium iodate tablets in every home in every port in Australia that is visited by these dangerous ships. There should also be a booklet in every home, something like the drug offensive booklet, which outlines to people the dangers and the risks they are being subjected to and which also lists assembly points, decontamination procedures, evacuation plans, what foods and what behaviour should be avoided in the event of an accident. Those items should be in every home in every port in Australia which is visited by nuclear warships. Preferably, the Federal Government should refuse entry of such environmentally hazardous ships into our ports. That is the option I would prefer. Senator BOSWELL(Queensland)(7.15) —Over the last 12 months the Queensland Government has been subjected to some vicious attacks in the Senate and in the other place. Today was no exception. We continually see the Minister for Finance, Senator Walsh, being asked dorothy dixers by either Senator Reynolds or Senator Jones which allows him to put the boot into the Queensland Government. I am not complaining about that; all is fair in love and war. But I want to record today some accurate statistics sourced by the Australian Bureau of Statistics. I believe that Senator Walsh, Senator Jones and to a degree Senator Maguire are selectively quoting from statistics. Senator Maguire has taken a quite uncommon interest in the Queensland economy, since he is a senator representing South Australia. I quote Mr Will Buttrose, an economist with Lloyds Bank. He said that the South Australian economy is the worst in Australia. I suggest to Senator Maguire that he lease or give his meagre talents to Mr Bannon and see whether he can help the South Australian Government to lift its game. One of the accusations made recently by Senator Walsh and the leader of a political party in Queensland was that Queensland has the highest rate of unemployment in Australia. I think we should examine that statement in the context that the Australian Bureau of Statistics looks at it. I quote directly from the Australian Bureau of Statistics because that statement needs to be examined in the correct context. The ABS states: The decrease in unemployment in Queensland in the past 12 months, ended April 1986, has been 4.8% (-4.8%) or 5,600 and represents the fastest decrease in unemployment of any State. It is well above the -0.5% achieved nationally. In the 12 months ended April 1986 employment in Queensland grew by 72,600, or 7.1%. Queensland's employment growth rate of 7.1% is the highest of any State and well above the national rate of 5.4%. The ABS continues: It would be expected that Queensland's strong employment growth would have made greater roads into unemployment in this State. The reason for this lies in the combined high growth rate in the State's work force. In the 12 months ending April 1986, Queensland's labour force growth was 5.9% which was the highest rate of increase of any State and compares with a 4.9% national labour force growth rate. The growth in the Queensland labour force reflects a sharp increase in the labour force participation rate which rose from 59.5% in April 1985 to 62.2% in April 1986. It is hard to determine precise reasons for such a movement in labour force participation rates, however an answer may lie with the problems confronting rural industries. Low international commodity prices, drought conditions, high interest rates and the proposed fringe benefits tax are impacting. This in turn may have led wives and children of rural producers and some small business people to stabilize family incomes. e.g. participation rates in the Fitzroy/Mackay region was 61.6%, in north western Queensland 61.4% and in north Queensland 63.4%-well above the Queensland average participation rate of 59.9%. As I see it, as high interest rates and lower commodity prices impact on the farming community, particularly in the sugar areas, wives are having to go out to work. They are seeking jobs in restaurants, hotels and motels to be able to sustain their properties and just to hold the line. I know of many people who are going through this. The wives are getting jobs simply, so to speak, to keep the wolves from the door. Queensland has created more jobs than any other State, with 7.1 per cent compared with the national growth rate of 3.8 per cent. It has created 72,000 jobs in real terms, or 20 per cent of all jobs created in Australia. That is a record of which any government in Australia should be proud. Another accusation is that Queensland has the lowest numbers of tertiary education places and students in Australia. That is correct; that is dead right. Queensland has 16.2 per cent of the population yet the Federal Government returns to Queensland in tertiary education funding only 14.4 per cent of Commonwealth grants for universities and 15.7 per cent of Commonwealth grants for colleges of advanced education. That represents a short changing in money terms of $28m and a loss in tertiary places and educational opportunities of 2,900 university places and 1,000 places in colleges of advanced education. In addition, Queensland misses out on funding for technical and further education institutions by receiving only 14.16 per cent of Federal Government funding. The lack of places is the result of Queensland's receiving a disproportionately low share of Commonwealth funds in the three areas of tertiary education-universities, colleges of advanced education and technical and further education institutions. In 1984-85 an allocation of Commonwealth funds to Queensland based on 16.3 per cent of the Australian population would have provided an increase in funding to Queensland universities and colleges of advanced education of $34.9m. To bring Queensland up to the national average would require in excess of 6,000 extra student places and associated funding for the universities and advanced education sectors alone. Tertiary education numbers are, therefore, not an economic factor. It is a factor that relies on Commonwealth funding. Commonwealth funding is around 14.4 per cent when Queensland has 16.2 per cent or 16.3 per cent of the population. Another accusation that has been levelled at the Queensland Government is that Queensland has had no increase in full time employment. That is false. The source for my figures is the Australian Bureau of Statistics labour force statistics for Australia for April 1986. In the month of April 1986, full time employment in Queensland increased by 11,000 or 1.3 per cent to 879,400. In Australia as a whole, full time employment increased by 18,500 or 0.3 per cent to 5,620,000. For the 12-month period ended April 1986 Queensland recorded an increase in full time employment of 55,000 jobs. Another accusation made is that Queensland is the only State in which juvenile unemployment has increased. That is also false. The source for my figures is the same as for those just given. During April 1986 the number of 15- to 19-year-olds looking for full time work decreased by 3,100 to 19,700. This represents an unemployment rate of 20.1 per cent. In April 1985 the rate was 21.4 per cent. In March 1986 it was 23.4 per cent. Thus, it has fallen 3.4 per cent in the matter of a month. Another allegation is that Queensland is the only State that has experienced a percentage decrease in new housing starts. That is also false. I want to put that on the record too. My source is the Australian Bureau of Statistics building approvals for Australia for March 1986. For the 12 months ended March 1986 all States except Western Australia recorded a percentage decrease. For New South Wales the decrease was 28 per cent, in Victoria 34 per cent, in Queensland 37 per cent, in South Australia 14 per cent, in Tasmania 40 per cent and the overall decrease in new home starts for Australia as a whole was 29 per cent. Only Western Australia had an increase of 3 per cent. That is an indictment of the Federal Government, not of the Queensland Government. It is an indictment of this Government's policy of high interest rates. Another accusation that should be laid to rest is that Queensland has experienced the lowest increase in new motor vehicle registrations. Again, that is false. Continually, false accusations are made. The source for these figures is the ABS registrations of new motor vehicles in Australia in March 1986. For the month ended March 1986 the increase in the number of new motor vehicles registered in Queensland was 8.4 per cent, compared with a national increase of 6.86 per cent. For the 12 months ended March 1986, Queensland's registrations decreased by 30.6 per cent-which is a very low figure-compared with a national decrease of 31.58 per cent. Victoria led the decline with 38.78 per cent and in South Australia, where a great many motor vehicles are manufactured, the figure was 36.15 per cent. Again, that is an indictment not of the Queensland Government but of the impact already, before the legislation is passed, of the fringe benefits tax. Of course, those registrations will fall a lot further. I am sure it is of concern to the Minister for Community Services, Senator Grimes, who I know is greatly worried about the economy of Australia. Another accusation is that Queensland has experienced the greatest percentage increase in bankruptcies. I cannot claim that that accusation is false. But I do dispute it because I cannot qualify it. From July 1985 to April 1986 Queensland had 885 bankruptices, New South Wales had 1,097 and Victoria 812. Queensland had 212 fewer bankruptcies than New South Wales and the Australian Capital Territory, or 73 more than Victoria. I suppose one could say that the populations of New South Wales and Victoria are greater and that therefore the figures would show Queensland with a higher percentage. But when we research these bankruptcies we find that a great number of those recorded are for families who have gone beyond their means in debt and for pensioners who have bought things that they cannot afford. With increased interest rates people are finding that they cannot meet their commitments. They are not all business bankruptcies. There are many domestic bankruptcies in those figures. That is why I dispute them. I cannot say which are retail bankruptcies, which are business bankruptcies or which are farmers bankruptcies. But I can say that many of the bankruptcies are domestic bankruptcies. I again say to Senator Grimes that that is no economic indicator. Another accusation is that Queensland has the second worse decrease in private capital investment. Again, I dispute those figures. My source is the Australian Bureau of Statistics State estimates of actual expenditure of new fixed capital expenditure by private enterprise in related industries for the September quarter 1985. For the September quarter this statement is correct. However, for the 12 months ended September 1985, the percentage increase was 13.8 for New South Wales, 28.8 for Victoria, 18.7 for Queensland and 7.3 for South Australia. Tasmania led the field with an increase of 89.7 per cent. The figure for Western Australia was 35.8 per cent and the figure for Australia as a whole was 22.4 per cent. It is also said that Queensland has the greatest number of days lost through industrial disputes. I dispute this because the Queensland electricity dispute accounted for 212,000 working days lost. If we look at the figures for October, November and December 1985 and January 1986 we will find that Queensland recorded a lower number of working days lost than did any other State. In October the figure was 8,100; in November, 29,300; in December, 3,700; and in January, 1,000. New South Wales had figures of 43,000 in October, 29,600 in November, 22,700 in December and 5,700 in January. In Victoria the figure in October was 120,000 man hours lost; in November, 62,800; in December, 6,900; and in January, 4,700. In three of the four months for which information is available Queensland had under 9 per cent of the total days lost. I want to have recorded in Hansard what the editor of Rydges magazine said on 23 May 1986: I think there are a lot of people concerned about the Queensland economy, because they see it as the health of the economy being very much dependent on the state of, well, commodity markets, which aren't looking very strong at the moment, and there's very few people predicting that they're going to improve substantially in the next 6 to 12 months. But really, when you compare what's going on with Queensland to other States, it's certainly not the worst performing State in Australia. That quotation is from a very prominent economist with the Rydges business journal. No debate on the economy of Queensland can be discussed without looking at the low taxes that Queenslanders pay. Queensland is a low tax State. Everyone acknowledges that. The Australian Bureau of Statistics' financial estimates, its estimates of taxation revenue for Australia in 1984-85, Commonwealth Grants Commission documents and State budget papers statistically prove and show beyond any doubt that Queensland is the low tax State. They show that Victoria pays $338.50 more per capita annually than does Queensland. For New South Wales the figure is $254.73, for South Australia it is $227.90 and for Western Australia it is $117.96 more than any person pays in Queensland. Queensland has no petroleum tax, tobacco tax or financial institutions tax. It lives without all of them. The Queensland economy is steady and reliable. It is not flash but it is making its contribution to the general economy of Australia. When it comes to exports, again Queensland leads the way. For the 12 months ended March 1986, Queensland produced 23 per cent of the export trade. For the nine months ended March 1986, Queensland's exports amounted to $5,804.7m or 23 per cent of the nation's exports. Queensland's contribution was as high as that of New South Wales. In March 1986 export trade was worth $579m or 22 per cent. Again, Queensland with 16 per cent of the population is holding its own, or more than holding its own, on exports despite the fact that exports of commodities such as sorghum, grain and wheat are down and exports of coal are down. Queensland still makes a great contribution to the Australian economy. Only 16.2 per cent of the nation's population for the 12 months ended March 1986 produced this result. Queensland has expected new fixed capital for the 12 months to June 1986 of $2,278.9m or 16.7 per cent of the total money invested in Australia. It recorded 19.8 per cent of the dwelling unit approvals commenced in Australia for 1984-85, 19.7 per cent of total dwelling unit commencements completed in 1984-85 and 20 per cent of the total dwelling units commenced and completed for the December quarter in 1985. Queensland contributed 20.2 per cent of the value of non-residential building approvals in Australia in 1984-85 and 18.5 per cent of the value of total building approvals in 1984-85. It recorded 22 per cent of the non-building construction commencements in 1984-85 and 16.3 per cent of the new motor vehicle registrations in 1984-85. The details and statistics given in my contribution are reliably sourced. They record what is actually happening in the economy in Queensland. Even though there have been high interest and taxation rates and an absolute massacre of rural and primary industry, and Queensland has a great number of primary producers, Queensland is still hanging in there. It is playing its part in providing jobs and exports for the good of the Australian economy. Senator GRIMES(Tasmania-Minister for Community Services)(7.36) —I will not keep the Senate long. Senator Gareth Evans was on duty in the chamber earlier tonight. In my kindly way I said: `Do not worry, Senator Boswell is speaking for only five minutes so I will take your place'. Everything in Queensland is much bigger than it seems and five minutes obviously is a long time in Queensland. On my scoring it amounted to about 25 minutes tonight. I would not dare enter the continuing debate and saga on the Queensland economy which occurs in this place between Senator Walsh, Senator Jones, Senator MacGibbon, Senator Boswell and others. I only remind honourable senators that someone-I cannot remember who, but perhaps you will remember, Mr Acting Deputy President-said that politicians use statistics like drunks use a lamp post, more for support than illumination. We have had a fair bit of that tonight and we have a fair bit in other debates in this place. I do not want to extend the debate. I am getting hungry. I suggest that the Senate do now adjourn. Question resolved in the affirmative. Senate adjourned at 7.37 p.m. The following papers were tabled: Australian Bureau of Statistics Act-Proposal 1986 No. 5-Retail Census 1985-86. Australian Meat and Live-stock Corporation Act-Order 1986-M29-Cancellation of Order No. M4/83-Export of Chilled Beef and Chilled Veal to USA and Canada. Banks (Shareholdings) Act-Regulation-Statutory Rules 1986 No. 107. Canberra College of Advanced Education Act-Statute-No. 58-Courses and Awards Amendment 1986, dated 2 May 1986. Customs Act-Notice 1986 No. 4-Specified rate in respect to the diesel fuel rebate, dated 19 May 1986. Excise Act-Notice 1986 No. 5-Specified rate in respect to the diesel fuel rebate, dated 19 May 1986. The following answers to questions were circulated: (Question No. 810) Senator Mason asked the Minister representing the Special Minister of State, upon notice, on 12 March 1986: (1) How many statutory authorities currently exist under the auspices of the Minister's Department. (2) What are the names of these authorities. (3) What appeal mechanisms, if any, exist for the general public to lodge a complaint against these authorities. (4) If it is proved that any member of staff of any of these authorities is guilty of incompetence, what action, if any, could be taken by a member of the public to sue the authority for compensation; if it is not possible to sue the authority, why is that the case. (5) How many cases concerning these authorities are currently before the Administrative Appeals Tribunal, and what is the delay at present between the listing of a case and its hearing before the Tribunal. (6) If any statutory authority under the Minister's Department cannot be sued, will the Minister consider amending the relevant legislation to make this possible. Senator Gareth Evans —The Special Minister of State has provided the following answer to the honourable senator's question: (1) Six. (2) Academic Salaries Tribunal, Australian Electoral Commission, Australian Federal Police, Commonwealth Grants Commission, National Crime Authority, Remuneration Tribunal. (3) Appeal mechanisms are as follows: Academic Salaries Tribunal-A person aggrieved by a decision of the Academic Salaries Tribunal of an administrative character, or conduct for the purpose of making a decision, or failure to make a decision, may be able to apply to the Federal Court for an order of review under the Administrative Decisions (Judicial Review) Act 1977 on the grounds set out in that Act. Australian Electoral Commission-Rights of appeal open to the general public are provided under the Commonwealth Electoral Act 1918 and the Electoral and Referendum Regulations as follows: (a) enrolment matters and registration as a general postal voter-Part X of the Act and Regulations 40a, 40b, 40c (b) registration of political parties-s.141 of the Act (c) validity of election results-Part XXII of the Act Australian Federal Police-Complaints (Australian Federal Police) Act 1981. Commonwealth Grants Commission-The Commission is responsible for providing advice to the Government on matters of federal financial relations which have been referred by the Minister for inquiry and report. Decisions of the Commission do not impact directly on the rights, privileges, benefits or other conditions of individual or groups of individuals in the general public. National Crime Authority-Decisions of the Authority are subject to review under the Administrative Decisions (Judicial Review) Act 1977. Applications may also be made to the Federal Court for review of decisions under s.32 (1) of the National Crime Authority Act 1984. Remuneration Tribunal-A person aggrieved by a decision of the Remuneration Tribunal of an administrative character, or conduct for the purpose of making a decision, or failure to make a decision, may be able to apply to the Federal Court for an order of review under the Administrative Decisions (Judicial Review) Act 1977 on the grounds set out in that Act. (4) The Attorney-General's Department has advised that, unless an authority is statutorily protected, it is liable for the torts of its servants committed in the course of their duty. Where employees, acting in the course of their duty are incompetent and, as a consequence, loss is suffered by a member of the public, it will commonly be found that the act or omission which was seen as incompetent was also tortious. For example, incompetent driving would probably be tortious. In the absence of a denial of liability the negligent giving of erroneous advice is tortious where the advice is given by a person having a duty of care to one who suffers foreseeable damage as a result of reasonably relying on that advice. Many other forms of incompetence would also be tortious, but each case would need to be considered on its own facts. None of the authorities listed in answer to part (2) of this question is statutorily protected against general liability in tort. (5) There are currently seven cases before the Administrative Appeals Tribunal, all concerning the Australian Federal Police. All cases are listed for hearing as soon as they are lodged. The time lapse between listing and hearings varies widely depending on particular circumstances. (6) Officers of the Australian Electoral Commission acting as Returning Officers in industrial ballots conducted under the provisions of the Conciliation and Arbitration Act are protected against proceedings for defamation under Regulation 146aj (5c) of the Conciliation and Arbitration Regulations. Any amendment of this regulation is a matter for the Minister for Employment and Industrial Relations. Members and Acting Members of the National Crime Authority performing their office in relation to a hearing of the Authority and legal practitioners and witnesses appearing at such hearings are afforded privilege under the provisions of s.36 of the National Crime Authority Act 1984 which prevents the Authority from being sued in this limited circumstance. These provisions are usual for tribunals established under Commonwealth legislation and considered necessary for the effective operation of the Authority in this role. (Question No. 818) Senator Mason asked the Minister representing the Minister for Defence, upon notice, on 12 February 1986: (1) How many statutory authorities currently exist under the auspices of the Minister's Department. (2) What are the names of these authorities. (3) What appeal mechanisms, if any, exist for the general public to lodge a complaint against these authorities. (4) If it is proved that any member of staff of any of these authorities is guilty of incompetence, what action, if any, could be taken by a member of the public to sue the authority for compensation; if it is not possible to sue the authority, why is that the case. (5) How many cases concerning these authorities are currently before the Administrative Appeals Tribunal, and what is the delay at present between the listing of a case and its hearing before the Tribunal. (6) If any statutory authority under the Minister's Department cannot be sued, will the Minister consider amending the relevant legislation to make this possible. Senator Gareth Evans —The Minister for Defence has provided the following answer to the honourable senator's question: (1) There are nine statutory authorities currently under the auspices of the Minister for Defence and his Department. (2) The names of these authorities are: (a) Defence Force Retirement and Death Benefits Authority (b) Royal Australian Navy Central Canteens Board (c) Royal Australian Navy Relief Trust Fund (d) Australian Military Forces Relief Trust Fund (e) Services Canteens Trust Fund (f) Royal Australian Air Force Veterans' Residences Trust (g) Royal Australian Air Force Welfare Trust Fund (h) Army and Air Force Canteens Service (i) Defence Force Remuneration Tribunal (3) The following appeal mechanisms exist for the general public to lodge a complaint against these authorities: (a) Defence Force Retirement and Death Benefits Authority. A person affected by, and dissatisfied with, a decision of the Defence Force Retirement and Death Benefits Authority may request the Authority to reconsider the decision. Such a request must be submitted within 30 days of the date the decision comes to the person's notice, although the Authority can grant an extension of the period. Application may be made to the Administrative Appeals Tribunal for a review of a decision of the Authority flowing from a reconsideration. (b) Royal Australian Navy Central Canteens Board. There are no specific appeal mechanisms relating to the Royal Australian Navy Central Canteens Board, but the normal procedures for complaint (such as the Ombudsman and recourse to the courts) are available in appropriate circumstances. (c) Royal Australian Navy Relief Trust Fund. There are no specific appeal mechanisms relating to the Royal Australian Navy Relief Trust Fund, but the normal procedures for complaint (such as the Ombudsman and recourse to the courts) are available in appropriate circumstances. (d) Australian Military Forces Relief Trust Fund. There are no specific appeal mechanisms relating to the Australian Military Forces Relief Trust Fund, but the normal procedures for complaint (such as the Ombudsman and recourse to the courts) are available in appropriate circumstances. (e) Services Canteens Trust Fund. There are no specific appeal mechanisms relating to the Services Canteens Trust Fund, but the normal procedures for complaint (such as the Ombudsman and recourse to the courts) are available in appropriate circumstances. (f) Royal Australian Air Force Veterans' Residences Trust. There are no specific appeal mechanisms relating to the Royal Australian Air Force Veterans' Residences Trust Fund, but the normal procedures for complaint (such as the Ombudsman and recourse to the courts) are available in appropriate circumstances. (g) Royal Australian Air Force Welfare Trust Fund. There are no specific appeal mechanisms relating to the Royal Australian Air Force Welfare Trust Fund, but the normal procedures for complaint (such as the Ombudsman and recourse to the courts) are available in appropriate circumstances. (h) Army and Air Force Canteens Service. There are no specific appeal mechanisms relating to the Army and Air Force Canteens Service, but the normal procedures for complaint (such as the Ombudsman and recourse to the courts) are available in appropriate circumstances. (4) The Attorney-General's Department has advised that, unless an authority is statutorily protected, it is liable for the torts of its servants committed in the course of their duty. Where employees, acting in the course of their duty are incompetent and, as a consequence, loss is suffered by a member of the public, it will commonly be found that the act or omission which was seen as incompetent was also tortious. For example, incompetent driving would probably be tortious. In the absence of a denial of liability the negligent giving of erroneous advice is tortious where the advice is given by a person having a duty of care to one who suffers foreseeable damage as a result of reasonably relying on that advice. Many other forms of incompetence would also be tortious, but each case would need to be considered on its own facts. None of the authorities listed in answer to Part (2) of this question is statutorily protected against general liability in tort. (5) Cases concerning statutory authorities under the auspices of the Minister for Defence and his Department currently before the Administrative Appeals Tribunal are as follows: (a) The Defence Force Retirement and Death Benefits Authority is currently concerned with 6 cases, including one on which decisions are awaited as at 24 April 1986. The delay between listing and hearing varies significantly, depending upon the nature of the appeal, the type of decision the subject of the appeal, the availability of witnesses and the Tribunal's sitting timetable. (b) The Administrative Appeals Tribunal has jurisdiction in respect of the Royal Australian Navy Central Canteens Board, Royal Australian Navy Relief Trust Fund, Australian Military Forces Relief Trust Fund, Services Canteens Trust Fund, Royal Australian Air Force Veterans' Residences Trust, Royal Australian Air Forces Welfare Trust Fund and Army and Air Force Canteens Service only in respect of applications made under the Freedom of Information Act. There are no such applications before the Tribunal at this stage. (c) The Administrative Appeals Tribunal has no jurisdiction in relation to the Defence Force Remuneration Tribunal. (6) Not applicable. (Question No. 1038) Senator Mason asked the Minister representing the Minister for Defence, upon notice, on 1 May 1986: (1) Is the telephone number (048) 28 6081 according to Telecom, a non-existent number out of Goulburn. (2) What is the correct telephone number for members of the public wishing to report the progress of such aircraft. (See Question without Notice on 20 March 1986 Hansard, 1336-1337). Senator Gareth Evans —The Minister for Defence has provided the following answer to the honourable senator's question: (1) Yes. (2) The correct telephone number should have been (049) 28 6081. The incorrect telephone number reported in the Hansard of 20 March 1986 appears to be the result of a transcription error rather than an error based upon incorrect advice from the RAAF. The number belongs to a member of the Air Staff at RAAF Williamtown. (Question No. 1042) Senator Kilgariff asked the Minister representing the Minister for Aviation, upon notice, on 1 May 1986: (1) Which Australian aerodromes currently are included in the Aerodrome Local Ownership Programme (ALOP). (2) Which aerodromes are currently under negotiations for inclusion in the ALOP. (3) Does the Government consider ALOP to be successful and is it the Government's intention to continue the program. (4) Will further applications for local ownership of aerodromes be received in the near future. (5) What funds are currently allocated to provide financial support for aerodromes through ALOP, and how are these funds distributed. (6) What fundings does the Minister for Aviation anticipate ALOP will receive in the 1986-87 financial year. Senator Gietzelt —The Minister for Aviation has provided the following answer to the honourable senator's question: (1) See Attachment A-``Licensed Aerodromes Participating in the ALOP at 30 April 1986''. (2) See Attachment B-``Aerodromes Eligible for Transfer to Local Ownership''. Discussion of transfer with local interests has been initiated, at least, in respect of all these; negotiations have advanced substantially in respect of some. (3) Yes and Yes. (4) Further transfer proposals are expected. Their timing is a prerogative of the prospective local authority owners, reflecting the voluntary nature of the Plan whereby both the Commonwealth and the local authority must mutually agree to a transfer. (5) Commonwealth ALOP expenditures in 1985-86 are expected to total some $19m grants towards the costs of developing, operating and maintaining eligible aerodromes. Distribution is on the basis of works proposed by participating aerodrome owners and approved in terms of justifiable aviation needs. (6) ALOP funding allocations for 1986-87 will be determined in the budgetary process. Attachment A1 LICENSED AERODROMES PARTICIPATING IN ALOP AT 30 APRIL 1986 (272) Aerodromes receiving maintenance and development grants at 30 April 1986 (216) Albany, Albury, Alpha, Aramac, Ararat, Armidale, Atherton, Aurukun, Ayre, Bairnsdale, Balgo Hill, Ballarat, Balranald, Barcaldine, Baradine, Bathurst, Bedourie, Benalla, Bendigo, Birchip, Birdsville, Blackall, Bollon, Boulia, Bourke, Bowen, Brewarrina, Broken Hill, Bunbury*, Bundaberg, Burketown, Burren Junction, Cairns, Caloundra, Carinda, Casino, Cessnock, Charters Towers, Chillagoe, Chinchilla, Clermont, Cleve, Cloncurry, Cobar, Coffs Harbour, Collarenebri, Collinsville, Condobolin, Coober Pedy, Coolah, Cooma, Coonabarabran, Coonamble, Cootamundra, Corryong, Corowa, Cowell, Croydon, Cowra, Cunnamulla, Darjarra, Dalby, Deniliquin, Devonport, Dirranbandi, Donald, Dubbo, Echuca, Emerald, Eromanga, Esperance, Eulo, Evans Head, Gayndah, Georgetown, Geraldton, Gilgandra, Gladstone, Glen Innes, Goodooga, Goondiwindi, Goulburn, Grafton, Gregory Downs, Griffith, Gunnedah, Gympie, Hamilton, Hay, Hervey Bay, Hillston, Hopetoun, Horsham, Hughenden, Ingham, Injune, Innisfail, Ivanhoe, Inverell, Isisford, Julia Creek, Jundah, Kalumburu, Karratha, Kempsey, Kerang, Kimba, Kingaroy, Kingscote, Kununurra, Lake Cargelligo, Latrobe Valley, Laverton, Leongatha* Leonora, Lightning Ridge, Lismore, Lord Howe Is., Loxton, Mareeba, Marla, Maroochydore, Marree, Maryborough (Q), Maryborough (V), Merimbula, Mildura, Millicent, Minnipa, Mitchell, Monto, Moree, Mornington Is., Moruya, Mount Coolon, Mount Garnet, Mudgee, Mungindi, Muttaburra, Naracoorte, Narrabri, Narrandera, Narromine, Nhill, Norseman, Nyngan, Orange, Orbost, Parkes, Pooncarie, Port Augusta, Port Hedland, Portland, Port Macquarie, Port Pirie, Proserpine, Queenstown, Quilpie, Quirindi, Redcliffe, Renmark, Richmond, Robinvale, Roebourne, Roma, Rottnest Is. St Arnaud, St George, St Helens, Scone, Sea Lake, Shepparton, Southern Cross, Stanthorpe, Stawell, Stonehenge, Strahan, Streaky Bay, Swan Hill, Tamworth, Tara, Taree, Taroom, Temora, Thangool, Thargomindah, Theodore, Tibooburra, Tocumwal, Tooraweenah, Toowoomba, Tottenham, Tumut, Waikerie, Walgett, Wangaratta*, Warracknabeal, Warren, Warrnambool, Wee Waa, Weipa, West Sale, West Wyalong, White Cliffs, Wilcannia, Wiluna, Windorah, Winton, Wollongong, Wondai, Wudinna, Wyandra, Wycheproof, Wynyard, Yarram, Young. Aerodromes receiving maintenance grants only at 30 April 1986 (56) Arrabury, Augustus Downs, Bamaga, Betoota, Borroloola, Blackwater, Cluny, Cuddapan, Davenport Downs, Delta Downs, Doomadgee, Durham Downs, Durrie, Dysart, Edward River, Flora Valley, Forbes, Gibb River, Glengyle, Glenormiston, Gove, Groote Eylandt, Iffley, Inkerman, Innamincka, Jabiru, Kamilaroi, Karumba, Kowanyama, Lawn Hill, Leigh Creek South, Leinster, Lorraine, Margaret River, Middlemount, Miranda Downs, Mitchell Plateau, Monkira, Mooraberree, Moranbah, Morney, Mount Howitt, Nappa Merrie, Newman, Nicholson, Ord River, Paraburdoo, Roseberth, Rutland Plains, Smithton, South Galway, Tanbar, Thylungra, Wondoola, Wrotham Park, Yulara Attachment B AERODROMES ELIGIBLE FOR TRANSFER TO LOCAL OWNERSHIP QUEENSLAND-Camooweal, Charleville, Coen, Cooktown, Lockhart River, Longreach, Mackay, Mount Isa, Normanton, Rockhampton, Thursday (Horn) Island. NEW SOUTH WALES-Norfolk Island* * Administered by Department of Aviation NSW Regional Office VICTORIA-Bacchus Marsh, Mallacoota, Mangalore. TASMANIA-Flinders Island, King Island. SOUTH AUSTRALIA-Ceduna, Gawler, Mount Gambier, Oodnadatta, Port Lincoln, Whyalla. NORTHERN TERRITORY-Alice Springs, Tennant Creek. WESTERN AUSTRALIA-Broome, Carnarvon, Cue, Derby, Fitzroy Crossing, Forrest, Halls Creek, Kalgoorlie, Marble Bar, Meekatharra, Mount Magnet, Nullagine, Onslow, Wittenoom, Wyndham. (Question No. 1045) Senator Peter Baume asked the Minister for Industry, Technology and Commerce, upon notice, on 2 May 1986: (1) Why was the by-law referred to in the front page lead article in the Queanbeyan Age newspaper on Friday, 14 February 1986, allowing Mont Equipment Pty Ltd to import special down-proof nylon to make its sleeping bags at a duty of 2 per cent allowed to expire. (2) If expiry of the by-law was considered appropriate why were no transitional provisions made to maintain a reasonable level of duty on this nylon. (3) Is the current level of duty at 40 per cent plus a $1 per square metre penalty considered an appropriate level of duty. (4) If the answer to (3) above is no, what has been done and why was it not done sooner, to have the level of duty reviewed since it remained at this level for at least 8 months and especially as the Minister has received representations from Mont Equipment Pty Ltd. (5) What is the Minister's attitude to the objection of the Melbourne textile manufacturer mentioned in the article to the granting of a concessional duty to this nylon on the basis that he may manufacture a nylon at some time in the future. (6) What procedures does the Department of Industry, Technology and Commerce have in place to monitor the expiry of by-laws and other similar developments that can change the rate of duty on products to ensure that a duty rate is not unintentionally allowed to change as has occurred in this case. (7) Has the Minister put in place any changes to these procedures in the light of the expiry of the nylon duty referred to in (1) above. Senator Button —The answer to the honourable senator's question is as follows: (1) and (2) The by-law referred to lapsed with the termination of the Commercial By-law System on 30 June 1985. Importers were given two years notice that the by-law would lapse. They were informed of this situation in the Consolidated By-law References published by the Australian Customs Service (ACS) and by notices in Commonwealth Tariff Concession Gazettes which advised importers of the affected goods to lodge applications early to minimise possible processing delays. (3) Yes, subject to an importer establishing that a concessional rate of duty is appropriate because goods serving similar functions are not and are not capable of being produced in Australia in the normal course of business. (4) and (5) An application for a Tariff Concession Order was not lodged by Mont Equipment Pty Ltd until 1 August 1985, two months after the previous concession lapsed. However, the proposed concession was opposed by an Australian manufacturer who had claimed capacity to produce this material. This matter had to be resolved before the application could proceed in terms of Section 269c of the Customs Act. A prima facie case for a concession was eventually established and a proposed concession was gazetted on 23 April 1986. (6) The duty rate in question was not unintentionally allowed to change. (7) No. (Question No. 1049) Senator Jones asked the Minister representing the Minister for Defence, upon notice, on 2 May 1986: What action is proposed to rectify the problem of lack of self-esteem identified among Australia's 38,000 defence spouses in the report `Supporting Service Families' now submitted to the Minister for Defence in the following areas: (a) improved service housing accommodation; (b) increased terms of stability in the length of postings; and (c) improved acceptance by service hierarchy of modern attitudes towards the status of women. Senator Gareth Evans —The Minister for Defence has provided the following answer to the honourable senator's question: (a) To redress the deficiencies in the housing programme for service families and thus assist in raising the self-esteem of defence spouses, the Government has embarked upon an expanded Defence housing programme that over the next decade will lead to a housing stock of greatly improved quality and meeting current community standards. Of the 22,000 houses currently managed by Defence the worst 6,000 will be progressively replaced and other houses of inadequate standard will be refurbished. An expanded funding programme of more than $750m during the next decade is to be used to bring the current stock of houses up to standard and service people are to be given a greater degree of choice of housing. It is the Government's intention to establish a Defence Housing Authority which will operate as a Statutory Authority, but under the Minister for Defence, to manage the total Defence Force housing stock. Legislation to establish the Authority will be introduced in the Autumn Session of 1987. An interim Defence housing agency will be established on an administrative basis in the new financial year. The interim agency will be able to assist with much of the necessary preliminary work towards developing strategies for meeting the Defence Force housing need. (b) The Government acknowledges the difficulties placed on many Service personnel and their families through the requirement to change location frequently. These difficulties were highlighted by Ms Sue Hamilton when she submitted her report to the Minister. While recognizing that there are numerous reasons why Defence Force personnel are required to change location, such as, to gain and maintain operational skills appropriate to a fighting force, the Government wishes to ensure that all opportunities to provide maximum family stability have been identified. Accordingly, the Government is to support the recommendation made by Ms Hamilton that a senior person be appointed to undertake a thorough examination of posting policies within the Services to identify as many cases as possible where geographic stability over at least three years can be achieved in peacetime. The person conducting the review will also be asked to recommend ways in which current posting systems could be redesigned to be more responsive to family requirements such as crucial stages in children's education. Announcement of the appointment of the Senior person can be expected shortly. (c) Under the auspices of this Government, the Defence Force has become significantly more attuned to providing equal employment opportunities for women within the force. In this way, it has gained a better appreciation of the growing diversity in the roles women are playing in the Australian way of life. Consequently, its attitude to spouses has been changing, and it will be considering those recommendations made by Ms Hamilton with regard to assisting spouses, who want to join the paid workforce, by: (1) providing some full and part-time employment for spouses within its own organisation as family liaison officers, spouses employment officers and education liaison officers; (2) providing at a central co-ordinating unit nationwide monitoring of the employment needs of, and development of co-ordinated strategies for improving the employment opportunities for, service spouses; (3) providing within each local area, spouse employment officers who will implement the policies decided and be in frequent contact with spouses; and (4) providing both nationally and locally, information on the kinds of educational activities that spouses may wish to pursue. The Services will also consider: (1) adopting a policy that recognises the special child care needs of Service personnel and their families, and (2) setting up a National Consultative Group of Service Spouses to act as a source of advice on the implementation of the Hamilton Report recommendations. Senator Button —On 11 March 1986, (Hansard, page 765) Senator Puplick asked me as Minister representing the Minister for Trade the following question, without notice: Is the Minister representing the Minister for Trade aware that an export market development grant of some $25,000 was credited last year to a rat-bag organisation known as the Creation Science Foundation Ltd? Has this so-called foundation, which is tax exempt as a religious organisation, written off $92,000 because of the failure of the company's investment agents-an amount equal to 60 per cent of the total donations which it received? Is the Minister concerned that export grants are being used to subsidise religious organisations, and particularly that such a bogus organisation can be a recipient of a large payment of public moneys, which is then wasted? Will he also draw to the attention of the Treasurer for review the tax exempt status of this body? The Minister for Trade has provided the following responses to the honourable senator's question: The Export Market Development Grants (EMDG) scheme is designed to encourage Australian exporters to seek out and develop overseas markets for goods, specified services, industrial property rights and know-how which are substantially of Australian origin. It provides financial incentives in the form of taxable cash grants based on eligible expenditure incurred on overseas activities where the promotion of export sales is the objective. The scheme is embodied in legislation-the Export Market Development Grants Act and the Australian Trade Commission Act. The EMDG Act sets down the criteria to be used to determine the eligibility of firms or organisations for assistance under the scheme and the calculation of actual grant entitlements. The scheme is, by design, a general access one, and firms or organisations which satisfy the requirements of the legislation are entitled to grants. With the exception of majority-owned South African companies, no individual organisation or the goods they promote overseas have been excluded from the EMDG scheme on the basis of moral grounds. Of course this is not to say that the Government necessarily endorses the views of any or all claimants under the scheme. The Creation Science organisations were paid EMD grants on the basis that they had incurred eligible expenditure on the overseas promotion of Australian made goods and satisfied the requirements of the EMDG legislation. I should add that the secrecy provisions of the legislation (Section 94 of the Australian Trade Commission Act) preclude the Australian Trade Commission from the publication or divulgence of information concerning the affairs of individual claimants.