Wednesday, 20 August 1986 The Senate met at 10 a.m. The Clerk-Honourable senators, the President is unable to attend the sitting of the Senate today. In accordance with standing order 29, the Deputy President will take the chair. The DEPUTY PRESIDENT (Senator D. J. Hamer) thereupon took the chair, 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 we deplore the discriminatory tax proposals as outlined in the Government's preferred option on proposed new and widened tax proposals as so outlined, namely: Capital Gains Tax Hidden Death Tax described as ``Capital Gains Tax after death'' Gift Tax Increased Company Tax Employer taxes on employees' employment benefits All such taxes will discriminate against and inhibit progress, growth and employment throughout the nation. They will attack hardworking people who have built up their assets; they will discourage thrift, they will inhibit development, they will treat unfairly all who plan for the future, they will cause trouble and expense in arriving at the value of the assets; they will discourage industry and punish achievement. Your petitioners therefore humbly pray that the Senate in Parliament assembled should reject these tax proposals. And your petitioners as in duty bound will ever pray. by Senator Sheil (from three citizens). To the Honourable the President and members of the Senate in Parliament assembled: The petition of the undersigned citizens of Australia respectfully showeth objection to the Metric system and request the Government to restore the Imperial system. And your petitioners as in duty bound will ever pray. by Senator Sheil (from 23 citizens). To the Honourable the President and members of the Senate in Parliament assembled. The petition of the undersigned respectfully showeth: Introduction of any additional capital gains taxes, wealth taxes or death duties is opposed on the grounds that: they adversely affect the small and medium size businesses in Australia, destroying incentive and discouraging investment in this important area of the economy; the Australian economy, and employment in particular, is heavily reliant on growth in small businesses; any capital gains that might result when owners of small businesses finally sell the business are not ``windfall gains'' but the result of many years of work and sacrifice, with very little being taken out of the business by way of salaries so that the maximum amount of money can be ploughed back into the business to create growth and jobs; Your petitioners request that the Senate, in Parliament assembled, will protect the rights of private enterprise and reject any inequitable additional taxes. And your petitioners as in duty bound will ever pray. by Senator Brownhill (from 37 citizens). To the Honourable the President and members of the Senate in Parliament assembled. The petition of the undersigned shows: That the Hawke Government should: pass on the full benefit of lower international oil prices on 1 March 1986; not increase or extend fuel taxes; and maintain its tax cut commitments. Your petitioners humbly pray that the Hawke Government honour its commitment to the Import Parity Pricing policy. And your petitioners as in duty bound will ever pray. by Senators Peter Baume (from 17 citizens), Brownhill (from six citizens) and Durack (from 22 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 Senators Michael Baume (from 51 citizens) and Townley (from 56 citizens). To the Honourable the President and members of the Senate in Parliament assembled: The humble petition of the undersigned citizens of Australia respectfully showeth: That the proposed Australian Bill of Rights Bill 1985 will endanger the Federal system in Australia, the State and Federal criminal justice systems, the State and Federal Police Force, the State and Federal education systems, the independence of the churches and religious associations, marriage and the family, children, the unborn, the handicapped, the aged and the infirm, employer and employee relationships, and Australian society generally. Our petitioners therefore humbly pray: That the House ensure that a referendum is held before the Australian Bill of Rights 1985 is permitted to become legislation. And your petitioners as in duty bound will ever pray. by Senator Alston (from 25 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 34 citizens). To the Honourable the President and members of the Senate in Parliament assembled. The Petition of the undersigned shows: That we urge you to oppose the Australian Bill of Rights Bill because: We get no legally enforceable rights under the Bill. The Bill does not guarantee vital rights such as the right not to belong to a trade union, the right to own private property and not be deprived of it without just compensation and the right of choice between Government and non-Government schools. The Bill gives Canberra extra powers to change our Federal system by the back door without a constitutional referendum. The Bill gives dangerous new powers to a Federal Government Commission. Your petitioners ask that the Senate, in Parliament assembled, should vote against the Bill of Rights, support Opposition amendments and seek a genuine public debate and a referendum on the Bill. And your petitioners as in duty bound will ever pray. by Senators Peter Baume (from 15 citizens), Brownhill (from 18 citizens) and Durack (from 2,291 citizens). To the Honourable the President and members of the Senate in the Parliament assembled. The Petition of the undersigned shows 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 humbly pray that the Senate rejects this Bill. And your petitioners as duty bound will ever pray. by Senators Collard (from 889 citizens) and Macklin (from 88 citizens). To the Honourable the President and members of the Senate in Parliament assembled. The Petition of the undersigned citizens of Australia respectfully showeth: That the Australian Bill of Rights Bill is a harmful, dangerous and divisive proposal, the provisions of which are authoritarian and anti-democratic. Your petitioners therefore pray: That the Senate rejects this Bill. And your petitioners as in duty bound will ever pray. by Senator Jessop (from 45 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 301 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 137 citizens). To the Honourable the President and members of the Senate in Parliament assembled: the humble petition of the undersigned citizens of Australia respectfully showeth: that the 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 therefore humbly pray: That the Senate should: completely reject the Bill of Rights and the Human Rights and Equal Opportunity Bill. And your petitioners as in duty bound will ever pray. by Senator Peter Baume (from 36 citizens). To the Honourable the President and members of the Senate in Parliament assembled: the humble petition of the undersigned citizens of Australia respectfully showeth: That the Australian Bill of Rights will do nothing to advance the rights of Australians, because it is dangerously ambiguous and will cause confusion within the legal system; it endangers our Federal system; and, it is to be administered in an authoritarian manner inconsistent with the present legal rights of all Australians. Your petitioners therefore pray: That the Senate rejects the Australian Bill of Rights Bill and all cognate Bills. And your petitioners as in duty bound will ever pray. by Senator Jessop (from 290 citizens). To the Honourable the President and members of the Senate in Parliament assembled. The petition of the undersigned citizens of Australia respectfully shows: That we oppose utterly the proposed Australian Bill of Rights because the Bill will- limit rather than protect the rights and freedoms of Australians set up a coercive and powerful Human Rights and Equal Opportunities Commission that will operate contrary to the individuals' rights and freedoms endanger our Federal system by its improper intrusion into States rights. Your petitioners therefore pray: That the Senate rejects the Australian Bill of Rights Bill and all cognate Bills. And your petitioners as in duty bound will ever pray. by Senator Macklin (from 101 citizens). To the Honourable the President and members of the Senate in Parliament assembled. The petition of the undersigned citizens of Australia shows that: We are opposed to the Parliament imposing a Bill of Rights on the people of Australia and we ask that the Senate reject the Bill entirely. Your petitioners humbly pray: That should the Honourable House decide to pass the Bill in amended form it will retain the amendment applying the legislation to trade unions. And your petitioners as in duty bound will ever pray. by Senator Alston (from 54 citizens). To the Honourable the President and members of the Senate, of the Parliament of Australia assembled. We, the undersigned, plead that Parliament will re-invoke the blasphemy, indecency, and obscenity proscriptions into the Customs (Prohibited Imports) Regulations, by adding those proscriptions to the present Section 4A, sub-regulation 1A (b) (1), for the following reasons: because there is a flood of obscene publications into the country, because such publications depict the abnormal as normal because such publications degrade men and women because such publications create new, offensive demands on women, with which they do not willingly comply (Eysenck and Nias) because this causes marriage breakdown because children easily obtain such publications because children copy what they see because the child found in possession of such publications is at risk, facing rejection, and carrying the burden of having altered the relationships in his home for the worse, between parents, and between parent and child because such a child faces, alone, the loss of trust because I am a reasonable adult person and I am offended by the obscene books which you have legislated into this community. 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 62 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 68 citizens). To the Honourable the President and members of the Senate in Parliament assembled. The petition of certain citizens of Australia shows that woodchipping and clearfelling will destroy the Otway Forests, water catchments and jobs in tourism. Your petitioners therefore pray that you will protect the Otway Forests for the future and refuse any licence to export woodchips from the Otways. by Senator Robert Ray (from 25 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: Upon evidence from within Australia and overseas, the introduction of Plant Variety Rights legislation would not be in Australia's best interest because: 1. Plant genetic resources should remain a public resource; 2. Australia's public plant breeding programmes could be undermined; 3. Such legislation may lead to a reduction in the genetic diversity of commercial varieties; 4. There is reason to fear that choices of seed and other plant propagation materials may be restricted due to the controls placed on their use; 5. Plant Varietal Rights legislation could lead to higher costs for the grower, the consumer, the plant-breeder and the tax-payer; 6. Plant Variety Rights will lead to a further increase in foreign control of Australia's plant genetic resources; Your petitioners therefore humbly pray that Parliament ensure that it recognises the widespread public opposition to PVR and promote alternative means of royalty collection for plant breeders. And your petitioners as in duty bound will ever pray. by Senator Peter Baume (from 14 citizens). To the Honourable the President and members of the Senate in 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 investment. And your petitioners as in duty bound will ever pray. by Senator Watson (from 48 citizens). To the Honourable the President and members of the Senate assembled. The petition of the undersigned respectfully showeth that: 1. The Watsonia Army Barracks contain electronic communication facilities, operated by Australian and American personel, that gives the United States the ability to pin-point Soviet nuclear submarines, hidden in the Oceans. 2. This would make it possible for U.S. killer-submarines to destroy all Soviet nuclear submarines, while the U.S. nuclear submarines launch their missiles in a `first strike' attack. This makes Watsonia a potential nuclear target. A nuclear attack on Watsonia would have a disastrous effect on Melbourne. 3. The `joint U.S.-Australian' bases in Australia endanger rather than protect us. They also add a new menace to nuclear arms race, that must be stopped. Your petitioners most humbly pray that the Senate in Parliament assembled should close the `Joint Australian-U.S.' electronic communication facilities in the Watsonia Army Barracks by Senator Zakharov (from 90 citizens). To the Honourable the President and members of the Senate of the Parliament of Australia assembled. We, the undersigned, plead that Parliament will legislate, or act in accordance with the present legislation to replace the current members of the Film Censorship Board who have admitted to Senator Harradine on 12th December, 1984 as reported in the Senate Select Committee on Video Material, (see attached extracts), that they are not applying either the blasphemy or obscenity tests as required under the provisions of the Customs (Cinematograph Films) Regulations, and that these persons be replace by persons who will apply these and other related tests in accordance with the said Regulations. Your petitioners humbly pray that you will give this matter your earnest consideration. And your petitioners as in duty bound will ever pray. by Senators Harradine (from 981 citizens) and Knowles (from 23 citizens). To the Honourable the President and members of the senate in Parliament The Petition of the undersigned shows that because it will cause serious harm to the community, the Parliament will not legalise the possession, sale, hire, or supply of any publication or video tape, video disc, slide or any other recording from which a visual image can be produced, which displays degradation of any person, particularly women and children, or animals; scenes of explicit sexual relations showing genitalia detail; acts of violence and sex; sexual perversion such as sodomy, mutilation, child pornography, urolagnia, coprophilia, necrophilia, bestiality; or the use and effect of illicit drug taking; explicit fellatio and cunnilingus; explicit nudity including touching genitalia, erect penis. Your petitioners pray the Senate, in Parliament assembled that you will give this matter earnest consideration. And your petitioners as in duty bound will ever pray. by Senator Harradine (from 806 citizens). To the Honourable President and members of the Senate in Parliament assembled. The petition of the undersigned respectfully shows: That we strongly support the `A.C.T. Smoking and Tobacco Products Advertisements Prohibition Bill' introduced by Senator Evans, because it represents the first positive national step towards the eventual elimination of widespread serious ill health caused by smoking tobacco. And your petitioners as in duty bound will ever pray. by Senator Vigor (from 150 citizens). To the Honourable the President and members of the Senate in the Parliament assembled. The petition of the undersigned shows, (1) That the medical services rendered by Dr. Clive Dart to the undersigned and their families were reasonably medically necessary and charges of overservicing are unjust. (2) A doctor's and patient's judgment of need for medical service be beyond question. Your petitioners, humbly pray, that the Senate, in parliament assembled, should oppose charges brought by the Minister for Health against Dr. Clive Dart, as services rendered were reasonably, medically necessary. National issues, such as the universal coverage of medicare to all Australian citizens when in need of medical service, and how it's necessity is decided, should be debated. And your petitioners as in duty bound will ever pray. by Senator Sheil (from 89 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 support the proposed Australian Bill of Rights Bill 1985, which will Protect individuals against violation of their rights by the impact of laws or by the actions of the governmental institutions; Be effective in implementing Australia's international obligations to properly secure fundamental rights and freedoms and Provide an educative charter. Your petitioners pray that the Senate, in Parliament assembled, should support the passage of this Bill at an early date. And your petitioners as in duty bound will ever pray. by Senator McKiernan (from 76 citizens). To the Honourable the President and members of the Senate in Parliament assembled. The humble petition of the undersigned citizens of Australia respectfully showeth: That the proposals of the Industries Assistance Commission in regard to the Pharmaceutical Products will be detrimental to the medicinal needs of pensioners and one parent families. That these proposals will cause confusion and additional expense to all consumers. Your petitioners humbly pray that no action should be taken that will restrict the availability of medicines and prescribed drugs to pensioners and one parent families. And your petitioners as in duty bound will ever pray. by Senator Knowles (from 436 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 protest against the current system of Apartheid in South Africa on the grounds that we claim that all people of all races are the same and should therefore be treated equally by all governments. We want to see the abolition of this system and further urge the Government to implement the Eminent Persons' Recommendations on South Africa.' And your petitioners in duty bound forever pray. by Senator Alston (from 581 citizens). To the Honourable the President and members of the Senate in Parliament assembled. Your petitioners, as in duty bound will humbly pray. That a public inquiry be conducted and a diplomatic approach be considered for the migration of the Nicolae Malan's family: wife Elena and children: Nicolae and Elena, to be allowed into Australia from Romania. by Senator Peter Baume (from 22 citizens). To the Honourable the President and members of the Senate in Parliament. The petition of the undersigned Queensland citizens respectfully showeth: (i) For the 1986 calendar year 34,000 students applied for only 14,500 first year places at tertiary institutions in Queensland. (ii) Queensland has 16.07% of Australia's total population, but the participation rate of students attending universities and colleges of advanced education is only 13.7% and 14.9% respectively. (Which for example compares unfavourably with the New South Wales figures of 34.85% of population and participation rates of 37.9% and 25.8% respectively.) (iii) Queensland students because of lack of places are disadvantaged and deprived in that they suffer the lowest participation rates of any State or Territory in Australia. Your petitioners request that the Federal Government immediately increase its tertiary funding so that Queensland students have at least the same opportunities as the average for Australia. by Senator Parer (from 1,990 citizens). To the Honourable the President and members of the Senate in the Parliament assembled. The petition of certain citizens of Victoria respectfully showeth: That all legitimate business expenses incurred in earning or producing assessable income should be allowable deductions. That the Hawke Government's Fringe Benefits Tax is an unwarranted burden on the small business and rural sectors, which will severely affect their long-term viability. Your petitioners humbly pray that the Government withdraws the Fringe Benefits Tax legislation without delay. by Senator Short (from 203 citizens). To the Honourable the President and members of the Senate in the Parliament assembled. The petition of certain citizens of Victoria respectfully showeth: That all legitimate business expenses incurred in earning or producing assessable income should be allowable deductions. That the Hawke Government's Capital Gains Tax is an unwarranted burden on the small business and rural sectors, which will severely affect their long-term viability. Your petitioners humbly pray that the Government withdraws the Capital Gains Tax legislation without delay. by Senator Short (from 143 citizens). Petitions received. Senator REID(Australian Capital Territory) —I give notice that, on the next day of sitting, I shall move: That part VII of the Children's Services Ordinance 1986, as contained in Australian Capital Territory Ordinance No. 13 of 1986 and made under the Seat of Government (Administration) Act 1910, be disallowed. Senator MESSNER(South Australia) —I give notice that, on the next day of sitting, I shall move: That the Senate- (a) notes that section 160zzt of the Income Tax Assessment Act taxes that part of the disposal proceeds of shares in a company or interests in a partnership or trust estate acquired before 20 September 1985 where that is attributable to an increase in the value of underlying property owned by that entity acquired on or after 20 September 1985; and (b) calls upon the Hawke Labor Government to amend the legislation so as to give effect to its promise that property held before 20 September 1985 would not be subject to capital gains tax. Senator COLSTON(Queensland) —I give notice that, on the next day of sitting, I shall move: That the time for presentation of the Report of the Standing Committee on Education and the Arts on a proposed amendment to the Copyright Amendment Bill 1986 be extended to 19 September 1986. I seek leave to make a short statement relating thereto. Leave granted. Senator COLSTON —I thank the Senate. Honourable senators will recall that on 11 June this year, which was the second last day of the autumn sittings, the Senate referred to the Standing Committee on Education and the Arts a proposed amendment to the Copyright Amendment Bill 1986. The amendment, which was proposed by the Deputy Leader of the Opposition (Senator Durack), concerns the copying of certain television and sound broadcasts by educational institutions for educational purposes. The Committee's terms of reference are to report, firstly, on the proposed amendment and, secondly, on `any other related issues arising out of the Committee's deliberations'. The Committee was asked to report on these matters on or before 28 August 1986, which at that time was the anticipated last day of the second week of the Budget session. The Committee advertised in mid-June for submissions to be lodged by 11 July 1986. Given the range and complexity of the issues involved in educational copyright, a reasonable amount of time had to be allowed for the presentation of submissions. Public hearings could not be arranged until 4 and 5 August, just over two weeks ago. It is clear from the 97 submissions received by the Committee and the evidence taken that there are numerous complex questions involved in educational copyright law. I should perhaps mention that the Attorney-General's Department has been trying to find answers to these questions for many years. When moving to refer these matters to the Committee, Senator Haines remarked that she thought that any application for an extension of the time limit for the inquiry would be regarded sympathetically by the Senate. The Committee will not be able to table a thorough report on the reference by 28 August. In effect, the report would have had to be tabled by this Friday, 22 August, because of the changed sitting weeks. Tomorrow, therefore, I shall be seeking an extension of the reporting time for this reference. Unless circumstances beyond the control of the Committee intervene, I consider that the Committee will be able to report to the Senate by 19 September 1986, the end of the second week of sittings for the Budget session. Senator CHANEY(Western Australia-Leader of the Opposition) —I give notice that, on the next day of sitting, I shall move: That the Senate condemns the Hawke Labor Government for its failure to provide an economic framework which will encourage the new investment vital to improving the prospects and living standards of all Australians. Senator WATSON(Tasmania) —I give notice that, on the next day of sitting, I shall move: That the Senate- (a) notes that the new fringe benefits and capital gains taxes are administrative nightmares, impose on businesses massive paper burdens, contain inequities and inconsistencies and cut across the Federal Government's desire to expand overseas trade; and (b) calls on the Government to introduce legislation to remove all anomalies and acknowledge the problems encountered by isolated local council, mining operations and other businesses operating in remote areas and overseas destinations. Senator VIGOR(South Australia) —I give notice that, on the next day of sitting, I shall move: That the Senate- (a) views with alarm the precipitate closure of the Australian Institute of Multicultural Affairs and the absorption of its functions within a departmental bureaucracy and without appropriate funding in the 1986-87 Budget; (b) shares the anxiety of many Australians about the announced dismemberment of the Human Rights Commission without any Government plan for tackling racism and other human rights abuses in this country; (c) calls upon the Federal Government to withdraw its discriminatory cuts to the program for teaching `English as a Second Language', and multicultural education; (d) stresses the importance of implementing the National Language Policy; and (e) urges the Government to stand up for its platform commitment to multiculturalism. Senator VALLENTINE(Western Australia) —I give notice that, on the next day of sitting, I shall move: That the Senate- (a) notes with dismay the Federal Government's decision to resume uranium exports to France; (b) recalls the policy of the Australian Labor Party (ALP) made in 1984, and re-affirmed at Hobart in July 1986, not to export uranium to France until that nation ceases testing nuclear weapons in the South Pacific region; (c) recalls that the original ban was made for symbolic reasons, knowing full well that the decision would not stop French nuclear tests but would make clear Australia's stand on the matter as a moral issue; (d) notes that France has still failed to sign the Nuclear Non-Proliferation Treaty, and has now tested over 150 nuclear weapons at Mururoa Atoll since 1966; (e) accepts that Australia's uranium is mixed with all other uranium imports to France and that the separation of Australian yellowcake is only a paper transaction in terms of where it ends up; (f) condemns the Labor Government's decision to renege on yet one more of its party policies with regard to nuclear proliferation so that almost nothing is left of its earlier commitments; and (g) calls upon the Federal Government to rescind the decision to resume uranium exports to France immediately. Senator BROWNHILL(New South Wales) —I seek leave to withdraw Notice of Motion No. 49, standing in my name. Leave granted. Senator VIGOR(South Australia) —I give notice that, nine sitting days after today, I shall move: That the Australian Broadcasting Tribunal (Inquiries) Regulations, as contained in Statutory Rules 1986 No. 100 and made under the Broadcasting Act 1942, be disallowed. Senator MESSNER(South Australia) —I give notice that, on the next day of sitting, I shall move: That the Senate notes the Commissioner of Taxation has issued a ruling known as IT No. 2121 which- (a) appears to tax contractors who form themselves into family trusts or companies as though they are individuals; (b) was intended to catch those arrangements which amount to nothing more than shams; (c) appears also, however, to catch those family arrangements which have been legitimately established with the purpose of providing limited liability to family assets such as the family home or to provide a `going concern' legal entity for the contractors' business; and (d) in many cases has been employed by the Taxation Commissioner to penalise contractors whose circumstances do not warrant such heavy-handed treatment. Senator MACKLIN(Queensland) —I give notice that, on the next day of sitting, I shall move: That the Senate, noting that- (a) renewable power sources-biomass, hydro, solar, wind and geothermal-already provide twice as much energy as nuclear power; (b) renewable energy supplies have become the fastest growing domestic sources of power since the United States (US) nuclear accident at Three Mile Island in March 1979; (c) the Chernobyl plant disaster has made it even more imperative for renewable energy development as the alternative to the expansion of nuclear power; and (d) over the past five years, 60,000 megawatts worth of nuclear plants were cancelled in the US, while 18,600 megawatts of cogeneration and renewable energy capacity were ordered by non-utility, entrepreneurial developers; urges the Federal Government to provide incentives for the rapid development of alternative energy sources and renewable energy efficiency improvements. Senator GRIMES(Tasmania-Manager of Government Business) —I table papers in accordance with the list circulated to honourable senators. With the concurrence of the Senate, I ask that the list be incorporated in Hansard. Leave granted. The list read as follows- 1. Commonwealth Superannuation Scheme-a report on long-term costs by the Australian Government Actuary. 2. Commonwealth Tertiary Education Commission-1985-87 Triennium-Technical and Further Education Council-Supplementary advice for 1987-pursuant to sub-section 9 (3) of the Commonwealth Tertiary Education Commission Act 1977. 3. Recombinant DNA Monitoring Committee-report for the period 1 July 1984 to 30 June 1985. 4. Advance Australia Foundation-Annual Report 1984-85-pursuant to sub-section 18 (2) of the Advance Australia Logo Protection Act 1984. 5. The Power Electronics Industry-Industries Assistance Commission Report. 6. Harmonisation of the Customs Tariff-Industries Assistance Commission Report. 7. Certain Fluorescent Lamps (Tubes) from the Federal Republic of Germany and Canada (Anti-Dumping)-Industries Assistance Commission Report. 8. The Textile, Clothing and Footwear Industries-Industries Assistance Commission Report. 9. Outboard Engines-Industries Assistance Commission Report. 10. Certain Knife Blades and Cutlery Blanks (Concessional Arrangements)-Industries Assistance Commission Report. 11. Aluminised Steel for use in Muffler Components and Exhaust Systems (Concessional Arrangements)-Industries Assistance Commission Report. 12. The Chemicals and Plastics Industries-Industries Assistance Commission Report. 13. Cultivation Machinery-Industries Assistance Commission Report. 14. Certain Aircraft Parts and Servicing Equipment (Concessional Arrangements)-Industries Assistance Commission Report. 15. Crop and Rainfall Insurance-Industries Assistance Commission Report. 16. The Australian National University-Interim Annual Report 1985-Part 1-Pursuant to sub-section 33 (3) of the Australian National University Act 1946. Motion (by Senator Tate) agreed to: That the time for presentation of the report of the Select Committee on the Human Embryo Experimentation Bill 1985 be extended to 25 September 1986. Debate resumed from 19 August, on motion by Senator Grimes: That the Bill be now read a second time. Senator ARCHER(Tasmania)(10.16) —The main purpose of the Remuneration and Allowances Alteration Bill 1986 is to remove the 11.7 per cent catch-up in parliamentary salaries awarded by the Remuneration Tribunal. It also provides for the recovery of that part of the increase which has already been paid. Anyone who has any idea that he might be a little in front will find that that clause will make it certain he will not be. The Bill also adjusts the allowances of certain judges. Again, this is one of those areas that we ought to look at. The Remuneration Tribunal is now handling a lot of money, not only in relation to members and senators but also for a very wide range of people. If one looks at the last part of the annual report, one will find pages and pages listing the people who are on various committees and boards and in a whole range of positions. I respectfully suggest that we ought to look over that list to see whether those bodies and organisations should not have been looked at a little more closely last night. The Bill also provides that under the Ministers of State Act ministerial salaries will be increased by regulation and not by amendment, as is currently the situation under the Act. I believe it is necessary for us to bear that in mind and see whether we think it is appropriate. Frankly, I do not. Accordingly, we will move an amendment to take away the power of the Government to have the salaries of Ministers fixed by regulation. I think that that amendment would be quite appropriate. The present practice is not acceptable, and, had the Standing Committee on Regulations and Ordinances had the opportunity to meet to consider this matter, it may well have thought so too. I think that, had the Standing Committee for the Scrutiny of Bills had the opportunity to view it, it may have passed some comments also. I do not think that the sort of amendment we passed in the last session which allowed ministerial salaries to be paid out imposes a very onerous task. I do not believe that simplifying matters for the bureaucracy is a good enough reason for making the change. Accordingly, I will be moving an amendment which will seek to leave out Part IV; clauses 13, 14 and 15 will be opposed and, in a consequential amendment to page 6, we will seek to leave out the heading of Part IV. We need to use this opportunity to make a few comments on the remuneration. The public discuss this matter regularly. It is important that we take some notice of what the commissioners say about the status of members of parliament. It is necessary also to mention that the increases recommended by the independent Tribunal have been rejected five times in 10 years by the government of the day. I do not think that the public at large fully appreciates that. I do not think that it fully understands that in many other respects the ranges of remuneration have increased for other people far more than for members of parliament. It is not desirable that being a member of parliament should be seen as a way to make an easy fortune, but I certainly do not believe that we should be in the position where ordinary family people find it impossible to take the job because they cannot afford to hold it. According to the available information, in 1975 level two public servants were earning $20,000. The earnings of a member of parliament were fixed at that same level of $20,000 because that was deemed to be appropriate. The latest figures that I have been able to obtain show that by 1986 the earnings of level two public servants had increased by 168 per cent while earnings of members of parliament had increased by 127 per cent. The difference in monetary terms is about $8,000. If it was good enough for public servants to be given those levels of increase, I believe that the public should at least know that that is the difference between what they are getting and what members of parliament are getting. The Tribunal carried out a very thorough investigation in its 1984 report. It stated: It remains important that those who hold such offices should be remunerated at an appropriate level. The present is not the first occasion on which members of parliament have taken a course, and suffered a disadvantage, such as this. As I have said, this has happened five times in 10 years. The purpose of this legislation is to reduce the award by the 11.7 per cent which the Tribunal had said was desirable if we were to be in a catch up situation. I certainly support that aspect. The state of the nation is such that we have to be shown to be making some practical denial ourselves. I realise that Ministers, whose loads are very large, should suffer the same as us. Notice has been given of another amendment by Senator Harradine concerning the entitlements of members in respect of overseas travel. The Opposition will move an amendment to Senator Harradine's amendment to make the entitlement for overseas travel for spouses or nominees the same as for internal travel. Section 1 (8) of the Remuneration Tribunal 1986 Review states: For the purpose of this entitlement `nominee' means: a parent; a son or daughter other than a dependent child as defined in paragraph 1.19; or a brother or sister of the senator or member, and may in special circumstances include one other member (except a member of the staff of the senator or member) approved at the discretion of the Special Minister of State. I would expect the Special Minister of State to approve those cases on a sparing basis. The present overseas travel clause in respect of which the amendment is being moved says: For the purpose of this entitlement, `nominee' means a person with whom the senator or member has established a bona fide stable domestic relationship. There is quite a lot of difference in those definitions and I think at this stage it is preferable that the entitlement for overseas travel is the same as that for internal travel. Accordingly, we will be moving that amendment to Senator Harradine's amendment. Senator MACKLIN(Queensland)(10.25) —The purpose of the Remuneration and Allowances Alteration Bill 1986 is basically to take away from members of parliament the amount which was awarded to them by the Remuneration Tribunal. I do not know how other members fared after the announcement made by the Prime Minister (Mr Hawke), but I must admit that I spent about a week afterwards trying to explain to people that we had not received a pay rise when in fact everybody was insisting that we had got an 11 per cent pay rise. We managed both to get the attacks and not to get the money, which does not seem to me to be very bright all round. Senator Puplick —Which would you rather? Senator MACKLIN —We might at least have had both. In the last session I spoke about the allowances of Ministers. The Minister in the chamber thought it was the best speech I had made because I talked about the problems that Ministers, obviously, as a group in the Parliament, would have and said that they were more severely dealt with by the changes to the fringe benefits tax than ordinary members of parliament, basically because of the additional ministerial allowances. It is a situation that we should be concerned about not only for the present; we should look somewhat into the future. Fairly obviously, allowances for members are not the principal reason why people come here. Indeed, a study was undertaken by the House of Commons to try to find a definition of the job of parliamentarian. It decided to start at what the salary range ought to be. It discovered, I think in a way we would all probably know, that if the salary were zero the House of Commons could still be filled. In other words, there were plenty of people who would want the job even if they were not paid any salary. I mention that because it is a point about salaries and a point about democracy in this country. Without a doubt, we could fill this chamber without paying anybody anything, but they would all be beholden to special interest groups and other groups in the community. At some stage we are going to get to that, whether the people out there like it or not. We are going to get there and it will not be too long before we get there. The Press and everybody else like to have a little run on salaries for members of parliament because it is always a good kicking horse. After we got rid of the communist can there was not much else left to kick around the place, so we got stuck into this. It might be fun. One can always get a good rise out of it and a good laugh. But ultimately we shall get to this: Either the government of the day will have to give a massive pay rise to parliamentarians, which will be totally unacceptable to the populace, or we are going to have two chambers with members in them who are beholden to interests outside this place and who are not beholden to the interests of the electorate. We can have one or the other; but we do not have many other directions to go. Fairly obviously, it is not at that point at the moment, but it is going to go there. There is no stopping it, because every government has made the decision that this Government has, and every parliament has made the decision that this Parliament will make. It is not the Government's decision; it is essentially a decision that is made by the Parliament, because if there was an agreement amongst all parties in the Parliament this Bill would not be here. The fact that it is here is because there is no agreement. No matter who is in opposition, they will not accept the Government doing it, and whoever is in government always make the decision that they do. That is partly due to timing because this chamber is usually not sitting when the Remuneration Tribunal brings down its decisions. There is no Caucus or party meeting to make any decision. The decision is made by Cabinet in isolation, and it is completely predictable. I think there is a problem. It is a worry which will have to be addressed at some stage in the future unless the population of Australia is quite happy for members of parliament to get part of their funds from here and part from somewhere else. I was recently in the United States of America and one of the interesting things I found in conversations on matters other than wheat was the major worry about the American political system and the massive use of money in buying votes in both Houses. We in Australia are partly excluded from that due to our party system. I must admit that one of the few things I would want to say in favour of the party system in Australia is that it does protect the individual members in a way in which they are not protected in the United States. But if salaries continue to decline at the rate at which they are our members here undoubtedly will not be so protected and it will be possible to buy power, which will be far cheaper than employing a lobbyist. Eventually the people in this place who make the decisions could be bought as they also have families and expenses to meet. They also have to make some decisions as to where their interests lie with regard to their families. I do not think that is a happy prospect. It has not occurred yet and it is not likely to occur for some time, but I do flag that that is the way we are going to go unless some rational decision is made. A rational solution is obviously that the absurd operation of the Tribunal, which has been going on for so many years, ought simply to be abolished. It is a pity it was not abolished in the Budget as that could at least have saved some money. Parliamentarians could then automatically be attached to some level within the Public Service which would entail their going through the normal tribunal operation. I think that would be the only sensible solution. At the moment we are spending money on an inquiry whose recommendations we knock back. If that is sensible expenditure of public money then I should not be here. I think that the Remuneration Tribunal is one of the absurd institutions that we have around the place and it should go. I think all of the other matters that the Remuneration Tribunal looks after, judges salaries and so forth, ought also to be automatically set against some standard. Another absurd situation which could also be abolished is the whole series of allowances that no longer make any sense whatsoever. In terms of absolute cost, since there are no additional costs involved, we simply ought to collapse the salaries and allowances together-they are all being taxed at the same rate anyhow-instead of having all the additional accounting carried out in the background with people working out allowances that no longer make any sense. Senator Aulich —And the superannuation. Senator MACKLIN —Superannuation is obviously a problem connected with that. I think there could be an adjustment for those people who have not had those salary levels so they would not get the windfall profit which they would normally get out of that. Since others are paying 11 per cent of their salary they would then be entitled to the additional remuneration upon retirement. But unless some sensible arrangement is made I believe we will simply continue this rather Alice in Wonderland exercise of asking responsible people in the community genuinely to deliberate on our allowances and bring down recommendations which we then knock back. I do not think we should go on with this utter farce any longer. In terms of the amendments which have been flagged, some of which have been circulated, the Australian Democrats will be supporting the Opposition's amendments with regard to the Ministers of State Act, which is dealt with in Part IV. I am not sure how this has crept in here. It looked like a good idea at the time, an attempt to do something that has not been done before. I remember talking eloquently, as I have already said, about Ministers' salaries during the Ministers of State Act debate only a few weeks before the end of last session. It does not seem to me to be onerous to act in this way. As a matter of principle salaries should be determined by some type of deliberate legislative act rather than simply by being delegated in a form such as that presented here. Senator Harradine has circulated an amendment and Senator Archer has suggested an amendment that the Opposition will move to Senator Harradine's amendment. I have not yet seen the Opposition's amendment. Senator Archer —It is coming. Senator MACKLIN —It has not yet been circulated. I want a closer look at it but I indicate now that we see merit in the Opposition's approach of simply having both internal and external travel dealt with on the same basis. The nominee basis seems to us to be a reasonable approach. I indicate that at the moment we lean towards supporting the Opposition's amendment but I hope to look further at the matter while Senator Harradine and the Minister are responding. Senator HARRADINE(Tasmania)(10.36) —The Remuneration and Allowances Alteration Bill amends the Remuneration Tribunal's determination as to salaries of parliamentarians. It was pushed through the House of Representatives yesterday, the first, second and third readings having taken place on the same day. Of course that is a most unusual procedure and places those of us in this chamber at a disadvantage when we attempt to consider the measure and its implications. The Bill is open to amendment by the Senate to modify any other provisions of the Tribunal's determinations of 1986. The Government's Bill amends the determination as to salaries for members of parliament in a way that the Tribunal considers just and reasonable. It would be appropriate at this stage to amend and modify the determinations and decisions of the Tribunal which were unjustified and for which the Tribunal has made no attempt to publish justification. One such provision is to grant equality of status for de factos and spouses for the purposes of overseas travel entitlements. That provision was first included in the Tribunal's determination No. 18 of 1984; it was repeated in the Tribunal's determination of 1985 and again this year. Because the Parliament cannot modify a determination without substantive legislation I introduced a Bill on 24 August 1984. During subsequent discussions on that Bill in this chamber the general view-and it was expressed particularly, as I recall, by Senator Button-was that the issues involved would need to be addressed by Parliament. As honourable senators will recall, attempts to have those issues, including the issue of de factos being treated on the same basis as spouses, addressed by this chamber have run into many problems. The problems involved time, priority and also, I believe, deliberate misunderstanding of the issues involved. Today we have the opportunity to address and determine these issues. The Government's Bill provides that opportunity. This Bill seeks, as mine does, to modify the determination by substantive legislation in respect of the rights and privileges of members of parliament. In respect of those rights and privileges, I believe that there would not be one honourable senator present who would say that the Government has a constitutional priority over, say, an individual member of parliament. Therefore, any argument that the amendment I am proposing is inappropriate at this time falls to the ground on that basis. The appropriate way of dealing with the measure is by amendment rather than by seeking leave to amend my Bill which relates to the 1984 Tribunal determination, and thus have it debated cognately. I emphasise, as I have done consistently, that this is not a matter for political point scoring; it is a matter of principle and should be dealt with as such, whether the arguments are for or against. I add that it is not a matter that can be covered over by subterfuge. I believe the Opposition's amendment would do just that, and I intend to point out how shortly. My view, and I believe it is shared by a very broad cross-section of the community, has always been that the Tribunal's 1984 decision granting equality of status to de factos with married spouses, repeated in its 1985 and 1986 determinations, publicly demeans the institution of marriage, strikes at its legislative recognition, and flies in the face of the responsibility of parliamentarians to uphold publicly a fundamental principle underpinning the laws we pass through Parliament. Let me go to the question of the laws we pass through Parliament. What are those laws when it comes to the question of marriage? They have been clearly and repeatedly stated. They have been stated, for example, in the Family Law Act and in the Marriage Act. I point out that there are also obligations under the marriage regulations, and I will deal with those first. Under the Marriage Act regulations an authorised celebrant must give to persons intending marriage the following statement: Marriage and family life have been basic to the strength of our society for a long time. The Parliament, in the Family Law Act has placed great stress on their importance. In the Family Law Act the principles are high sounding, although the practice may not be so. It says of marriage: . . . the need to preserve and protect the institution of marriage as the union of a man and a woman to the exclusion of all others voluntarily entered into for life. It goes on: . . . the need to give the widest possible protection and assistance to the family as the natural and fundamental group unit of society, particularly while it is responsible for the care and education of dependent children. Under section 46 (1) of the Marriage Act the Parliament insists that the authorised celebrant must, in the presence of witnesses, remind the couple of `the solemn and binding nature of the relationship into which you are now about to enter'. We in this Parliament have made those declarations about the status of marriage. Surely we in this Parliament have a responsibility to uphold those principles, to uphold them when they relate particularly to matters that affect this Parliament. I will quote a former distinguished member of the House of Representatives, Mr Kim Beazley senior, who in opposing the Tribunal's decision in 1984 said: (The Commonwealth) should hesitate a long time before further belittling marriage, in this case the marriage of Federal legislators, with the proposal to ask the taxpayer to finance the travel of people who are not spouses and who have undertaken no obligation such as the obligation of marriage. Insofar as the obligation of marriage is concerned, Kim Beazley senior is absolutely correct. A similar view was expressed by Justice Sir Murray McInerney of the Victorian Supreme Court on 21 August 1982 when he said: I have read one paper on this subject by an author who started with the grievance that de factos were required to `forfeit the rights of married people'. De factos are not required to forfeit anything. They have elected to live together outside marriage by virtue of which alone they would have acquired those rights. They have in many cases elected-deliberately-not to acquire the status and more significantly not to undertake the duties and responsibilities inherent in that status. Very often that election has been made precisely because the party is not prepared to subject himself or herself to any legal obligation in respect of the incidents of the proposed cohabitation. I believe that by facilitating this conscious rejection of obligations we are deliberately denigrating the vast majority of couples who accept their obligations by entering into marriage. Let me make my position very clear because, of course, in the course of my working life, both in the trade union movement and in this sphere, I have dealt with and helped persons not in a marriage relationship. Let nothing that I say here be taken in any way as an attack on benefits paid to de factos. Of course, those benefits have been regarded as not placing a de facto relationship in a more advantageous position than a bona fide marriage relationship. I have studied this for some years and the initial provisions in respect of de factos were precisely that. Originally they were designed to ensure that cohabiting unmarried couples were not placed in a position of advantage in relation to legally married couples, for example, in regard to pension benefits. That was the first basis within the social security system for recognising de facto relationships. In other words, had the Department of Social Security not recognised de facto relationships then of course a de facto couple living together would have received pension benefits higher than that received by a married couple. That was the first basis of recognition. Later benefits extended to persons in cohabiting circumstances or de facto relationships could perhaps be regarded as tolerant and charitable gestures of society to those who had not yet come to the real vision of the beauty of marriage and its fundamental importance to society. So we come to some of the statements that have been made in support of this measure. One of those statements was made by the then Attorney-General, Senator Gareth Evans. That statement was truly surprising, to say the least. In effect, the then Attorney-General said that unless we gave to de factos the same entitlements that spouses have we could be operating against the sex discrimination legislation. He said: There is a further point that it has been recognised by this Parliament . . . by the passage of the Sex Discrimination Act that there should not be discrimination in the provision of public goods and services and so on on the grounds of marital status, which includes its negative, the absence of a formal marital status. I wonder whether the former Attorney-General would adhere to that, given the most recent decision of the High Court of Australia in relation to ex-nuptial children. The High Court found that the marriage power could not be utilised for the purposes of dealing with ex-nuptial children. I will, of course, be dealing with the question of the Sex Discrimination Act at a later stage this session. I indicate that in the third committee debate in the United Nations when the convention was being considered there was no intention at that stage to equate a de facto relationship with a marriage relationship, and therefore the Commonwealth cannot invoke the external affairs power under the Constitution for so doing in domestic legislation so far as it relates to the States. In any event, there is no definition of `goods' in the sex discrimination legislation, but there is a definition of `services', and it includes services relating to entertainment, recreation or refreshment. I do not know whether that is what the former Attorney-General had in mind. Leaving all that aside, when the Remuneration Tribunal first decided that members of parliament could take de facto spouses overseas there was an outcry, as all honourable senators will recall. There was a significant outcry from ordinary electors who saw this as flying in the face of what society ought to do, in that if it is good enough for the leaders of our society to do this it is good enough for everyone else. I believe that although the hubbub has died down the principle remains. We have an opportunity now to excise from the Tribunal's determination the provision which gives de factos recognition on the same basis as spouses. We ought to do that by simply passing my amendment. The Opposition's proposed amendment, as it has been described by Senator Archer, would be a smoke screen to enable the Government-the Minister-to approve of de factos going overseas. Senator Archer —Or reject. Senator HARRADINE —As Senator Archer said: `Or reject'. The fact is that this Minister approves. If we give that power under this legislation, he will approve. He is already doing it so far as Ministers are concerned. That approval is regularly given. To say that it will be placed on the same basis as domestic travel is a nonsense because this cannot be equated with domestic travel. Domestic travel is outlined by the Tribunal as being for particular purposes. On page 75 of the Tribunal's 1986 review it is stated: Spouse or Nominee of a Senator or Member For the purpose of this entitlement `nominee' means: a parent; a son or daughter other than a dependent child as defined in paragraph 1.19; or a brother or sister of the senator or member, and may in special circumstances include one other person (except a member of the staff of the senator or member) approved at the discretion of the Special Minister of State. I am not sure what the Opposition's amendment would do, but the Opposition says, as Senator Archer has said, that the amendment would place overseas travel on the same basis as internal travel. It cannot do that because internal travel is paid for out of funds of the Commonwealth; it is not paid for out of the entitlement that is given to members of parliament. In any event are we going to-- Senator Peter Baume —It's a very fine distinction, Senator. Senator HARRADINE —So does the Opposition wish to allow a parent or a son or a daughter other than a dependent child or a brother or sister to accompany a member of parliament overseas? Is that what is proposed? Senator Archer —If they are the nominee. You can't change your nominee once a week. Senator HARRADINE —That is very interesting. I do not know whether the Senate would have the power to do that in any event because it may indeed be adding to the burden of the Commonwealth purse. Senator Chaney —No, it is still the same allowance. There is a set allowance. Senator Archer —It's not adding to anything. Senator HARRADINE —The provisions on internal travel are for a certain number of trips per year. Senator Archer —We're not changing that. Senator HARRADINE —I understand what the honourable senators are saying. What they are saying so far as overseas travel is concerned-- Senator Archer —We're not changing that either. Senator HARRADINE —What honourable senators are saying about overseas travel is that there was previously no entitlement to take a brother or a sister or a parent but that there was an entitlement for a de facto. Most of us have brothers and sisters, or parents, but most of us do not have de factos. I cannot quite follow that it may not add-- Senator Archer —You can't follow-- Senator HARRADINE —I cannot follow that it may not add significantly to the cost of travel overseas. Senator Macklin —It can't add to the cost. Senator Haines —How can it add to the cost? Senator HARRADINE —I will deal with that in the Committee stage. Opposition senators are trying to ensure that de factos will be covered. They know that, under the provisions on page 75 of the report, the Minister already approves the internal travel of de factos to Canberra. That was not the case under the previous Minister for Administrative Services, Mr Newman. The provision which enables the Minister in special circumstances to include one other person for travel was specifically designed for two particular purposes. It was specifically designed for use in the case of formal functions to which a senator and his or her partner were invited and to enable the housekeeper or some person who was not a relative of a widowed senator but who was looking after his or her children to come to Canberra. This is a far cry from the case of overseas travel. The principle is very clear and needs to be dealt with by the Parliament efficiently and effectively. If the Opposition's amendment to my amendment goes through, then as surely as night follows day all that will be done is that a smoke screen will be put over the whole matter which will ensure that the principle is not dealt with. I ask Opposition members to consider this matter very carefully before they vote on it, because that will be the outcome. Mr Deputy President, you will recall that once the Remuneration Tribunal's determination of 1974 came out there was an outcry. You will recall that I attempted to rectify the situation. Not only I, but also a number of other members of this chamber, were concerned about the provision which granted equality of status to de factos compared with married spouses. You will also recall, Mr Deputy President, that the Parliament had difficulties in addressing this question because under the present legislation we cannot reject or accept a Tribunal recommendation in part, other than by substantive regulation. We cannot, for example, disallow just one provision of a determination by a disallowance motion. We have to either accept or reject the lot. This Bill now provides us with the opportunity to address this question which is of great significance to this society. I believe that the whole of society, the people of Australia, is very concerned about the fact that this Government and this Parliament are not upholding the institution of marriage as they should. If we do not do so, the fundamental institution of society-marriage-will come under greater and greater pressure. I believe that we have the opportunity today to make our decision concisely and without the confusion that the Opposition's amendment will produce. My concern is that if the Opposition pursues what it seeks to pursue it will simply transfer the equality of status for de factos from the Tribunal's decision to the hands of the Minister, whose record is to provide that equality of status. Senator JESSOP(South Australia)(11.05) —Whenever I examine Remuneration Tribunal reports I do so with a certain amount of cynicism. Senator Gareth Evans —Whenever you examine anything you do it with a certain amount of cynicism. Senator JESSOP —I think this cynicism would apply on both sides of the Parliament. In 1973 we established the Remuneration Tribunal to take away from Parliament the odium with respect to making decisions about salary increases for members of the Senate and the House of Representatives. But ever since the Tribunal was established, to my knowledge, we have either rejected, entirely or in part, or deferred the decisions by the Tribunal, which I think makes a mockery of having a tribunal which costs a considerable amount of money. The Tribunal seems to me to be quite irrelevant. I heard Senator Macklin make a few constructive comments about the salaries of members of parliament in particular. I agree with him. I have felt for years that our salaries ought to be linked to an appropriate level of the Australian Public Service so that when salary increases occur in the community our salaries are increased without the embarrassment of our being isolated from the rest of the community. I for one believe that we have been consistent in demonstrating our willingness to set an example to the rest of the community with respect to salary restraint. I have gone to the Tribunal on many occasions but never have I advocated an increase in salaries. I have always been concerned about the conditions applying to travel for our wives and so on. Our wives should not be regarded - - Senator Haines —Hang on! Senator JESSOP —And husbands. I forgot the new Leader of the Australian Democrats, who is trying desperately to attract my attention to her husband's welfare. I include Senator Haines's husband. It seems to me that the spouses of members of parliament should not be regarded as second class citizens with respect to travel to Canberra, for example. Why should our wives be restricted in accompanying us to Canberra? If we examine the record we will find that in any case only about 43 per cent of the current entitlement is taken advantage of by our wives. I think it is a disgrace that Ministers can take their wives anywhere at any time, on an unlimited basis, whereas our wives are treated very disparagingly indeed. That is an anomaly about which I have always argued on behalf of the Parliament. I have never worried about salary increases. Last year, honourable senators will recall, the Tribunal, having regard to salaries paid to other sections of the community, said that we were entitled to an increase in salary of something in excess of $4,000. But no, we could not do that because it was not the right time. On this occasion the judge quite correctly pointed to the anomalies provisions of the Tribunal's terms of reference and said to me that he could quite happily and comfortably recommend a salary increase of $5,000-odd or perhaps a bit more because since we last received a salary increase the salaries of the rest of the community have rocketed ahead. We are now placed at a disadvantage. Now I suppose the rest of the community will say: `That is great; the members of parliament are getting what the community thinks they are worth'. I think that is a stupid attitude, in any case. I suppose the community will be highly delighted now because, as a result of the fringe benefits tax, our electorate allowance is to be taxed and we are to suffer a decrease in salary in excess of 20 per cent, or $150 to $200 a week. I suppose the community will think that to inhibit the capacity of parliamentarians to do the job of representing it in an effective manner is a great joke, a great laugh. I am really getting a bit hot under the collar about the Tribunal, the disregard that we have had for it and the cost that it imposes upon taxpayers. We ought to reconsider the whole question of the Tribunal in the interests of the economy and perhaps in the interests of a better go for members of this Parliament. I have no great problem because my overdraft is probably a little less than that of most people in this place. I have no dependent children. However, I feel very sorry for the younger members of parliament who have children at school, who are paying off houses at extremely high interest rates, who are paying off motor vehicles or are leasing them, who are in some cases paying school fees, and who have costs associated with keeping children and wives properly dressed. A lot of members of parliament will have to reconsider whether they are prepared to go on in this way in future. I make that point quite clear. At the moment we are being treated disgracefully. Senator Macklin drew attention to the United States of America. The system there seems to be quite good. Members of parliament receive something like $10 more than the highest paid public servant. I do not think that would be entirely satisfactory or acceptable in Australia and I would not suggest it. However, I reinforce what Senator Macklin said-that is, we ought to be linked with an appropriate level of the Public Service having regard to our work load and our responsibilities in the community. I hope that the Government will revise its attitude to the Remuneration Tribunal in future. Senator GARETH EVANS(Victoria-Minister for Resources and Energy)(11.12) — Although those listening to Senator Harradine may be forgiven for thinking otherwise, the basic point of the Remuneration and Allowances Alteration Bill 1986 is not to mount an assault on the institution of marriage; rather, it is an assault on the pockets of members of parliament. As such it represents one of those rare occasions in parliamentary life when we are all in furious agreement. For a start we know that we are conspicuously underpaid by any standard of comparative salary justice, with the erosion of salaries from a rough equivalence of Level 1 or Level 2 of the Public Service some years ago down to around Class 10 of the Third Division at the moment and falling. However we know, secondly, that no one believes that we are underpaid. Thirdly, we know that the Remuneration Tribunal did the right and rational thing in recommending in its determination an 11.7 per cent catch-up. We further know that we have no alternative whatsoever in the present economic and political environment but to knock back, as we are now doing, that determination. Finally, we know that having made that decision we will get no credit whatsoever from anyone for having made the sacrifice. So clearly we have no alternative but simply to join hands around the chamber and sing in unison the familiar refrains of the masochism tango. Only one aspect of the Opposition and Australian Democrats contribution to this debate causes me some concern and that is the back sliding that it represents from a previously often espoused high principle. I talk, of course, of the well-known opposition of both the Opposition and the Democrats to any retrospective legislation which inflicts pain. This manifestly is an example of such a piece of retrospective pain-inflicting legislation in that it not only denies us a pay increase in the future but also requires us to pay back some $600 of money already received. I simply make the point that should there be any disposition to honour that high principle on the part of the Opposition and the Australian Democrats the Government would, on this occasion, bear that result with such fortitude as it could command. As to the amendments that have been moved, we have been treated once again to the familiar concern of Senator Harradine that de facto partners should not be acknowledged as having any- thing like the same rights, status and perhaps humanity as those who have chosen to formalise their relationships. There is a lot to be said about all that but I will leave it to the Committee stage and, in particular, to the contribution of the Minister for the defence of domestic sin, Senator Grimes, to perhaps re-state the familiar arguments against the really very extreme position that Senator Harradine here advances. I am not in a position to indicate the Government's willingness to accept the Opposition's amendment on this question. All I will simply say is that from my perspective, and I think from that of those who have been listening to this debate, it offers some obvious advantages over not only Senator Harradine's amendment, which it is designed to replace, but also perhaps the present system which focuses clearly, so far as overseas travel is concerned, on one particular category of nominee-the de facto partner. Maybe there is something to be said for extending that range of categories by adopting the same list as that used for the domestic environment, thus making it possible for members of parliament to use their fixed travel entitlement not only for a de facto nominee but also for parents, children and so on. However, from a Government perspective I have to make the point that although clearly there is no right on the face of it to any greater access to government funds than is available at the moment-it is simply a question of substituting one class of nominee for a broader range-nonetheless, in practice, there may be some additional burden on the Treasury to the extent that people who would not now take their full entitlement to the travel grant would, by virtue of this extension of the categories of people for whom it is able to be used-- Senator Archer —That is no different from the interstate position though, is it? Senator GARETH EVANS —That is true but to the extent that it may mean in practice there is more using up of the entitlement than is the case at the moment there may be adverse implications for the Treasury and as such I would have to express some reluctance on the part of the Government to accept it. However, should this amendment be forced upon us I again indicate that I guess we would bear it with fortitude. The other amendment moved by the Opposition would remove the provision in this Bill enabling ministerial salaries to be adjusted in future by regulation rather than by legislation. If people feel passionately that this should be the subject of specific legislation each year rather than regulation, that will not cause any particular difficulty for the Government. It will simply mean that we have yet further burdens on already scarce legislative time. To the extent that people have been concerned or are likely to be concerned in the future about what is in the regulations adjusting ministerial salaries, of course the disallowance provisions are available so no parliamentary rights are being lost as a result of the proposed clauses in this Bill. I indicate again, perhaps to shorten debate at the Committee stage, that should this amendment win majority support the Government will not regard that as a great tragedy, although as the legislation stands it is a desirable streamlining measure. I thank honourable senators for their support for this Bill and wish it a speedy passage through its remaining stages. Question resolved in the affirmative. Bill read a second time. Clauses 1 to 4-by leave-taken together, and agreed to. Proposed new clause 4a. Senator HARRADINE(Tasmania)(11.20) —I move: Page 4, after clause 4, add the following clause: `Entitlements of members of the Parliament `4a. (1) Determination No. 11 of 1986 of the Remuneration Tribunal dated 6 June 1986 is modified- (a) by omitting paragraph 7.1; (b) by omitting from sub-sub-paragraph 7.2 (d) (ii) `, or nominee as defined,'; (c) by omitting from sub-sub-paragraph 7.2 (d) (iii) `, spouse, or nominee as defined,' and substituting `or spouse'; (d) by omitting from sub-paragraph 7.3 (c) `or nominee'; and (e) by omitting from paragraph 7.4 `or nominee'. `(2) The determination of the Remuneration Tribunal referred to in this section as modified by this section has effect as if it were a determination of the Remuneration Tribunal.'. The amendment proposes to omit paragraph 7.1 of the Remuneration Tribunal's Determination No. 11 of 1986. Paragraph 7.1 reads: For the purposes of this entitlement, `nominee' means a person with whom the senator or member has established a bona fide stable domestic relationship. Other consequential amendments are listed and I do not intend to canvass them at this stage. They were canvassed during the second reading debate and during previous debates in this Parliament. Senator ARCHER(Tasmania)(11.21) —I have foreshadowed an amendment that has already been circulated which would provide that the same conditions apply as under paragraph 1.8 of the determination for the travel of a spouse or nominee of a senator or member within Australia. I should like to touch on one or two points. I do not see that it is desirable to have two different provisions for what is fundamentally a very similar situation. I believe there are times when the provisions for domestic travel arrangements could be appropriate for overseas travel, and I believe that such a situation has happened recently. I certainly do not believe that there should be an open slather, first come, first served arrangement in regard to who becomes one's travelling partner. I draw attention in particular to paragraph 1.9 which states: A senator or member may nominate to the Special Minister of State one nominee. . . This, of course, precludes the inference that one can draw lots and take anybody anywhere one likes, any time one likes. That is not the case. Also, I draw attention to the fact that approval is at the discretion of the Minister and I would expect the Minister, whoever that may be, to accept that discretion and to administer it accordingly. I believe it is desirable for the sake of consistency for people to know that exactly the same arrangements apply. Again for the sake of consistency, I believe that if we are to make a legislative change, it would be better if it came about by way of an all purpose Bill that would pick up the question of spouses as against de facto spouses in all the legislation in which this question occurs. I therefore move as an amendment to Senator Harradine's proposed new clause 4a: Leave out paragraphs (a) to (e) (inclusive) of proposed new sub-clause 4a (1), insert the following: ``by omitting paragraph 7.1 and substituting the following paragraph: `7.1 For the purposes of this entitlement, `nominee' means: a parent; a son or daughter other than a dependent child as defined in paragraph 1.19; or a brother or sister of the senator or member, and may in special circumstances include one other person (except a member of the staff of the senator or member) approved at the discretion of the Special Minister of State .'.''. Senator GRIMES(Tasmania-Minister for Community Services)(11.24) —I rise, not as the holder of the title given to me by my learned colleague the Minister for Resources and Energy (Senator Gareth Evans) but as someone who has something to say in this area that needs to be said, without necessarily defending sin, domestic or otherwise. I have some sympathy for Senator Harradine. It looks as though he has moved an amendment to achieve an end and, as a result of further amendments, the whole thing has gone the opposite way. We look like having a situation whereby the provisions for people to be able to take a spouse or nominee when travelling overseas will be the same as those that now apply in regard to domestic travel. I will not oppose this. As Senator Macklin has pointed out, this does not increase the entitlement or, necessarily, the cost to the taxpayer. Perhaps we should have given the matter more thought. We would have done so if we had known that this sort of amendment was to be moved today. I want to make some remarks about Senator Harradine's statements. I point out that the Remuneration Tribunal and the Government, in considering this matter, have always referred to bona fide, stable domestic relationships. I happen to think, as does Senator Harradine, that stable domestic relationships-within marriage or outside marriage-are important to the stability of our society. I do not think that his emphasis on the married state being the ultimate criterion for the stability of our society is necessarily right. It is certainly something which is believed, and will be believed for a long time in our society, because most people in our society will remain in the married state, as has been the case in the past. But in other, what I would call civilised, societies, particularly the Scandinavian societies and some of the western European societies, no great distinction is made between the married state and what we choose to call the de facto state. In fact, in the Scandinavian countries different words are used to describe the different states. They are publicly acknowledged and no one thinks twice about it. I do not think that their societies are any less stable or civilised than ours. I repeat what I have said during debates on previous occasions: People live in relationships which are not formalised by marriage for all sorts of reasons. On many occasions those reasons are good reasons. Sometimes, in fact not infrequently, even under our reformed system, the reason that people do so is for the benefit of a third person who may have been married previously to one of the partners. Under our existing legal setup, people sometimes do not obtain a divorce-at least for a time, but sometimes not at all-for the protection of that third person. They do that for reasons which for them are important reasons and moral reasons and just reasons. I do not believe it is for members of this Parliament to pass judgment on them. I do not think it is for this Parliament to penalise them. I do not think they should be given any great advantages-they are not advantaged under the Social Security Act-but I do not think they should be penalised. It is for that reason that I think much of the hoo-ha about this subject is unfortunate. Senator Harradine is an exception. When he debates this matter, he does so as a matter of principle. He puts forward his arguments without making a personal attack. As he said, when this matter was announced there was a hue and cry in the community. That hue and cry, unfortunately, was not of the standard he has maintained in this place. Some of the hue and cry by members of parliament-not only by members of the Opposition-concerned political point-scoring. There were headlines about taxpayers paying for members to take their floosies around the world. That nonsense went on and on as it always does under these circumstances. I do not think we should let that hue and cry allow us to forget that there are people in this society who live in relationships which are not formalised by marriage. They live in stable, bona fide domestic relationships. As Senator Haines once said in a debate in this place, what is better for our society-a couple who have lived in a stable, bona fide, loving domestic relationship for five or 10 years, or a married couple with a husband who belts his wife twice a week, gives her inadequate support, and abuses her mentally and physically? Apparently we consider that to be a respectable way in which to live. I do not think we are in a position to make judgments just because people have not signed a bit of paper inside or outside a church. For that reason I reject Senator Harradine's moves in this area, although I respect the reasons why he is doing so. The Government-which is at the moment represented by Senator Evans and me-will accept the Opposition's amendment. As this matter will have to be considered in the House of Representatives, we shall consult our colleagues to ensure that there will not be a great increase in expenditure for the taxpayer. I suspect that the Opposition's amendment at least will bring the consistency about which Senator Archer talks. Senator Macklin is right. We have salaries, allowances-electoral, ministerial and travel-domestic travel rights for wives, spouses, friends and nominees and overseas travel rights. Senator Archer —In fact it is money. Senator GRIMES —As Senator Archer says, it is all about money. We have a complicated set of allowances. The allowances have largely arisen because members on both sides of parliament are always reluctant, for political reasons, to face up to the fact that, if we are to have a proper democracy in this country, members of parliament must be paid adequately, or they will be paid from outside parliament. In the old days, in the State of Montana in the United States of America, members of the legislature were paid by the biggest mining company in that State. Some years ago, Senator Coates and I had an acquaintance who was one of the few socialist members of parliament in the United States. He was a member of the Montana State legislature and was paid by the Anaconda Mining Co. He did not last very long in that parliament. That is an extreme example but it shows the sort of situation we shall end up with if the remuneration of members of parliament continues to drop as it has already done. There are members of the House of Representatives in particular who are in some difficult seats and have not had an easy time in becoming and remaining members of parliament. If we are not to go through the farce that occurs in West Germany-where the salaries are minute and the allowances huge, at about three times salary levels-we should at some time bite the bullet, get together and work out a reasonable level. Senator Puplick —But not just now. Senator GRIMES —Yes, I know. I would do it now, probably. We should work out a reasonable level, but it is no good even saying, as the Remuneration Tribunal has done, that we need an 11 per cent increase in salaries. We need to get all the salaries and allowances together, judge what is a reasonable total and stop all the nonsense, book work and crazy business that goes on. We must build that into a reasonable remuneration and somehow get it away from politics. I remind the Senate that we set up the Remuneration Tribunal to get remuneration away from politics. To my horror, when I became a senator, I found that we earned $14,000. We increased that to $20,000. Two honourable senators opposed that, one of whom is still a senator. I heard him grizzling this morning about the Bill. But in those days he was an independent; now he is a member of a party and has the protection about which Senator Macklin talks and he wants justice now. The Government will accept the Opposition's amendment to Senator Harradine's motion. We shall not cry about losing our capacity to increase our ministerial salaries by regulation. However, we as a Government will have to consider this matter because the financial implications are perhaps not as clear cut as Senator Archer believes. Senator MACKLIN(Queensland)(11.33) —The Australian Democrats will support the Opposition's amendment to Senator Harradine's motion. I should like to make it clear, because it was not clear from Senator Harradine's comments, that the overseas allowance is structured so that each member of parliament receives one air fare in each three-year period. That air fare remains constant. It may be divided between a member, or senator, and his nominee. It is not, as the general public and media understand it, an additional fare. That must be made very clear. We are talking about not an additional fare but one fare and whether it will be paid as a first class air fare or two tourist class air fares. That important point seems to have been missed in all our debates The Remuneration Tribunal's review excludes from travel entitlements a member of the staff of the senator or member. It is fairly obvious why that exclusion exists. We must remember that overseas travel is not for the delectation and amusement of members of parliament but for the benefit of the Commonwealth. There could be real argument to exclude spouses entirely and to allow only staff, on the grounds that what one does overseas is work and that that work would be enhanced by the attendance of a member of staff. I give a personal example. A couple of years ago a member of my staff paid his own way to accompany me to the United States. His work was invaluable because it doubled or trebled the time I could use and the contacts I was able to make. He increased magnificently the amount of work I was able to get through. I have never taken my spouse overseas. I suppose that I am lucky in that I am married to a qualified researcher because my wife would be capable of fulfilling that type of task. I wonder whether we are looking at this aspect from the right end. I hope that if the Government takes up the suggestions that other honourable senators and I have made and to which Senator Grimes responded, it will look in a rational way at the intention behind overseas trips. If the intention is work, one must look at it as work. Senator Evans made the outlandish suggestion that members of the Opposition might be backsliding with regard to retrospective taxation. I refer him to Hansard and the debate on this matter under the Fraser Government. One specific exclusion in terms of retrospective taxation applied to people who had agreed to have that exclusion applied to them. As it appears that there will be a unanimous vote in this exercise, I hope that the point will be well taken that we are inflicting this pain on ourselves. The retrospective tax principle concerned members of parliament inflicting that tax on others. In this case, as Senator Evans said, we shall all be masochists and inflict this pain on ourselves. Senator Teague —Also, the cut was declared at the time. Senator MACKLIN —Yes, that is perfectly correct. I should like to comment on Senator Harradine's propositions and reiterate a point made by Senator Grimes. I feel strongly about this. In the past couple of weeks, we saw an example-I emphasise that it is only an example-of massive child abuse. I am not sure why that case was highlighted but I and, I am sure, other honourable senators have had brought to attention cases that are almost as horrific. The example to which I referred took place inside marriage. We are looking-I talk particularly from the point of view of the children-for people who will care and nurture children and enable them to grow up as good citizens in our society. I would not want to be associated with anything that detracted in any way from the type of caring work done by people who may not have a marriage certificate. I think very much in those circumstances of the children. I would not feel that I could go ahead in voting without making it clear that that is my personal and passionately held view. Senator Harradine's point about overseas travel had some legitimacy. However, that point might be better addressed by referring to my first argument that we should work out what we are doing in terms of overseas travel for the Commonwealth. That might be a better avenue of deliberation in terms of expenditure than the one on which we have been engaged until now. Senator HARRADINE(Tasmania)(11.40) —In respect of the matter just raised by Senator Macklin and the issue raised by Senator Grimes, it seems to me that what they indicated about my amendment is precisely what they would have us do; in other words, my amendment really proposes to omit from the Remuneration Tribunal 1986 Review paragraph 7.1, which reads: For the purposes of this entitlement, `nominee' means a person with whom the senator or member has established a bone fide stable domestic relationship. I do not want to be in that judgmental frame of mind where I have to say what is bona fide and what is not. If one does not have these matters dealt with on the basis of what the law is so far as marriage is concerned, of course one gets into judgmental situations. The very burden of Senator Macklin's contribution and Senator Grimes's contribution was that we should not get into judgmental situations. The only way to avoid that, of course, is to set the standard on the basis of the law, and that is precisely what I am doing. I believe that we set a whip for ourselves if we do it in any other way. Besides demeaning publicly the institution of marriage and besides undermining the fundamental principle of the laws which we as a Parliament have established, we will fall into the trap of being required to be judgmental in order to determine who accompanies a senator overseas and who does not. I think that the Opposition's amendment-of course, the Government knows this-will do what is already being done; that is, approval will be given for a senator or member to be accompanied by a de facto when travelling overseas. I take the point that was made by Senator Gareth Evans, that this could well increase the amount of money that is spent. In fact, he supported what I found difficulty in expressing in the second reading debate-that the effect of the Opposition's amendment would be not only to maintain what the current situation is, namely, that de factos can go overseas, but also to extend that to parents, brothers, sisters and what have you. I admit that we have only a certain entitlement, which can be taken either by the senator or member or shared by the senator or member with the others nominated in the Remuneration Tribunal's determination. However, there are a number of senators and members who are probably too busy on committee work or other work in the Parliament to take up their entitlements but who, should the Opposition's amendment go through, when going overseas would have the choice of taking relatives as described under the amendment. If that is the proposition, that is fair enough. If that is the way the Parliament wants it, that is fair enough. But it comes back to the other provision whereby the Minister, in special circumstances, could include one other person, and that person is approved at the discretion of the Minister. The Minister already approves de factos so far as Ministers are concerned. Senator Archer —It is not de factos; it is `a companion'. Senator HARRADINE —We have got companions now, have we? That is an interesting point mentioned by Senator Archer, because it has always intrigued me. The Tribunal's determination does not mention female companions either. It just says: For the purposes of this entitlement, `nominee' means a person with whom the senator or member has established a bona fide stable domestic relationship. I assume that to mean de factos. I do not assume that to be anything else. Senator Archer —You read it again. Senator HARRADINE —Does Senator Archer think that means homosexual partners? I do not. I give them the benefit of the doubt. I think it probably does mean de factos. The Opposition's amendment maintains the status quo and extends it. I will be opposing that amendment as I believe it ought to be opposed. Amendment agreed to. Proposed new clause, as amended, agreed to. Clauses 5 to 12-by leave-taken together, and agreed to. Part IV (Amendments of the Ministers of State Act). Senator ARCHER(Tasmania)(11.47) —I seek leave to have Part IV deleted, as per the amendment circulated. Leave granted. Senator ARCHER —I move: Page 6, Part IV, (clauses 13 to 15) lines 1 to 13, leave out the Part. Senator GARETH EVANS(Victoria-Minister for Resources and Energy)(11.48) —I indicate that the Government will oppose this amendment because we regard it as desirable, in the interests of preserving parliamentary time, that things that can be done by regulations and still preserve Parliament's right to scrutinise the matter should be done that way. I have indicated previously that we will not pursue that opposition to the point of division if the Australian Democrats indicate they are in support of it, because it will not change the status quo. It simply seems to us to represent some unnecessary obsession on the part of the other side with the difference between legislation and delegated legislation and one that really does need argument in support of it rather than mere assertion. Senator Teague —It is an important distinction. Senator GARETH EVANS —It is a distinction without practical significance if Parliament retains the opportunity to disallow and in circumstances like this, where there is no question of policy building and so on involved but simply annual changes to tables of rates. I agree that there is an important distinction between legislation and delegated legislation if we are talking about legislative policy making at large, but on something essentially mechanical like this, where there is a fail-safe mechanism available to the Parliament, it seems to the Government to be an unnecessary bit of enthusiasm on the part of the Opposition. Depending on what the Democrats do, I guess we will just have to live with it. Senator ARCHER(Tasmania)(11.49) —I did mention during the second reading debate that, to prevent another payment being made before the recoveries start, it is necessary that the Bill go through as quickly as possible. It was introduced yesterday afternoon and debated in the other place before we had even seen a copy of it. It was brought in here this morning to be introduced and dealt with so that it could go out straight away. It has not passed either the Standing Committee on Regulations and Ordinances or the Standing Committee for the Scrutiny of Bills. If they followed their normal practice they would at least raise this question of delegated authority passing substantial sums of money on a regular basis. I do not think it is at all unreasonable that we should draw attention to it at this stage. In fact, we would prob- ably be negligent if we did not. On behalf of the Opposition I object to having an amount of this type of regularity being dealt with by regulation. Senator MACKLIN(Queensland)(11.50) —I indicate that the Australian Democrats will be supporting the Opposition's amendment. Senator HARRADINE(Tasmania)(11.50) —I think it is an important principle to stand upon. I agree with what has been said by Senator Archer and Senator Macklin. Part IV negatived. Clause 16 agreed to. Clause 17 (Recovery of overpayments). Senator HARRADINE(Tasmania)(11.51) —This clause deals with the recovery of overpayments. I believe that the insertion of this clause into Federal legislation is a precedent which we should not accept. It is being applied to us at this time and it could be applied to others at a later date. I do not think that any trade unionist worth his salt either would or should agree to this provision. The provision is entitled `Recovery of overpayments'. The fact is that we have not been overpaid. A decision has been made by the Remuneration Tribunal and that decision is law until it is reversed by a decision of the Parliament either as in the normal case, by a disallowance motion, or by substantive legislation. Senator Coates —You agreed to clause 2. The commencement date is 1 July. Senator HARRADINE —Sorry, I missed it. Perhaps I am too late. Perhaps I can go back to clause 2 later. The question of retrospectivity comes into this. Does this clause mean that we will be required to pay back what payments have been legitimately made under the Tribunal? What will happen to the tax that we have paid on that sum? I imagine that in some way that will be paid back to us and not kept by the Australian Taxation Office. I am concerned that if this goes through the Parliament it may be misunderstood that we accept the principle of retrospectivity. Both Senator Macklin and Senator Archer have indicated their support. They stand against retrospectivity but they are able to support this legislation on the basis that an announcement was made at the time. There seems to be no real argument against that. This legislation deals with the question of the payment of salaries and wages. Having been a trade unionist for a long time, I am concerned about allowing this provision. I do not mind giving the money back voluntarily. Senator Withers —That is going a bit too far. Senator HARRADINE —Does the honourable senator think that that is going a bit too far? I would rather give it back voluntarily than have in legislation a provision for recovery under such circumstances. Senator ARCHER(Tasmania)(11.55) —I wish to confirm what Senator Harradine has said. I cannot see where the retrospectivity applies when the announcement was made at the time of the declaration and before we had in fact received the first payment. I accept that we are now undertaking the legislative measures to make it possible to confirm what the Government advised at the time the decision was made. I cannot agree that this represents any retrospectivity. Senator GARETH EVANS(Victoria-Minister for Resources and Energy)(11.56) —I simply say on behalf of the Government that I am indebted to Senator Archer for his deft bit of footwork in demonstrating why it is that this is not really a retrospective piece of pain inflicting legislation. That is the Government's view of it and, unhappy as the result may be for all of us, the Government does insist on the retention of this clause. Clause agreed to. Title agreed to. Bill, as amended, agreed to. Bill reported with amendments; report adopted. Bill (on motion by Senator Gareth Evans) read a third time. Debate resumed from 13 June, on motion by Senator Gietzelt: That the Bill be now read a second time. upon which Senator Peter Baume had moved by way of amendment: At end of motion, add `, but in fully endorsing the principle of equal opportunity in employment and career advancement through merit, the Senate believes that- (a) voluntary co-operation rather than additional Government regulation is the preferred method of achieving equal opportunity in employment; and (b) this Bill: (i) should build on the goodwill and expertise developed with private employers during the voluntary pilot program, (ii) will add to the cost burdens of business, thereby reducing overall employment opportunities and increasing prices to consumers, (iii) will increase the level of business regulation, (iv) will establish yet another bureaucracy at a cost to the taxpayer, and (v) will further extend the interference of trade unions in the activities of private employers'. Senator COATES(Tasmania)(11.58) —As I said when I spoke briefly before this debate was adjourned on 13 June, I wholeheartedly support the Affirmative Action (Equal Opportunity for Women) Bill 1986. It was very annoying that it was not able to be dealt with and finalised in June; but, as promised then, it is being given priority now. The Bill seeks to ensure that discrimination against women in employment is eliminated and, to put it in a more positive way, that there is equal opportunity for women in the work place. The Bill proposes to do this in a very gentle and very gradual way. Despite the moans of some in the Opposition, it is a very gentle piece of legislation. It will apply for the time being only to higher education institutions and to employers with more than 1,000 employees. Even then the implementation is to be gradual. Next year the Bill will apply only to employers with more than 1,000 employees, and not until 1988 for those with more than 500, and not until 1989 for those with more than 100. It asks each relevant employer to institute an affirmative action program. It does not prescribe quotas or anything like that. There are no draconian penalties, the sanction for non-co-operation being merely naming in a report to the Minister. Even though the Opposition's amendment calls for the program to be based on voluntary co-operation rather than legislation, it is virtually voluntary anyway. I have some sympathy for organisations such as the Women's Electoral Lobby and the Australian Council of Trade Unions that have called for a tougher Bill, but our position is to give it a try in this more gentle, non-punitive way. If such encouragement does not work, if the response from business and industry is not good enough over the years, we will have to consider a different tack. But we are giving it a chance this way to see whether the good response experienced in the pilot program can be extended amongst employers generally for their benefit as well as for the benefit of Australian women. The full value of capable women is not being realised because they are generally overlooked and underrated by employers. Affirmative action programs are necessary in principle but they have economic and social merit too and will lead to an improvement in the Australian work force generally as more and more employers appreciate the benefit to them and as workers, male and female, obtain a better recognition of their worth. Attitudes on all sides must change. The emphasis in this legislation is on consultation, setting objectives, and monitoring and evaluation. I want to look at the need for affirmative action in the light of the increasingly disturbing phenomenon dubbed the feminisation of poverty, which should be a matter of grave concern to all Australians-as it is to this Government. The Affirmative Action Bill is an indication of how seriously this Government views the position of Australian women, a position generally of low status both economically and culturally. Quite often women in Australian society are isolated from the mainstream of Australian life; that is, they do not enjoy full access to wealth, education, housing, living standards and recreational activities. Many factors-cultural, social, ideological and geographical-contribute to this sort of isolation, but the real cause is economic problems. The facts speak for themselves. Of all full time workers in all job categories women still earn on average only 78 per cent of the earnings of their male counterparts. Ninety-six per cent of all single parent families, the families most likely to be suffering poverty, are headed by women. In an address given at Adelaide University a couple of years ago by Bettina Cass of Sydney University, who is the Director of the Social Security Review, the disturbing situation faced by Australian women was succinctly put. She said: Female sex itself connotes such a profound risk of relative deprivation that it is categorised as a disability without the addition of other harmful conditions like unemployment, sickness, age or invalidity. In the 1980s the likelihood of women suffering unemployment, poverty, inadequate housing and so on is something like four times greater than it is for men. Women and their children are largely the victims of poverty. In the years up to 1983 job opportunities for women, particularly in full time employment, became severely restricted. At the same time, Australian society underwent many important changes. That period also witnessed the emergence of a greater preponderance of single parent families. The far greater percentage of women single parents in receipt of social security benefits indicates the difficulties women face in the Australian labour market. While men face the same difficulty with child care and home responsibilities, more men than women are able to work. Too often sections of this society blame single parents for being an enormous drain on the Federal budget but according to the figures single mothers are excluded from the work force with the result that they have no alternative but to rely on government assistance. Women are facing huge changes in the labour market, and problems arise mainly for women who have suffered losses of jobs, retrenchments and reductions of hours because of the introduction of new technology. In December last year women made up only 30 per cent of all full time workers yet they represented 78 per cent of all part time workers. Since 1966 the number of female part time workers has jumped from 350,000 to 973,000, a rise of 178 per cent. There may be abundant part time work for women but part time work does little to improve the long term economic security of women and their children. Working women, whether part time or full time, are concentrated in three occupational groups-clerical, sales, and service, including sport and recreation. Jobs in these areas generally have low status, offer lower wages and afford few opportunities for advancement, promotion or on the job training and development. An indication of the extent of the segregation of the Australian labour market and the accompanying low status, low wage syndrome lies in the fact that in professional occupations in which women predominate, for example nursing, wage levels are unacceptably low. For too long this country has been dividing work by sex and, as is so often the case, where there is division there is hierarchy. In the Australian labour market that hierarchy manifests itself in the following way: Men's work is considered important and valuable and is remunerated accordingly; women's work is not accorded the same value and so is poorly remunerated. This is one of the reasons why despite equal pay women still earn only two-thirds of the average male rate. This is the poverty trap in which far too many women are caught. The affirmative action program is being introduced into this labour market. This Government has had the foresight and concern to do something to redress the employment problems that women face. We have made a firm decision that it is not enough to mouth platitudes about equal opportunity and the elimination of sex discrimination. Something decisive and constructive needs to be done. The affirmative action legislation sets up the structures and procedures by which results can be achieved. Australia is fortunate in that it can draw on the experience of other countries in this type of legislation and so avoid some of the problems and pitfalls that other nations have had to face in their attempts to redress the problems of disadvantaged and minority groups. This experience has proved invaluable in relation to the setting of quotas, which this legislation avoids. In countries in which quotas were set requiring companies or businesses to employ a certain number of women in the ensuing 12 months, merit was often overlooked. This had a couple of unfortunate results. There was a backlash of resentment from those people who though properly qualified had been passed over, because of the exigencies of the quota, for someone without the same qualifications and or training. This does little to advance the cause of women who deserve recognition and respect in the labour force. Also, quotas are in many ways unfair on those people who when appointed lack qualifications and experience and so are unable to cope fully with the job, thus suffering a lack of job satisfaction and low morale. It cannot be stressed strongly enough that affirmative action in the Australian context does not involve quotas and is not positive discrimination but is firmly based on the principle of merit. Certain sections of the community which have not supported affirmative action have distorted the contents of this Bill in an attempt to delude the electorate for their own purposes. The Australian newspaper was guilty of this sort of misinformation in an editorial on 21 February this year. It used the following words: Do we need federal legislation such as the Affirmative Action Bill . . . to coerce businesses and institutions such as universities into setting and meeting quotas to increase the number of women in their work forces and then establish programs to ensure these women are treated on equal footing with men? As I said, there is a vast difference between employers setting targets and goals in accordance with the specificity of their circumstances and the Government coercing employers to fulfil quotas. Perhaps the editor of the Australian should actually read the legislation. In introducing this Bill the Prime Minister (Mr Hawke) said: I want to stress that the Government's affirmative action legislation does not propose positive discrimination or reverse discrimination. We are totally opposed to the use of quotas, and this legislation, by stating that all actions are based on merit, makes this clear. It seems that despite efforts by this Government to explain its proposed legislative measures through extensive consultation and by having many groups participate in the pilot program there are groups which wilfully misrepresent the contents of the Bill. The Bill does not involve riding over the merit principle to give preferential treatment in hiring, promotion or admission to an educational institution merely on the basis of membership of a disadvantaged group. Affirmative action in Australia is not designed to give preferential treatment to any group or individual but is designed to identify and remove practices and procedures which are discriminatory and which have caused the exclusion of women. It is designed to remove the barriers which at present allow men to be the preferred group. The Government believes that legislation is necessary to encourage employers to improve the prospects for their women employees. In a Press release in February this year Mr Geoff Allen of the Business Council of Australia said that the Council `strongly opposes the view that legislation is either appropriate or necessary to achieve the objectives of equal opportunity for women'. He put forward an alternative idea: That equal opportunity for women could be achieved far more effectively by voluntary participation in the Council for Equal Employment Opportunity, which is sponsored by the Business Council of Australia. As an indication of the necessity for the legislation, it is worth noting that the Council for Equal Employment Opportunity was established only after the Government had launched the affirmative action program. If private industry is as committed to equal employment opportunity as Mr Allen would have us believe, it would have made moves in this direction years ago instead of needing the impetus of a government initiative. The BCA and other groups which say legislation is not necessary do not realise that legislation has another dimension apart from specific requirements and regulations. That dimension is harder to measure but is of vital importance and can be called its educative role. It is this educative role which has the effect of changing attitudes which hinder the raising of the status of women. The fact is that affirmative action in itself is not sufficient to improve the economic position of women. It is a start, but it needs to be complemented by attitudinal changes. The right of women to work needs to be recognised. The value of the work women do has to be acknowledged. The ability of women to undertake successfully work which is traditionally seen as men's work needs to be recognised. Women's role as the primary caretakers of children needs to be changed so that fathers take equal responsibility for their children. Access to quality child care needs to be extended to allow women to participate in the full time work force. The Government is making great strides in this direction, but a lot still remains to be done. I doubt that voluntary participation in the Council of Equal Employment Opportunity will be able to effect these changes which are necessary to overcome the insecure economic position of women. Perhaps the BCA's Council can be complementary, but it is not a substitute. The Affirmative Action (Equal Opportunity for Women) Bill is an important factor in the process of achieving the changes I have talked about and is a worthy piece of legislation for that reason. I congratulate the Minister Assisting the Prime Minister on the Status of Women (Senator Ryan) on her initiative, on behalf of the Australian Labor Party when we were in opposition in 1981, in introducing the forerunner to this Bill. I congratulate her for battling for the Bill to the point where it is near fruition. I am hopeful of great success for the participant employers and for the women who thereby gain the recognition they deserve. Senator HILL(South Australia)(12.13) —I will speak briefly on the Affirmative Action (Equal Opportunity for Women) Bill 1986. I am respectful of the fact that there are some 22 speakers on the list all wanting an equal opportunity to speak on it, but there are a number of points I want to make. The goal of the Bill is equal employment opportunity for women, which is something I think we would all applaud, certainly on this side of the chamber. The question is: How much does this Bill contribute towards the goal of equal employment opportunity for women? I intend to argue in my brief contribution that, although the Bill might make some contribution, it is generally geared towards the welfare of women in employment, women who are better educated and women who are more likely to be upwardly mobile in employment, rather than the large number of disadvantaged women about whom Senator Coates spoke. I argue that the major problems facing women are really beyond the competence of this Bill to remedy. Nevertheless, I am prepared to accept that it can play a constructive and purposeful role for the limited number of women of whom I just spoke. I remind the Senate that the Bill is so structured as to seek from relevant employers affirmative action programs designed to ensure that employers take appropriate action to eliminate discrimination against women in relation to employment matters, and to take measures to promote equal opportunity for women in relation to employment matters. Employment matters include recruitment procedures and selection criteria for the appointment or engagement of persons as employees, the promotion and transfer of employees, training and staff development for employees, and conditions of service of employees. As Senator Coates said, the Bill covers higher education institutions and employers who employ in excess of 100 employees. It does not include the Commonwealth, a State, a Territory, an authority or a voluntary body. Senator Peter Baume —Not yet. Senator HILL —Not yet. It is limited in form. It is interesting, for example, that trade unions as voluntary associations would not be covered by the Bill. But that is not the principal argument I want to put. As I said, there is an argument that with regard to some women it can be of advantage. I refer to a survey taken at Sydney University in 1985 which showed that less than one-third of the university's academic staff were women. That indicates a problem in itself, but more dramatic is that in the top levels of the professional staff-the senior lecturers, professors, et cetera-only 10 per cent were women, whereas in the bottom academic staff levels, such as research assistants, 60 per cent were female. Obviously, there is room within the tertiary institutions for considerable upgrading and for a program which will allow a more equitable distribution of senior jobs for women. I accept that there is a beneficial purpose in a program at Sydney University, for example, which could help remedy that imbalance, but, as I said, that represents only a small section of women. The women in most need of legislation, or constructive government help in other ways, are those who will not benefit from this Bill. Basically, this Bill provides a tool for women whom I might describe as being in the know, women who are already in the bureaucracy, femocrats with their networks, women in middle management, women in tertiary and financial institutions, women who already have access to the system, generally with education and reasonably available prospects of opportunity. They are the women I define as in the know and they are women who will benefit particularly from this Bill. That leaves that massive group of women who are not in the know, women who will not benefit by this legislation, women employed in lowly paid jobs, in highly repetitive jobs, in labour intensive jobs. In particular I give the example of migrant women with little knowledge of English, with limited support services, and with very little opportunity to rise beyond the positions they already occupy because of the necessity to earn enough for themselves and their families. How will they benefit from this Bill? The answer is, of course, that they will not; it is not designed to apply to them in their situation. It is worth noting-it will not come as a surprise-when I mention migrant women that the percentage of unemployment amongst them is higher than for all women. It is 12.8 per cent as opposed to 10.8 per cent. Therefore, this group of women in most need will not benefit specifically from this form of legislation. Furthermore, if we look at migrant women we see that their participation rate in the work force is higher than for non-migrant women. This is simply because migrant women generally come from lower socio-economic groups and have a greater need for work. What we on this side of the chamber are particularly interested in is giving the women who need work a fair opportunity to work. For example, Vietnamese women have a participation rate in the work force of some 57 per cent of their number compared to 46 per cent for all Australian women. Therefore, migrant women have a greater need which will, not be helped by this legislation. What do we need for such women? We need programs of language classes which are more accessible to migrant women. Special needs in regard to training and retraining have also to be taken into account. Senator Crowley —That is affirmative action. Senator HILL —I agree that affirmative action will do that. However, the affirmative action contained within the structure of this Bill will not do that. This Bill, as it is structured, will not be of any help to those women whatsoever. These are women who are not in the know. This Bill is designed primarily for women in the know. Let us look at another group of severely disadvantaged women-the single parents. Whether we like it or not almost 15 per cent of all families with dependent children today are now single parent families. Of that 15 per cent, 93 per cent are headed by women. According to statistics available to all of us some 41 per cent are below the poverty line. Therefore, we have a major group of disadvantaged women to whom we should be addressing programs to assist them. Will this Bill assist them? The answer is no. Such women are disadvantaged and are not in a position to take advantage of the forms of affirmative action which this Bill encompasses and which it is designed to meet. What we need is a different form of program for such women. Child care is paramount in their considerations but child care does not come within the ambit of this Bill. I would like to remind the Senate that of course it was the Opposition that, during the last election, addressed that specific problem faced by single women seeking to enter the work force, that is, how they can get child care facilities at reasonable cost, at a cost which they can afford. Of course, we addressed this through a suggested program of taxation rebate. That is what I would suggest to this Government. Affirmative action should look at specific problems in regard to disadvantaged women. Senator Crowley —Supporting mothers do not enjoy-- Senator HILL —Senator Crowley will get her turn to speak. Such programs should address the problems of single parents and should take constructive steps forward for their benefit. The women who are, of course, most disadvantaged at the moment are women who are unemployed. Again it is worth reflecting on the fact that the unemployment rate for women is higher than that for men. As I understand, current unemployment levels stand officially at 6.8 per cent for women as opposed to 6 per cent for men. However, that figure does not of course take into account the women who are unemployed and who have not registered as unemployed. I think that one could assume on reasonable grounds that unemployment would be higher among women than among men. Therefore, again we find women in the community disadvantaged as opposed to men. We should be looking for a constructive affirmative action program to help these highly disadvantaged unemployed women. Primarily, we do not find such help within this Bill. This Bill will not give such women greater opportunity to get into employment. On the other side the Opposition again looks to constructive, positive alternatives. As honourable senators know we have therefore been strong advocates of permanent part time work opportunity. This is something which the Labor Government and the trade union movement have been most tardy in embracing. It is only now and with great reluctance that we see some progress being made in this area-perhaps because of the agitation from the Opposition. Nevertheless, the small progress being made by some unions, such as the Administrative and Clerical Officers Association, is applauded by the Opposition. However, that union's newly negotiated agreement, which will deal with clerical and administrative assistants, will be limited to only 3 per cent of the total number of clerical and administrative staff within the Australian Public Service. That agreement has been made grudgingly. It represents only a small step in the right direction. We are advocating much greater opportunity in regard to permanent part time work. We are advocating that it be introduced within awards relating to work on the factory floor level or in the closed shop situation to aid women in lower paid work or women who seek to get into such lower paid jobs. However, the union movement simply is not prepared to give an inch on that matter. We would argue that if the Labor Government were to do something constructive it could develop an affirmative action program in that area. In that way it would be doing something worth while. It is of worry to us that technological change, which must now continue at a more rapid rate if Australia is to recover economically, will place greater pressure on the employment of women because traditionally women have held jobs at the lower end of employment and in the more unskilled areas. Therefore, I see the problem being accentuated. It is a problem that needs to be addressed by a purposeful affirmative action program. However, it is not within the design or structure of this Bill. Apart from the women who are particularly disadvantaged not being helped by this legislation-I refer to migrant women, the single parents, the unemployed and that mass of women employed at the bottom level of the unskilled employment market and who are the most dramatic cases that need the benefit of government action-we must then move to the next sector of women in employment. In Australia, perhaps as opposed to other parts of the Western world, we find that women who are in the work force tend to be concentrated in a small number of industries and within a narrow range of occupations within those industries. I remind honour- able senators that the vast majority of women have been, and continue to be, employed in clerical, sales, service and professional technical-related occupations. Women make up some 81 per cent of the labour force in those four occupational groupings. If we look at industry we find that in 1982 almost two-thirds of female employees were concentrated in four main industries. In the community services area women represented 28 per cent of the work force. It will be no surprise to honourable senators to learn that in the wholesale and retail trade women represented 22 per cent of the work force. In manufacturing industry they represented 12.6 per cent and in the finance, insurance, real estate and business services area they represented 11.5 per cent. We therefore find women concentrated in a small number of industries and confined to a narrow range of occupations. Obviously if we are going to do something constructive that concentration has to be broken down. Women have to be given more opportunities in industries outside those traditional areas. Is that goal going to be helped by this Bill? To be quite fair I think that one can see only very little opportunity for affirmative action type programs, as encompassed by this Bill, helping to meet the needs of these women as exhibited by their restriction within traditional forms of employment. This would require a different type of affirmative action. It would require a different kind of program in order to develop changes of attitude. Changes within the education system would be needed to overcome educational shortcomings for girls in this country. We need programs to educate parents into looking at higher employment aspirations for their girls. This is a necessary and worthwhile goal. However, it is a goal that will not be solved by virtue of this legislation. In those few words what I wanted to do was to give credit where it was due. I can see that in some small area this Bill will assist some women. But I stress the fact that with the major problem areas in this field, that is, the highly disadvantaged areas for women, this Bill will not help. Therefore, the Government has a responsibility that is not being adequately met. With respect to that large group of employed women who are, if I might use the term, in the centre, their problems of having a wider sphere from which to choose employment and a wider sphere from which to seek to become upwardly mobile are also not being met by this piece of legislation, and therefore in relation to those women the Government has a responsibility which is not currently being met. Affirmative actions which recognise the failures of the past and which provide positive steps to redress such failures are to be supported and certainly will be supported on this side. To do so is compatible with the merit principle because women have to be given the opportunity to be put in a position where true merit can be tested. Unless they are given that opportunity by affirmative action programs to get there in the first instance, so many will miss out. That is why we are prepared to support the concept in principle. There is still a long way to go. I would be most unhappy if this Government feels that it can sit down with this Bill that is before use today and believe that it has achieved something that is going to be great and worth while because that is by far overvaluing what this very limited piece of legislation does achieve. Give it its small credit but recognise the extent of the problems that exist and positively approach and tackle those problems. Senator CROWLEY(South Australia)(12.32) —Senator Hill's comments, I think, betray very clearly the Opposition's position on this piece of legislation. It wants to say that it likes it, but there is such division in its ranks that it has had to qualify that support. Senator Peter Baume spoke for the Opposition late in the last session. He made a most entertaining speech. I thank him for recording yet again the history of the achievements of women in South Australia. Perhaps that is because some of his colleagues in South Australia have done a lot of homework there. Even he, in giving his support for this legislation, still wanted to introduce a swag of amendments that the Opposition proposes. I would suggest that they may not be reflective of Senator Peter Baume's position, but they certainly are reflective of the divisions in the Opposition on this piece of legislation. One of the points that Senator Hill raised was that the Opposition, in coming to the last election, campaigned on great things that it would do for women through the tax system. He suggested that child care costs could be addressed by a tax rebate system. He suggested too, when I interjected, that I would get my time. Yes, I have it now, and I would like to point out that the tax system is of no advantage whatsoever to people who pay no tax. Most supporting mothers of the sort for which he was suggesting he was campaigning do not pay tax and would gain no possible benefit from a tax rebate scheme as opposed to the prospects of raising child care provision. Secondly, the tax rebate system creates not one extra place for child care. Both of those provisions were seriously considered by the Government in providing an alternative arrangement. I do not mind Senator Hill having that view, but for the record I think it is important that people know that it is a false view, that it is indefensible and silly. Senator Hill —And what? Senator CROWLEY —Silly. It is wrong. It achieves not one of those things that the honourable senator claims it achieves. Secondly, I would suggest that his arguments against this piece of legislation are based on the same spurious logic. The honourable senator suggests that this Bill will not address all the problems confronting women in this society. Of course not. It specifically addresses what is under the terms of this piece of legislation; nobody could argue otherwise. It is like suggesting that moves for the union movement will not solve the problems for single mothers. Of course not. It is not addressing those problems. It is a ridiculous argument and I find it depressing that Senator Hill would sink to that level. Again, I think he represents in his qualified support for this legislation the problems confronting the Opposition. There is not a united voice in the Opposition ranks about this legislation, and I will come to that later. Senator Peter Baume —But there is an official voice. Senator CROWLEY —We hope that the official voice is the one which is heard and recorded and which supports the speedy passage of this legislation. I shall repeat what the Affirmative Action (Equal Employment Opportunity for Women) Bill 1986 sets out to do-rather than the things that Senator Hill says it will not do. This Bill sets out to eliminate discrimination against women and to promote equal opportunity for women in universities, colleges of advanced education and private sector companies employing more than 100 employees. It is very clear about that. It is quite specific about that. I think it is important that that be understood. It is a piece of legislation that very much develops and goes hand in glove with the sex discrimination legislation that has already been passed by this Government. I think that piece of legislation, in its successful passage, indicated again exactly how divided the Opposition is on these issues concerning the status of women, the rights of women and the opportunities for women. Numbers of Opposition members would feel very much in sympathy with the legislation and the intentions of this Government-in fact they have said so-but others in the Opposition are divided on it. That same division is reflected very well in the affirmative action debate that is taking place here. Any reading of the Hansard record of the debate on this Bill in the House of Representatives would indicate that the same was happening there. I come again to the differences in the Opposition. They were highlighted very nicely at the recent national Liberal Party conference that was held in Adelaide. At that conference there was the remarkable case of a motion which was put and which actually won major support, albeit 23 to 21-even so it was passed-restricting the sex discrimination legislation to apply to Commonwealth employees only. It enjoyed a fierce attack by many of the Liberal women at that conference, so much so that two days later, at the first national Liberal women's conference, a motion overturning the original one was moved and successfully passed. It certainly highlights the division in the ranks, not only amongst the men and women but also between men and men and between women and women in the Party. I think it is particularly interesting for those of us who know Senator Walters's view on these matters to understand that it was reported in the Advertiser on 8 August that when the motion was put by the national Liberal women: Tasmanian Senator Shirley Walters, a conservative, big-L Liberal who spoke strongly in favour of the Tasmanian motion in the Federal Council, did not speak or raise her hand against the Sullivan-Worth motion at the women's conference. Neither did anyone else. I presume they were resorting to the Thomas More situation of silence being assent under the law. But that silence and that assent at this conference were very much in opposition to what Senator Walters had to say at the previous national Liberal conference. She was supporting such attitudes as I might cite from the New South Wales delegate, Dr Michael Fitzpatrick, who supported that motion to restrict the sex discrimination legislation and who said that he was concerned that militant feminists were dictating to the community; they were a minority group and they were very vocal. He said that the Liberal philosophy should be based on the protection of the family and to protect the mother who stayed at home to look after the children. Feminists represented no one but themselves and had tried time and time again to advance policies detrimental to the welfare of the country. I turn to the report of the national Liberal women's conference, and I find quite a remarkable difference of opinion and a different assessment. I am sure that the national Liberal women would be greatly entertained by the description of them which appeared in the article by Wallace Brown, which I quoted earlier, in the Advertiser of 8 August. Describing the membership there it stated: From one of the Liberal Party's original members, Dame Beryl Beaurepaire of Melbourne, to a Ms Jan Hindmarsh, investment adviser, of Brisbane, this was a reasonably broad cross-section of concerned, intelligent, articulate and politically aware women. Feminists in the main, yes. But in the true sense of the word, not so-called affirmative action buffs who want to push men aside. Reported in that newspaper item is yet again the misrepresentation of what the affirmative action position is and of what this Bill is about. In finishing this part of my contribution, I can say that I was entertained by a further passage from the article. Ms Virginia Chadwick, a Liberal member of the New South Wales Legislative Council, had this to say: As a party- that is, as a Liberal Party- we are not really comfortable with assertive, confident and ambitious women. Indeed, it is not. I suggest that the Liberal Opposition needs to get itself sorted out regarding the division on the Affirmative Action Bill and even the Sex Discrimination (Consequential Amendments) Bill. I do not mind if Opposition members have their divisions as long as they do not use those divisions to misrepresent-I think very mischievously-the intentions of the affirmative action legislation, or even, in the more gentle-voiced way of Senator Hill, to argue furphies that are quite irrelevant and remote from the thrust and central arguments of this legislation. This legislation is necessary to ensure that all large employers take seriously their obligations to women employees. The many things that Senator Hill listed as not being part of the affirmative action program may well be part of the affirmative action program. For example, migrant women workers in organisations employing more than 100 people will certainly be considered under the affirmative action program. That is precisely what employers will have to address. Under this legislation they will have to determine the distribution of people working in their firm or organisation. They will have to undertake a statistical analysis of the distribution of their workers and their level of employment and then come up with a program providing ways of addressing the needs of those workers. I would have thought that very high on the list for any serious employer would be the need to ensure that people who did not have English as a first language had that need addressed. I could see that requirement being quite clearly one of the factors decided on under an affirmative action program by a responsible employer. A number of the other things which Senator Hill suggested would not be part of affirmative action and are not covered under this Bill. They are just wild distractions. If we looked through the pilot program reports we would have some clear idea of whether employers have a good understanding of what is required under this legislation. They have had the opportunity to test it. We would also have a fair understanding of what they have already decided would be good ideas. Many of the things Senator Hill proposed are certainly the sorts of things that could easily come, and in fact do come, under an affirmative action program if they are seen by the firm, the employer, the union and the employees involved to be appropriate and necessary to further the rights of women and the equality of opportunity for women in that organisation. Senator Hill's arguments were very false. Another very important feature of this legislation goes to a point that has been mentioned in a number of important forums and certainly by Mr Kirk from Esso Australia Ltd. The report from the working group on affirmative action stressed again and again that neither individual employers nor the nation can afford to waste the valuable contributions which women can and do make to the economy. That point needs to be stressed. It is one of the underlying principles of the affirmative action legislation. In fact, Mr Kirk said that very splendidly when he was reporting on what happened in his firm, Esso. He said that there were a number of reasons why Esso decided on affirmative action voluntarily before the legislation was introduced and significant discussion was happening in the community. He said: First, we were aware of the increasing availability and qualifications of women . . . Secondly, he argued that they could see that it was going to happen as the Australian Labor Party, which was then in opposition, was talking along those lines. Thirdly, he argued: . . . to run an efficient operation we should be utilising the best available human resources. To neglect 50 per cent of the available talent and skills just because of gender did not make good business sense. From a hard, pragmatic position-not because of any bleeding heart notions of the needs of women but from hard, economic and pragmatic deliberations-Esso and its management agreed that it was ridiculous to waste all those talents. It is important to stress that this legislation is not something that has been dumped on this Government, the Parliament or the Opposition. It has emerged out of a very thoughtful and reflective consultation process over two years. It has been reported in a series of papers, including a working paper. It has had the experience of a pilot program and the working party report. What should be noted is not only the broad membership of that working party but also the presence in that working party of the Opposition and the fact that the working party's recommendations and report were unanimous. It is pleasing to the Government that the report was unanimous and that the Opposition, as represented in the working party, could so decide and see the sense of what was being proposed. Again, that was spelt out by Senator Peter Baume in this place. As I have already said, the legislation complements the sex discrimination legislation. It will apply to 19 universities, to 46 colleges of advanced education and to private sector organisations which have more than 100 employees. Debate interrupted. Sitting suspended from 12.46 to 2 p.m. Senator CHANEY —My question is addressed to the Minister for Finance. I remind him of the severe criticisms he has delivered concerning the failure of a number of Budgets brought down by the previous Government to meet their targets, and I remind him also that the deficit predicted in the Government's Budget last year was out by some $800m. I ask the Minister: Does he stand by the accuracy of the figures in the Budget brought down by the Government last night? Will he resign if they prove to be as rubbery as the Opposition is predicting? Senator WALSH —It is correct that last year, for the first time-this Government having produced three Budgets-there was an overrun on estimated outlays and a Budget outcome deficit higher than the estimate. The reasons for that were detailed in the statement which I issued on the June Commonwealth financial transactions. I do not recall it all now and I do not have the statement with me but the principal reasons for both the outlays overrun and the increase in the deficit were related to the devaluation of the Australian dollar and the consequential increase in both public debt interest payments for those Commonwealth borrowings which were owed abroad, or interest liabilities which were payable abroad, and Commonwealth purchases of equipment, particularly defence equipment. I suppose it is regrettable that that happened but a devaluation of the size that has taken place was not foreseen at the time the Budget was introduced. However, it is when a Treasurer year after year has a Budget outcome in which the outlays exceed the Budget estimates that one is really getting into the area of fraud. That is exactly what happened during the five years Mr Howard was Treasurer. In every one of those five years outlays exceeded the estimates presented with the Budget. Governments can make mistakes; Treasurers can make mistakes; they can fail to foresee circumstances that are developing, as we failed to foresee everything 12 months ago. But when for five years in succession a Treasurer has a Budget outcome in which the outlays are in excess of the estimate one has to start questioning the honesty and integrity of the Treasurer concerned. That is exactly the record Mr Howard has. Moreover, in three of those five years there was also a very substantial increase in the Budget deficit on the outcome as against the forecast which was made. So Mr Howard's score is five shonky figures out of five on the outlays side and three shonky figures out of five on the deficit side. That is the record of a man who was Treasurer and who now has the audacity, or effrontery, to present himself as an alternative Prime Minister and responsible economic manager. As for the question relating to this year's Budget, of course no estimate can be anything but an estimate. It is unlikely that any particular figure will be precisely accurate and that the outcome will exactly coincide with the figure forecast, whether it relates to pension payments, the unemployment benefit or capital expenditure. Indeed the only payments about which one can be fairly certain are those usually fixed amounts which are written into legislation as transfer payments usually to other governments. One cannot guarantee the absolute accuracy of any individual figure in the Budget or of the figures in aggregate. In the absence of parameter changes which have not been foreseen, normally there is some shortfall on outlays. That is because departments tend to overestimate the speed with which new programs can be introduced. That is what has happened in three of the four years we have been in government and there is no particular reason to believe that it will not happen again. However, that could be more than offset by some parameter change. The Government believes that the figures presented in the Budget are the best estimates available. Whatever a previous Treasurer might have done, this Treasurer and this Government are not in the business of consistently producing shonky Budget figures year after year. Senator CHANEY —Mr Deputy President, I ask a supplementary question. The Minister specifically mentioned the unemployment benefit. Is the Minister personally satisfied with the basis for estimating the outlays on unemployment benefit in the next year? Is he prepared-not during Question Time but at a later time-to make available to the Senate the basis of the calculations on unemployment benefit payments in the Budget? Senator WALSH —Senator Grimes has just reminded me that of all the rubbery figures in rubbery Liberal Treasurers' Budgets the unemployment benefit estimates were the most rubbery. The figure on UB recipients is supplied by Treasury so I cannot give an undertaking that I will make the documents available. The figure in the Budget Papers is the figure supplied by Treasury and in the first instance it is based on the state of the labour market. A deduction is made from that. There is also in this Budget-details are provided, I think, in the social security section of Statement No. 3-some reduction in the UB expenditure estimate because of the tightening in administration which is now being put in place. From memory there will be an estimated saving of more than $30m. I will not stand by that figure precisely but it is something of that order. My opinion is that it is possible that that is an underestimate of the saving. I will have to refer to the Treasurer the question about that document because that is a Treasury document, not a Department of Finance one. Senator CHILDS —I refer the Minister for Veterans' Affairs to a report in today's Melbourne Sun that as a result of the Budget those getting a war widow's pension will no longer be eligible for a social security pension at the same time. Is this report accurate? Senator GIETZELT —I have seen the report in the Melbourne Sun, which makes statements that are not correct. As a result considerable distress will be caused to a group of persons who should not be placed in that position. It is not an accurate report and therefore it will cause unnecessary distress to war widows. I hope that the Melbourne Sun-and indeed other sections of the media-will appreciate the necessity to be accurate when it makes comments in respect of different aspects of the Budget. I also hope that the Sun in particular will promptly clarify the matter to minimise the distress this article caused. War widows are entitled, in addition to the war widow's pension which is paid at the same rate as the single age pension, is tax free and is free of any income or assets test, to a domestic allowance of $12 per week. This measure was introduced by the Chifley Government in 1947. Around three out of four of the 60,000-odd war widows are also able to receive, subject to the income and assets test, a part social security pension. It is certainly not the case that these war widows will lose their entitlement to a part social security pension. However, the Government has decided that this social security pension entitlement will be frozen at the level being paid on 18 December 1986. In the case of a widow with no other income apart from the war widow's pension and domestic allowance, the maximum social security entitlement will be $60.05 a week and it will be frozen at that level. I am advised that the average social security entitlement of war widows is approximately $35 a week. I also point out that the war widow's pension will continue to be adjusted every six months. So, as the consumer price index adjustments are made, the war widow will naturally receive the same increase in income as any other beneficiary who is eligible for an income support pension, in line with the CPI increase. The only difference is that those war widows to whom I have referred will cease to benefit from the double indexation of both their war widow's and social security pensions. If they were receiving $60.05, that amount will be frozen, but they will receive the normal CPI adjustment to the war widow's pension. As I was advised that this article might create some difficulties, my Secretary prepared a minute for me on the issue. I seek leave to incorporate that in Hansard so that the position is clarified for all those who want to know the precise position. Leave granted. The document read as follows- DUAL ENTITLEMENT FOR WAR/DEFENCE WIDOWS PENSIONS AND SERVICE AND SOCIAL SECURITY PENSIONS Minister This minute is to inform you of the effect of the Government's decision to freeze from 1 November 1986 the amount of service or social security pension paid to war widows. 2. In the Treasurer's Budget speech he stated that: ``From November 1, 1986, where a newly eligible war or defence widow pensioner is also eligible for a social security pension, the maximum level of the social security pension will be frozen at $60.05 a week.'' 3. However, the Government's decision also said that those war widows in receipt of service or social security pensions will have them frozen at the rate they were receiving on 1 November 1986. 4. That is, from 1 November 1986, those war widows would continue to receive their existing rate of service or social security pensions, but will not be eligible for any increases above that rate in future. They will not receive the CPI increases to be made to these pensions in December 1986. 5. Also, from 1 November 1986, all war widows whose service or social security pensions are subsequently reduced because of increased income, other than war widows pension, will not be able to be increased above that reduced rate in the event that their income ceases or the level reduces in future. 6. The following examples illustrate the above. (a) War Widow receiving Age Pension prior to 1 November 1986 If the war widows only source of income is war widow's pension, age pension would be payable at $60.05 a week if unmarried, or $69.15 a week if married. If the war widow has other income or assets these rates will be less under the income/assets test. These rates will continue in payment after November 1986 subject to the income/assets test. (b) War Widow receiving Service Pension prior to 1 November 1986 As war widow's pension is not taken into account in assessing the rate of service pension, the rate of service pension would be payable at $102.10 a week if unmarried, or $85.15 a week if married. Lesser amounts would be paid if the widow has additional income. These rates will continue in payment after 1 November 1986, subject to the income/assets test. (c) War Widows pension granted after 1 November 1986 to a service or social security pensioner The rate of service or age pension will be reduced to $60.05 a week if already being paid at a higher rate, otherwise pension will continue at the lesser rate in payment. (d) Service or Social Security pension granted after 1 November 1986 to a War Widow The Service or Social Security pension will be granted at the rate of $60.05 a week, or such lesser amount assessed under the income/assets test. (e) Effect on rates of Service or Social Security pensions of variations in assessable income (other than in war widows pension) after 1 November 1986 If, because of an increase in other income a service or social security pension is assessed at a rate lower than that in payment after 1 November 1986, the service or social security pension will be reduced to that lower rate. The service or social security pension will not be increased in future even if the income affecting the assessment subsequently reduces. For example: Rate in payment after 1 November 1986: $60.05 p.w. Rate assessed and payable following increased income: $40.00 p.w. Rate assessed when income subsequently reduced: $60.05 p.w. Rate actually payable: $40.00 p.w. Theoretically it would be appropriate for a war widow whose service or social security pension is frozen at a rate lower than the maximum possible ($60.05 a week) to relinquish the pension when her income reduces, and reapply for it to be granted at the higher assessed rate (up to $60.05 a week). It is intended to legislate to prevent this. 20 August 1986...(D. Volker) Secretary The DEPUTY PRESIDENT —Mr President had occasion yesterday to refer to the length of answers. I draw the attention of the Senate to the fact that so far two questions have been answered in 11 minutes. I would be grateful if Ministers could endeavour to make their answers as concise as possible. Senator LEWIS —I refer the Minister for Industry, Technology and Commerce to Statement No. 2 of Budget Paper No. 1 at page 60, which states: . . . further positive response to the depreciation of the Australian dollar is expected in exports of manufactures . . . That is manufactures, not manufacturers. We know that the Government is exporting manufacturers, but it is not expecting to get any revenue from their export. I ask the Minister: Can the Government identify the areas of manufacturing which are expected to increase exports and what contribution each is expected to make to the balance of payments? Senator BUTTON —Senator Lewis's question is alleviated by his customary wit, which we are all used to in this place. I congratulate him on his little joke. Of course, I do not have Budget Paper No. 1, Statement No. 2, page 60, in front of me at this time in anticipation of a perceptive question from Senator Lewis-which, I might say, is very rare indeed. Let me give a very general answer and I will give a more specific answer to Senator Lewis at a later stage if he requires one. I think there are a number of areas in which Australian manufacturers can compete because of the dollar value of 62c or 63c. No better incentive for exports could be available to any manufacturing sector in any country than that which is available to Australian manufacturers now. The problem, of course, is that the manufacturing sector was nurtured for years by Liberal-National Party governments-I refer, for example, to the seven years of the Fraser Government-and nothing was done to exhort manufacturers to get into export activity. Export activity in those years was regarded by Australian manufacturers as something which one did when one had a surplus on the domestic market. A manufacturer then went to Singapore or somewhere else and tried to flog the product. That is the sort of thing that happened during those seven years. Senator Lewis —You cannot give us any answer because there is not an answer. Senator BUTTON —Let me come to the answer. If some of the words are too big for Senator Lewis, I will explain them to him afterwards. Let me identify a couple of areas of manufacturing which were identified the other day at the Confederation of Australian Industry forum by Mr John Elliott, who is, I believe, the Treasurer of the Liberal Party. He told the CAI forum that businesses in this country-I think Mr Elliott put it in these terms-have to get off their backsides, get out there and take advantage of the dollar. He mentioned two areas which were within his own bailiwick-motor vehicle components and beer. Senator Lewis —Are they not manufactured overseas? They are not being exported. They are being manufactured overseas. Senator BUTTON —No, they are not being exported. Senator Lewis —Oh, yes. Senator BUTTON —Senator Lewis says: `Oh, yes'. I guess that he has as much access to Mr Elliott as I do. He should talk to him. The fact is that he was talking about things which are manufactured in Australia. Of course, a wide range of companies-software houses, various computer and electronic companies, and particularly motor vehicle component manufacturers -are already taking advantage of the Australian dollar situation and are exporting to other countries, including Japan. As I have said in this place on many occasions, this sector will take time to turn around because the whole sector started off with a dreadful legacy illustrated by the inane interjection Senator Walters tried to make a minute or two ago. Of course it will take time. Senator Lewis —You are saying that they will turn around this year and provide revenue for this Budget. That is what you are saying in this statement. Senator BUTTON —No. I am not saying that at all. The DEPUTY PRESIDENT —Order! The Minister should answer the question, not the interjection. Senator BUTTON —There are two issues which Senator Lewis clearly has confused in his mind. I have never said in this place-no Minister in this Government has said it-that the current account deficit will be turned around this month, next month or in a year's time; it will not. That is a medium to long haul. It is believed that the quantity of manufactured exports will rise, and there are plenty of examples of that. If Senator Lewis wants me to get on the telephone or go around the country, I will do so, but I am sure that that prediction will be fulfilled because many of those companies are already doing that. All we can do is try to encourage that process. Let me give Senator Lewis a couple of examples. I believe we will be exporting considerably more aluminium from this country in the current year than was the case last year. That is because new capacity is coming on stream. Senator Lewis —That is not a manufactured product. Senator BUTTON —Mr Deputy President, in view of your request to be brief I do not intend to remain on my feet and enter into a continuing argument with Senator Lewis about this issue. Maybe one day-I think he will be getting the pension before then-Senator Lewis will have the opportunity to stand here and give the spiel he has been trying to give in the last few minutes. That is a very long time away. Senator MORRIS —Is the Minister for Veterans' Affairs aware that a group identified with the Defence and Ex-Services Party is seeking to take control of the Totally and Permanently Disabled Soldiers Association in New South Wales? In the Minister's view, is this group's primary concern the welfare of the TPI Association's members or does this group have motives that may, if it succeeds, be detrimental to the TPI Association's membership? Senator GIETZELT —I am aware that a new organisation called the Defence and Ex-Services Party has been formed. It has been registered with the Australian Electoral Commission for the purpose of fielding candidates in the Senate election in New South Wales which will be held in the next 18 months. I am aware, as a result of the representations that have been made to me as well as to a number of members of my Party, that the executive officers of the Defence and Ex-Services Party are currently contesting elections for the New South Wales branch of the TPI Association. The concern that has been expressed to me is that those officers are contesting all the principal positions in the TPI Association for the first time. It is the view of the rank and file of that organisation that their motives may be connected with political aspirations. It has been suggested to me that the persons concerned with the political organisation, the Defence and Ex-Services Party, are involved in a political coup to take over the TPI Association in order to use its extensive financial resources to contest the Senate election. A Mr Hanley, who has been prominent in that organisation, has attacked all the political parties in the Parliament as a result of the passage of the Veterans' Entitlements Bill. He has suggested that all those who are currently senators have let their party down. He has said also that, as a result of that legislation, the TPI pension will be reduced from $190 to $71 a week. Every honourable senator knows that that is not true, but that propaganda is used to suggest to members of the TPI Association that there should be a change in the leadership and direction of the Association, which is a strictly non-political organisation concerned only with the welfare of its members. I am informed that the TPI Association has about $2m worth of assets. If this group were to get control of the Association, it could conceivably, according to rank and file members of the Association in New South Wales, use those assets for wrongful purposes. The Association's aim is to provide welfare assistance to TPI members. It is a strictly non-political organisation. The advertisements that the Defence and Ex-Services Party has placed in the journal of the New South Wales branch of the Returned Services League of Australia have been drawn to the RSL's attention. It has decided to ban any further advertisements from that party. Mr Hanley has made a number of statements which have created some distress for the TPI and other ex-service men and women in Australia. But he should be the last person to concern himself with veterans' pensions, as he is in receipt of a substantial pension from the Commonwealth Public Service, of which he was a senior member, and retired on 50 per cent of his salary. He is also a TPI pensioner. It is clear that he intends to spend most of his time in political campaigning about issues that do not exist so far as the veterans' community is concerned. I hope that the TPI Association's members will take note of Mr Hanley's background and the lies that he is perpetrating in the campaign and will return to office officials who will maintain the TPI Association's integrity and non-political status. Senator SANDERS —My question is directed to the Minister for Resources and Energy. First, is it not a fact that, even though the French claim that Australian uranium will not be used for weapons, the supply of additional Australian uranium will allow the French to divert uranium from other sources, from power production to weapons production? Secondly, does the fact that France is not a signatory to the Treaty on the Non-Proliferation of Nuclear Weapons mean that there is no legal or moral obligation for Australia to supply uranium to France, and that any such sale is thus for purely financial reasons? Thirdly, is it not a fact that the sale of uranium to France will endanger the South Pacific Forum and the South Pacific Nuclear Free Zone Treaty area by establishing a double standard in our relationship with France over nuclear matters? Finally, why did the Government decide on this uranium sale in opposition to its policies? Senator GARETH EVANS —The Government did not take the decision to resume uranium sales to France lightly, not only because of its party policy implications but also because the embargo policy symbolised in a dramatic way our absolute opposition to French nuclear testing in the South Pacific-opposition that we are, of course, continuing to pursue vigorously in every available forum, bilateral and multilateral. The balance of considerations in favour of this decision at the end of the day overwhelmed those against. Let me describe those relevant considerations. Obviously, there were budgetary ones. To achieve the kinds of deficit target figures the Government was chasing-that task became more stringent as time went on and economic circumstances changed, making it necessary to go for lower and lower levels-some dramatic savings, cuts and revenue alternatives had to be considered. The budgetary implications of the existing embargo policy were considerable. Not only had there been the $41m of outlays over the past two years on earlier contracted sums, but there was a commitment to pay another $25m this year, $26m next year and $13m the year after that. The decision was made on the basis that the Budget would benefit to the extent not only of the amounts contracted to be taken this year but also the amount previously stockpiled. So there was a $66m budgetary impact. Honourable senators will undoubtedly appreciate that not many other avenues offered that saving in a way that was not immediately hurtful to sections of the Australian community. Not only was there the budgetary impact as such but there was the larger economic impact of the decision. The $66m will go straight into our current account and, as such, be an important contributor in alleviating the larger balance of payments problem we obviously have. Moreover, there are obvious implications for the future, in terms not only of that sum this year but also of opening up the French market. It is estimated that if, as seems reasonable, in the future we get 25 per cent of the domestic energy market in France, it will mean, in current dollar values through the late 1980s or at least the early 1990s, export returns to Australia of something over $200m a year. In our present economic climate, it is a considerable luxury to forgo an economic advantage for the nation of that magnitude. Those budgetary and economic considerations would not, of course, be conclusive were there grounds to believe that the policy was, nonetheless, having some impact in forcing France to change its mind about tests in the South Pacific. If it were having such a potential effect, we would be involved in the same sort of calculation as we are in the context of South African sanctions, and it would be a question of the country making a continuing economic and budgetary sacrifice to achieve some larger policy end. I guess that that would be an overwhelming consideration. But the reality is otherwise. The policy has had a non-existent political impact in France. There has never been any question of any of the other uranium suppliers-Gabon, Niger, Canada or Namibia-participating in this kind of boycott. There has never been any political pressure or economic pressure on France to modify its behaviour as a result of this embargo. There has never been a chance for the policy in that sense to have an effect. In those circumstances, that became a relevant consideration when weighed against the other advantages. As to the implications of the policy change in our attitude to the nuclear non-proliferation treaty which Senator Sanders properly raises, in short the Government's change of policy does not undermine the credibility of our strong support for the nuclear non-proliferation treaty, notwithstanding, of course, the fact that France is not a party to that treaty. France is not a party to that treaty but is a party to safeguards arrangements, bilaterally and multilaterally, including in particular those with Australia, which are for all practical purposes exactly the same in their effect. Australian uranium as a consequence of those safeguards arrangements has not been, is not now and will not be in the future used in any French nuclear weapons programs-on Mururoa Atoll or anywhere else. Senator Sanders raised also the larger foreign policy implications for the Pacific of a South Pacific nuclear free zone, adherence by our friends in the Pacific and the implications for the Forum countries. All I can say in that respect is that there has just been a meeting of the South Pacific Forum. It took place in the context of enormous Press speculation here and internationally about a possible reversal of the policy; yet that issue was not raised at the Forum by any country. One must accordingly make judgments about its impact. The reality is that at the Forum meeting and elsewhere Australian policy has been acknowledged as a symbolic gesture, not one with any substantive effect. The gesture was made in 1983. The gesture was valuable at the time but it has ceased to be of value. There comes a time in the life of every nation when gestures of that kind simply cannot, for the overall good of the nation, be afforded. Senator SANDERS —I ask a supplementary question. The Minister mentioned that he hoped that Australia would soon have 25 per cent of the French uranium market. I ask: Have we signed any new contracts for uranium supply to France, other than the existing contracts which we all know about? Senator GARETH EVANS —There are no new uranium contracts that have been signed but, as a result of this decision, arrangements have been made for the continuation of the existing contract, including the taking of the originally contracted amounts of uranium. I simply make the point, and was making the point, in the context of the market for all practical purposes now being opened, that it is therefore possible for Roxby Downs new supplies coming on to the market to now actively pursue the French market in a way that was not possible during the currency of this policy. Senator DEVLIN —Will the Minister representing the Minister for Local Government and Administrative Services confirm that the fringe benefits tax applies to local government? Will the Commonwealth Government be giving special assistance to isolated councils possibly adversely affected by the tax? Senator GIETZELT —The fringe benefits tax, of course, applies to local government as it does to everybody else in the community, including politicians. However, many of the reports about the effects of the tax are highly sensational, exaggerated and misleading. Local government, having had an opportunity to sift through the propaganda that has been waged against the fringe benefits tax, has started to realise that its liability will be significantly less than the initial estimates that were made. For example, in one particular case that has been drawn to my attention, the Fairfield City Council in Sydney, one of the largest councils, has estimated that its liability will not even be one-tenth of one per cent of the Council's budget. Isolated councils will benefit from the changes that have been made to the proposed tax on the private component of motor vehicle use. It is expected that any such disabilities that councils may find will be taken into account by State government and local government grants commissions in the allocation of Commonwealth general purpose financial assistance, so what they may lose may well be supplemented by changes to the funds made available through the local government grants commission. I understand that the Minister for Local Government and Administrative Services, my colleague Mr Uren, made a speech in Perth early this month in which he stressed-I think that some publicity was given to it in the Australian-that the Commonwealth could give special assistance to isolated local councils. So I suppose the short answer to Senator Devlin's question is that I do not think local government will suffer greatly from the fringe benefits tax. Senator BROWNHILL —My question is addressed to the Minister representing the Treasurer. After three successive quarters of negative growth, how does the Government justify its Budget forecast of a gross domestic product growth of 2 1/4 per cent when investment is predicted to decline? Senator WALSH —I cannot recall the precise page in Budget Paper No. 1, but the GDP growth forecast comprises 1 3/4 per cent because of both import replacement and increased exports and half a per cent from gross national expenditure growth. Senator REYNOLDS —I address my question to the Minister Assisting the Prime Minister on the Status of Women. Did the Minister hear the comments of Senator Michael Baume criticising the cost of the Federal Government's national agenda for women? Can the Minister outline details of this highly cost-effective campaign to establish the priorities of Australian women? Furthermore, can the Minister explain why so many members of the Opposition are always opposed to consulting women and involving them in the policy-making process? Senator RYAN —I cannot answer the last part of Senator Reynolds's question because, indeed, it is a mystery to me why a party that lost office partly because it lost the confidence of Australian women should persist in its anti-women attitudes. Those attitudes are very commonly expressed in this chamber and, of course, at the Federal Council of the Liberal Party of Australia held in Adelaide recently, the best the Party could think of was to vote in favour of dismantling the Sex Discrimination Act. I think it is certainly the case that there are some women in the Liberal Party who are very well aware of the disastrous effects of these anti-women policies and stances that have been taken by the leadership of the Liberal Party, but while the leadership of the Liberal Party persists in these derogatory and negative attitudes towards Australian women in questions of equality, it will continue to fail to attract the votes of Australian women. In contrast, of course, our Government came to office recording the highest vote that we have yet recorded amongst Australian women. We sustained that level of electoral support amongst women in 1984 and we are determined to continue to sustain it. We will sustain it not by empty promises, rhetoric and empty talk, but by the solid delivery of improvements in services, in which we have a great record, by protection against all forms of discrimination, which we have tackled legislatively, in various policy areas, and perhaps most importantly, by recognising Australian women, whatever their circumstances and, I might say, whatever their political views, as important participants in policy formulation. The whole exercise of consulting women all around Australia has been a broad-based, non-partisan and very genuine attempt to garner the views of Australian women on a range of subjects of importance to them. It has been a highly successful exercise. I can report that, to date, I have been involved in about 25 such major meetings in far flung parts of Australia. Other women members of parliament and women members of the National Women's Consultative Council have done likewise. Those meetings have been attended not only by Labor supporters or supporters of the Australian Democrats but also by women members of the Liberal Party, who have been most welcome and who, indeed, have been invited to give their views about the direction that the Commonwealth should be taking. Senator Haines, the Leader of the Australian Democrats, has just reminded me that women members of the National Party of Australia have also been invited and have attended these consultations. I do not know whether Senator Bjelke-Petersen has attended any in Queensland, but certainly she would be welcome to do so if she so chose to do. In contrast to the leadership of the conservative parties opposite, what we are about is to genuinely find out the views of Australian women, not just those women who are in strong and articulate women's organisations, who are involved in trade unions or who work in the professions or the bureaucracy, but women who are not involved in those sorts of organisations and who are welcoming these opportunities to make comments, suggestions, criticisms and recommendations about the direction of government policy. With typical mean-mindedness and typical tunnel vision, all Senator Michael Baume could think to ask was what the cost of this exercise will be. I will certainly seek to get a costing of the exercise but I can assure honourable senators that it is one of the most cost efficient exercises our Government or perhaps any government has been involved in. As is often the case with Australian women, most of the work is done by volunteer women workers who give up their own time to organise these meetings, to make sure that women in their community are aware of them and to notify relevant groups. Most of the collecting of the views is done by members of parliament, who use their normal travel entitlements on this totally legitimate exercise which allows the views of a large section of the community previously neglected to come before Government and, indeed, before the Opposition, because the results of this exercise will be a public document, a public agenda, which we hope will attract bipartisan support. As to the details of the costs, the Office of the Status of Women has certainly been involved-- Senator Chaney —Mr Deputy President, I raise a point of order. I make the point that the Minister is clearly debating the question. We have had very few questions today. She should be brought to order and sat down. The DEPUTY PRESIDENT —It is a very long answer, but the Minister is being relevant to the question. Senator RYAN —Mr Deputy President, I know that the views of Australian women and the way in which we are consulting them is very boring for Senator Chaney; so I will now conclude my answer. The details of the costs will be provided to Senator Reynolds as soon as possible. Senator MESSNER —My question is addressed to the Minister representing the Treasurer. Is it a fact that Budget Paper No. 1 indicates that the consumer price index grew by an underlying annual rate of 10.4 per cent in the six months ended 30 June 1986? Does this rate reflect the considerable effects of the depreciation of the Australian dollar, offset by falling oil prices? In view of the continuing fall in the value of the dollar, the recent upward trends in oil prices and the underlying rate of 10.4 per cent in the last six months of the last financial year, how can the Government confidently predict an inflation rate of 8 per cent in the Budget for the forthcoming financial year? Senator WALSH —Did the honourable senator say that that was in Budget Paper No. 1, Statement No. 2? Senator Messner —Budget Paper No. 1, page 28. Senator WALSH —That would be Statement No. 2, if it is on page 28 of Budget Paper No. 1. I have not read it all the way through; so I am not sure what the honourable senator means by `the underlying rate of inflation of 10.4 per cent'. The CPI increase for those two quarters was 4.3 per cent and of course since then there has been a discounting of that by 2 per cent in the national wage case. I am sorry; that was for the September and December quarters. The honourable senator asks how the CPI forecast can be justified. I think it is very important that this fact be more widely appreciated: Inflation in Australia is not being driven by wage increases. Inflation in Australia is being driven by import price changes caused by the devaluation of the Australian dollar, which in turn has been caused principally by the disastrous decline in Australia's terms of trade. Senator Michael Baume —Why are you discounting by only 2 per cent? Senator WALSH —Go and draw up another Patrick Partners balance sheet or prospectus, or something like that. I know that the honourable senator is an expert on putting out shonky pros- pectuses, but whether he really understands this I do not know. The DEPUTY PRESIDENT —Order! Senator Walsh, that is not a proper line of answer. Senator Chaney —Mr Deputy President, I raise a point of order. I ask that the Minister withdraw that last remark. The DEPUTY PRESIDENT —I ask the Minister to withdraw. The remark was in response to Senator Baume. Senator WALSH —Did you ask me to withdraw, Mr Deputy President? I did not hear you very well. I withdraw. Inflation in Australia is not being driven by wages; indeed it is being controlled by wages. In the three and a half years that this Government has been in power there has been a real wage rate decline of the order of 5 per cent. In the United Kingdom, under the sort of industrial relations policy which the Opposition says it would like to have, for not quite the same period but for the calendar years 1983 to 1985, there were real wage rate increases of 11.5 per cent. The perverse outcome of all these wage and commodity price changes that have taken place is that a country such as Australia, in which real wages have declined, has recently had an increase in its inflation rate, whereas most of the countries of Western Europe and North America have had falling inflation rates in spite of real wage increases. In some cases, such as in the United Kingdom, which I cited, countries have had very substantial real wage increases. There is a common cause for that paradox, and the common cause is the changes in commodity prices which have punished Australia in terms of both national income and, by the devaluation of the dollar, our domestic price level. Most of the countries in north-western Europe and North America have been beneficiaries of precisely that same phenomenon; that is, the fall in commodity prices. Senator MESSNER —Mr Deputy President, I have a supplementary question. The point that has been made by the Minister ad nauseam was, of course, referred to in my question and I added for his benefit the further point that in fact oil prices are tending to rise. What I am now asking is: If that is so, obviously inflation will be higher this coming year than the stated figure in the Government's own Budget Papers of 8 per cent; so how can he possibly justify the 8 per cent figure? That is the simple question. Senator WALSH —How can we justify it? I have already referred the honourable senator to one wage discount which is in place. There is a specific statement of Government policy in the Budget Papers to seek a further result in the next national wage case. That is the last one which would affect this financial year. As to the honourable senator's reference to oil prices, the policy the Government adopted, I think some six months ago, in response to the very sudden and huge decline in world oil prices, and consequentially in the import parity price for Australian oil, was in general to maintain revenue neutrality; that is, if oil prices fell and the crude oil excise fell with them, the Government would recover approximately the same amount of revenue from increases in the refined petroleum products excise. That is not quite a one to one offset because a portion of our total petroleum consumption is sourced overseas; but, if oil prices rise and crude oil excise rises with them, the Government's general policy is to apply that same principle but in reverse; that is, to achieve broad revenue neutrality by reducing the excise on refined petroleum products. Senator TATE —My question is directed to the Minister representing the Minister for Employment and Industrial Relations. The Minister will be aware of a Budget allocation of $3.1m for a scheme of community work for the unemployed, as foreshadowed by the Prime Minister in his address to the nation in June of this year. The Minister will also be familiar with my previous questions in this place suggesting that guidelines be altered so as to allow those unemployed to undertake several hours of community work without prejudicing receipt of benefits. Can the Minister give an assurance that participation in the new scheme will be voluntary and will in no way amount to civil conscription of those who genuinely cannot find paid work? Senator Walters —Oh, lovely! Senator Tate —Do you want conscription? Senator WALSH —The Opposition has always wanted conscription in the past; so I suppose it still wants it. Senator Tate has shown an interest in this subject for some considerable time. Indeed, I have here a couple of extracts from Hansard as far back as 25 March 1985 and 19 April 1985; so I understand his interest in it. In response to the last part of Senator Tate's question, yes, I can guarantee that this will not be civil conscription and that participation in the scheme will be voluntary. There is a widespread belief-I think probably well founded-that a large number of young people presently receiving unemployment benefits would like to have an extended opportunity to perform some sort of community work. I say `an extended opportunity' because the volunteer youth program has been operating at a very low level for some time. What the Government now proposes to do is, I suppose, an extension of that. Because of that I can also give an assurance that those who do undertake that sort of community work will not have their entitlement to unemployment benefits prejudiced. There are, of course, as Senator Tate suggested, some people who would like to make this sort of scheme compulsory. Foremost is the Leader of the Opposition, who asserted last year that it ought to be compulsory for everybody on the unemployment benefit to undertake full time tertiary training for three days a week. The catch is that if all those people undertook tertiary training in the cheapest per capita way, that is, at a technical and further education college, the cost would be a modest $600m. That was one of the savings options proposed last year by the Opposition Leader-I presume before he had time to think the matter through. I trust he is not still pushing that silly idea which he floated last year. I invite confirmation from the Opposition that he is not pushing that silly idea any more. There is no confirmation so I presume that he is still pushing it. I can conclude nothing else. That is an extreme example but if in any scheme of this type such a practice were compulsory there would be huge administrative costs and a requirement for a large number of additional public servants to enforce the scheme. Senator MacGIBBON —My question is addressed to the Minister representing the Treasurer and the Minister for Employment and Industrial Relations. I refer to the Treasurer's banana republic interview of 14 May in which he said that a growth outcome of less than 3 per cent would result in an increase in unemployment. In view of the fact that the Budget predicts total growth of 2 1/4 per cent in 1986-87, I ask: By how much does the Government expect unemployment to rise this year? How can that be reconciled with the fact that unemployment is at 8.3 per cent yet the Budget predicts an average unemployment rate of only 7.9 per cent? Senator WALSH —Firstly, I will give some clarification of the figure. The 2 1/4 per cent Budget forecast which Senator MacGibbon mentioned is for gross domestic product growth. Non-farm GDP is forecast to increase by 2 1/2 per cent. Non-farm GDP tends to be much more sensitive to employment and unemployment levels than the GDP in total. The more restricted non-farm GDP is more directly related to the labour market. The Treasurer's comment that any growth rate below 3 per cent would result in an increase in unemployment is based on the normal sorts of assumptions about the underlying demographic structure-that is, the net additions to the 15- to 65-year age group and therefore to the potential labour force-and on assumptions about productivity growth. It is generally accepted, as the Treasurer said, that any growth rate below 3 per cent will cause some increase in unemployment. Indeed, the Budget documents make it quite clear that the Government anticipates some increase in unemployment, although the unemployment rate is a function not only of the number of people in employment but also of the participation rate. That rate can swing to a quite significant extent. I cannot guarantee the figure, but I think it is correct to say it was forecast in the Budget Papers that the number of UB recipients will on average increase by 35,000 this year. That is the most precise estimate which the Government has made on that in the Budget Papers. It is necessary for internal numerical consistency to have a precise figure built into the estimates of UB recipients. However, that sort of change is not necessarily directly related to the unemployment rate which will finally occur. Senator AULICH —Can the Minister representing the Minister for Employment and Industrial Relations inform the Senate of the Government's attitude to claims by the Plumbers and Gasfitters Employees Union of Australia for a $60 per week over-award payment and a 36-hour week-in effect, a breach of the prices and incomes accord? Senator WALSH —The Government's attitude to that attempt by the plumbers and gasfitters, led by George Crawford, to break out of the accord is one of strong opposition. Mr Willis spoke on this matter before Parliament resumed, and it is very likely that he has spoken on it in the House of Representatives since we resumed. One way the Government will apply pressure to ensure that the plumbers and gasfitters campaign fails is through the guidelines which have long been established for the letting of government contracts. Potential contractors who break out of the accord or collaborate with unions that want to break out of the accord will be discriminated against when it comes to awarding government contracts. I understand also that most of the other unions involved in the building industry oppose the campaign by the plumbers and gasfitters. I note however that the Opposition is in coalition with George Crawford, because George Crawford has adopted the Opposition's wages policy-that is, to let collective bargaining and market forces determine wages. So the Opposition supports George Crawford's campaign for a $60 wage increase and a 36-hour week. Let that be very clearly understood. George Crawford and the plumbers and gasfitters are acting in complete conformity with the Opposition's wages policy, in total opposition to and non-conformity with the wages policy of this Government. If the wages policy of this Government does not prevail-that is, if the plumbers and gasfitters and George Crawford have any sort of significant victory-and the wages policy of the Opposition and George Crawford is then adopted by other unions the outcome for the country will be catastrophic. It is essential that the wages policy of the Federal Labor Government and the majority of Australian unions prevail and that the wages policy put forward jointly by the unholy coalition of the plumbers and gasfitters union and the Liberal and National parties be defeated. Senator KILGARIFF —I refer the Minister for Resources and Energy to the decision announced by the Treasurer last night to allow Queensland Mines Ltd to fulfil its contracts to sell uranium to France. Does this decision herald the start of a surge in Australian uranium sales which will see the Federal Government allowing Queensland Mines to develop its other leases, enabling the development of the Koongarra and Jabiluka deposits and facilitating the development of uranium deposits on Aboriginal land, where the Aboriginal owners have reached development agreements with mining companies? Senator GARETH EVANS —The Australian Labor Party policy on limiting to three the number of mines from which uranium can be produced and sold remains, I assure the honourable senator and everyone else, quite intact. Senator MAGUIRE —The Minister representing the Minister for Transport will be aware of the unprecedented world-wide surplus of shipping tonnage and widespread low-cost freight competition. How has Australian shipping been affected by these world-wide trends? What are the implications for Australian exporters of the current instability in the shipping market? Senator GIETZELT —The Senate would be aware that there have been great changes in the trade situations of most countries. That is reflected in the maritime industry. Some instability in attitudes has developed over the last year or so, and that has implications for Australia. Over recent years there has been an unprecedented level of surplus shipping tonnage on a world-wide basis. As a result there has been increasing low-cost competition. This has resulted in the collapse or restructuring of major transport or maritime companies. The Minister has informed me that there is no shortage of new shipping lines seeking to enter Australia's export trade on a commercial basis. Competition has never been as great. As a consequence most export freight rates from Australia have never been so low. In response to Senator Maguire's question, I understand that these developments have encouraged Australian exporters to have an increased regard for reliability and stability factors within the industry, which is a terribly important part of efficient shipping services to overseas markets. In effect, I am advised that there have been some positive factors in the maritime industry as a result of the changes that have taken place. Senator MACKLIN —I direct my question to the Minister for Education and refer to that part of Budget Paper No. 2 relating to the Department of Education and the participation and equity program, which the Minister has called the cornerstone of the Government's education policy. Can the Minister explain how in the last year the Government expended $277,000 on its programs in participation and equity, and $240,000 on publicity for its programs, a mere $37,000 less? In looking at the figure of $200,000 allocated for this year, instead of the $300,000 which ought to have been allocated, with a 30 per cent real increase in the national programs, how can this any longer be called the cornerstone of the Australian Labor Party's education policy? Senator RYAN —Senator Macklin's question indicates that he does not understand the administration of that program. The program is administered mainly by the two commissions, that is, the Schools Commission and the Tertiary Education Commission, through the Technical and Further Education Council. The bulk of the funds go out to programs which enable teachers to set up new curricula, new courses, of a kind that will attract young people who were previously not attracted to the formal education system to stay in the system. That is where the money goes. That is where the program is. As far as my Department is concerned, just a small amount of the overall program funds is withheld for purposes such as publicity and for other associated purposes such as, from memory, making videos to explain the nature of the program to educators, and things of that kind. In the past there have been a number of conferences also funded through that small vote. Senator Macklin really says nothing about the program when he concentrates on those two small items of expenditure from within the Department. If Senator Macklin or other honour- able senators are interested in the program as it works they should address themselves to those programs operated through the two commissions. They would then see a very large range of programs which are funded and which are proving successful in many ways. An obvious sign of their success is that participation rates in the upper secondary schooling in disadvantaged areas have increased quite dramatically since that program has been in place, and more especially last year. I invite Senator Macklin to get from the Schools Commission an area by area breakdown of the schools which have received PEP funds, and to note the increasing participation rates in those schools. It has undeniably been a success. It is so regarded by parents, teachers and school administrators, and of course, funds for that program in this Budget will flow out; they will not be cut or reduced in any fashion. Senator GIETZELT —Yesterday Senator Bjelke-Petersen asked me a question with respect to a proposed hotel-motel complex at the proposed new Brisbane Airport. I have been advised by the Minister for Aviation (Mr Peter Morris) that there are reasons why this information was not provided to me. Tenders calling for a hotel-motel development closed on 1 July 1986. Bids in respect of this complex are being examined currently in the normal way as part of the normal tendering process. As a result, of course, it is not proper that Ministers or the Government at this stage should make any comment in advance of a decision on any part of the tendering process. With major proposals of the kind contemplated by the Government, it is essential that an appropriate period be allowed for proper evaluation. I imagine that when that moment arrives a public statement will be made. The DEPUTY PRESIDENT —I inform the Senate that the President has received the following letter, dated 20 August, from Senator Chaney: Dear Mr President, Pursuant to Standing Order 64, I give notice that today I propose to move- `That, in the opinion of the Senate, the following is a matter of urgency: The need for the highest taxing government in Australia's history to abandon its destructive, anti-investment and anti-incentive fringe benefits and capital gains taxes.' Yours sincerely, (FRED CHANEY) Senator for the State of Western Australia Is the proposal supported? More than the number of senators required by the Standing Orders having risen in their places- Senator CHANEY(Western Australia-Leader of the Opposition)(3.07) —I move: That, in the opinion of the Senate, the following is a matter of urgency: The need for the highest taxing government in Australia's history to abandon its destructive, anti-investment and anti-incentive fringe benefits and capital gains taxes. The Opposition brings forward this matter of urgency because it clearly is a matter of serious concern to all Australians that we should resume the path of economic growth and recovery. That was what we might have expected this week to be devoted to, with the Budget being brought down last night, but of course those expectations have been rather settled by what the Government has produced. We have here the highest taxing government in Australia's history. For the third year in a row it has put in its own Budget Papers that it is taking more than a quarter of the gross domestic product. Of everything produced in Australia, a quarter is taken in taxes by this Federal Government and, at a time when we are in an economic crisis which the Prime Minister (Mr Hawke) has described as something akin to war, we find that the Government's policy seems to be to tax us out of our difficulties. What is the economic context in which we are operating? If I may refer to the Government's own predictions as put forward in the Budget last night, we are told that we will have diminishing living standards. The Government tells us on page 9 of the Budget that we will have to restrain real household disposable incomes, consistent with the need for our living standards to be trimmed. We find that the Government is saying that there will be reduced private sector investment. We find that that investment will be reduced in terms of business fixed capital investment, with even larger declines in the investment in housing in this financial year. We find the Government telling us we live in a country which will suffer increasing unemployment this year, confirmed by the Minister for Finance (Senator Walsh) in Question Time today, and we find that we have a Budget in which the Government is predicting a continuation of the dreadful balance of payments situation we have suffered over this last year. I suppose one of the hopes that might have emerged is that we would move into a lower interest rate environment. If we accept the Government's estimate that our balance of payments situation will be very difficult, that we are likely to have a deficit of something in the order of 6 per cent again in this current financial year-a figure that Senator Walsh, who is at the table, scoffed at earlier this year-then it is unlikely that there will be a softening of interest rates. We bring this matter forward because we believe that the high level of taxation is an important factor in contributing to the difficulties we face. Later this week we will be debating the Budget, a document which I think we all agree is failing to produce the sort of turnaround in Australia's economic fortunes that all Australians want. For today we concentrate our attention on the taxation system and in particular on the Government's brilliant introduction of a capital gains tax and a fringe benefits tax as part of the cause for the economic malaise which is afflicting Australia and which on the Government's own prediction will continue to afflict Australia over the next 12 months. It is the position of the Opposition that there is no single solution to Australia's economic problems. It is certainly not a set of problems that can be solved just by a Budget. It is not a set of problems that can be solved by simply targeting in on one area of government activity. There are key areas which this Government must tackle, which any government of Australia today would have to tackle if it wanted to put us back on the path of growth and into a situation where Australians could expect rising instead of falling standards of living. Those key areas that must be tackled are the labour market, and this the Government has lamentably failed to do; the cost burdens which make Australia's industry uncompetitive, and this it has lamentably failed to do; the issues of excessive regulation, and that it has lamentably failed to do; and of course the taxation burden which is frightening off investment in this country. Our fundamental complaint about the Government's approach to taxation is that it has destroyed incentive and, in particular, the incentive to invest. It is far too complex. It has introduced new cost burdens on business, quite apart from the cost of the taxes themselves. We believe that the Government's approach to taxation has been unfair because it has, for example, imposed tax burdens not on those who receive benefit but on those who pay the benefits. We say most clearly that the overall approach to taxation that the Government has introduced is against the new investment which is absolutely vital if Australia is to have a growing economy which can compete with the rest of the world. That is the context of this debate. We are now in a situation in which in the last 24 hours the Government has announced further tax increases amounting to more than $1.4 billion at a time when, indeed, the whole community is crying out for tax relief and tax reduction and not tax increase. We would have hoped that by now the Government would have taken some notice of the very wide demands which have been made for relief from the particular taxes specified in this motion of urgency. It is not a narrow Opposition view that these taxes are counterproductive; it is the view of a very substantial part of the Australian community and many of the people who normally are not our political allies. We raised these matters-in particular we raised the issue of the fringe benefits tax-with the Minister for Finance in the Senate at Question Time yesterday. Senator Walsh will be speaking later in this debate. It was interesting to see the contemptuous way in which he responded to the question asked by Senator Messner about the fringe benefits tax. Senator Messner asked him about the attitude of Premier Unsworth, Premier Burke and Mr Ron Edwards, MP. Of course, the Minister for Finance made it quite clear that he would simply abuse those people for putting the views they did rather than responding to those views and giving them the sort of consideration that those people might have thought that they were entitled to. It is interesting to see that the barbs of the Minister for Finance have been so blunted by the fact that he directs them just as much towards his Labor colleagues, particularly his State Labor colleagues, as he does towards those who have the misfortune to sit opposite him in this place. The view that these taxes should be moved out as quickly as possible goes well beyond the Opposition which has pledged to repeal these taxes. Let me remind the Senate of all the people who have made a very public demonstration of their opposition to these government taxes. The very great regret that we have as an opposition is that some of them were not more public at the time when the decisions were being made and at the time when we were opposing these taxes in the Senate. That might have influenced the Australian Democrats, who are, of course, the cause of these taxes being able to be put in place because they voted for them. It might have helped the Democrats to make up their minds in a more sensible way if the Labor Premiers, who are now so vocal in their opposition to this tax, had been as vocal at the time when the legislation was before the Senate. Nevertheless, I welcome the conversion of the many people who have come out against this tax recently. On this occasion I even welcome the support of Premier Burke of Western Australia, who asked the Government to rethink the perks tax in late July of this year. Indeed, he even had Sir Arvi Parbo as his guest speaker to point out just what an inane tax this was and what an impact this was having on the productive industries in this country. It was under the chairmanship of Mr Burke that Sir Arvi Parbo pointed out in Perth that under the Government's tax proposal single men's rooms in remote housing areas are taxed as though they were houses and that even the cost of transferring employees from one location to another is considered a fringe benefit. Therefore, we have a situation in which if an employer wants to transfer an employee from one place to another that will be seen as a fringe benefit on which the employer would have to pay tax. We then, of course, had the comments of Mr Unsworth, who was not at all short of criticisms of the fringe benefits tax after he had been brought to face reality by his electoral misfortune in New South Wales. He said that what has come out of the fringe benefits proposal is an administrative nightmare. The Labor Opposition Leader in Queensland, not a man whom one would find reported in the national Press very often, was reported in the national Press on this issue. Again he used the expression that this tax is an administrative nightmare and that the Government should be doing something about it. His comment about the Government's proposal was: . . . reads as if some bureaucrat down there-- of course, that is here in Canberra-- has gone mad. We also find that rather more moderate Labor voice, the Labor Premier in South Australia, Mr Bannon, severely criticising this tax and saying that he has doubts about it in regard to its administrative requirements and saying that he believes that it needs change. Most recently, we find that the Government's own back bench, led by a man who does not normally leap to national prominence, Mr Ron Edwards, a Western Australian back bencher, apparently getting great support in the ALP Caucus when he called on the Government to make urgent changes to the application of the tax. The figures involved in opposition to the tax come from well beyond political circles. However, I make the point that very substantial figures in the Labor movement have recognised that the prejudices and, indeed, the elements of cowardice which led the Government to introduce the fringe benefits tax in the form it did ought to be put aside and that the Government should repeal the fringe benefits tax and let business get on with the job of doing business instead of filling in forms. The Opposition's opposition to this fringe benefits tax has been quite straightforward. We believe that the tax is unfair. We believe that it is an administrative nightmare. Of course, the Minister for Finance, who sits opposite, who often has to field questions on this issue, is fond of talking about the rorts. He is fond of talking about those people with high salary packages who are able to get benefits in the form of fringe benefits and not pay tax on them. I say very simply to the Minister that those people in that position can very easily be assessed for taxation by the Commissioner of Taxation. Simple procedures are available to deal with that. The reality is that the fringe benefits tax is impacting not on just a narrow band of people who are able to get very high incomes at reduced tax but on a wide range of business and on a wide range of the productive enterprises of Australia which should be encouraged by this Government, instead of being discouraged. The Government sent out a 56-page booklet on how business people would have to account for the fringe benefits tax. I do not have the time in this debate to go through all the ridiculous detail that people are called on to provide. However, let me say that the Government has moved to a point where people who are using cars as part of their business are required to record so many details that of course many will find it impossible to get their employees to comply. We find that each day it is required that the person who is using such a car keep a record of the date of the journey, the odometer reading at the beginning and the end of the journey, the number of kilometres travelled, the purpose of the journey, the name of the person driving the car, the date the entry was made and the name of the person making the entry. We are told that it has to be in English and signed by the person making the entry. I do not know whether that is a discrimination against people who do not speak English but it is certainly a discrimination against all those people trying to carry on business in Australia and whom the Government is exhorting to be competitive and to get out and compete with the rest of the world. It throws administrative nightmares-I use the word which has been used by Labor leaders-in the road of people who are seeking to get out there to compete, to invest and to make Australia a growth country again instead of a country in decline as it has become under this Government. I would like to touch on some of the recent indications of the impact of this tax on people who are trying to carry on business, often under very great difficulty. For example, we find that the car industry is now confirming the predictions that people in that industry made late last year and earlier this year about the damaging impact that this tax would have on car manufacturers in Australia. We find that the Federal Chamber of Automotive Industries in its latest statement is telling us that, whilst it believes the real impact of the fringe benefits tax will not occur until the last quarter of 1986, already it has caused a 13 per cent drop in fleet sales. I have made the point in this place before, and I make it again, that that decline is on top of a whole series of other declines which are doing enormous damage to the automotive industry. What this Government is doing is wilfully adding a new tax burden which is exacerbating the difficulties of that industry. It will cost jobs in the union of the acting Government Whip. It will cost jobs in at least three States of the Commonwealth. We find that the National Roads and Motorists Association has done a survey which estimates that the tax has added $100 a week to the cost of a company car. The whole range-hundreds of thousands-of businesses which provide company cars is subjected to new tax burdens which have nothing to do with the profitability of those enterprises. When the Agnew nickel mine in Western Australia had to suspend operations in the very difficult trading conditions that it has, it made it quite explicit that it was the fringe benefits tax and other taxes, together with escalating direct and indirect labour costs, which have been significant factors in the decision to suspend operations. The long established mining company in Australia, Mount Isa Mines, described the fringe benefits tax as the last straw. A senior executive of that company was reported as saying that 80 per cent of the company's fringe benefits are paid to blue collar unionists but that they would attract an extra $5m in taxes. He said that that was the last straw that broke the camel's back-a fringe benefits tax which is being dishonestly marketed by the Federal Government as a device to stop rorts. There is a whole range of people who are being affected in this way. We have the mining companies which are operating in a highly competitive world market. We find that other organisations, such as the National Trust of Australia, educational organisations, the Red Cross Society and so on, are being subjected to a new tax which the Minister opposite and the Labor Party proponents of this tax keep describing as a tax to prevent rorts. In reality it is providing a new burden on productive enterprise and even a new burden on non-profit organisations that are providing services to the Australian community. We find that State and local governments are having to pay huge amounts in additional taxes. It is estimated that they will have to shell out an additional $55m, and that highlights the absurdity of this tax because other taxes will have to be raised to pay this additional tax to the Commonwealth. We are calling for repeal of this tax because we believe that that would be an important element in restoring confidence in the investment community and doing something about the Government's disastrous investment situation. The Government's prediction is that investment is falling, and it is quite clear that many businesses are being affected by both the fringe benefits tax and the capital gains tax. Our request to the Government is made with the strong support of the bulk of the Australian people. The majority of the Australian people have stopped regarding this fringe benefits tax as something which is going to stop rorts. They have now come to see that this is a tax which will impose important and heavy new burdens on businesses around Australia, that it is the ordinary men and women of Australia, in particular those who work in the more remote areas of Australia, who are going to suffer the damage from the new tax. In addition, there are the extraordinary costs which are being incurred. The Government proudly announced that it is going to reduce the number of public servants by 2,000. In fact, the number of public servants next year is predicted to be higher than the number last year, but the estimate for extra staff required for the administration of this tax alone is 590. That alone is a good reason for reconsidering this new tax and its absurd complexity. It is imposing heavy administrative costs, not merely on businesses in a direct sense but on the Government and hence on every Australian taxpayer. We have a situation where, in the national interest, we believe it is centrally important that the Government should recast its taxation policies. We in the Opposition believed that there was some prospect that last night in the Budget we would see that occurring. In fact, instead of that, we have seen new tax burdens and we have seen, therefore, a worsening of the anti-investment elements of the environment in Australia today. In relation to this we have had a very confusing couple of weeks. In the last couple of weeks both the Prime Minister and the Treasurer have hinted at possible change; then they have denied it, and then they have not seemed to know what the other was saying. We had the spectacle of Senator Cook, who generally comes in and takes part in these debates-we are going to miss him today because he usually contributes to the Opposition's cause in a very effective way-calling a Perth news conference to assure the world that there would be no change. Just what he was seeking to achieve by that I am not sure. We ask the question: What is the Government going to do? It is quite clear that this tax is having a negative effect on an economy which is in decline. It is quite clear that if we are to get economic recovery we have to have a situation where business is encouraged, and where it is encouraged to enter into new investment. We believe that the capital gains tax discourages new investment; we believe that the fringe benefits tax discourages all forms of business activity. We believe that if the Government has the interests of Australia at heart it will get rid of these taxes and not leave the matter until it is defeated in an ignominious way at the end of next year and it is left to the present Opposition to do the job for it. Senator WALSH(Western Australia-Minister for Finance)(3.25) —Fairness demands that employees who are paid solely in cash-as most Australians are-should not be asked to pay more tax and thus effectively subsidise those whose income is obtained partly in cash and partly in the form of valuable benefits of other kinds. That is a quotation not from Bob Hawke, not from Paul Keating, not from me; it is a quotation from John Howard in a Press statement that was issued on 11 July 1980. It bears repeating. It is from John Howard, the present Leader of the Opposition: Fairness demands that employees who are paid solely in cash-as most Australians are-should not be asked to pay more tax, and thus effectively subsidise, those whose income is obtained partly in cash and partly in the form of valuable benefits of other kinds . . . (Quorum formed) I can see that the members of the Liberal Party of Australia do not like having their Leader's words quoted back at them-their Leader putting the case against allowing massive tax evasion and avoidance through the practice of taking income in kind instead of income in cash and evading taxation in the process. He knew that it should have been stopped in 1980, but he failed to stop it, as he failed to do everything else when he was Treasurer. It has been left to this Government to get on and do all the jobs, all the necessary things which John Howard ignominiously failed to do in the five years when he was Treasurer. We seem to have heard from Senator Chaney this hypothesis that the present parlous condition of the Australian economy is caused by the very recent application of a fringe benefits tax and a capital gains tax. If one had to put a name to that, I suppose one would have to call it the theory of retrospective causation. Indeed, it is the absence of taxes such as these which has made a significant contribution to the Australian economy being in the parlous condition that it is. I refer specifically to Senator Chaney's point about motor vehicles. It was asserted by an industry lobby-an assertion repeated mindlessly by the Opposition-that because of new measures in regard to the provision of motor vehicles to employees, which had been a major area of tax avoidance or evasion in the fringe benefits area, there would be a massive decline in the sales of motor vehicles to employers. If that were true, it proves that because of the existence of a tax haven, a tax avoidance mechanism by way of fringe benefits through a free company car, excessive investment was being poured into the purchase of motor vehicles for which there was no underlying economic justification. That is, the existence of a tax shelter was attracting capital, which ought to have been invested in productive areas, into a non-productive tax haven, a tax avoidance area, when there was no functional need whatsoever for that investment to have taken place. The Opposition cannot have it both ways. Indeed, far from taxes of this type having caused the structural problems of the Australian economy, the absence of taxes of this type is one of the causes of the structural problems that we presently face. The fact is that for the last six years Australia has been recording a current account deficit of between 4 and 6 per cent of gross domestic product. The highest current deficit ever recorded was in 1981-82, when John Howard was Treasurer. The major cause of that deficit being as large as it was was the so-called resources boom which had been talked up for cynical political reasons in 1980-a boom which never happened. We as a nation, however, are saddled with the interest costs of that free and easy period of foreign borrowing by governments, State governments in particular, for the resources boom which never happened. That situation has continued for some time. When this Government came to office it set about implementing in the Australian economy the structural changes which are essential if our current account problem is in the long term to be overcome-and Australia has had periodic current account crises. The only way it can be overcome is by restructuring the Australian economy, something that could not have been done overnight. This Government had started that process and it was proceeding. Indeed, one of the more thoughtful economic journalists, David Clarke, wrote that the Government had set in place the mechanisms which were required to turn the economy around and then it was hit with the collapse of the terms of trade. The Opposition, of course, likes to dismiss the horrendous implications of that terms of trade shift. But let me just say that in 1985-86, over the previous year, our terms of trade declined by 10 per cent. It is expected that there will be a further decline of 8 per cent in this financial year. No country can take a terms of trade decline of that magnitude without its having some pretty horrible implications. So that decline has caused particular difficulties. The country does have an economic crisis, and what is the Opposition's answer to it? To bring back the free boozy lunch. That is the best proposition which the Opposition can put up to overcome a potentially hazardous current account situation accumulated over many years and compounded by a huge adverse movement in the terms of trade. The Opposition says that the way to fix up this situation is to bring back the free lunch and to reinstitute a taxation system which encourages the misdirection of capital investment into areas for which there is no functional need and no economic justification-to encourage investment in tax shelters by way of the provision of excessive motor vehicles, among other things. The fact is that Australian industry, Australian capitalism, Australian business-call it whatever you like-has before it the greatest opportunity it has had probably for 50 years, if not ever. Our real unit labour costs expressed in Australian dollars are at the lowest level they have been since the 1960s. The level of industrial disputes is lower than it has been since the 1960s. We have an effective wages policy which has reduced award earnings, award rates, in real terms by 5 per cent over a 3 1/2-year period at a time when the economy was enjoying a high and sustained rate of economic growth. There is no precedent in Australian economic history for that outcome. Finally, because of the very large devaluation of the dollar-around 40 per cent when measured against the trade weighted index-something caused principally by the terms of trade decline, Australian exporting and import competing industries are massively competitive by international standards. Some of them will take up the challenge. Others will sit around on their arses and whinge about having to pay a fringe benefits tax-something that they should have had to pay long ago. The substance of an editorial which appeared in the Australian Financial Review on 12 August concerned the fact that New Zealand had turned around its traditional trade deficit with Australia and indeed now had a trade surplus. The editorial concluded with this paragraph: Fringe benefits taxes are now well established in New Zealand. While Australian business people whinge, New Zealanders are getting on with business and taking their markets. That is an admonition which the responsible section of the Australian business community ought to take to its bosom. Instead of getting on and doing the job they are supposed to do in the most competitive environment that they have ever had, with the most successful wages policy, the most successful industrial relations policy and the lowest real unit labour costs ever, expressed in Australian dollars, and instead of getting on and doing the job as their counterparts in New Zealand have done, the Australian business community sits around and whinges about a fringe benefits tax with the encouragement of the economic saboteurs in the Opposition. In New Zealand a fringe benefits tax was introduced in April 1985 at a rate of 45c, since increased to 48c. It is a model for the Australian legislation. The same sorts of complaints came from some sections of the New Zealand Establishment about it-that it would not work and so on-all of which have been disproved. Let us look back and remember the provisional payment system introduced on 1 September 1983. It was said then by the same sorts of people and, in many cases, precisely the same individuals-many of whom are members of the Opposition-that that tax was administratively impossible, that it could not be introduced and that it had to be postponed. Last, it was said that it would cause catastrophic economic damage. The tax came in and none of those things happened. Why were those people mounting that campaign? It was because they were habitual tax evaders. They were into the black economy. They were not worried about the administration of the tax. They were not worried about economic damage. They were habitual tax evaders who wanted to continue to be habitual tax evaders, and this Government stopped them. When the Fraser Government very belatedly did something about the decay of the income tax base and introduced its bottom of the harbour tax legislation exactly the same complaints were made. It was said that business could not pay this liability, that thousands of businesses would become bankrupt and that hundreds of thousands of workers would lose their jobs as businesses became bankrupt. From April 1983 the money began to come in, ironically at the very point that economic growth turned sharply upwards. Those false campaigns have been waged in the past by people who had a vested interest in deceiving the public and continuing to cheat it. The same sorts of people are doing it today. Senator Messner —Do you think Premier Burke is saying those things? Senator WALSH —I said yesterday that I will be telling Premier Burke, when we are both in Western Australia together, what I think about his comments on the subject. There is a common thread behind what the Opposition is doing; it is not doing it just in this area. The Opposition is trying to sabotage the Australian economy. We saw an overt example of it when a Western Australian Liberal member of the Legislative Assembly, Mr Lightfoot, wrote to George Shultz and said: `Please keep subsidising the sales of wheat and sugar so that the prices received by Australian farmers will be lower than they would otherwise be. Please keep paying for the Afghan war. Subsidise sales of wheat and sugar in order that Australian farmers and the Australian nation will receive lower prices'. He wrote to George Shultz and begged him to do it. Mr Lightfoot is crasser than most Liberals. He allowed the letter to get out because it was probably a popular thing to say in Leonora. The others are not so crass, but essentially they are doing the same thing. They are sabotaging the economy. Instead of telling business that it has the greatest opportunity it has ever had, they collaborate with a section of the business community in an orgy of self-indulgent self-pity because they are no longer going to be able to avoid and evade paying the taxes which they always should have paid, as Mr Howard said many years ago. They collaborate with George Crawford in a wages policy. They have a wages policy in common with George Crawford and are collaborating with him in an attempt to wreck the prices and income accord, which has-and it is worth repeating-given Australia the lowest real unit labour costs expressed in Australian dollars that it has had since the 1960s, the lowest level of industrial disputes since the 1960s, the highest sustained rate of economic growth since the 1950s, a wages policy which has delivered declines in real award wages through that period of high growth and finally, because of the devaluation of the dollar, the most internationally competitive industry Australia has ever seen. What does the Opposition say? Instead of saying to business `Go and make the most of your opportunities; show some of the entrepreneurial flair that you are always talking about, that you admire in the abstract but rarely put into practice, show that entrepreneurial flair which you believe you have and go and get on with your job', the Opposition encourages business to indulge itself in an orgy of self-pity because it will no longer be able to avoid paying taxes. Almost a year ago this taxation package-I stress the word `package'-was considered by the Opposition's front bench. A document that Senator Messner prepared was thoughtfully leaked that very night and appeared on television. That document said that if they picked up the goodies such as the ending of the double taxation of dividends and the lowering of marginal tax rates and rejected what it called the nasties in the package-such as getting rid of the free boozy business lunch, and imposing a fringe benefits tax and a capital gains tax-they would be seen as humbugs and hypocrites. That is exactly what the Opposition is doing and humbugs and hypocrites are exactly what its members are. Finally I turn to the matter of administration. I said this yesterday and I repeat it: If anybody can propose a more efficient system of administration than the one which the Government has proposed, of course the Government is prepared to listen. Any sensible government or sensible group of people would be. However, a pack of lies is being told about the administration of this tax, even by implication. Senator Chaney talked about a log book. Nobody has to keep a log book. People have a choice between applying a statutory formula or keeping a log book. But the Opposition is conducting a deliberate campaign of misinformation. It wants the public to believe that this tax is administratively impossible just as it said the provisional payments system was administratively impossible. I do not have time to go through all the details but I have a transcript of the Carleton-Walsh Report of 12 August. It is an interview with Max Walsh and Peter Cleeland, the member for McEwen, and I believe it is the most lucid account of the administration of the fringe benefits tax I have seen. In particular it deals with the furphy, the lie, that it is impossible for employers to administer such a tax. In New Zealand employers are paying the tax quarterly, just as employers in Australia will be obliged to do. Employers in New Zealand have stopped whingeing about it and have got on with doing the job. In Australia employers, encouraged by the Opposition, have declined to do that. I seek leave to incorporate in Hansard a section of the transcript of the interview between Max Walsh and Peter Cleeland. Leave granted. The transcript read as follows- Max Walsh: Peter Cleeland, if I could come first to the last point that Robert Oser made there, because it's the point which so many of the critics of the FBT make, is that they don't object to the actual tax perhaps, but they do object to the principal that it is paid by employers, not the employees, the recipients of the particular privileges. How does the Labor Party handle that sort of criticism? Peter Cleeland: Well don't forget, Max, that since about 1942, Section 26 (e) of the Income Tax Assessment Act has provided that all fringe benefits are taxable. Now of course the reality is that employers have never complied with that Section, so the cost of taxing that particular fringe benefits has always been there but it's just never been taxed. So things haven't changed. Max Walsh: It was never, am I right, it was never the responsibility of the employer, it was the responsibility of the employee to pay the tax on those fringe benefits? Peter Cleeland: But then the employer was obliged under tax law, to value the benefit and make provision on the Group Certificate, of the benefit paid to the employee, so in fact the Taxation Department could tax it. That was never done. Max Walsh: Why wasn't it done? Peter Cleeland: Well it became a tax rort in the eighties, of the seventies into the eighties, and it became a standardised package that why bother paying tax when the High Court of Australia under Sir Garfield Barwick seemed to let anything go through at all. I mean it became an entrenched system in the employment package area. Max Walsh: Do you think it might have been worthwhile Labor challenging that with its new High Court, rather than going into what is this 400 page Act? Peter Cleeland: Well it would have been even more costly for the employer because under the Section 26 (e) provision, someone has to value each benefit paid to each employee and then on each individual Group Certificate, make a valuation. Now that would have been twice as costly as a single rate of tax across all benefits. It's a much simpler administrative process. Max Walsh: Well if I could pick up the points that I hope Mr Oser made point by point. First of all he spoke about the paper burden. He's described it as a nightmare of paper and calculations. Well, as a tax lawyer, do you agree with that or not? Peter Cleeland: Well I'm a bit surprised at Mr Oser's statements that companies don't keep detailed records of the cost of their employment. I find that a very strange statement for an accountant to make. How in the dickens can a company properly claim tax deductibility for those expenses of company employment if they're not keeping accurate records. I can't see any additional costs for those record keeping as already exists. Max Walsh: You mean even the filling out of log books, it's a fairly complex sort of thing, particularly with the most, perhaps the most sensitive area, that of motor vehicle usage? Peter Cleeland: Well that's the employee's responsibility, not the employer's. So the employer can't complain in terms of administration costs, what the employee has to do to get the tax deduction. Max Walsh: So your contention is there is little or no additional administrative costs for most businesses? Peter Cleeland: That's right. Max Walsh: There would be for a lot of businesses such as those nominated by Mr Oser, say charities which up to now have had no tax responsibility whatsoever. Peter Cleeland: Well don't forget that benevolent institutions have been exempted from the fringe benefit tax. Now the government doesn't believe any purely charitable organisation can be subject to FBT. Max Walsh: The particular case he quoted, if a charity takes somebody out to a dinner, entertainment, that they have to pay tax on that part of the food consumed by their own employees. Peter Cleeland: Well why should a charitable institution who's providing a benefit like any other company structure, be exempt specifically when the private sector isn't? Max Walsh: The other areas of course which Mr Oser didn't cover, which hitherto haven't paid tax, are of course State Government authorities and their own, the public sector of the Australian Public Service and the statutory authorities. I mean today we saw Qantas making a provision I think of $16 million. They are really taking on new administrative costs, aren't they? Peter Cleeland: Well if they don't know already which of their employees are taking a subsidised flight on a Qantas aeroplane, then I suggest their records are inefficient already. They should know which employee already is taking a subsidised flight so I can't see again where there is any additional record keeping required. Max Walsh: If I could turn to the other area which Mr Oser nominated as one of the anomalies, that is the difficult and specific area of housing and he referred particularly to the mining industry and the accommodation industry, where people live on their place of work. He felt that this should be given special treatment. Do you feel there is any case for this? Peter Cleeland: Well let's keep in mind first that the former failed Treasurer, now Leader of the Opposition, tried very hard to do exactly what the government is now doing, but failed. Now this government is not like the former Treasurer. We are not going to fail on this issue and in fact it will continue. Now the second point about that is that there is very concessional tax. There is a specific remote area provision for those areas and the rate of tax applicable would be very minimal indeed. Max Walsh: And Mr Cleeland, he also spoke of the area of Australian consultants working abroad, people earning export income from Australia who will now find themselves subject to quite large amounts of fringe benefits tax, competing with people from other countries, other consultants, who aren't subject to this. Are you at all concerned about this? Peter Cleeland: Well, I'm not quite sure what he's talking about there frankly, Max, because don't forget the way the fringe benefit tax works is that if it is not a deductible benefit in the hands of the employee, then it is a taxable fringe benefit tax. Now in many of those cases an employee who's receiving some specific payment because of the employment aspect, it is deductible, hence it wouldn't be caught by the fringe benefit tax. I think it needs a bit further clarification, exactly what Mr Oser is talking about there. Max Walsh: Well, having some knowledge of the complaints from this particular area, I could nominate the idea of a consultant working abroad, where he has to pay large amounts for accommodation and in particular areas, run the sort of household which he wouldn't run in Australia, with servants and other things. And the suggestion is that the Australian consultants, if they have to pay tax on this, will not be anywhere near as competitive as they are with consultants from say Canada or the United States. Peter Cleeland: Well I'm not sure why an Australian citizen living overseas requires servants when he hasn't got servants in Australia to perform his function. If in fact you receive those lovely benefits, I see no reason why you shouldn't be taxed. It's part of his overall remuneration. Max Walsh: Well the consultants would say that if you are going to do this, is you simply won't have them operating from Australia, consultants, they'll operate, and earning export income for Australia, they'll operate the Canadian or United States consultants. Peter Cleeland: I'm not quite sure if the only way Australian industry can work is by having an incentive by way of benefit to make people work, then this country is in a terrible terrible state. Max Walsh: Well if I could now personalise this. Your seat is the seat of McEwen. What's the sort of swing that would unseat Peter Cleeland? Peter Cleeland: Well the official margin at the moment is 2.1 percent. Max Walsh: And are you happy to see this fringe benefits tax come in? Do you think that it places your particular seat at risk? Peter Cleeland: No I don't. You've got to remember that there's less than 10 percent of Australians are in fact receiving income in the form of benefits. And 90 percent have been paying additional rates of tax because of this particular situation. Now I'll be happy next year when a man on $30,000 a year is going to get $25 net in his pocket. He'll be that much better off and I think they're the people who understand what the fringe benefit tax is all about. Max Walsh: Peter Cleeland, thanks very much for coming in. Senator WALSH —Finally I want to expand on a point I made earlier. A taxation reform package has been introduced by this Government. If what Senator Messner once chose to call the nasties are knocked off it becomes impossible to deliver the goodies-that is, the cuts in marginal tax rates and the end of the double taxation of company dividends-in an economically responsible Budget. It is also impossible to deliver those goodies if the things which the Opposition is selectively opposing are successfully opposed. Of course the Government will ensure that that opposition is not successful. Senator SIDDONS(Victoria)(3.45) —The Leader of the Opposition, Senator Chaney, who led this debate for the Opposition started his speech with some very pertinent comments about the current Budget. He said that the Budget gave no encouragement to growth and recovery. The Australian Democrats would agree with that. He said that there is no encouragement to private sector investment in this Budget. The Democrats agree with that. He said that unemployment will rise. It certainly will; there is no argument about that. He said that this Budget does nothing to solve the balance of payments problems and that undoubtedly interest rates will rise. All of these points made by Senator Chaney are absolutely relevant; they are points with which the Democrats agree absolutely. It is the solutions that the Opposition has for these problems and the alternatives that it is offering to the Australian people-alternatives to the measures in the current Budget-with which we disagree. Senator Chaney listed four points. He said that the labour market has to be deregulated. The Opposition has not shown how it would go about deregulating the labour market without enormous industrial confrontation. It has not come up with any solution that seems at all viable to the Democrats. The Opposition has said that it will attack costs, but it has not told us where it will cut costs. The Opposition has said that there is excessive regulation in the community at the moment, and we agree with that. Finally, Senator Chaney got to the point of the debate today-that taxation is too high. It certainly is. However, where will the revenue come from if not from the taxation measures set out in the current Budget? There have to be alternative methods of raising revenue and those alternatives have not been spelt out by the Opposition. Senator Chaney turned to the Democrats and made a cheap political point. He said: `If only the Democrats had joined with the Opposition to block the whole tax package we would not have this problem of high taxation'. I am getting sick and tired of simple political point scoring by the Opposition. Let us look at the facts. Last year we were confronted with a tax package at a time when the Government's stocks were the highest of those of any government ever in this country. We had two alternatives. First, we could do what the Opposition did and implored us to do-that is, stand flat footed, say that we would oppose the whole tax package and that there was nothing good in it at all and just block it. If we had done that there is no doubt that the Government would have gone to the people on that tax issue. The Government promised $4 billion worth of tax cuts to the Australian people and it is sticking by that promise. Senator Messner —We are not paying for it out of this. Senator SIDDONS —This was the position last year and if the Democrats had joined with the Opposition we would undoubtedly have faced a double dissolution probably early this year and the Government would have had every prospect of gaining control of both houses of Parliament. Flat-footed opposition to the tax package was not the responsible political course to follow last year. We confronted the Government, debated the whole tax package with it and listened to the literally thousands of representations we had from individuals and groups in the community to see whether we could get the worst aspects of the tax package changed so that it would not impact too heavily on any groups of people. Senator Messner —You didn't do much of a job. Senator SIDDONS —Senator Messner says that we did not do a very good job. Let me turn to what the Democrats did. I will not say what we did; I will quote what other people have said we did. The fringe benefits tax has been referred to today, and I quote a letter I received from the Federal Chamber of Automotive Industries. In case not all honourable senators are aware, this body represents the manufacturers of Ford, Holden, Toyota and Mitsubishi cars. It is a very important body. On 4 July 1986, the Federal Chamber of Automotive Industries, in a letter to me signed by the President, W. L. Dix, stated: Dear Senator, The purpose of this letter is to document the Automotive Industry's appreciation of the support it received from the Democrats in negotiations concerning the fringe benefits tax legislation. We appreciate recognition by the Democrats of the significance of the fringe benefits tax on the vehicle industry and your cooperation in establishing a basis which generated a revised vehicle fringe benefits tax scale, which we estimate will result in a full year tax reduction in the order of $200 million or about 25%, compared with collections which would have been derived by utilisation of the original Government formula. I repeat that: $200m. Senator Messner says that that is a small concession we wrung from the Government. It is not small as far as the manufacturers of motor cars in this country are concerned. The letter went on to state that at least 20,000 jobs would have been saved in the automotive industry as a result of the initiative on the fringe benefits tax. One of the most important concessions we gained did not concern the fringe benefits tax or the capital gains tax; it concerned the quarantining of farm losses. When we started to negotiate with the Government it was strongly of the view that the quarantining of farm losses should continue. It made a concession and, finally, as a result of continued pressure by the Democrats, it abandoned the whole notion of quarantining of farm losses. Was that an insignificant concession? The Democrats think it certainly was not. The only contribution by the Opposition was to say: `We will oppose the tax. Let us not try to precipitate a double dissolution at a time when the Government would have no trouble in gaining control of both Houses of the Parliament'. I now refer to the capital gains tax. The Opposition is prepared to say: `We want no capital gains tax'. It wants Australia to be the only country in the Western world that has no capital gains tax. It wants the tax rorts to continue whereby profits are converted into capital gains, no tax is paid, and there is an uneven distribution between income earned through capital gains and income earned through personal exertion. There is, of course, an absolute necessity for any Western country to have a capital gains tax. The United States is in the process of modifying its capital gains tax. It is doing precisely what the Democrats succeeded in getting the Government to agree to in our negotiations. The United States will impose a capital gains tax at the marginal rate of tax and it will be indexed for inflation. So there will be absolutely no difference between income gained by personal exertion and income gained as a result of capital gain. It matters not where the income is derived from. That is the modern approach to capital gains. That is a much milder form of capital gains tax than the flat capital gains tax which was originally imposed in the United States. At least we are now in the forefront, with a gains tax which is even-handed in regard to both forms of income. We succeeded in gaining other considerable concessions. There is to be no retrospectivity element in the capital gains tax. The tax is to be indexed for inflation, as I have said. Capital losses are to be offset against capital gains. The family home is to be exempt from the capital gains tax. There is to be no death duty element in the capital gains tax. In particular, the goodwill element in small businesses is recognised, and there is to be a 20 per cent reduction in the tax to take account of goodwill. Employee share ownership schemes were being unfairly treated, and that was modified. The capital gains tax is to be averaged over five years, and that was an important concession. We succeeded in gaining the Government's agreement to no fewer than eight out of the 10 or 12 concessions for which we asked. We now have a capital gains tax which is mild and fair and which does not impact unfairly on various sectors of the community. I now turn to the fundamental matter in this debate. We agree that taxes are too high. We agree that the fringe benefits tax is very complex. Had the Opposition joined with us and negotiated with the Government, I am sure that we could have achieved a fringe benefits tax which was much less complicated. Instead, the Opposition would not even consider discussing the matter with the Government. It opposed the tax outright. At least we have succeeded in getting considerable concessions in both those areas. The Democrats' fundamental criticism of the Opposition is this: It is pretty good on rhetoric, but it is very small on constructive ideas as to where and how there should be a change of direction in the way in which this economy is managed. The fact is that both the Labor Party and the Liberal Party are dominated by radical free marketeers. They want to sit back and let market forces rule this economy. Neither the Labor Party nor the Liberal Party is prepared to manage the economy in the interests of all Australians, and that is what must be done. To illustrate what could be done if a government of this country were prepared to manage the economy, I refer to our alternative Budget. We set out concrete proposals as to where revenue could be gathered if only there were some attempt to manage the economy. For instance, we pointed out that if the takeover loopholes were addressed, at least $1.5 billion in additional revenue could be gained from that area alone. To illustrate how that could be done, one need only look at the fact that between 1981 and 1984 company tax as a percentage of net profit fell from 25 per cent to 17.6 per cent. Most responsible commentators agree that at least half of this fall in revenue from company tax was due to the excessive takeover rorts which have occurred in this country. Half of that amount represents $1.5 billion in a full year; in 10 months-the life of the current Budget-it represents $1.2 billion. Everybody agrees that we have a very critical balance of payments problem. What are we doing about it? We are being asked to accept an austerity Budget as the only solution to solving our balance of payments problem. I have heard no suggestion from the Opposition or anyone else in the Parliament that there are ways of attacking this problem directly. I have not heard one politician in this country say that there is an alternative to an austerity Budget in attacking our balance of payments problem. Of course there is an alternative. We can attack that problem directly, and that is precisely what we advocated in our alternative Budget. We said: `Why not impose a tax of 6.5 per cent on luxury imports as a temporary measure?' The fact is that over a full year imports are worth $35,000m. If a tax of 6.5 per cent were imposed on one-fifth of those imports-I refer to luxury items such as orange juice from California, when our own oranges in the Murray Valley are left to rot, and luxury motor cars-another $450m would be raised and, at the same time, the number of imports would be slowed down. We could have done something about transfer pricing, which is one of the greatest tax rorts. All of these initiatives would result in pressure being applied to big business. It would not affect small business one iota. It is in the area of big business that the tax rorts are going on. There has been no criticism by the Opposition, and certainly no attention by the Government, in regard to that area. A lot can be done, but a fundamental change of direction must take place. Somebody in this country must stand up and say: `We are prepared to manage the Australian economy'. We cannot sit back and let market forces run it. We cannot sit back and let international money speculators make fortunes from speculation on the Australian dollar. We cannot sit back and let international representatives of foreign banks tell us daily on the airwaves how we should run our country and say that, if we do not do as they want, they will sell the Australian dollar into the dust. It is about time that we had a government with the guts to run this country in the interests of all Australians. Senator COLLARD(Queensland-Leader of the National Party of Australia)(4.00) —I support the motion which has been moved as a matter of urgency by the Leader of the Opposition (Senator Chaney). It states: The need for the highest taxing government in Australia's history to abandon its destructive, anti-investment and anti-incentive fringe benefits and capital gains taxes. Some of the comments made recently, especially about the fringe benefits tax, have been interesting. I shall list some. The first one is: Quite clearly what's come out of the fringe benefits proposal is an administrative nightmare. The second quote is: It's just another annoyance or another uncertainty. Thirdly: Some people would say its been handled in cumbersome and heavy-handed ways. Fourthly: There is no question about that and certainly (there have been problems) involved with complying with the tax, the completion of the administration and technical arrangements, and the impact of the tax. Fifthly: He termed some aspects of it as `ridiculous' and said it read `as if some bureaucrat down there had gone mad'. Who made those comments? They were made not by Sir Joh Bjelke-Petersen, the Right Honourable Ian Sinclair or the Honourable John Howard but by Labor Premiers of this country and the Leader of the Opposition in Queensland. There is almost no need for us to make an effort because we can just rely on what Labor Party members have said about the ridiculous disincentive which has been thrust on this land. Why has the fringe benefits tax been imposed? Senator Walsh when he took part in this debate quoted John Howard's statement that there was a need for fairness in the tax situation. I do not disagree with that. I do not think anyone does. Why, therefore, do we have such a tax? There has always been a fringe benefits tax. It might come as something new to Labor Party members that old section 26 (e) of the Income Tax Assessment Act 1936 states that the assessable income of a taxpayer shall include: the value to the taxpayer of all allowances, gratuities, compensations, benefits, bonuses and premiums allowed, given or granted to him in respect of, or for or in relation directly or indirectly to, any employment of or services rendered by him, whether so allowed, given or granted in money, goods, land, meals, sustenance, the use of premises or quarters or otherwise; That just about covers anything. Yet Senator Walsh talked about the rorts that have been going on. If there have been rorts, the old section 26 (e) was able to handle them all, if the Commissioner of Taxation had done his job. But no, apparently the Government wanted extra money and so we have the new fringe benefits tax. The old one would have been quite adequate if applied. Suitable arrangements had been made under it. Farmers, policemen, clergymen, teachers and all transferees came under its auspices. Arrangements were made with the Commissioner of Taxation for a person's rent to be considered in relation to where he lived. It was agreed that a nominal rent would be paid which took into account the fact that certain people would not be able to obtain their own accommodation. It would allow for the fact that those people were continually moving from place to place and living in isolation and for the other factors that had to be considered to make the measure fair. That system worked in most cases and everyone was reasonably happy about it. If the Commissioner of Taxation was not happy, there was all the power in the world under section 26 (e) to bring people back into line. Let us consider a little of the history of the matter. When the Prime Minister (Mr Hawke) was President of the Australian Council of Trade Unions he told his followers that we were living in a utopia and that we could have our bit without exerting too much effort. When he became Prime Minister, he continued to say that we lived in a utopia and we could have our bit without exerting too much effort. We got to the stage where quickly we became a high-cost, low-productivity, unreliable supplier on the world market. That started to bring about our demise and the economic downfall which we have all experienced and with which we are fully conversant. It is really all about that great socialist manifesto, the redistribution of wealth. It is not about the creation of wealth, just the redistribution. Unfortunately, the Government seems to overlook the fact that we cannot keep redistributing what we are not creating. It is essential to the total argument that all Australian people understand that. Because of the many disincentives applied, the private sector is no longer able to create the wealth needed for this country not only to survive but also to prosper. Government is still growing and, if it is to grow further, it will need more tax. We have the now quite well-known nefarious capital gains tax, the fringe benefits tax which this debate is about and a few others which have come and gone along the road. It was fascinating to hear the Australian Democrats take part in this argument, trying to tell us how through their efforts the excesses of these taxes had been reduced. Everyone should understand that, if the Australian Democrats had gone along with the Opposition, we would not have had these taxes. They went to water and tried to get out from under. They did a backyard deal about which we know nothing. They are trying to get out from under by saying that the taxes would have been far worse if they had not negotiated. Everybody knows that these taxes would not exist if the Australian Democrats had not gone along with the Government. Senator Siddons quoted from a letter by Mr Bill Dix who said how thankful his members were for the efforts of the Australian Democrats because the fringe benefits tax was not as bad as it could have been. I am sure that Mr Dix now knows very well that there would not have been a fringe benefits tax if the Australian Democrats had stood up and been counted on this issue. I guarantee that they did not receive many letters from the farming section of the community complimenting them on their attitude and actions. As Senator Chaney said, the fringe benefits tax is complex. A complex booklet was circulated to the business community and accountants. It was so complex that the Commissioner of Taxation had to send people around Australia to explain it. There are still many areas of doubt. I understand that the National Farmers Federation and other sections of the community have listed for the Commissioner of Taxation about 120 anomalies which they want explained. This is a complex initiative. It is hard to understand and has already cost many jobs. Nobody has denied that. One of the basic issues is that it breaks one of the fundamental tenets of tax law: It is the recipient of an income or benefit who pays the tax. Under this ridiculous legislation it is the provider. A farmer who has tried to keep his help on his farm and has no income for himself has to borrow the money to pay the fringe benefits tax incurred because he has employees. There cannot be a much more ridiculous situation. In many instances, farmers have had to let labour go. Some have had to let one or two workers go; some have had to sack all their permanent staff and employ them on a temporary basis. Some State Labor Party members in Queensland have been saying that there have been no retrenchments in the rural industry because of the fringe benefits tax. If we look at the situations in which a lot of these people live out in the more remote areas, whether they be in the smaller townships working for local government or whether they be on farms, and in respect of which the fringe benefits tax is incurred, it is essential that these `fringe benefits' be provided. Where is a ringer on a station property going to get accommodation if it is not provided? Where is he going to get fresh meat? Where will he get his power? Indeed, why would he go out there if there was not some added attraction to the job so that he would be prepared to go out there and find accommodation and suitable facilities for himself and his wife? Since this iniquitous taxation was introduced, people have been put off. People who have been out in remote areas with their wives and small families have had to come back to the smaller country towns and go into the provincial towns to try to find accommodation and work for themselves, while all the time they were quite gainfully and happily employed in the more remote areas, with suitable arrangements between them and their employers. These so-called fringe benefits are essential, particularly in the remoter areas, in providing the many much-needed exports for this country. Just yesterday the Commissioner of Taxation put out a Press release on the valuation that would be applied to some of these houses. There are two methods to go about it. In Press release No. 86/21 the Commissioner said: Under section 29 of the Fringe Benefits Tax Assessment Act 1986 an employer may elect to value remote area housing fringe benefits using a statutory formula instead of a market rental value basis. Where an employer elects to use the statutory formula, the annual value for each unit of remote area accommodation is what is described in the law as a statutory annual rent amount. He went on to say: The statutory annual rent amount for 1986-87 is $7,170. If ever I have heard of a bureaucrat sitting down in the splendid isolation of Canberra and working out something, this is it; but that gives us an idea of the concepts that the Commissioner of Taxation and his bureaucrats have as far as this whole section goes. We are well aware that this nation has massive overseas debts. It was interesting to see a re-play this morning of a British television program which even commented on the fact-if my figures are correct-that Australia's overseas debt is 32 billion pounds sterling. Argentina's overseas debt is 33 billion pounds sterling. There is no doubt that the `banana republic' statements of the Treasurer (Mr Keating) are probably truer than we would ever wish. What is probably more important about that is the way the rest of the world is taking notice of this economy. We have seen that reflected in the value of the dollar. We saw it last night when the rest of the world took notice of the good proposed Budget deficit, one that everyone will try to achieve, but then when the rest of the world saw the fine print in the Budget and saw that the inflation rate was still going to be many times that of our trading partners, it once again started to put a real value on our Australian dollar. We have the economy in a mess. Extra taxes are not the answer. With the forms and documents necessary it is estimated that over 500 extra public servants will be required to look after this tax. There are at least over 120 anomalies on which we have had no reply from the Government. The economy is in a mess. First of all we have been through the debt led recovery. We are now apparently going through the tax led recovery. There is not really much growth in this economy when we strip the public sector from the growth and just look at the private sector; yet it is the private sector which is the only sector which can get this country out of the mess in which we find it. Yet this Government is penalising the very sector that can get this country out of this mess, the very sector that can increase manufacturing and the very sector that can increase our exports. There have been many promises of a review of this tax. At the big farm rally at Canowindra the Prime Minister said he would review the tax; but as soon as he got away from the farmers, that prospect of review was very short lived. So I get back to the whole point of this matter of urgency. It is very anti-investment and it is very anti any incentive to the very section of the community that can get this nation going again. We are a trading nation; unless we trade, we are in all sorts of trouble. Currently we are in that trouble. We are buying more than we are selling and we are consuming more than we are producing. Until we right that wrong and until we get our productivity up to acceptable levels-we are certainly not going to do it the way the Government is treating us-we will bear the consequences of this Government's actions. Senator MAGUIRE(South Australia)(4.15) —This afternoon we are debating a motion by Senator Chaney on taxation. We in the Government oppose this motion because it confirms what most of us have suspected about the Opposition on taxation-that it wants to return to the past. It wants to return to the golden age of tax avoidance and tax evasion, that age when taxation was voluntary for the wealthy in our country. In moving this motion, it is signalling that it wants to remove our anti-tax avoidance armoury. The motion demonstrates also the Opposition's inconsistency in its taxation position. It demonstrates the Liberals' breathtaking hypocrisy, because they are trying to have it both ways on taxation. In the last sitting week of last session, on 10 June, Senator Chaney moved a motion in respect of the Government's taxation package calling for our income tax deductions to be introduced in September, and not in December as provided for in the Budget. He wanted tax cuts in September rather than in December, and, of course, on every possible occasion and on every piece of legislation up to that particular time the Opposition tried to block the legislation that the Government proposed to raise revenue to finance the very tax cuts that Senator Chaney wanted. That illustrates the Opposition's hypocrisy and inconsistency on taxation reform. The legislation that we proposed on a number of occasions in the last session relating to fringe benefits taxation, entertainment allowances being disallowed and capital gains tax are the keys to financing the substantial income tax cuts that are going to be made available to the Australian people from 1 December. It is important to note, as I have said before in this place and will say again, that those taxation measures are part of a package. The tax package is a redistributive measure. It does not increase the taxation burden overall; it redistributes the burden from various groups in the community to other groups. The tax reductions in that package are financed by the range of tax measures I have already referred to this afternoon, including, very importantly, the fringe benefits taxation. On each occasion the Liberals opposed the legislation that we needed to obtain the revenue to provide those vitally important taxation reductions to the community. Senator Chaney has come into the Senate this afternoon and proposed that we abandon fringe benefits taxation and the capital gains tax. What the motion really tells the Australian people is that the Opposition wants the Government to abandon its personal income tax reductions. That is what it really boils down to. It wants to deny us the revenue. The Opposition is really saying that it wants to deny the Australian people those vitally important reductions in personal income tax which will be in place on 1 December. What it is doing is proposing to take away the source of government revenue which will finance those cuts. As I have indicated already, the Government's reforms are part of a package. On the one hand we are obtaining revenue and, on the other hand, we are paying it out. They are very important points to be borne in mind. The fringe benefits tax is a tax on the increasing practice of non-cash remuneration for employees. There are cases documented where some top executives in this country have received up to 40 per cent of their remuneration in the form of non-cash payments. That is what we are cracking down on. That is what the fringe benefits tax is all about. I will instance the revenue estimates from the fringe benefits tax. For the current financial year the original estimate of revenue from the taxation of fringe benefits was $320m, rising to over $500m next financial year. They are very substantial sums of money, running into hundreds of millions of dollars. Of course, this motion today indicates very clearly that the Opposition wishes to deny the Government that revenue, that particular means of financing personal income tax cuts for the Australian community. We have introduced the capital gains tax. The motion refers to that. We introduced that tax to put fairness and equity back into the Australian taxation system. We introduced that tax to reduce the avoidance of personal income tax. The conversion of income which is taxable to capital gains, which had not been taxable, had to be stopped. That revenue from the capital gains tax will also help finance the very substantial reductions in personal income tax which will be provided later this year. The capital gains tax alone raises only a modest amount of revenue; in fact the estimate is $25m a year. But the important thing about it is not so much the revenue that it raises directly but rather the extra income tax revenue collected because the capital gains tax cements the tax base of the income tax. It removes some of the key loopholes in the personal income tax base. So in that way very substantial amounts of revenue will be garnered in the form of extra income tax collections. I have already indicated the substantial extra revenue to come from the taxation of fringe benefits, of non-cash remuneration. Those two substantial sums of money are very important elements of the financing package for the personal income tax cuts. It is very interesting to note that this motion does not refer to the disallowance of entertainment expenses. We in the Government were assailed in this place week after week, month after month, by Opposition spokespersons about the damage to the Australian economy which they claimed would come from the disallowance of entertainment expenses. They seem to have dropped that allegation very quickly and have consigned it to the dustbin of history. In Senator Chaney's motion today he claims that this Government is a high tax government. That is what he set out to prove in his argument in the Senate this afternoon. Let us get some of the facts on the record. Look at part of the record of this Government in the taxation arena. For example, in November 1984 the Hawke Government reduced personal income tax by an average of $7.60 a week. That was a very substantial reduction in personal income tax and it was the average reduction for wage and salary earners. The Government's taxation package, to be introduced by December, will in fact provide a very substantial lift in the tax free threshold-that is, the tax exempt income of taxpayers. That threshold currently is $4,595. The Government will be increasing it to $5,100-a very substantial increase. That is going to be of major benefit to the low income earners of this country. Of course, the threshold benefits all taxpayers as well as low income earners. The Opposition, in government, never delivered a tax free threshold in excess of $5,000. This afternoon Senator Chaney claimed that the Government was a high tax government, but let us check the facts relating to marginal tax rates. Senator Chaney was a Minister in the Fraser Government. The Treasurer at that time, Mr Howard, brought down five Budgets, from 1978 to 1982 inclusive. The lowest marginal tax rate that Mr Howard, as Treasurer, could deliver to the Australian people was 30c in the dollar. The tax package to be implemented by the Hawke Government is going to provide, by 1 July next year, a bottom marginal tax rate of 24c in the dollar. Legislation was introduced into the House of Representatives last night to provide for that reduction. So there will be a very substantial lowering of the tax rate to apply to the bottom income bracket in the Australian tax scale-6c lower than Mr Howard could deliver in five years as Australian Treasurer. Yet, despite offering those substantial reductions in personal income tax the Opposition would want to deny this Government revenue. The Opposition spokespersons today have claimed that this Government is a high tax government, but let us look at the top marginal tax rates. The lowest top marginal tax rate Mr Howard could deliver in five Budgets was 60c in the dollar. That was the best Mr Howard could offer the Australian people. This Government is going to reduce the top marginal tax rate not to 59c in the dollar but to 49c in the dollar, with effect from 1 July next year. Under the legislation introduced in the House of Representatives last night the rate will fall to an interim level of 55c in the dollar from December. So the top marginal tax rate under this Government is substantially lower than the top marginal tax rate that the Liberal Party could offer in government, and it gives the lie to Senator Chaney's comment that we are a high tax party. The middle tax rate will also be reduced enormously as a result of the tax package. The vital thing to bear in mind is that as a result of this taxation package-I have indicated that the Opposition wants to pull the rug from under it by denying us the revenue to give effect to it-no longer will any Australian wage and salary earner pay more than half of his or her extra income in tax because the top rate will be 49c in the dollar. The Liberals could never achieve that sort of outcome. As I have indicated, we thought it vitally important to introduce the fringe benefits tax in Australia. There had been a rapid escalation of non-cash remuneration in the community and a proliferation of arrangements of various kinds by which high income people were rewarded outside the taxation net. It even got to the stage in Australia where companies known as remuneration consultants were established in Melbourne and Sydney. Their business was to devise packages of remuneration for top executives and other employees in such a way as to avoid the income tax net. I find that sort of activity socially indefensible. It gives no economic return to the nation. Those firms existed simply to use the Liberals' taxation arrangements and find loop- holes in order to provide non-cash remuneration for the top wage and salary earners and executives of this country. This motion today suggests that the Opposition wants to perpetuate the unfair tax system which we have had in Australia. It suggests that it really wants to perpetuate the distortion of Australia's economy into tax avoiding areas and speculation away from productive areas. We have heard spokespersons for the Opposition making dire claims about the impact of the fringe benefits tax on the motor vehicle industry. Senator Chaney was one of those this afternoon. I wish to quote an article from the Adelaide News-a newspaper which has been heavily involved in criticising the car fringe benefits tax-of 9 July, by Mr Brian Francis, headed: `Car tax effect may be falling'. The article states in part: Business leaders are believed to be deciding to continue to renew company cars for executives. The trend has been shown in seminars on the fringe benefits tax held in Adelaide over recent weeks. SA Motor Trade Association president Mr Richard Flashman, said the association believes businessmen had `done their sums' and decided it was still more economical to provide a car. That gives the lie to the claims that have been made about the impact of the fringe benefits tax on the motor vehicle industry in South Australia. The Government has introduced a capital gains tax to avoid the erosion of the income tax base through the loophole of converting income into capital gains. I will be very interested this afternoon to see how Senator Robert Hill votes on this measure because in his maiden speech in 1981-he is a substantial figure in the Liberal Party and the President of the South Australian branch-he came out very strongly and said that the time for the introduction of a capital gains tax in Australia was long overdue. I will look very closely at his position on this motion. As I have indicated, the Government's tax reform is a package. The revenue gains to be obtained through measures such as the fringe benefits tax and the capital gains tax, which are part of the subject of this motion today, will be paid back in the form of personal income tax cuts from December. The Liberals in effect are saying to the Australian community by way of this motion that they do not want them to have personal income tax reductions. The Liberals are really hankering for the golden age of tax avoidance and evasion, where taxation was voluntary for the wealthy and where paying one's proper share was seen as aberrant. It is no wonder that under the Liberal Party ordinary Australians lost faith in the tax system. Senator MESSNER(South Australia)(4.31) —I strongly support the motion of urgency proposed by my leader, Senator Chaney, which reads, in part, as follows: The need for the highest taxing government in Australia's history to abandon its destructive, anti-investment and anti-incentive fringe benefits and capital gains taxes. The motion is all-embracing and certainly touches a great number of areas of concern to the community. The first point to establish is that this is the highest taxing government in Australia's history. That goes without challenge. This Hawke Labor Government has imposed more taxes on the people of Australia than has any other government since Federation. The proportion of the gross domestic product that as a result of last night's Budget will go to taxes is unassailably the highest amount that has ever passed into the hands of any Federal government, Liberal or Labor, since Federation. This proves the point absolutely that this Government stands for high taxation and more taxation. That is destroying confidence in the country's ability to drag itself out of the economic recession. Consequently we are proposing this matter of urgency today. The point that the Liberal and National parties intend to make is that the taxes imposed by this Government destroy incentive. Incentive is a vital element in encouraging people to take risks, build up their businesses, employ more people and lift this country out of recession. That is the choice open to any Australian government when assessing and putting in place new systems of taxation. But this Government does not show any sign of boosting incentive. On every occasion the Government introduces new taxation measures it ensures that those people who are striving to lift this country by working harder, by working overtime and by seeking to take risks in the business community, face more and greater taxation penalities. That is what this Government stands for. That is why the capital gains tax has been introduced-to reduce the capacity of individuals to build up their own equity. That is absolutely clear from the Government's approach to the capital gains tax. A tax is being imposed on the future growth of wealth in the community. It inhibits people from working harder to build up their assets. In introducing the tax the Government says: `If you are already wealthy we will not tax you but if you want to get wealthy we will tax you'. This destroys the incentive of people wanting to take a risk to build up their businesses and provide employment opportunities for Australians. The tax does precisely the reverse of what the Government claims it ought to be doing. Consequently, it will continue to inhibit people from building up the community and providing more jobs for Australians. Let us go over some of the furphies and anomalies mentioned by the Government during this debate. First and foremost, let us deal with the statement that is wheeled out by Senator Walsh all the time about the Leader of the Opposition, Mr Howard. Senator Walsh says that Mr Howard presided over a great period of taxation avoidance. It was the Fraser-Howard Government which introduced the Crimes (Taxation Offences) Act in 1980, which effectively destroyed the tax avoidance industry. The Government knows that. All one needs to do is speak to those lawyers and accountants who were involved in that business to understand what an impact that Act had. That specific action was taken by the former Fraser Government to deal with those problems that were evident at the time. Senator Walsh also referred to the fact that this Government is dealing with a very difficult economic position. We know that but we point out that the economic situation in Australia today stems directly from this Government's lack of determined action in dealing with the problems of work conditions and the cost of labour. This Government continually points to the falling real cost of labour and says that that protects our competitiveness on world markets. But what it neglects to tell us at the same time is that that cost has been adjusted for variations in the exchange rate, which we all know has been collapsing recently. So the logic of that argument is that while we continue to put on more and more costs of labour, making industry less and less competitive, all we have to do is keep the dollar falling and we will offset the disadvantage and build up competitiveness. That is the Government's answer to the problem but that kind of short-sighted attitude does not deal with the fundamental difficulties that Australia faces. We need a new approach to maintain competitiveness on world markets so that we can build up job opportunities, provide jobs in export-oriented industries, and thus create jobs for our children and for those in the dole queues. In the introduction of the new taxes-such as the fringe benefits tax-which are destroying jobs, we have noted the role of the Australian Democrats. They supported the legislation and are directly responsible, as is the Government, for the continuing destruction of industries. The motor car industry has been affected by a fall in market sales of some 175,000 cars on an annual basis, since the beginning of this year. This has destroyed job opportunities in the car industry, particularly in my State of South Australia. One would have hoped that the Democrats might have seen the light at the right moment, when they had the opportunity to oppose the legislation and so safeguard the jobs of South Australians. But no, they chose to go with the Government, so ensuring that the car industry was put under increasing pressure. Let us examine what the loss of 175,000 car sales means to the market. Senator Maguire made a great deal out of the fact that the fringe benefits tax, for instance, will bring in some $300m to the coffers. How much will we lose by way of sales tax not coming to the Government as a result of the fall in the car market? It is more than $400m. By the collapse of the car market we have already lost more than we will gain. Some $400m has been lost to get back $300m from the fringe benefits tax. Those opposite must be incredibly stupid, as they obviously are, to believe that somehow the community will win from that kind of nonsense. Senator Maguire seeks all the time to misrepresent the position on tax cuts. He said that the Government is introducing tax cuts in December and in July of next year, and this will cost the Government $4,500m. Senator Maguire then says that all this will be provided for by the fringe benefits tax, the capital gains tax and so on. The truth is that it is the community that will be paying for its own tax cuts by virtue of the fact that inflation will force up tax receipts. Of course, there might be some element of growth in that which will boost the amount received by some $3 billion. The combined value of the tax package will bring in only something like one-third of the total amount of money needed. The Government is merely giving back to the people the money it will be taking in taxes because of inflation. That is the truth of the matter. It has nothing to do with taxing people through the fringe benefits tax or any other kind of tax in order to give them tax cuts. It is an absolute lie to represent the Government's policy in that way. The Opposition stands for lower taxation. Our policy, when it is released in due time, will show how clearly committed the Liberal and National parties are to lower taxation. Senator Maguire —Why don't we see it? Senator MESSNER —The honourable senator will get it in due course so he will properly understand how determined we are about that matter. The condition of the economy is of very great concern to all Australians. The Government, by its own admission in the Budget Papers last night, said that investment will fall by at least one per cent. That might not mean much to the people outside listening to this broadcast. The point is that investment means jobs, and the only way to create jobs is to back all those who want to join the work force with money and with goods so as to ensure that they are able to produce more goods for the community. That is what investment is all about, but this Government is seeking to destroy investment by virtue of allowing the work practices in the community to continue in the way that they do, by not taking the axe to the Government's expenditure program, by imposing, as it did last night, even more taxes than one could have dreamt possible, after the assault we have had in the last six or eight months with the introduction of the fringe benefits tax and the capital gains tax. This Government is totally without reason and has totally lost its direction in terms of what it is seeking to do in the community. Dealing with the problems of competitiveness, we did hear the Minister for Finance (Senator Walsh) say something about a Liberal Party member in Western Australia, Mr Lightfoot, who apparently has been writing to the United States Government seeking continuance of the United States Government's wheat dumping operations. I repudiate everything Mr Lightfoot says about that matter, and I say that on behalf of members of the Opposition. I want to make it quite clear that we certainly do not have any support at all for that kind of principle. I hope that the Government will stop talking about it in terms of somehow being a connection with every member of the Liberal and National parties because it comes from the mouth of one State member in Western Australia. Senator Watson —Where are the Democrats on this issue? Senator MESSNER —The Democrats are a high taxing party. They have sold us down the river and have no clear alternative policy. Senator Siddons today in this place gave us the solution to the economic problems. He wants not to cut expenditure but to boost it and to boost the deficit to about $6 billion. Effectively, he is saying: `Let us have higher interest rates so we can drive investment down even further than it is at present'. That is what Senator Siddons is arguing. What a load of nonsense that is. Clearly, that would sell this country even further down the tube than we are at present. At least the Government recognises that a lower deficit is important, notwithstanding that it goes about it in the wrong way. It has not reduced expenditure but has introduced more taxation, which is precisely in line with its policies. The highest taxing party in the history of the Australian Federation is now occupying the Treasury bench in this Parliament. More than a quarter of the value of every good and service sold in this country goes to the Hawke Labor Government for its own expenditure. It is the highest taxing government in the history of Australia. My colleagues who spoke before me mentioned many aspects of the fringe benefits tax that are absolutely farcical in their operation. I fully support their remarks, as does every member on this side of the Senate. We can say the same things about many aspects of that matter which is so close to the heart of the Labor Party, the capital gains tax. In the end that will prove to be a greater disaster than even the fringe benefits tax. The DEPUTY PRESIDENT —Order! The honourable senator's time has expired. Senator ROBERT RAY(Victoria)(4.46) —It is a pity Senator Peter Baume is not in the chamber. Being such a good medical practitioner, he could have given me a prognosis on Senator Messner's political amnesia. Listening to his speech today, he seemed to have forgotten the Opposition's seven years in government. I might remind him that the Liberal Party of Australia when it went out of office in 1983 left us with a legacy of rorts in the taxation system unparalleled anywhere in the world. It presided over the degradation of the taxation system in this country. In its last period in office criminal evasion schemes proliferated. We had tax evasion six times larger than in the United States. The coalition did virtually nothing to reform the taxation system. I do remember one great act of courage. Senator Messner —On a point of order, Mr Deputy President: Is it correct that an honourable senator can stand in this place and tell outright lies about the situation? The DEPUTY PRESIDENT —Order, Senator Messner! You are not allowed to use that expression. If Senator Robert Ray is misrepresenting something you said, you are entitled at the end of his speech to reply, but not at the moment. Senator ROBERT RAY —Only once did the Liberal Party opposite take any major act on taxation. It was not an act of courage; it was an act of absolutely paralysed fear. When it brought into this chamber a Bill to attack bottom of the harbour schemes and to adopt the principle of retrospectivity, that was one occasion when, faced with absolute electoral disaster, the Liberals came in here and rectified the abuses in the tax system. Not all of them did, of course; there are plenty of them still in this chamber today who voted to support the tax avoiders. At least I respect their opposition to retrospectivity in subsequent Bills. As for those hypocrites who in 1982 voted for retrospectivity for self-survival but who have opposed it ever since, I have absolute contempt for them. Most of the artificial schemes have been wiped out. They would all be wiped out if enough honourable senators had the courage to make clear to the tax avoiders that retrospectivity would be an entrenched principle. We would never have tax avoidance on that scale. We will always have tax evasion to a limited or greater extent, but with the prescribed payments scheme we introduced and with the proposed Australia Card, this Labor Government will do much to restrict tax evasion. We may never eradicate it entirely, but we will go a long way down the path. The major tax problem of today is that high marginal rates of tax have forced and encouraged the development of tax shelters and have encouraged the more privileged members of society to seek benefits that are not taxable. We all know what they are. We know about the cheap loans. We know about the free use of cars. We know about using and misusing entertainment allowances, the payment of school fees, and on and on it goes. The whole tax system was haemorrhaging. The one point that is clear is that the tax system had absolutely no equity whatsoever. Equity is an interesting word. It is never mentioned by the Liberals opposite. To give Malcolm Fraser his due, at least he used to talk about equity tax, even though implementing it was something abhorrent to him. No one on the opposite side talks any more about equity in the tax system. As the Treasurer (Mr Keating) has pointed out on many occasions, the fringe benefits tax applies only to a minority in the community, and it applies mainly to those on higher incomes who have sought to reduce their taxable income by other benefits. Often the example is used of next door neighbours. One travels to work by train, eats his lunch out of a brown paper bag, and goes back home to sign the cheque to pay off the monthly payments on the house at no subsidised rate. Meanwhile, the neighbour drives a company car to work, has a filet mignon for lunch for which he does not have to pay and then goes back to a home that is being paid for with a subsidised housing loan. How is that equitable? How can we in this society allow that to continue? In order to deal with those matters the Government commissioned an extensive White Paper. We held a taxation summit and came up with an equitable package. I would have to admit that new taxes are never popular. We can run as many surveys as we like about tax equity and everyone will say: `We don't want to pay any more tax; we want a fairer tax system'. It does not matter what new tax we introduce, people will always criticise it. Of course, Liberal senators here today and over the past few months have tried cheaply to exploit those sentiments in the electorate. Their criticisms-they have made some criticisms relating to administrative difficulties in regard to these taxes-have to be looked at. The same criticisms were made of the prescribed payments tax. What did we do? We fixed the problems up. Now we do not hear those immense criticisms of the prescribed payments tax in regard to administrative difficulties. If administrative difficulties evolve with the fringe benefits tax they will be tackled and dealt with. It must be remembered that of course the fringe benefits tax will raise $600m. This is nowhere near as much as what we will be giving back to taxpayers in the tax cuts to be brought in in December 1986 and July 1987. I want to move very briefly to the subject of the capital gains taxes because no honourable senators opposite have really mentioned much about those taxes in their criticisms. No honourable senators opposite have mentioned the fact that nearly all Organisation for Economic Co-operation and Development countries-the bastions of capitalism-have a capital gains tax. The United States has capital gains taxes. One could hardly call it a socialist society. Senator Boswell —Not at those rates. Senator ROBERT RAY —The intellectual wit of the National Party has asserted: `Not at those rates'. The tax will raise $25m a year in this country. How can that stultify the farm sector? How can that stultify business? Senator Boswell —That's the first year. Senator ROBERT RAY —I am sorry to inform Senator Boswell that that is over an average of five years. It is a pity he never read the White Paper. The capital gains tax is to prevent people transferring their normal income earning capacity into a capital gain, thereby avoiding tax. What we really should do-what I think Senator Boswell should do-is look at the three-card trick that the Liberal Party is trying to apply. What the Liberal Party is saying is: `We will abolish the fringe benefits tax'-that is $600m gone- `we will abolish capital gains tax; we will not have a tax on lump sum superannuation; we will do away with the means test; and we will not have any taxation on wine'. To top it off the Liberal Party is saying: `We will go back to parity pricing for oil'. This would mean another massive haemorrhaging of government receipts. It says it will do those six things. It says that it will keep expenditure on government outlays at real negative growth for three years. As well as that the Liberal Party also is promising increased expenditures all over the place. That is the three-card trick. It cannot be done with mirrors. What honourable senators opposite have come up with is a rural package of $400m extra expenditure. Senator Kilgariff wants a railway line built from Alice Springs to Darwin-another $500m. Therefore, what the Liberal Party is doing is cutting taxation. It will cut new tax measures. It will slash government expenditure. However, it will increase government expenditure in other areas while keeping the deficit down. How is it going to do that? Where is the money coming from? The economic approach of honourable senators opposite is an absolute joke. It is negative; it is inconsistent and it is inconceivable. I will now quote from the Australian Financial Review of 12 August. I very quickly add that it is not a paper that normally supports the Labor Party. That newspaper stated: Like it or not, the fringe benefits tax issue directly concerns only a relatively small number of Australians. Those who are expending so much energy fighting it should look at the graph on page 1 in today's issue of The Australian Financial Review. It shows that our trade with New Zealand has now gone into deficit; that New Zealand's imports to Australia have kept rising strongly since the introduction of Closer Economic Relations, while Australia's exports across the Tasman have fallen. Fringe benefit taxes are now well established in New Zealand. While Australian business people whinge, New Zealanders are getting on with business and taking their markets. Nothing could be truer than that statement in the Australian Financial Review. When one is considering any tax system the first question has to be in regard to its equity, or it all breaks down. What honourable senators opposite are trying to justify is that some people should get benefits that are not taxable while the rest of the community has to pay its full marginal rate of taxation. That is what honourable senators opposite are saying to us. They are not putting up any other alternatives. Honourable senators opposite are saying that certain people in society must have a protected and privileged position not to pay taxation. Senator Watson —Come on; be honest. Senator ROBERT RAY —That is what Senator Watson is saying. He is saying that people in a privileged position able to negotiate a package that might involve free meals, subsidised housing, free school fees or other such things should not have those privileges touched. I remind Senator Watson that when his party presided over this economy from 1975 to 1983 we had a proliferation of tax avoidance and tax evasion. Nothing of any effective nature-bar one thing-was done to prevent those schemes. Honourable senators opposite-not all of them but some, including Senator Watson-came into this chamber and voted for retrospectivity. However, the next time the principle was brought up those honourable senators suddenly reverted to their old principles. They said `no retrospectivity whatsoever'. The definition of someone who does something one day and does directly the opposite the next day in this chamber is well known but is something that maybe should not be mentioned unless with the indulgence of the Deputy President. I believe the fringe benefit tax and the capital gains tax are fully justified. As revenue raisers they will nowhere near equate with the amount those taxpayers affected will get back through tax cuts. It is always said that no new tax is popular. New taxes are never popular. However, what we have to look at is the overall mix of taxation and getting that taxation mix correct. When honourable senators opposite were in government they had a windfall gain from the oil price levy. I think that even the most reluctant honourable senators opposite would agree that that tax covered up a lot of the problems in the taxation system. When one finds a new source of revenue amounting almost to $4 billion a year it is easy to ignore all the other tax problems existing in the system. The Government has made it quite clear that it is going to proceed with the fringe benefits tax and the capital gains taxes. We have also made it quite clear that if some of the criticisms of its administrative arrangements are valid we will have to look at them, obviously as we did with the prescribed payments tax. We would have to rectify those administrative problems. I just ask when the Liberal Party is going to produce its alternative Budget. I am very much looking forward to knowing how it will be able to dispense with six major tax areas; how it can hold outlays with no real increase in real terms. I will be interested to know how it will be able to do that while keeping all the promises that its shadow Ministers have made around the country. Will it involve funny money or mirrors? When honourable senators opposite such as Senator Messner tell us how to do it I will do a very unprincipled thing; I will pinch their policy. As soon as honourable senators opposite discover how to reduce and abolish a whole range of taxes, how to keep the Budget deficit down and increase expenditure outlays on a whole range of things I ask them not to keep it a secret but to come into this chamber and tell us all about it. That would be a remarkable thing. We would not then have a balance of payments problem. We could export that particular solution right around the world at a massive price. We would turn the balance of payments round in one day. I tell the nation that Senator Messner either tomorrow or the next day will fix our balance of payments problem by marketing the Messner plan that says that it can do all those things. I am looking forward to that. This particular debate has not been particularly edifying. I do not think that any honourable senator has been particularly fired up. I do not know why. I believe that the urgency motion should be defeated. Senator HARRADINE(Tasmania)(5.00) —Firstly, in respect of one matter that Senator Robert Ray mentioned, I should set the record straight by saying that had the Senate passed the restrospective tax legislation it would have had the result, presumably, of preventing the Australian Taxation Office from pursuing bottom of the harbour moneys under section 260 of the Income Tax Assessment Act. The court decisions which were obtained in December last year have opened up the opportunity for recouping far more than the Government's retrospective taxation legislation envisaged. That is said as a matter of interest and as a matter of fact. One of the problems with which I am faced in relation to this motion is that, as I understand it, under Standing Orders it is incapable of being amended. It is an urgency motion. The motion reads: That, in the opinion of the Senate, the following is a matter of urgency: The need for the highest taxing government in Australia's history to abandon its destructive, anti-investment and anti-incentive fringe benefits and capital gains taxes. My view is that not all capital gains taxes nor all fringe benefits taxes fall within that category. Some such examples have been given. So far as speculative capital gains are concerned insofar as the capital gains taxes hit speculative capital gains further than section 26aaa, that acts as an investment incentive, not an anti-investment incentive. I would have preferred the word `its' to have been omitted and after the word `anti-incentive' the words `aspects of' to have been inserted, so that the motion would have read: That, in the opinion of the Senate, the following is a matter of urgency: The need for the highest taxing government in Australia's history to abandon destructive, anti-investment and anti-incentive aspects of fringe benefits and capital gains taxes. I think that would have been a more appropriate message to the Government where those aspects of fringe benefits and capital gains taxes are hitting hard in investment, are destructive and provide a disincentive. Senator CHANEY(Western Australia-Leader of the Opposition)(5.02) —in reply-The Senate has only a few minutes of the time available to debate this motion, I rise merely to thank Opposition senators for their support of it and to reject the rather silly suggestion which was made by Senator Walsh in leading for the Government that the Opposition was suggesting that tax changes alone would cause economic recovery. The point that I made very explicitly was that there is a series of factors which have given rise to the Government's Budget pro- nouncements-that investment in Australia is falling, that unemployment is rising and that we all have to trim our living standards. One of the things which need to be attended to is the tax system, in particular the fringe benefits tax and capital gains tax which are such disincentives to so many people in small businesses. I do not have time to address the very many points which were made by speakers with respect to the matter. I noted Senator Robert Ray's comment that what is being taken from the fringe benefits tax is nowhere near the tax cuts which are being offered. I simply note that it is rather sad that the Government has deferred the proposed tax cuts and cancelled out a good proportion of them by increasing taxes on fuel and increasing the Medicare levy to ensure that the same taxpayers will have to hand over a good deal of the tax savings which will subsequently come from the tax reductions for which the Government tells us it is going to legislate. I commend this motion. I think it would be a contributing factor to Australia's economic recovery if we could do something about these very inefficient, very administratively cumbersome and very resented taxes. Question put: That the motion (Senator Chaney's) be agreed to. The Senate divided. (The Deputy President-Senator D. J. Hamer) Ayes . . . . . . . . . . . 30 Noes . . . . . . . . . . . 36 —— Majority . . . . . . . . . 6 —— Alston, R. K. R. Lewis, A. W. R. Archer, B. R. MacGibbon, D. J. Baume, Michael Messner, A. J. Bjelke-Petersen, F. I. Newman, J. M. Boswell, R. L. D. Parer, W. R. Brownhill, D. G. C. Puplick, C. J. G. Carrick, Sir John Reid, M. E. (Teller)Chaney, F. M. Sheil, G. Collard, S. J. Short, J. R. Crichton-Browne, N. A. Teague, B. C. Guilfoyle, Dame Margaret Townley, M. Hamer, D. J. Vanstone, A. E. Hill, R. Walters, M. S. Jessop, D. S. Watson, J. O. W. Kilgariff, B. F. Withers, R. G. Aulich, T. Haines, J. Black, J. R. Jones, G. N. Bolkus, N. McKiernan, J. P. Childs, B. K. Macklin, M. J. Coates, J. Maguire, G. R. Coleman, R. N. Mason, C. V. J. Colston, M. A. Morris, J. Cook, P. F. S. Ray, RobertCooney, B. Reynolds, M. Crowley, R. A. Richardson, G. F. Devlin, R. Robertson, E. A. (Teller)Elstob, R. C. Ryan, S. M. Evans, Gareth Sibraa, K. W. Foreman, D. J. Siddons, J. R. Georges, G. Tate, M. C. Gietzelt, A. T. Vigor, D. B. Giles, P. J. Walsh, P. A. Grimes, D. J. Zakharov, A. O. Durack, P. D. McClelland, DouglasBaume, Peter McIntosh, G. D. Button, J. N., Knowles, S. C. Question so resolved in the negative. Bill received from the House of Representatives. Ordered that the Bill may be taken through all its stages without delay. Bill (on motion by Senator Gareth Evans) read a first time. Senator GARETH EVANS(Victoria-Minister for Resources and Energy)(5.11) —I move: That the Bill be now read a second time. This Bill is to repeal the Parliamentary Commission of Inquiry Act 1986 and thereby to terminate the inquiry which the Commission was established to carry out. The Commission was set up to inquire and advise the Parliament whether any conduct of Mr Justice Lionel Murphy had been such as to amount, in its opinion, to proved misbehaviour within the meaning of section 72 of the Constitution. The Act requires the report to be made on or before 30 September 1986 unless that date is extended by resolution of each House of the Parliament. Honourable senators will be aware of the distressing news of Mr Justice Murphy's illness. In a statement issued on 1 August 1986, he said that his medical advice is that he has an advanced state of cancer in its secondary stages, and that there is no cure and no treatment. The advice is that in the absence of a remission he will not live very long. This advice was confirmed in a special report of the Parliamentary Commission of Inquiry to the Presiding Officers dated 5 August 1986, which was circulated to the leaders of the various parties in the Parliament and tabled yesterday. I inform the Senate that the Attorney-General (Mr Lionel Bowen) was advised by Mr Justice Murphy on 5 August that his health was deteriorating to the extent that he would not be able to continue to sit on the High Court after that week, that he was going on sick leave and that he was proposing to devote himself to writing up judgments upon which he has yet to make delivery. It was with profound sadness that I learnt of Mr Justice Murphy's illness. No doubt all honourable senators will have felt the same. As I have already stated on behalf of the Government, Lionel Murphy and his family have already had to bear more stress in the last two and a half years than most people experience in a lifetime. They will have the sympathy of every compassionate and fair minded Australian as they face this severest ordeal of all. The matter this Parliament must now address is the inquiry. The special report of the Commission tabled yesterday states that the illness of the judge, in combination with the fact that its inquiry will take at least four more months, raises the question whether the statutory task set for the Commission can be discharged at all. The Commission has made plain its own views, which are that to continue hearings if the judge were too ill to take part in them would be contrary to established practice and to natural justice. The Commission's inquiry should be terminated forthwith, and that is what the Bill before the Senate does. I seek leave to incor- porate in Hansard the remainder of the second reading speech. Leave granted. The remainder of the speech read as follows- The Bill also includes special consequential provisions. These are made necessary by the fact that the Commission has not made, and will not be able to make, any findings in relation to matters before it. In particular it is necessary to protect from access and publication any allegations against Mr Justice Murphy. For these purposes, clause 7 has the effect of transferring the documents in the possession of the Commission immediately before the commencement of the repealing Act to the care of the Presiding Officers. Clause 8 makes it an offence to publish allegations derived from materials before the Commission. I turn then to clauses 7 and 8. Clause 7 (1) and (2) make provision for the transfer into the care of the President of the Senate and the Speaker of the House of Representatives of the documents in the physical possession of the Commission immediately before the commencement of the repealing Act. As regards documents which contain any material relating to the conduct of Mr Justice Murphy, provision is made in clause 7 (3) to exclude access under any other Federal, State or Territory law, including the Freedom of Information Act 1982, the Archives Act 1983 and any law which provides for the production of documents. Evidence concerning these documents by the persons referred to in clause 7 (3) is also excluded. As regards documents which do not contain material relating to the conduct of Mr Justice Murphy, access may be obtained but only under the exclusive code provided in clause 7 (4). Specific reference is made to any material relating to the meaning of section 72 of the Constitution. Such material could be of general public interest, and it would be able to be released if it does not contain material relating to the conduct of Mr Justice Murphy. Access will be a matter to be decided by the Presiding Officers. As indicated clause 7 (4) is an exclusive code; in particular, access under the Freedom of Information Act or the Archives Act will be excluded, as will any law which provides for the production of documents. At the winding up of the Commission, there will be some documents with agencies covered by the Freedom of Information Act. Clause 7 (5) has the effect that the agencies are exempt from the operation of the Freedom of Information Act in relation to documents which have been created for the purposes of the Commission. Clause 8 is an overriding provision that makes it a criminal offence to disclose any allegations derived from materials before the Commission relating to Mr Justice Murphy or any information relating to consideration in the Commission of any particular allegation. Now that the inquiry is being wound up it would be oppressive and unconscionable to allow the circulation of allegations derived from materials before the Commission but on which no report by the Commission will ever be available. The provision is limited to allegations `derived'-and I emphasise the word `derived'-from materials before the Commission, and any information relating to the Commission's own consideration of any particular allegation. The provision says nothing about materials that exist independently of the Commission. Finally, I want to emphasise to the Senate in the plainest way that the Commissioners themselves see enormous difficulties in their ever being able to complete their inquiry into any of the allegations in any satisfactory way. My own conclusion, based on what they have said, is that to continue the inquiry would be a futile and oppressive exercise. I express my thanks and appreciation to each Commissioner for undertaking the inquiry that Parliament set up. Each is a distinguished retired Senior Judge. The presiding member of the Commission is Sir George Lush, a former Judge of the Supreme Court of Victoria. Sir George retired from the Supreme Court in October 1983 after 17 years on the bench. He was Chairman of the Victorian Bar Council and President of the Australian Bar Association from 1964 to 1966. Sir Richard Blackburn, a former Chief Justice of the ACT Supreme Court, was appointed as the ACT's Chief Judge in 1977. Sir Richard was also a member of the Federal Court of Australia, and a Judge of the Northern Territory Supreme Court from 1966 to 1971. The Honourable Andrew Wells, QC is a former Judge of the Supreme Court of South Australia. Mr Wells retired in 1984 after 14 years on the Bench. The two former State Judges were chosen after consultation by the Prime Minister with the Premiers of Victoria and South Australia. Sir Richard Blackburn accepted the Attorney-General's invitation to serve on the Commission. The appointments were finally made after consultation with the Opposition and the Australian Democrats. I commend the Bill to the Senate. Debate (on motion by Senator Chaney) adjourned. Senator TEAGUE(South Australia)(5.15) —I move: That the Senate take note of the paper. This report by the Technical and Further Education Council is a most embarrassing report for the Government as it recommends that the Government meet needs in the technical and further education area, such as the manpower skills and resources needed for the industrial development of Australia, which the Government, in its decisions in the Budget last night, has directly denied. It must be a most disappointing outcome for everyone associated with a technical and further education college and, indeed, for all members of the Technical and Further Education Council. Not only is this a most embarrassing report for the Government, but it is probably the last report of its kind because the Government has now taken steps to ensure that these sorts of reports will never come before the Parliament again. As from several months ago, the councils of the Commonwealth Tertiary Education Commission will no longer have their reports tabled in the Parliament. They will be made available only in house to the Commonwealth Tertiary Education Commission. So, this report goes down as a most memorable last report from one of the three subsidiary councils of the Commonwealth Tertiary Education Commission. The report is concerned with next year, 1987, and with any supplementary provisions of resources for TAFE in 1987, that being the last year of the triennium. The introduction to the report, first of all, loudly applauds the direct achievements in TAFE until this Government came into office. Enrolment in the substantial streams of TAFE, streams 1 to 5, grew enormously-by 157 per cent-in the period under review, from 1974 to 1984. But the provision of resources then declined. The Council directly criticises the Government's decision to reduce resources so dramatically. It says on page 3 of the report: The reduction in Commonwealth effort in TAFE for 1986-affecting both recurrent and capital programs-has been damaging in its effects on the level of effort which can be undertaken in TAFE and has prejudiced the confidence and morale which has been built up in TAFE. The need is for further growth and development, not contraction. Under the Fraser Government, there was growth and development. Under the Hawke Labor Government, there is contraction. Last year there was an 18 per cent real cut in the provision for TAFE. Perhaps this report has had the outcome of the 2.5 per cent increase in money terms for TAFE announced in the Budget last night. But that is still a real cut. TAFE has had cut upon cut from the present Labor Government. This report was called for in January this year and was timely in its preparation. In March this year it was given to Mr Hudson, the Chairman of the Commonwealth Tertiary Education Commission, and so to the Government. The report's recommendations are summarised on page 33. It gives reasons for an 11.4 per cent increase in recurrent money for TAFE; yet it received 2.5 per cent-a substantial cut. This is a most embarrassing and appalling outcome for TAFE. Such outcomes have now been established as a consistent record for the Hawke Labor Government. This last report from one of the councils of the Tertiary Education Commission will go down as a lamentable highlighting of the atrocious record of the Hawke Labor Government. Senator HARRADINE(Tasmania)(5.20) —On page 5 of the Commonwealth Tertiary Education Commission 1985-87 triennium report there is a paragraph entitled `Priority One-Youth'. It indicates that unemployment rates are higher for young people in the 15- to 19-year age group-some 20.3 per cent of the full time labour force of that age group-compared with the 20- to 24-year age group. However, the significant point is that in absolute terms more 20- to 24-year-olds than 15- to 19-year-olds are unemployed and looking for full time work. The report states: Moreover, at August 1985 the average period of unemployment for 15-19 year olds looking for full-time work was 29 weeks whereas for 20-24 year olds the average period of unemployment was 46.2 weeks. I am grateful that that statistic is in this report, but that is not the situation now. The situation has worsened considerably. The July unemployment figure for 15- to 19-year-olds is up to 22.7 per cent. In some States the figure is up to 25 per cent-that is, one youth in every four cannot get a job. It is fortunate that this report has come down, because the Budget is a budget for unemployment. The Budget states that as a result of decisions that have been made there will be additional unemployment and that this situation will fall heaviest on our youth. Also the ordinary average wage earner, and the family on wages, will be hardest hit. Today Eric Risstrom is on record as saying that the real losers of this Budget are the ordinary families on below average earnings-that is, $20,000-with children. This applies particularly if the children are unemployed or if they are trying to get into tertiary education. The incentives are not there. This is the tragedy of the situation and it reveals the fundamental problem with the attempts by the Government to concentrate on economic aspects alone to the exclusion of the social aspects of the unemployment problem. The Government and, I believe, the Prime Minister (Mr Hawke) should heed their own words-that in our society today we cannot expect a situation where everyone who seeks to be employed can be employed. According to Mr Hawke far more attention should be given to creating opportunities outside the work force in which socially desirable work can be done. As I have often repeated here, what more socially desirable work can be done for individuals and for society than, for example, the work that a mother does at home. Yet that work is ignored in the Australian Bureau of Statistics survey, it is ignored in the Budget and it is ignored when it comes to any sort of economic recognition. This is a tragic situation. The stark figures have been adverted to in this report and I make no apologies for referring to them. Question resolved in the affirmative. Senator HARRADINE(Tasmania) —I move: That the Senate take note of the paper. I seek leave to continue my remarks later. Leave granted; debate adjourned. Senator VIGOR(South Australia) —I move: That the Senate take note of the paper. I seek leave to continue my remarks later. Leave granted; debate adjourned. Senator CHANEY(Western Australia-Leader of the Opposition) —I move: That the Senate take note of the paper. I seek leave to continue my remarks later. Leave granted; debate adjourned. Senator CHANEY(Western Australia-Leader of the Opposition)(5.28) —I move: That the Senate take note of the papers. The Senate has before it nine reports of the Industries Assistance Commission. They cover a great range of products, from knife blades to aircraft parts to fluorescent lamps. We have also dealt with a paper on the harmonisation of the Customs tariff. I really want to make the point that to some extent the industry protection measures which are the subject of IAC reports-the granting of assistance through tariffs and bounties-are matters of very great complexity and require a lifetime of study to cover the whole of their complexities, and I think that this needs to be put into a more reasonable context. Over the last year we have seen a dramatic deterioration in the value of the Australian dollar which has enormously affected the competitive position of Australian manufacturing industries. Again that is not a straightforward matter because industries which gain from the devaluation sometimes lose when they have to import components, machinery or various other things. I suppose the last 12 months has demonstrated to us the fact that the sort of industry assistance which is the subject of many of these reports is for many industries of much less consideration. What I think is very healthy about the industry assistance area is the concentration throughout industry bodies on attending to elements in the Australian economy which make it difficult for Australian industry to be competitive. It is interesting to hear the present Government, the Prime Minister (Mr Hawke) and the Minister for Industry, Technology and Commerce (Senator Button) lecturing manufacturing industry on what is required. Today we had a lecture from the Minister for Finance, Senator Walsh, in the matter of urgency debate about the need for Australian management and Australian entrepreneurs to get off their tails, to be more effective and to do the job that they are there to do. I think Australian entrepreneurs and Australian managers would be very much encouraged if the Government showed itself as being ready to do something about the concerns of industry in the many areas where it finds it very difficult to compete internationally. This afternoon I express the view on behalf of the Opposition that the calls the Government is making to Australian manufacturing that it must be outward looking and internationally competitive-calls which the Opposition supports-make sense only if at the same time the Government addresses the many unsatisfactory elements of the Australian economy. There has been a lot of publicity this week about work practices in Western Australia, at the Robe River works, and there have been other difficulties on the North West Shelf. It is quite clear that Australia can no longer afford the luxury of perverse work practices, absurd demarcation disputes, and things of that sort. I think it is fundamental to the health of Australian industry that the Government should be seen as determined to assist industry and the trade union movement to root out those practices. It is not something which can take ten years. I do not think Australia has ten years in which to reverse the very bad practices of the past. I suggest to the Government that there is a major challenge for it greatly to accelerate the relatively minor steps it has taken so far-for example, in the heavy engineering industry-to discourage work practices which make it very difficult for Australian industry to be competitive. In the minute or so remaining to me, I make the point that there is no single answer to the problems of Australian manufacturing industry. It is very heartening to the Opposition to find a growing unanimity in industry on the need to concentrate not so much on industry protection but on obtaining the sort of environment in which industry has a chance to be outward looking and internationally competitive. I call on industry to be very tough with this Government and, indeed, with the next government, in making demands for the removal of burdens, be they tax burdens, cost burdens or the burdens of restrictive practices, which prevent Australian businessmen from performing in the way in which I am sure they wish to perform and in the way in which Australia's future requires. I hope that it will not be too long before our having to consider these detailed reports becomes a matter of the past, and we have a more outward looking and competitive economy which relies less upon the intervention of government and more upon the fact that Australian managers are able to do a job which is as good as the job that is being done anywhere else in the world without the burden of excessive trade union interference. The DEPUTY PRESIDENT —Order! The honourable senator's time has expired. Senator WATSON(Tasmania)(5.33) —I wish to speak to paper No. 8, the Industries Assistance Commission report on the textile, clothing and footwear industries. If the preferred option of the IAC is adopted, it could result in the loss of between 60,000 and 80,000 jobs. In this environment of high unemployment, I do not think this is good enough or realistic. The IAC report on the textile, clothing and footwear industries, I believe, does not give proper attention to the community's capacity to absorb the rate of change involved in this report and to accommodate both the economic and social consequences of such tariff reductions as are contained in this preferred option. The focus in this issue, I believe, should not be simply on protection but on fostering international competitiveness, with due regard to our domestic situation at the moment. I believe that one of the regrettable features of the Budget last night was the cut in bounty payments and the effect that that will obviously have on unemployment. Protection should not be dismissed solely in pursuit of a perfectly competitive market. It has serious implications for domestic employment and output for Australian living standards, and for government revenue. I think it is totally inadvisable to argue for high reductions in protection at a time when unemployment is high and increasing, prospects for world trade are dismal, and world trade barriers are intensifying. In 1983-84 the textile, clothing and footwear industries played a significant role in Australia's domestic economy. Industry turnover was $5.6 billion and it had a $2.6 billion added value, constituting 7 per cent of total value added by all manufacturing. It employed approximately 10 per cent of the total manufacturing work force and was the largest single employer of women in the manufacturing sector, with 27 per cent of females working in manufacturing industry. The industry has continued to expand its operations in many areas, while at the same time improved efficiency through rationalisation has been achieved. Since 1980 over $420m has been invested in new plant and state of the art equipment, while labour productivity has improved markedly. Reductions in tariff involve serious complications which are often unrecognised by the anti-protectionists. For example, resource immobility is one issue which I believe always receives inadequate attention, yet is of vital significance. Labour is not a fully mobile resource. Our country is large and it takes time to respond to changes within the employment market. Labour mobility, unfortunately, is low and is limited by geographical and training factors. There has been a lack of training and a lack of incentive to get people to change. For this reason, structural unemployment undoubtedly is likely to worsen in the short term if protection is reduced in accordance with the preferred option. There is a way around it. Perhaps one of the options does leave some hope. We hope that the Government will follow this lesser option, provided other factors are built in, such as appropriate training for displaced people and a proper monitoring authority. A further consideration, of course, that we must take into account is the timing of the gains and the losses. Unfortunately, losses and gains are not made simultaneously. Gains by way of cheaper prices are immediate, of course, while the losses are also forthcoming. However, the benefits by way of increased exports are long term propositions. The gains from reduced protection are postponed too far into the future. As unemployment rises among our trading partners, the adjustment process within Australia in re- allocating resources becomes slower and slower. I think we must recognise that we are living in a time of world trade difficulties and that a lot of products are being dumped on to our markets. The emphasis must be on improving our productivity and our work practices, rather than a wholesale abandonment of some of those protective devices that have been put in place to protect jobs and employment. Senator VIGOR(South Australia)(5.37) —I would like to address the general issue that is raised by this group of papers on tariffs. Tariffs are a very blunt instrument in handling trade, whereas bounties can be very much more specific and can actually handle the problems of an ailing industry and tide it over as that industry becomes more competitive in various ways, especially if the bounties have firm time scales imposed on them. Currently, the major problem is that the Government seems to have opened the floodgates on foreign capital coming into the country or flowing out of it. We do not seem to have any way in which to control money flowing into and out of the country, most of it for speculative purposes and not for the purposes of extra production. Senator Walsh —What has that to do with this? Senator VIGOR —Tariffs are being set up to protect various industries, or not to protect them. We are talking about the general policy of the Government in its Budget which has cut down the bounties area and is also leaving a number of our industries open to problems through the tariff round. The Government is currently asking us to listen to Treasury advice in this area. It has some strategy which is leaving our industries completely open to being taken over, without insisting that any of the money involved in taking equity in these businesses or in buying products is actually used for constructive purposes. As two honourable senators have said, the problem is that we do not encourage people to take risks in our industry. We are feather- bedding certain industries and leaving others completely open. That is why I say that tariffs are blunt. We need a system to encourage industry. It does not help to starve Telecom Australia of research funds that could be spent trying to develop an Australian industry. There are real problems with the way in which tariffs are set up. For example, in my State, we are distinctly affected by imports of citrus concentrates. That is having an enormous effect on the citrus industry. But no one in that industry can successfully complain because of the current system of setting up tariffs and initiating Industries Assistance Commission reports. Nobody can get an inquiry into the dumping of citrus concentrates because the government system for investigating dumping is so very blunt. Sometimes dumping results in huge profits for multinational companies which exploit Third World labour forces and places where the labour markets are not regulated. This problem is being imported to Australia because we do not have a sensible system of protecting ourselves from the vagaries in the trading system in the rest of the world. Senator HARRADINE(Tasmania)(5.42) —Much of what I wanted to say has been said by other senators. Senator Watson adverted to the Industries Assistance Commission's report on the textile, clothing and footwear industries. He is a man with vast experience of textiles and clothing, if not of footwear. In the time available I would like to add a couple of brief points. Anger is often directed at the IAC but my concern is that the IAC is not given firm policies and an understanding of what the Government or the Parliament of the day wants. This is particularly so in the textile, clothing and footwear industries. If we were concerned about the importance of decentralisation of industry, the creation of jobs in decentralised areas, such as Devonport in Tasmania, and the strategic importance of certain industries, such as the textile, clothing and footwear industries, a different picture would be painted and better guidance would be given to the Industries Assistance Commission. Question resolved in the affirmative. Senator VIGOR(South Australia) —I move: That the Senate take note of the paper. I seek leave to continue my remarks later. Leave granted; debate adjourned. Debate resumed from 13 June, on motion by Senator Vigor: That the Senate take note of the report. Senator VIGOR(South Australia)(5.45) —The inquiry into computer acquisition by the Department of Employment and Industrial Relations arose because of complaints by certain computer vendors about the conduct of a tender and because of criticisms by the Auditor-General about shortcomings in project planning for Job Seeker-computer acquisition by the Department of Employment and Industrial Relations. Public tendering is governed by strict guidelines but each department or authority handles its own tenders, within the constraints of Department of Administrative Services procedures. The committee of inquiry has come up with some disturbing findings in this case which underline some of the hazards encountered by Public Service departments and, indeed, most Australian organisations when lay people happen to try to purchase very advanced technology. Computer technology has advanced quickly. Data bases in particular offer considerable advantages in information access over conventional filing and sorting systems. Linkage of many remote sites into a single data base allows quick access to well-organised information. However, because those advances continue apace, there has been insufficient investment in the industry on standardisation. It is exactly like the VHS-Beta argument with video tapes. In fact, manufacturers prefer to keep their equipment non-standard, so that customers will find it too costly, when upgrading, to buy from another manufacturer. That practice should be stamped on. It results in non-standardisation and has become one of the most insidious and dishonest marketing practices. There is the practice also of underquoting, underestimating and undersupplying to get the customer committed beyond the point of no return. Another dishonest marketing practice is to forward-sell new technology. In this practice, the company advertises in carefully phrased innuendoes that its current product incorporates a particular technological capacity, whereas in fact this is only scheduled for release at a later date, by which time the industry calls it an `update'. In the meantime, the company is protected by conditions of sale that indemnify it against failure of its product to meet specifications. This is a particularly pernicious process. All these types of practices appear to have been used in this case. In supplying computing equipment, salesmen have added advantages that are not available in other areas. They deal with clients who are generally ignorant simply because the technology is not properly understood. One may try to buy the most advanced technology but the purchasing guidelines and performance indices are generally out of date before the bureaucracy has had time even to get the ink dry on the contract documents. Added advantages for the salesmen are the wide advertisements given to the latest technology in computing, so that customers take it for granted that these new advanced facilities are fully tested products. It is almost unknown for any single computer manufacturer to be able to supply an integrated, working, tested system incorporating all the latest features available on the market. Only fellow professionals in the computing industry are fully aware of these traps for new players and they cannot always predict where a particular new piece of computing equipment will have a set of hidden `gotchas'. I commend the committee of inquiry on its tenacity in wading through the reams of technical specifications to extract the essence of failure in this project. Indeed, this high expectation of both technical and financial success on the part of enthusiastic public servants is sufficient to make them impatient with the normal bureaucratic delays and constraints. The exploitation of this enthusiasm by commercial computer salesmen has become quite a normal practice in the industry. These dishonest practices I mentioned earlier are pretty common, and it may be that something needs to be done about them. The other shortcomings we have in current government purchasing practices have also been highlighted in this report, and we should learn from it and legislate to try to stop this process. We have a need in funding for rolling triennial budgets. We need to examine properly the desire for equipment and to be able to plan for the full introduction of a system so that all the equipment does not have to be purchased within one financial year and so that people are not trapped into making decisions at the wrong time. Another problem that occurs in the Public Service is that funds can be cut in the middle of a project, which means that people rush in and purchase equipment which they may not have otherwise purchased. There is a need to give clear costings of all possible alternatives when seeking approval for capital expenditure. There is also a need, when cutting back projects, to be assured that there is not an overall loss and that one does not end up without both the system and the money that was going to pay for the system. It may be that dependent projects are going to get into a problem and cost even more money. Two closely related computer proposals were put to Cabinet in this case. The first one was an extension of the job bank system, which was requested to allow country centres access to job information. This required some extra mainframe computers and would have provided sufficient extra capacity to support the job seeker system. The second system was a job seeker system providing local registers of people seeking jobs which could be matched with available jobs on the job bank central computer. This required local terminals with access to a central job bank computer. Cabinet, in its cost cutting exercise last year, approved the job seeker program but not the extension to the job bank system. It did not appreciate, apparently, the need for extra central computing capacity to support the proposal. In order to proceed, an urgent revision of the technical specifications of the job seeker system resulted in the dumb terminals out at the various centres being replaced with stand-alone micro-computers. However, the current state of the art was such that commercially available micros at that stage had only limited and very unreliable software. As a computer expert, I suppose I could have told the Government that, but because of the Westminster system and various other problems with government, the skills which we have in this Parliament are not actually accessed by the Government when it looks at these types of things. Although the revised specification was technically feasible and was ahead of the current commercially tested software, this led to enormous problems for the computer company, which could not supply. The next stage that happened was robbing Peter to pay Paul. There was a diversion of allocated funds. This was done by changing the technical specifications while the project was still there. The two original projects together required $5.02m initially for the job seekers, and $3.3m in 1984-85; and for the job bank program $6.8m, and $4.7m in 1984-85. The revised job seeker program still required an extra $2m of capital funds in 1984-85, so the Government did not gain anything. This is a long, sad story and I hope that other people will be able to continue it. The DEPUTY PRESIDENT —Order! The honourable senator's time has expired. Debate (on motion by Senator Walsh) adjourned. Senator CHILDS(New South Wales) —On behalf of the Senate Standing Committee on Industry and Trade I present the fourth report on the Development of Closer Economic Relations between Australia and New Zealand. Ordered that the report be printed. Senator CHILDS —by leave-I move: That the Senate take note of the report. It is an honour to present to the Senate the fourth report of the Senate Standing Committee on Industry and Trade's inquiry into the Development of Closer Economic Relations between Australia and New Zealand. The Committee commenced its inquiry into the Australia-New Zealand Closer Economic Relations Trade Agreement, which is known as CER, on 24 August 1984. A number of honourable senators have participated on the Industry and Trade Committee during the period of inquiry. Since that date, the Committee has presented four reports which have examined various aspects of the CER agreement. I think it would be useful to recap on some of the major findings and conclusions from earlier reports before I discuss the Committee's fourth report on CER. One of the first observations the Committee made when it commenced its inquiry into CER was the lack of awareness of CER in Australia. This awareness has improved since 1984 but it still does not approach the depth of awareness and interest that exists in New Zealand. The Committee cannot stress enough the fact that Australians will become significant losers under CER if this apathy and lack of involvement persist. The operation and success of the exclusive Australian licensing scheme-EALs, as they are known-have been the subject of debate from day one of the agreement. Although access has increased annually since 1983 and a large number of item codes have become licence exempt or licence on demand, the licensing scheme still continues to frustrate and thwart Australian export market development efforts. In its second report, the Committee stated that the agreement lacked a plan or strategy for future development of industries and regions in both countries. The Committee still believes that this is the case and maintains that no one can predict significant benefits without some clearer understanding of industry and regional outcomes. The Committee is also of the opinion that the agreement, in its present form, does not guarantee fair competition in a number of areas, and as such will not be able to promote the most efficient use of resources. Exchange rate fluctuations still continue to add an additional element of uncertainty into the trans-Tasman trade equation. Since the freezing of both exchange rates, the Australian and New Zealand dollars have moved quite sharply and suddenly against other and most major currencies. This has been further compounded by the fact that our respective currencies have, at times, moved in opposite directions. This is not conducive to export market development. One of the glaring omissions from the CER trade agreement is the lack of a definite timetable for the removal of all forms of export assistance between the two countries. The Committee believes that it is contrary to the whole philosophy of a free trade agreement. The continued existence of export subsidies provides an unfair advantage to the exporter at the expense of the local producer. CER does not exist in isolation from the rest of the world. Our earlier reports have dealt with the problem of trading practices of third countries and their impact on CER; in particular the damaging effects of the European Community's common agricultural policy and more recently the United States export enhancement program. These practices not only undermine our traditional export markets but have the potential to disrupt each other's domestic markets if they are used to offload unwanted stocks of agricultural produce. I now come to the major findings of the Committee's fourth report on CER. One of the major uncertainties surrounding CER, particularly from the point of view of manufacturing, is the ability of each member country to continue to pursue independent industry policies. The maintenance of different industry policies, particularly in cases involving different levels of tariff assistance, can result in what is commonly called ``the intermediate goods problem''. The existence of this problem results in one member country obtaining an unfair advantage over the other. In addition, differences in other forms of barrier protection will result in similar unfair trading advantages. Bounties, subsidies, concessional loans and many other non-tariff barriers to trade are used by both sides as instruments of industry policy. If CER is to succeed, then much more consideration must be given to the impact of industry policies on CER. Unfortunately the wait and see approach adopted by both sides tends to play down the importance of the relationship between industry policy and CER. It was drawn to the Committee's attention time and time again that limited access into New Zealand is still one of the major obstacles for Australian manufacturers. The very poor utilisation of EALs makes the Committee question why licensing was given a 12-year phase-out period compared with only five years for tariffs-a major issue. To date, New Zealand has benefited from CER. Trade figures for the 11 months ended May 1986, show that the balance of trade between Australia and New Zealand has moved to a $150.7m deficit compared with a surplus of $209.8m in 1984-85. Even this sharp turnaround in the balance of trade does not seem to be causing our trade officials undue concern. In fact they are still prepared to make unsubstantiated statements to the effect that `over the longer term the result should be more even'. The Committee simply cannot share their optimism! On the contrary, Australia will continue to lose more ground if attitudes towards CER do not change. This change of attitude must come from both the private and public sectors. The Committee undertook a number of manufacturing case studies in order to assess, at first hand, the progress and problems arising from CER. The studies revealed a number of interesting matters. In particular the studies reinforced the Committee's view that both countries will need to consult more closely on the question of specific industry problems. Some studies also highlighted the existence of non-tariff barriers to trade which were preventing manufacturers from freely trading under CER. There were also indications arising out of the case studies that third country trade prospects could be enhanced by greater industry to industry co-operation. The Committee believes that CER has been seen as a far more important trade and economic agreement for New Zealand. Therefore it is particularly important, in view of Australia's overall lacklustre trade performance, to take a more active interest in the future course of trans-Tasman trade. It is hoped that the 1988 review will provide an appropriate launching pad for this renewed interest. The Committee believes that Australia has not benefited from trade under CER to this point in time. Further, the Committee believes that the benefits will not come automatically, as suggested by some trade officials, but rather Australia will have to take a far greater interest in the future development and direction of CER. As a first step the Committee has concluded in its fourth report that the relevant Australian Government departments and industry groups need to ensure that adequate preparation is undertaken for the 1988 review. The Committee believes that its four reports on CER should provide the Australian participants with useful background material and a basis on which to develop a comprehensive document spelling out Australia's objectives for the CER trade agreement over the next 10 years. Finally, in many respects, Australia's lack of success under CER reflects a far wider problem associated with export market development. CER must not be considered in the context of bilateralism versus multilateralism but rather as bilateral free trade in association with the development of a more outward orientation towards trade. Further, if it can be clearly demonstrated that changes arising from developments under CER will result in increased prosperity for both countries, then it is imperative that the CER trade agreement should be given every possible assistance to ensure the fulfilment of its objectives. I commend the report to the Senate. Senator WATSON(Tasmania)(6.06) —I would like to commend the Senate Standing Committee on Industry and Trade on a quite outstanding report in relation to closer economic relations between Australia and New Zealand, but I have a number of reservations in relation to the CER agreement. In fact, it has been acknowledged in New Zealand that the implementation of CER since January 1983 has caused fewer problems than New Zealand expected. In 1985 the New Zealand Minister for Trade and Industry stated: We have done rather better out of CER than we thought we might. We have expanded our share of trade with Australia slightly faster than Australia has its share with us. If we look at the latest figures we find a complete reversal of the trade position. Now, for the first time, New Zealand has overtaken Australia in its share of the trans-Tasman trade. While undoubtedly there have been winners-and most of the winners have been in New Zealand, although there have also been winners in Australia, the manufacturers-there have also been losers. Most of those losers have tended to come from my State because that share of trade that has increased most significantly from New Zealand's point of view is certainly in the agricultural trade. While New Zealand has successfully exploited the closer economic relations, I think Australia has failed to capitalise on what has really happened. Undoubtedly we must say good luck to New Zealand. One area of interest is third markets. Both Australia and New Zealand have decided to co-operate in these third markets, provided it is mutually advantageous. The other area of interest is research. Unfortunately far too little seems to have been directed to this particular activity. In fact, research has played a vital part in the development and maintenance of an efficient farm sector. I think an increasing number of problems require solution through research. If Australian agriculture is to remain fully competitive and to develop its undoubted potential much more must be done in this area. I am somewhat critical of the resource funds that are devoted by the Commonwealth Scientific and Industrial Research Organisation to do research into horticulture. While millions are being spent in the wheat and cereals areas, the horticultural area is relatively neglected. Considering that the north-west coast of Tasmania accounts for something like 75 per cent of Australia's frozen pea production, I think this is an area in which more money should be spent. There is certainly a need to develop plant variety rights schemes. We are lagging behind in this area simply because our growers have not got access to the latest varieties that are available overseas. I still complain that in relation to the CER agreement there needs to be a monitoring authority, and the Committee report acknowledges this. A monitoring authority is essential particularly when we have such volatile movements in the exchange rates between the two countries. If we graphed the situation we would see that the importation of peas in particular has a very strong linkage with the exchange rate prevailing between Australia and New Zealand. Because of the strong policy followed by the New Zealand Government until very recently the New Zealand dollar had been appreciating quite strongly. For this reason over the last couple of years we have not had the sorts of cutbacks that we had earlier. Following the sudden collapse of the New Zealand dollar recently I can see a flood of imports from New Zealand, which will be to the detriment of Tasmanian agriculture. The market-place a few years ago was controlled by the vegetable processors. Unfortunately, it now remains the domain of the big seven, or the big five, supermarket chains. There may be a need to investigate the purchasing power of supermarket chains. That is important from the point of view of housewives associations and vegetable growers. Unfortunately, from time to time, we hear allegations of veiled threats to import produce. The growers' view is that some of the Australian processors are unwilling to challenge supermarket chains which are importing produce from New Zealand, Canada, the United States of America and so on. Tasmanian agriculture must be protected from violent movements in exchange rates. It is completely unfair to expect farmers growing crops to suddenly find, through no fault of their own, that because of a lack of proper understanding, monitoring arrangements and adjustment processes, the crops are not needed. Also, the so-called fast-track anti-dumping provisions are an absolute farce. They operate only in situations where people making the complaint are virtually bankrupt. Much more work must be done in relation to movements in exchange rates and the flow of agriculture across the Tasman. This is far too important an industry to be subject to such fluctuations considering the high cost nowadays of putting in crops. I commend the report to the Senate. Question resolved in the affirmative. Debate resumed. Senator CROWLEY(South Australia)(6.14) —In my contribution earlier today I was describing the details of the Affirmative Action (Equal Opportunity for Women) Bill largely because very clearly there has been some misunderstanding about what the legislation proposes and what it addresses and covers. I had accounted for the title of the Bill, its principal aims and how it was derived from a serious and significant consultation process over two years, a process that had produced a pilot program, a working paper and a working party report. I had remarked that there was a consensus on the recommendations in that working party report, and in large part that consensus is reflected in the sensible contributions to the debate to this point. The disarray and the difficulties within the Opposition are also reflected in some of the contributions of its members. I certainly remarked on Senator Peter Baume's contribution and again I acknowledge it. But Senator Baume in particular would have the view he does as he was on the working party and contributed to the consensus report. I would have been very surprised if he had changed his view. The fact that he did not is entirely consistent. I had described how the Bill will apply to 19 universities, 46 colleges of advanced education and to all private sector organisations with 100 or more employees. The line on my paper said that I was interrupted at this point so I will move to my next point. The Bill describes in detail the way that the affirmative action programs to be implemented by those universities, colleges and private organisations will be introduced as a phased-in process. The Bill specifies the dates and times at which the affirmative action programs in the various institutions and organisations will start and the times at which the programs shall be reported on-that is, a year after the programs start. I will not hold up the Senate by detailing that but for anybody with an interest it is spelled out very precisely in the Bill. I suppose it can be said that the universities are required to report by 1 July 1987. Their affirmative action programs started as at 1 July 1986. I will be very interested to look at the reports emerging from the universities in 12 months' time. Each organisation or college is required to produce two reports-a public report going to the statistics describing jobs, classifications and the distribution of men and women in their organisation, a report on the progress of the affirmative action program and some outline of that program in their organisation. They will also submit a private or confidential report which will outline in more detail the eight steps of the affirmative action program. Those steps are listed in the Bill in great detail, and I mentioned them earlier. That private report will not be available to the public except under very special circumstances. The decision to have the two reports emerged from consultation during the early discussion stages. It met the needs of people who had a concern about the confidentiality of information about employees. At the same time the public report also met the needs and requirements of government in relation to accountability in this area of legislation. The expenses incurred by any organisation or firm in establishing affirmative action will be tax deductible. The most significant dispute and misunderstanding-and I submit that on many occasions it is deliberate misunderstanding-in this legislation has been about what affirmative action means. It is described very precisely in the legislation. The Government and I are a little surprised at the misunderstanding that continues to be raised about this matter because the Government has said since the beginning of this debate that the affirmative action program is based on the principle of merit. I simply say it again: It is based on the principle of merit; it is not based on quotas. Firms are not required to employ a certain number of women or to appoint women to positions if they are not qualified, but merely because they are of the female gender. This legislation is absolutely clear on that. Affirmative action or equal opportunity for women legislation is based on the principle of merit. The other specific point of importance is that the Bill also spells out quite clearly that any forward estimate under the requirements of affirmative action will include measures or aims that can reasonably be implemented by a relevant employer within a specified time. There is no requirement for employer organisations to do what is unreasonable or to do unreasonable things in an unreasonable time. The legislation is thoughtful and reflects, I think, the real world in which it is being introduced. It has to be said again that those positions were agreed to by all, including the Opposition, in the working party's recommendations. I take the opportunity here to thank those people who were involved in the working party, those people involved in the pilot program, and those people in the Office of the Status of Women and in the office of the Minister Assisting the Prime Minister on the Status of Women (Senator Ryan). They had a large hand in all the work and prior efforts that have gone into this legislation. There has been considerable consultation between trade unions, employers, and women's organisations. As I said earlier, the working party was representative of those groups and the Opposition. I mention in particular that in the pilot program three of my State's organisations were represented-the Mitsubishi firm, the South Australian College of Advanced Education, and the Simpson company. I know personally that their contributions were very constructive, as were all the contributions, I understand. Some people have argued that this legislation is not tough enough, that the only real penalty for firms, organisations or institutions failing to produce their reports is that they will be named publicly. I would have thought that it was a considerable penalty for an organisation to be named as not being prepared to co-operate. I might say that the naming of a firm or an organisation will happen only after that firm or organisation has had the opportunity to advance good reasons for its inability to produce a report on time or actually to implement a program. The other penalty that ought to be noted is that there is a fine and/or jail term if any of the confidential information in the private report is released improperly. It is interesting to ask again why the Government has been so concerned to introduce this legislation. It is very important to spell out once again this Government's commitment to furthering the conditions, the rights, and the opportunities for women. It is part of the Government's commitment to justice and equality for all citizens. This is a very significant reform, enshrining in legislation not only the requirement of practice but also the principle of equality of opportunity for all citizens. It needs to be said at any opportunity, and I will certainly do it now, that affirmative action is not about advantaging women over men. It is about addressing a current insufficiency and even discrimination in a society that handicaps women in their employment at all levels. We have to ask then: Ought we to do nothing, as some members of the Opposition have suggested, or ought we to address the current discriminatory practices, the current insufficient practices? This legislation is not about discriminating against men, it is about addressing the current discrimination against women. It must be understood that that is the intention and the effect of this legislation. Otherwise, we are saying that we accept the current discrimination and inequality in society against women. I urge honourable members, honourable senators, and anybody else who has the interest to read the thoughtful speeches in this debate because a number of people have spelled out any number of examples of discrimination against women. I will mention only one. Dealing with average weekly earnings according to Australian Bureau of Statistics figures for February 1986, addressing all paid work, the male average was $422.70; for females it was $276.40. If we look at full time work only, for males the average was $460.10; for females it was $360.60. In my own State of South Australia the figure for all paid work for males was $393.90 compared with a figure for females of $256. For full time work only, the male average was $435.70; for females it was $350.30. Those figures speak very clearly of the current inequalities for women in the work force in this country-more than sufficient reason, I think, to introduce legislation to address that insufficiency. Senator Hill also made the point that this legislation is only for middle class and educated women. I presume that he does not mean that they should be freed from discrimination and that others should not, nor do I understand him to mean that they should continue to be discriminated against while we redress discrimination for impoverished women. I would hope that middle class and educated women in this country can enjoy a society free of discrimination, just as any other women or man in our society can. The legislation affirms that it is for all of our society, for every man and woman, to have the opportunity to develop the talents and skills they have and to extend the range of those talents and skills. It is not that this legislation restricts that development to women only. In fact, it is legislation that proposes to enhance the development of talents and skills of women so that they can contribute to the productivity of this country for the benefit of all. It needs to be understood, and I will say it again, that this legislation is not against men; it is advantaging women in their currently discriminated position. The final point I want to make, and I believe Senator Ryan in her comments will address this more comprehensively, is that some people have asked what will happen to Commonwealth statutory authorities. Commonwealth statutory authorities are not covered by this legislation because separate legislation is being introduced to require equal employment opportunity programs in those authorities for women as well as for Aboriginals, migrants and the physically disabled. That is because this Government is committed to having the same employment conditions in all parts of government employment, and there are already EEO programs in Commonwealth Government departments. The Bill does not cover State government employment, nor does the Sex Discrimination Act. Both of those are State matters and are covered by State legislation. I say again that this is a very significant piece of legislation. It addresses the current discrimination against women in employment and proposes ways in which opportunities for women and their talents can be extended. It celebrates the principle of choice by extending the opportunities for women. It will enable them to make a wider series of choices. It also celebrates choice in that the affirmative action program is something the employer will introduce in consultation with his or her employees. That choice is there in the legislation. The affirmative action director will not design or establish these programs. The definition of the programs will be available and will be described by each employer. Therefore, it will meet the needs of each employer according to the requirements and specific needs of the employees in any particular organisation or institution. It is a most important piece of legislation. It is based on the principle of merit. It redresses discrimination. It extends equality of opportunity. It is part of this Government's commitment to social justice and equity. I commend the legislation to the Senate. Senator WALTERS(Tasmania) —Mr Acting Deputy President, I claim to have been misrepresented. Senator Crowley has just grossly misrepresented me. It is a pity that an honourable senator has resorted to inaccuracies for political purposes. She was referring to the meeting of the Federal Council of the Liberal Party of Australia held in Adelaide just recently. She referred to two motions. One of those motions was debated at the meeting of the Federal Council and the other motion was debated at the Federal Women's Council meeting held in Adelaide at the same time. Senator Crowley claimed that I spoke against the Sex Discrimination Act as that applied to Commonwealth public servants and that, indeed, when at the Federal Women's Council a motion relating to the Sex Discrimination Act was brought up I did not speak against it. Senator Crowley implied that I was speaking with two voices. Just to put the record straight, the situation was that the motion at the Federal Council of the Liberal Party used the Sex Discrimination Act as an example. However, it was really a motion concerning our policy of federalism. I spoke entirely on our policy of federalism. Indeed, in that speech I indicated that the motion just happened to be a motion regarding the Sex Discrimination Act. But what I was objecting to-I made it very clear what I was objecting to-was the use of the external affairs powers. Senator Crowley did not-- The ACTING DEPUTY PRESIDENT(Senator Jessop) —Order! I think, Senator Walters, that you have given me sufficient information. I notice that your name is on the speakers' list and you can use that time for explanation. Senator WALTERS —Mr Acting Deputy President, I must speak at this time because I will not be speaking in the course of the debate tonight. The ACTING DEPUTY PRESIDENT —Could you wind up as quickly as you can? Senator WALTERS —Yes. I spoke about the federalism policy and the use of the external affairs power. Indeed, in the course of the Women's Council meeting the seconder of the motion-a motion supporting the Sex Discrimination act in principle-pointed out that the motion had nothing to do at all with the previous motion debated at the Federal Council meeting. The seconder of that motion was herself a States righter and was seconding the motion because it was a matter of `in principle'. Of course, I supported that motion at the Federal Women's Council. The only issue debated-I repeat that it was the only issue debated-was the federalism policy and the use of external affairs power. That is something which you, Mr Acting Deputy President, would know I always support, particularly as it applied to my State in regard to the Franklin Dam issue. Senator CROWLEY(South Australia) —Mr Acting Deputy President, I think it is important to rise in response. The ACTING DEPUTY PRESIDENT —Senator Crowley, are you seeking leave? Senator CROWLEY —Yes. The ACTING DEPUTY PRESIDENT —Is leave granted? Senator Walters —What is it for? Senator CROWLEY —Senator Walters in her opening remarks suggested that I had grossly misrepresented the facts. I seek leave to make a statement. Senator Lewis —Leave is not granted. The ACTING DEPUTY PRESIDENT —Leave is not granted. Senator Lewis —She is not seeking leave to make a personal explanation. Senator CROWLEY —Indeed I am. Senator Lewis —She is seeking leave to speak on the subject. Senator CROWLEY —I have just finished speaking. Mr Acting Deputy President, may I say clearly what I intended to do. Senator Walters made a reference to me which I feel I should refute. I seek leave to make a statement. The ACTING DEPUTY PRESIDENT —Senator Crowley, are you seeking leave to make a personal explanation? Senator CROWLEY —Yes, Mr Acting Deputy President. The ACTING DEPUTY PRESIDENT —Is leave granted for Senator Crowley to make a personal explanation? Leave granted. Senator CROWLEY —I make a personal explanation in response to the slur placed on me by Senator Walters when she suggested that I have grossly misrepresented her on purpose and for political gain. There is no way in which I could speak on behalf of Senator Walters. I would never want to do so nor would I even try. In fact, the honourable senator demonstrates a remarkable ability to do it on her own behalf and on the behalf of lots of others. I simply wish to say that I had no intention of slurring Senator Walters. I simply referred to reports in the Adelaide Advertiser. Those reports were all I could go on. I did not attend the Liberal Women's Conference or vet the Liberal policy. I am able only to refer to the quotes reported in the Adelaide Advertiser. I do not, and did not, intend to misrepresent what was reported there. I suggest that if there was a misrepresentation Senator Walters might take the matter up with the Adelaide Advertiser. However, I most strongly object to her imputation that I would deliberately lie. Senator BOSWELL(Queensland)(6.35) —Tonight we are debating the Affirmative Action (Equal Opportunity for Women) Bill 1986. I would like to state clearly at the start of my contribution that the National Party of Australia is opposed to this legislation, although the National Party is not opposed to the concept of equal opportunity for both sexes. The National Party believes that this legislation is demeaning to women. The legislation clearly tells me-I think it clearly tells a lot of women-that women really are not good enough to compete against men unless they have some form of legislative protection. That is a concept that the National Party can never accept. We believe in equal opportunity. We believe that men and women are equal in every way. We believe in equal opportunity and demonstrate that clearly in a lot of practical ways. The Federal President of our Party is a woman, Mrs Shirley McKerrow. The two women who run the National Party in Brisbane do an excellent job. The Secretary of the New South Wales National Party is a woman. We have endorsed ten women for winnable seats in the coming State election. Some of these seats are green ribbon National Party seats with a 64 per cent National Party vote. I refer, for example, to the seat of Callide. That demonstrates to all the people of Queensland and the people of Australia that the National Party is the party of equal opportunity. It demonstrates that the National Party is unlike the Australian Labor Party in Queensland, which has endorsed only seven women. Most of those endorsements are for seats that will be impossible to win. I must say that although the Australian Labor Party did re-endorse a sitting member for one of those Queensland seats it did not re-endorse in the meantime the very popular Greek, Jim Fouras, the sitting member for a South Brisbane seat. The Greek people in South Brisbane will never forgive the Australian Labor Party for treating Jim Fouras in such a shabby way. Unlike the Australian Labor Party, the National Party has no hang-ups in regard to race. We have endorsed three Greek candidates. We also have a Torres Strait Islander and a Chinese person running for us. We just do not believe that equal opportunity should be based on sex. The National Party believes that equal opportunity means that the best man or the best woman for the job gets the job. I believe that the National Party has shown that it is a party that believes in equal opportunity. However, the National Party cannot agree that this type of legislation does anything except add costs on to business and disrupt business. At this time when we are facing a financial crisis the National Party believes that it is absolute stupidity and madness to bring in this type of legislation. Apart from the philosophical reasons which I have outlined there are many practical reasons as to why this legislation should be rejected out of hand. For instance, we are told that this legislation proposes to create an affirmative action commission and that the office of the proposed affirmative action commissioner initially will cost the Australian taxpayer $1.25m. That cost will be to administer an affirmative action program for 510 firms with over 1,000 employees. In two years time the firms that have over 100 employees also will be caught in the equal opportunity trap. The office of the proposed affirmative action commissioner will then have to investigate those firms. There are approximately 5,000 firms that employ over 100 people. There are 510 firms that employ over 1,000 people. Therefore, on the basis of a straight proportional increase, one would think that the $1.25m initially outlaid to administer the 510 firms will escalate to around $12.5m. We are told that there will be an office in Sydney. I ask the Minister for Industry, Technology and Commerce (Senator Button) whether there will be offices in Victoria, Queensland and all those other States? We are creating a monster. It is not going to do one thing for the economy and it will not create one productive job in Australia. The Minister should be honest with the people and honest with the Senate, and should tell the Senate what will be the cost of the equal opportunity office two or three years down the track. At a time when Australia is facing a financial crisis, when we have to slash $500 million from welfare expenditure and increase tax by $1.5 billion, we should not be bringing in an expensive, big sister, snooping organisation that is going to frustrate, hinder, intrude on and add costs to business. If this equal opportunity program is going to be expensive to the taxpayer, we should spare a thought for the already harassed employer who is trying to unravel himself from the draconian fringe benefits tax that is costing business millions and millions of dollars. The employer will have to put in a public report and a private report to the office of the commissioner. I suppose he will have to investigate all the equal opportunity programs involving every woman whom he employs. It will cost Australian business many millions of dollars-when Senator Button and all the other Ministers are telling us that we have to be competitive, that we have to get our business plans right, that we have to be able to compete with other nations. It shows the hypocrisy of the Australian Labor Party when it brings down legislation like this, which will only add costs to business. Senator Button looks ashamed over there-- Senator Button —I would be ashamed about the rail charges of your Queensland Government. Senator BOSWELL —If you want to debate the rail charges, Senator, I would be happy to accommodate you at any time, but at the moment we are debating affirmative action. We are told that under this legislation consultation is required between trade unions and employers. That is also a concept that the National Party rejects. We believe that a businessman owns his business, puts up capital and takes his financial risks. We believe he should be able to make the decisions that are going to make or break his company without any consultation with the unions. If he wants to consult the union representative, that is his prerogative; he should be able to do that. But in no way should it be compulsory. In no way should an owner of a business be forced to go with his cap in his hand to talk to the union representative and ask who he is to employ or who he is to promote or demote. That has to be the decision of the person who owns the business. That is another reason that we will not accept this legislation. It will also require firms to set up equal opportunity programs. These are going to be costly to enforce and even to organise. I say to Senator Button, who is one of the senior Ministers in the Government, that business is hanging on by its fingernails out there. Business is facing low profits, because of low demand, and massive interest rates. The last thing that it needs at the moment is more interference. Most businesses are facing reductions in profits and are just hanging there, hoping that in another 18 months this Government will go away, that the coalition will be returned and that then they can get back into a profit-making mode. All they are doing now is counting the days to the next Federal election. Senator Button —They might have you. That is a great possibility. Senator BOSWELL —They can go only one way, Senator, and that is up, because you have reached the bottom of the barrel. Another reason for the National Party being opposed to this legislation is a fundamental one. Clause 5 (9) invokes an international treaty that can be used to override State rights. I was elected to the Senate to protect the rights of my State, to stand up for the federal system of government-not to erode those rights, not to sell them out. Senator Grimes —You do it. Senator BOSWELL —I am going to do it, Senator. In my contribution I have endeavoured to outline my Party's opposition to this legislation. I believe it is demeaning to women. It is an invasion of the privacy between employee and employer. It gives a union the right to intrude into decisions that are rightfully the prerogative of the employer, the owner of the business. It is costly to the taxpayer and it is costly to business. The women who support my Party reject the legislation. They do not want it. The Country Women's Association rejects the legislation. It believes it is not in the best interests of women. Only 10 minutes ago I was speaking to Vivienne Quinn, the Queensland Chairman of the Australian Small Business Association, who is sitting in the public gallery. She is a very prominent woman in Queensland business. I went up to her and I said that I would be speaking on this equal opportunity legislation and I asked what her personal view on it was. She said: `We reject that legislation out of hand. It is not required. We believe women are equal to men and they should compete equally. We do not need and do not want any special legislation. We do not want to be treated as a disadvantaged minority group. We want equality'. That is what the women of Australia want. They do not want this special, demeaning type of legislation. The women who support the National Party find it hard to accept this type of legislation. When a woman is in a camp in the Gulf of Carpentaria mustering cattle, working side by side with her husband, it is hard for her to understand that she is not equal. A woman would find it hard to understand that she is not equal if she were driving a tractor for eight or 10 hours a day, trying to support her husband, trying to sustain their farm when they have had to let go their last worker as a result of the imposition of the fringe benefits tax. It would be hard to understand that she is not equal. Senator Button —Come on. Senator BOSWELL —That is true, Senator. Every rural worker in Australia is costing a farmer so much money-I think it comes down to $1,700 a year. Many of these farmers are on negative incomes. The average farmer is earning $7,600 a year. The fringe benefits tax is the straw that has finally broken their backs. That is the fact of life. Small business women are standing beside their husbands being their storemen and packers and their clerk-typists. They cannot understand why they need equal opportunity legislation. They believe they are equal. They cannot understand the Government bringing this sort of legislation before the Parliament. The legislation becomes completely irrelevant to them. The National Party treats all people as equals and sees no reason to support this legislation. Senator KNOWLES(Western Australia)(6.48) —I state, firstly, that as a woman and as a Liberal I am totally committed to equal employment opportunity. However, this is a piece of legislation that may be framed with the best of intentions but about which, as a Liberal, I have grave reservations. I am most concerned in principle at any further regulation applied by government to the private sector or to our tertiary institutions. I am particularly concerned that this legislation purports to offer equality of opportunity but will fuel an increasing emphasis on equality of outcomes and will therefore erode the merit principle. At the outset I must state that equality of opportunity of employment again is a deeply held Liberal belief that is as essential as our belief that merit and individual suitability should be the criteria for filling any position. For that reason I support measures that corporations and public institutions may take in reviewing personnel policies to enhance equality of opportunity and remove any discrimination. I favour such action when its effect is to increase the pool of qualified applicants, making it more likely that the best person will be chosen for any vacancy. Major firms owe it to themselves to ensure that they are not violating the merit principle in any way-with regard to men or women. The pursuit of excellence at all levels is the best guarantee against discrimination in employment and that, too, is important. On previous occasions the Minister for Education (Senator Ryan) has said that the pursuit of excellence in education was not necessary. I am firmly of the belief that the pursuit of excellence in any employment or educational institution is vital. I therefore wholeheartedly support voluntary programs for equal opportunity by individual firms and institutions that involve the training of women for bigger and better positions with no consideration whatsoever given to preferential hiring. With any legislation of this kind we must seek to ensure the ever-threatened freedom of choice. This means that employers must be free to choose the person who is best qualified and best suited for the position, just as we should uphold a woman's right to seek employment in any career she chooses. All too often in the past freedom of choice has been limited to the actions of authorities claiming to act in the interests of society. We have experienced in the past unspoken affirmative action in favour of men against women and of single women against married women. It was felt then that married women belonged in the home, just as today we in the Liberal Party firmly believe that the decision as to whether a married woman will work, and at what level, is purely and simply up to her and her family. That should be their choice and not the choice of any government. If we are concerned to preserve freedom of choice we need to be wary of any government legislation and regulation that dictates employment policy for private enterprise and tertiary institutions, no matter how benevolent the intentions might be. Before we vote on this legislation we should ask ourselves, I suppose, whether we may be setting a precedent whereby future governments may create new forms of discrimination in employment by giving legislative weight to the orthodoxies of the time. Freedom of choice over the long term can only be diminished by regulation and interference. This brings me to my first major reservation about this Bill-its compulsory nature. It was noted in the report of the working party on affirmative action that both the Business Council of Australia and the Confederation of Australian Industry advocated that the field of affirmative action be left to voluntary programs. Senator Sheil —The Government does not listen to them. Senator KNOWLES —Exactly, the Government does not listen to them. A strong, firm and unequivocal commitment and recommendation has been completely ignored. As a Liberal I believe that the principle of mandatory programs under the supervision of yet another bureaucratic agency is inherently undesirable. Employment practices that are beneficial to employer and employee alike may, at the most, need government advice, but certainly not government enforcement. Whenever we in this Parliament decide that private enterprise should conform to some new measure that we might consider as socially desirable, we should be under absolutely no illusion that the process will be simple or cheap. We are imposing additional costs on the private sector, costs which it simply cannot afford. The cost to the 28 companies taking part in the pilot program was between $5m and $10m. One company spent $750,000. Overseas, the 500 largest firms in the United States during 1981 spent $1.5 billion on affirmative action programs. If the tertiary education sector can take as correct what the Vice-Chancellor of Sydney University has said, he has estimated the cost of affirmative action at $450,000 per annum. Where does that money come from? It comes purely and simply straight from the taxpayer. The requirement of clause 18 relating to the compilation of statistics will be a particularly heavy imposition on those businesses that do not have computerised staff records. These costs will have their greatest impact, not on large corporations, but on the 3,430 firms employing between 100 and 500 people which never have excess manpower. Whilst these firms are being given a longer lead time to implement affirmative action, the ultimate reality of the cost burden has to be met some time. I urge the Senate to consider that such smaller firms may not be enjoying the increased profits now benefiting some major corporations. Again, it is disturbing that smaller, private firms will, under clause 13 (3) (a), have to submit public reports as to the types of jobs performed by employees of either sex. Once again, consider the manpower needed for that exercise. The smaller firms, in particular, have the right to confidentiality as to their internal operations. At this stage I am pleased to move on behalf of the Opposition an amendment to the Opposition's amendment to the motion for the second reading. This amendment seeks to highlight the additional financial burden that the Bill will place on the business sector. I move: At the end of the words proposed to be added, add: `, and (vi) will further erode business confidence at a time of national economic crisis which was not properly addressed by the 1986-87 Budget'. I do not doubt that the sanctions against non-compliance, for example, will be effective in compelling employers to submit to affirmative action and I deplore the suggestions that stronger penalties should be introduced. Why should there be penalities at all? That is the question. The effect of incurring the official displeasure of the Government through being named in Parliament has deeper ramifications in today's society and is yet another example of big brother creeping into our daily lives. When so many private firms have so many dealings with government and its agencies, it is quite a brave employer who dares to defy the government, and in such a public forum. There is an implied threat that non-complying firms will be excluded from subsidies and any government purchasing. In other words, once big brother or big sister names you, watch out! Many firms will avoid that risk and implement a program which will impose severe costs and administrative burdens that will not be solved by a provision for tax deductibility. I would also sound a warning that the Office of the new Director of Affirmative Action has the potential to expand and create an empire, like so many institutions supported by the Australian taxpayer. When the Prime Minister (Mr Hawke) informs Parliament that the two major employer institutions have established a council for equal opportunity with a register of participating companies we should ask the question why we need a new section of the Public Service to do the same job. The Bill's explanatory memorandum mentions an initial staff of 25 with a budget of $1.25m, a mere drop in the ocean of bureaucratic spending, but nonetheless a cost that should not be thoughtlessly imposed on the taxpayers we represent. It was only last night that we saw the Budget brought down in this place with cuts everywhere. It is important that there should not be further cuts. The DEPUTY PRESIDENT —Order! It being 7 p.m., the debate is interrupted. I put the question: That the Senate do now adjourn. Question resolved in the affirmative. Senate adjourned at 7 p.m. The following papers were tabled: Lands Acquisition Act-Statement by the Minister describing lands acquired by agreement under sub-section 7 (1) of the Act, for specified public purposes. National Occupational Health and Safety Commission Act-Regulations-Statutory Rules 1986 No. 206. Public Service Act-Determinations 1986 Nos 52, 56, 60, 64. Seat of Government (Administration) Act- Ordinances 1986- No. 37-Crimes (Amendment) (No. 3). No. 38-Bookmakers (Amendment). No. 39-Church Lands Leases (Amendment). Regulations 1986-No. 10-(House of Assembly Ordinance). Superannuation Act-Regulation-Statutory Rules 1986 No. 207. Wildlife Protection (Regulation of Exports and Imports) Act-Declarations under sub-section 9 (1), dated 15 July 1986 and 27 July 1986. Governor-General's Proclamation-Commencement of an Act: A Proclamation by His Excellency the Governor-General was tabled, notifying that His Excellency had proclaimed the following Act to come into operation on the date specified: Australian Citizenship Amendment Act 1986-20 August 1986 (Gazette No. S 401, 15 August 1986). The following answers to questions were circulated: (Question No. 1105) Senator Jones asked the Minister representing the Minister for Transport, upon notice, on 29 May 1986: (1) What has been the cost throughout Australia of bridge repairs on major highways financed by the Federal Government caused by overloaded trucks attempting, but failing to pass under them, in the years 1984 and 1985. (2) Who pays the costs for such incidents? Is it the Federal Government, the various State and Territory Governments, local authorities, the employers of the trucks that cause this damage, owners or employer drivers. (3) What measures are available to the Federal Government to monitor the overloading of interstate trucks. (4) What penalties are imposed in the Northern Territory and the Australian Capital Territory for blatant overloading. (5) Who are the recipients of such charges, the employer or the employee. Senator Gietzelt —The Minister for Transport has provided the following answer to the honourable senator's question: (1) Each State and Territory has its own systems for accounting roadworks and has provided the following details. Separate statistics are not available in New South Wales or Western Australia, however in each State, the incidence and cost are thought to be very small. In Victoria there was a single case in which a tip-truck hoist malfunctioned. Final costs are not yet available but liability has been accepted by the truck-owner. In Queensland there was one case involving a tramway overpass, costing $950, and in South Australia in 1985 one case costing $1,000. There were no cases in Tasmania or the Northern Territory. (2) In all States and the Northern Territory liability is determined by the Courts, in the absence of voluntary admissions. So that repairs may be put in hand without delay, the cost is initially met by the Road Authority and charged to the program from which the road is funded. When an amount is recovered in respect of an incident it is credited to that road program. (3) to (5) State and Territory Governments have primary responsibility for administering vehicle mass and dimension limits. The Federal Government's role is to encourage appropriately uniform limits in the best interests of the whole Australian community. It does so by working through the co-operative framework of the Australian Transport Advisory Council (ATAC), which brings together Federal, State and Territory Ministers responsible for Transport. The questions you raise should therefore be addressed to the relevant State and Territory Ministers. In the case of the Australian Capital Territory, responsibility rests with the Hon. Gordon Scholes, MP, the Minister for Territories. (Question No. 1130) Senator Newman asked the Minister representing the Minister for Defence, upon notice, on 2 June 1986: What actual progress has been made towards the speedy implementation of the recommendations of the Hamilton Report into living conditions for Service families. Senator Gareth Evans —The Minister for Defence has provided the following answer to the honourable senator's question: Work has already commenced on the implementation of some of the recommendations contained in Mrs Hamilton's excellent report `Supporting Service Families'. The Department's Deputy Secretary A and the Assistant Chief of the Defence Force (Policy) have accepted joint responsibility for co-ordinating the implementation of Mrs Hamilton's recommendations. Financial cover has been programmed for the next five years to cover the estimates which relate to the Australia-wide Defence Families Information and Liaison Service. The Hamilton Report Implementation Team, headed by Brigadier Phil Davies, has been established to assist the relevant senior officers in pursuing the issues raised in `Supporting Service Families'. The team's task is to co-ordinate within six months the implementation of those recommendations that can be given immediate effect, and to prepare within the same period a detailed strategy for implementation for those with longer term implications. Its principal objectives are: (a) To determine and implement those recommendations of the report which can be given immediate effect. (b) To prepare a detailed strategy of implementation for those recommendations of the report with longer term implications. (c) To establish the Australian Defence Families Information and Liaison Service. (d) To prepare for the Minister for Defence, by 5 December 1986, a progress report on the strategy for implementation of the report's recommendations. (e) To establish a National Consultative Group of Service Spouses to advise on the implementation of the report's recommendations. The Hamilton Report Implementation Team has no authority to implement those Hamilton Report recommendations relating to conditions of service. This is the responsibility of the Department's Director-General of Service Conditions. However, the team will monitor progress in this area and provide advice as to the impact that perceived conditions of service shortfalls have on families of defence force members. In conclusion, the team has been able to commence operations on a positive note because of the general acceptance of Mrs Hamilton's report. Their efforts will, however, be directed primarily at establishing the Family Information and Liaison Service organisation as it offers practical support in the field to our families. Conditions of service matters on the other hand must be referred and processed through the departmental and Government machinery, and this involves delay.