Wednesday, 13 May 1987 The PRESIDENT (Senator the Hon. Kerry Sibraa) took the chair at 10 a.m., and read prayers. The Clerk —Petitions have been lodged for presentation as follows: To the Honourable the President and members of the Senate in Parliament assembled. The petition of the undersigned respectfully showeth: That we consider the 2 per cent discounting of Commonwealth Occupational Superannuation Scheme pension adjustments on 10 October 1986 to be a serious breach of trust by the Government. The Commonwealth has reneged on an established commitment as incorporated in Commonwealth legislation and benefit promise pensions are not being paid in full. In particular we resent the long-term effect of the discounting. The pension loss is compounded throughout the life of a pensioner and surviving dependants-into the 21st century for many. We consider this Government-induced penalty to be out of all proportion to the short-term ``extraordinary circumstances of the economy'' given as the reason for the discounting. Your Petitioners most humbly pray that the Senate, in Parliament assembled, should urge the Government to: 1. limit the pension discounting effect of the Superannuation and other Benefits Legislation Amendment Act 1986 to the period 10 October 1986 to 1 July 1987 so that pensions are restored to the 9 October 1986 level as a base for the 1987 pension adjustment; and 2. consult with organisations representing pensioners before changing the terms of conditions of Commonwealth Occupational Superannuation Schemes. And your petitioners as in duty bound will ever pray. by Senators Alston (from 15 citizens), Peter Baume (from 45 citizens), Brownhill (from 122 citizens), Sir John Carrick (from 17 citizens), Ryan (from 103 citizens) and West (from 26 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: The Hawke Labour Government's high tax policies and the introduction of any new taxes including a wealth tax on the net wealth of individual Australians and Australian business is totally condemned and opposed. Your petitioners therefore humbly pray that the Senate in Parliament assembled should: Not introduce an investment destroying wealth tax into the Senate. And your petitioners as in duty bound will ever pray. by Senator Brownhill (from 31 citizens). To the Honourable the President and members of the Senate in Parliament assembled. The petition of the undersigned respectfully showeth: That there is widespread community concern about the proposal to irradiate food in Australia. Your petitioners, most humbly pray that the Senate in Parliament assembled should: 1. Block the introduction of Food Irradiation into Australia and 2. Ban the import of Cobalt-60 and Caesium 137 and Caesium 134 to be used to Irradiate Food Products. And your petitioners as in duty bound will ever pray. by Senator Macklin (from 362 citizens). To the Honourable the President and members of Senate in Parliament assembled. The petition of the undersigned respectfully showeth: That we most strongly oppose the process of `food irradiation' by Cobalt 60 or any other radioactive substance. That we oppose the introduction of regulations that will facilitate the food irradiation process being permitted by State Governments. That we express our deep concern at this attempt to extend the use of radioactive substances and exposure of workers to radiation. Your petitioners humbly pray that the Senate ban the importation of radioactive Cobalt 60 or other radioactive substances for the purpose of food irradiation and disallow regulations permitting the irradiation of food in Australia. And your petitioners as in duty bound will ever pray. by Senator Sanders (from 383 citizens). To the Honourable the President and members of the Senate in Parliament assembled. The humble petition of the undersigned respectfully showeth that: 1. There is no legal barrier to the importation of X-rated videos into the A.C.T. or to their sale in the A.C.T. 2. The Government has ignored the repeated protests of the Senate and the people of Canberra on this situation. 3. As a result of X-rated videos are being sold from Canberra to other States, although they are banned in all States. Your petitioners therefore ask the Senate to put pressure on the Government to ban the importation and sale of X-rated video material. And your petitioners as in duty bound will ever pray. by Senator Ryan (from 166 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: Moreton Island is an invaluable natural resource for Queensland and the world and that mining on Moreton would gravely compromise its unique flora and fauna and its outstanding recreational archaeological and scientific values. Your petitioners most humbly pray that the Senate in Parliament assembled, should: urge the government to use its proven constitutional powers to halt sand mining on Moreton by supporting the Moreton Island Preservation Bill. And your petitioners as in duty bound will ever pray. by Senator Macklin (from 85 citizens). Petitions received. Senator COONEY(Victoria) —I give notice that, 10 sitting days after today, I shall move: That the Determination of Fees and Charges dated 23 February 1987, made under the Health Authority Ordinance 1985, made under the Seat of Government (Administration) Act 1910, be disallowed. I seek leave to incorporate in Hansard a short statement of the concern of the Standing Committee on Regulations and Ordinances. Leave granted. The statement read as follows- The Committee has written to the Minister for Territories seeking his comments on the drafting of this Determination, which was tabled without the Committee having any explanatory note. The Determination creates apparently unreviewable subjective discretions, the adverse exercise of which could affect the levels of fees payable by hospital patients. Where reasonably possible, the committee favours: objective drafting of decision-making criteria when powers are conferred on officials; provision of some form of independent review of discretionary decisions; and the proper presentation of delegated legislation to Parliament i.e. instruments should be numbered in regular arithmetical series for ease of citation and brief explanatory notes on the meaning and impact of the instrument should be available for the information of Parliament, the Committee and the public. Senator COONEY(Victoria) —Pursuant to my notice of intention given yesterday, I now withdraw Business of the Senate, Notice of Motion No. 1 standing in my name for this day of sitting concerning Defence Determinations Nos 93 and 94 of 1986. Senator GARETH EVANS(Victoria-Manager of Government Business in the Senate) —by leave-I take this opportunity to amend Government Business, Notice of Motion No. 4, standing in my name by leaving out paragraph (4) relating to proceeding to the third reading of a Bill by leave. This is in the interests of a quiet life and in the interests of having the other procedural motions on the list this morning dealt with formally. The motion will read as follows: That the following proposed Sessional Order be agreed to: That, notwithstanding anything contained in the Standing Orders, the following procedures apply in respect of Bills: (1) A Senator may present a Bill or two or more Bills after the Senate has agreed to a motion upon notice, setting out the long title of the Bill or Bills, that the Bill or Bills be introduced. (2) After the presentation of a Bill or Bills, or after the receipt of a Message or Messages from the House of Representatives forwarding a Bill or Bills for concurrence, a motion may be moved without notice containing any of the following provisions: (a) that the Bill or Bills may proceed without formalities (this shall have the effect of suspending any requirements for stages of the passage of the Bill or Bills to take place on different days, for notice of motions for such stages, and for the printing and certification of the Bill or Bills during passage); (b) in respect of two or more Bills, that the Bills may be taken together (this shall have the effect of allowing the questions for the several stages of the passage of the Bills (or any of them) being put in one motion at each stage, the consideration of the Bills (or any of them) together in Committee of the Whole, and the reading of the short titles only on every order for the reading of the Bills, the words in parentheses being applicable where there are more than two Bills); (c) that the Bill, or, where the provision referred to in subparagraph (2) (b) is agreed to, the Bills, be now read a first time. (3) Where a motion is moved containing two or more of the provisions set out in paragraph (2), at the request of any Senator the motion shall be divided and the provisions put as separate motions. Senator GARETH EVANS(Victoria-Manager of Government Business in the Senate) —Papers are tabled 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. President of the Australian Conciliation and Arbitration Commission-annual report for the year ended 13 August 1986-pursuant to section 70 of the Conciliation and Arbitration Act 1904. 2. Arbitration Inspectorate-annual report 1985-86-pursuant to sub-section 125 (12) of the Conciliation and Arbitration Act 1904. Restoration to Notice Paper Motion (by Senator Gareth Evans)put: That the Order of the Day for the second reading of the Broadcasting Amendment Bill 1986 be restored to the Notice Paper and be an Order of the Day for the next day of sitting. The Senate divided. (The President-Senator the Hon. Kerry Sibraa) Ayes . . . . . . . . . . . 27 Noes . . . . . . . . . . . 32 —— Majority . . . . . . . . . 5 —— Aulich, T. Jones, G. N.Bolkus, N. McKiernan, J. P.Childs, B. K. Maguire, G. R.Coates, J. Ray, RobertColeman, R. N. Reynolds, M.Colston, M. A. Robertson, E. A. (Teller)Cooney, B. Ryan, S. M.Crowley, R. A. Sibraa, K. W.Devlin, R. Siddons, J. R.Elstob, R. C. Tate, M. C.Evans, Gareth Walsh, P. A.Foreman, D. J. West, S. M.Gietzelt, A. T. Zakharov, A. O.Giles, P. J. Alston, R. K. R. Knowles, S. C.Archer, B. R. Lewis, A. W. R.Baume, Michael MacGibbon, D. J.Baume, Peter Macklin, M. J.Boswell, R. L. D. Newman, J. M.Brownhill, D. G. C. Powell, J. F.Carrick, Sir John Reid, M. E.Chaney, F. M. Sanders, N. K.Collard, S. J. Short, J. R.Crichton-Browne, N. A. Teague, B. C.Durack, P. D. Townley, M.Guilfoyle, Dame Margaret Vanstone, A. E.Haines, J. Vigor, D. B.Hamer, D. J. Walters, M. S.Jessop, D. S. Watson, J. O. W.Kilgariff, B. F. (Teller) Withers, R. G. Black, J. R. Parer, W. R.Richardson, G. F. Hill, R.McIntosh, G. D. Messner, A. J.Morris, J. Puplick, C. J. G.Button, J. N. Bjelke-Petersen, F. I. (Senator Sheil did not vote, to compensate for the vacancy caused by the resignation of Senator Grimes). Question so resolved in the negative. Motions (by Senator Gareth Evans)-by leave-proposed: 1. That the Order of the Senate of 22 February 1985 relating to the consideration of Papers presented by Ministers be varied: (a) by leaving out subparagraph (2) (d) and inserting the following subparagraph: ``(d) on Thursdays, at the commencement of General Business, when an order of the Day is called on under this Sessional Order Senators who have previously spoken to that Order of the Day may speak again for not more than 5 minutes, and debate under this Sessional Order at that time shall not exceed 1 hour.''; and (b) by adding after paragraph (2) the following paragraphs: ``(2A) Where a Paper is presented but is not called on under paragraph (1) because of the limitation of time provided by paragraph 2 (b), the consideration of that Paper shall be made an Order of the Day for the next day on which General Business is considered at the commencement of General Business, without any question being put, and where that Order of the Day is called on at that time, a motion may be moved without notice to take note of that Paper. (2B) Where consideration of a Paper is an Order of the Day in accordance with paragraph (2A), it shall remain an Order of the Day for each succeeding day on which General Business is considered at the commencement of General Business until: (a) the Order of the Day is called on and no motion to take note of the Paper is moved; (b) a motion to take note of the paper is determined; or (c) the Order of the Day is discharged from the Notice Paper, whichever first occurs.''. 2. That the following proposed Sessional Order be agreed to: That the Standing Orders have effect as if Standing Orders 141, 142, 143, 144, 145 and 149 were deleted and the following Standing Orders inserted: ``140. In respect of every amendment the President shall put a question, `That the amendment be agreed to'. ``141. An amendment to a motion may not be moved if it is the same in substance as an amendment already determined to the same motion, or would have the effect only of reversing an amendment already made.'' [Note: These Standing Orders are expressed to apply to amendments to motions, but by virtue of Standing Order 201 apply also to amendments moved to Bills in Committee of the Whole.] 3. That the following proposed Sessional Order be agreed to: That, notwithstanding anything contained in the Standing Orders, the following procedures apply in respect of Bills: (1) A Senator may present a Bill or two or more Bills after the Senate has agreed to a motion upon notice, setting out the long title of the Bill or Bills, that the Bill or Bills be introduced. (2) After the presentation of a Bill or Bills, or after the receipt of a Message or Messages from the House of Representatives forwarding a Bill or Bills for concurrence, a motion may be moved without notice containing any of the following provisions: (a) that the Bill or Bills may proceed without formalities (this shall have the effect of suspending any requirements for stages of the passage of the Bill or Bills to take place on different days, for notice of motions for such stages, and for the printing and certification of the Bill or Bills during passage); (b) in respect of two or more Bills, that the Bills may be taken together (this shall have the effect of allowing the questions for the several stages of the passage of the Bills (or any of them) being put in one motion at each stage, the consideration of the Bills (or any of them) together in Committee of the Whole, and the reading of the short titles only on every order for the reading of the Bills, the words in parentheses being applicable where there are more than two Bills); (c) that the Bill, or, where the provision referred to in subparagraph (2) (b) is agreed to, the bills, be now read a first time. (3) Where a motion is moved containing two or more of the provisions set out in paragraph (2), at the request of any Senator the motion shall be divided and the provisions put as separate motions. 4. That the following proposed Sessional Order be agreed to: That, notwithstanding anything contained in the Standing Orders, when debate on a motion is adjourned, by motion or by the granting of leave for a Senator to continue the Senator's speech, the resumption of the debate shall be made an Order of the Day for the next day of sitting without any question being put, unless a motion is agreed to fixing another time for the resumption of the debate. The PRESIDENT —Order! The question is: That the motions be agreed to. Senator MacGibbon-On a point of order, Mr President: I request that you read the motion, because I did not hear the mumbling of the Minister. Senator Gareth Evans-The motion was, Mr President, that the motions to which notice has been given in my name and which are standing on the Notice Paper as Government Business items 2, 3, 4 and 5 be agreed to. That was the motion that I moved. Question resolved in the affirmative. Referral to Standing Committee on Constitutional and Legal Affairs Senator ALSTON(Victoria)(10.12) —I move: That the Administrative Decisions (Judicial Review) Amendment Bill 1986 be referred to the Standing Committee on Constitutional and Legal Affairs for inquiry and report. On 26 February 1986 the Administrative Decisions (Judicial Review) Amendment Bill was passed by the House of Representatives. It was introduced into the Senate on 17 March 1987 but has not yet been given a second reading. According to the second reading speech, this Bill is designed to make some fine-tuning amendments to the Administrative Decisions (Judicial Review) Act 1977. This description is moot. It is arguable that the amendments it makes will substantially change the spirit of the Administrative Decisions (Judicial Review) Act. It is because of this doubt that I have moved for the reference of the matter to the Standing Committee on Constitutional and Legal Affairs. To clarify the focus of the inquiry that I propose, I shall detail some of the history of the Administrative Decisions (Judicial Review) Act. The Administrative Decisions Judicial Review Act 1977 was enacted with the intention of providing a relatively simple means of obtaining a judicial review of administrative action. The Act seeks to balance the desire to provide individuals with a means of obtaining judicial review of administrative action, on the one hand, with the need to protect public authorities from unwarranted or vexatious litigation, on the other. It provides for the establishment and operation of the Administrative Review Council, which is required to monitor the operation of the Commonwealth system of administrative law. In June 1983 the Administrative Review Council commenced a major examination of the operation of the Act. The first stage of this examination was completed with the presentation to the Commonwealth Attorney-General of a report entitled `Report of the Administrative Decisions (Judicial Review) Act 1977 Stage 1' on 13 August 1986. That report was tabled in the Senate on 25 November, 1986. The Administrative Review Council's report dealt with alleged abuses of the Act, which it described as being `those proceedings which are designed to delay or frustrate Commonwealth Administration (in a broad sense) merely in order to gain a tactical advantage rather than to establish a genuine legal right or interest'. The Review Council found little evidence of such abuses. However, the report recommended that the Administrative Decisions (Judicial Review) Act should be amended in order to avert the possibility of abuse. Specifically, the report recommended that the Federal Court of Australia should be granted a statutory power to stay proceedings or refuse to grant an application under the Act where that court considers it inappropriate to grant the application or to continue to hear the proceedings. One factor which is to be considered by the Federal Court is the availability of an alternative avenue of review. The amendment seeks to redress the problem identified by the Administrative Review Council by strengthening the court's discretion under the Act to refuse to grant an application for review or, where there is provision in another law, for review of the relevant decision by a tribunal, authority or person. It also seeks to discourage the disruption of administrative proceedings by narrowing the scope for resort to the Act during those proceedings where legislative provision exists for the review of the decision complained of at the conclusion of those proceedings. The New South Wales Council for Civil Liberties has argued that the amendment `is designed to curtail and destroy the rights of persons adversely affected by administrative decisions to challenge them'. In a letter the Council pointed to additional technicality, further possibilities for delay and increased costs on applicants as being major problems. The Administrative Review Council has simply noted that, in some respects, the Bill goes further than the Council recommended in its report. Accordingly, I believe that the Bill should receive some additional consideration before it is debated in the Senate. In speaking to this motion, I emphasise my belief that the Committee's inquiry should be confined precisely to the effect of this amendment-that is to say, the Committee should consider exclusively the question of whether there should be a requirement for leave as a condition precedent to making an application for review under the Administrative Decisions (Judicial Review) Act where alternative avenues of appeal exist. This being so, the Committee should be able to report in August of this year. Senator TATE(Tasmania-Special Minister of State)(10.17) —The Government will be opposing the motion to send the Administrative Decisions (Judicial Review) Amendment Bill 1986 to the Senate Standing Committee on Constitutional and Legal Affairs. I understand that the Bill is not entirely based on the Administrative Review Council report. That may be a cause for concern. I think these matters can be adequately dealt with in this chamber in both the second reading debate and the Committee stage. There will be an adequate opportunity for an understanding to develop within the chamber sufficient for honourable senators to make the necessary decisions during the second reading debate and the Committee stage, if there should be one. I do not think it requires a series of hearings, the summoning of witnesses, the taking of submissions and the preparation of a report by the Constitutional and Legal Affairs Committee to inform and prepare honourable senators adequately for a vote. That would obviously be the reason for the Committee undertaking such a reference. The Government takes the view that it is not necessary. Senator MACKLIN(Queensland)(10.18) —The Administrative Decisions (Judicial Review) Amendment Bill 1986 has been considered at quite some length by the Australian Democrats. Prior to Senator Alston moving the motion to send it to the Senate Standing Committee on Constitutional and Legal Affairs, we had determined that we would be opposing this Bill when it came on for a vote. We seek to oppose this Bill for a fairly long list of reasons. We do not believe it is as it is purported to be in the explanatory memorandum to the second reading speech which was incorporated in Hansard. We do not believe it is merely a tidying up operation. We believe it goes much further than that. Hence, we signal that we are opposed to the legislation. It becomes somewhat difficult to make a judgment as to whether the reference to a committee is useful. However, we have not yet been able to ascertain from the Opposition parties their attitude to this Bill. On that basis we believe that if the Bill were to come on for a vote it could very well be passed. That is the complete opposite of our intention. Hence, we indicate that on that ground at least we would accept the reference to the Committee in the hope that the added material which is uncovered in the Committee's inquiry would be sufficient to convince the Opposition parties to vote against this Bill. The difficulty with the reference to the Committee is that this Committee, as with all other committees of the Senate, is already overcommitted in terms of its work load. The amount of time available between now and the Budget session is not only limited but will also get progressively shorter and shorter and the sitting of the Senate is likely to extend into July. Senator Coates —Fancy telling us that. Senator MACKLIN —The discussions this morning have indicated that we will probably need a second up week, probably the week beginning 14 June. It will not have escaped the notice of honourable senators that at the end of today's business we will have had three days in the last two weeks in which no Government business has been discussed at all. We have not even got to Government business, so the indications certainly are that if the Senate is to complete even those Bills which have a deadline on them-the Sugar Cane Levy Bill 1987, for example, which we must get through-- Senator Tate —That is a Queenslander speaking! Senator MACKLIN —I am not unmindful of the State from which I come. Obviously, looking at the Bills which have deadlines on them, the Senate will need to sit until the end of June. Senator Colston —Which June? Senator MACKLIN —I have been asked which June. In terms of the business which we have to get through by the beginning of July, it is obvious we will have to sit till the end of June. I presume that the Government will also require some of the other legislation that does not have a deadline on it. It is fairly obvious, if one looks at the proposed Budget session sittings, that the Government will have limited time to get its legislation through in that session. Hence, if honourable senators wish to discuss at great length a whole range of other matters-and this is our primary role, of course-we will have to sit until July. I think there are great difficulties for the Committee if it is to meet and work on this Bill. I imagine that the Committee and its Chairman will be able to fill us in on these matters. I imagine that the Chairman will be able to indicate that this particular reference will probably be at the bottom of the Committee's list and could very well not be discussed for a long time. The Australian Democrats are opposed to this Bill, so this delay does not concern us a great deal. We are not concerned about when the Committee is able, in the fullness of time, to get around to this reference. We imagine that that will be a considerable time down the track and thus this piece of legislation is unlikely to be dealt with again. If that is the case, it would fit in with our intention-that is, to vote against this Bill at the second reading stage. We believe that the Bill takes away significant rights of citizens on appeal and that is unacceptable. We believe that the legislation proposed here will make a significant inroad into citizens' rights of appeal and therefore we cannot support it. For those reasons we will support this reference, not because we believe that ultimately it will lead to an informed debate in this place. I think that the length of time that it will take for the Bill to be considered by the Committee will mean that we will not see it again this session and that it is unlikely that we will see it in the Budget session either. For those reasons we support the reference to the Committee. Senator ALSTON(Victoria)(10.24) —in reply-By way of response to the question of timing raised by Senator Macklin, the Senate Standing Committee on Constitutional and Legal Affairs anticipates that it can conclude its deliberations on this matter by August this year. We have already had preliminary discussions and the very matters that Senator Macklin raises are the sorts of issues that we would like to explore further. It may well be that that will expedite the passage of the legislation at a later time. Question resolved in the affirmative. Debate resumed from 12 May, on motion by Senator Tate: That the Senate- (a) noting the failure of the Joint Sitting of the Tasmanian Parliament on 8 May 1987 to choose the duly nominated Australian Labor Party (ALP) Candidate, John Devereux, to fill the casual vacancy consequent on the resignation of Dr Don Grimes; (b) noting the resolution of the Senate of 19 March 1987 endorsing the constitution convention, established in 13 successive instances since the 1977 Referendum, that ``a person chosen to fill the vacant place in accordance with section 15 of the Constitution should be the member of the political party duly nominated by that party to fill that place''; and (c) noting the statement by the Leader of the Opposition (the Honourable John Howard) on 8 May 1987 that ``I believe that the person appointed to fill casual vacancies of this kind ought to be the person nominated by the retiring Senator's political party'', and the statements in support of the established convention made by the leaders of all other parties in the Commonwealth Parliament. calls on the Presiding Officers of the Tasmanian Parliament to immediately take such action as is necessary to reconvene the Joint Sitting of the Houses of the Tasmanian Parliament to fill the vacancy in order that representation of the people of Tasmania in this place be in accordance with their constitutional entitlement, and calls on those members of the Tasmanian House of Assembly and Legislative Council, including members of the Gray Government, who have to date acted contrary to the established convention, to vote at such a Joint Sitting to accept the nominated ALP candidate. Senator DURACK(Western Australia)(10.25) —In the few minutes during which I spoke on this motion before the adjournment last night, I pointed out that the Senate on 19 March had endorsed the principle that a person chosen to fill a vacant place in accordance with section 15 of the Constitution should be a member of the political party duly nominated by that Party to fill that place. That was passed with the unamimous support of all parties in the Senate. On behalf of the Opposition I expressed clear support for that principle. The further event that has occurred since 19 March is the decision at the Joint Sitting of the Tasmanian Parliament on 8 May, which refused to adopt the nominated Australian Labor Party candidate, Mr Devereux, to fill the vacancy caused by the resignation of former Senator Grimes. On that same day the Leader of the Opposition, Mr Howard stated: I believe that the person appointed to fill casual vacancies of this kind ought to be the person nominated by the retiring Senator's political party. It has been perfectly clear for some time where we in this place stand on this issue. One wonders what is the point of this matter being raised again by the Government when it has an enormous amount of business on the Notice Paper, to the extent that the Senate will probably be sitting well into the winter recess. We are constantly being told by the Manager of Government Business in the Senate (Senator Gareth Evans) that time is being wasted by the Opposition, yet the Government has brought forward yet another motion on an issue about which we are all agreed. Senator Tate —You are not all agreed. Senator DURACK —We are all agreed in this chamber on this matter, and yesterday the motion was supported overwhelmingly in the House of Representatives, yet here we are debating the same issue again. The only addition in the motion is the proposal that the Senate calls on the: . . . Presiding Officers of the Tasmanian Parliament to immediately take such action as is necessary to reconvene the Joint Sitting of the Houses of the Tasmanian Parliament . . . and calls on those members of the Tasmanian House of Assembly and Legislative Council . . . who have to date acted contrary to the established convention, to vote at such a Joint Sitting to accept the nominated ALP candidate. If Senator Tate and others want to pass this motion, the Opposition will not oppose it. We wonder what possible good it will do. The Tasmanian Parliament has been well aware of the views of the Senate and of the Opposition in this place since 19 March. The Tasmanian Joint Sitting was comprised of a lot of pretty robust Independents who know what they are doing. Senator Coates —So-called Independents. Senator DURACK —Whether they can be properly described as Independents may be challenged, but it makes no difference. They know what they are doing; they have taken this step clearly with their eyes open. We may not agree with it and may well believe they are mistaken, but I think that we are deluding ourselves if we think that by passing this motion we will have any influence whatever on the people who sat on 8 May and who took that decision with their eyes fully open after the most extensive public debate on this issue. It was not as though it had merely been debated in this place or had been the subject of comment by Mr Howard or anyone else; in recent months there has been the most extensive public debate. The Press has been absolutely and utterly fascinated with this subject, as if it were one of the major subjects that this nation had to deal with. Senator Coleman —It should be as far as the Tasmanians are concerned as they are the ones who are underrepresented in this place. Senator DURACK —As far as the representation in this place of Tasmanians is concerned-I think I heard Senator Tate being asked a question on this matter on AM-the Opposition has, since the time of the resignation of Senator Grimes, granted a pair. We have offered a pair and we will continue to offer a pair for as long as this vacancy is not filled. We have made it perfectly clear that we disapprove of the action taken by the Tasmanian Parliament in its joint sitting and the views that have been expressed by Mr Gray and so on. But this motion attempts to take up a vast amount of time of this Parliament, both in another place and here. We are continually debating this issue when Tasmania's proportional representation is not disturbed in the Senate, because of the Opposition's decision to continue granting a pair. The Government suggests that Tasmania is in some great state of loss of representation because one of its people is absent when it already has 11 senators and five members of the House of Representatives. For heaven's sake, the amount of travel that honourable senators engage in and the amount of time that States are not represented in this chamber because honourable senators are travelling all around the world on one trip or another make it a ridiculous argument to say that because Tasmania is one person down in the Senate for a time Tasmania's representation is sadly lacking along the lines that we have heard from Senator Tate. If that is the case, senators ought not to travel when the Senate is sitting. That argument is pretty weak. I think I can best sum up Senator Tate's motion and proposals with a quotation from Macbeth. When poor old Macbeth had learnt about the death of his wife he was given to a very emotional soliloquy in the course of which he said: Life is but a walking shadow; a poor player That struts and frets his hour upon the stage, And then is heard no more: it is a tale Told by an idiot, full of sound and fury, Signifying nothing- Really that is all that this additional motion moved by Senator Tate amounts to. I gave my reasons in the debate on 19 March. I do not propose to make another speech about whether this matter concerns a constitutional convention. We will not allow ourselves to be diverted or fussed about whether, in this quite pointless exercise, we use the term `convention' or `practice' or whatever. The fact is that we agree with what the motion is basically all about. We have agreed with it ever since this debate started. We agreed with it on 19 March and we agree with it again. We will not be diverted, as I have said, by these fulminations about what the Tasmanian Parliament ought to do. There seems to be no reason why we should not express that view, for the little good that it may do. But if we are to be in the business of making these sorts of statements, surely to goodness we ought to add to the motion the real cause of this problem; namely, the attitude of this Hawke Government, from day one after its election, to the people of Tasmania and their interests. Therefore I propose to move an addition to this motion by way of amendment. I move: At end of motion, add ``, calls on the Federal Government to maintain and preserve the traditional and Constitutional division of powers between the Federal Government and the State Governments and, in particular, calls on the Federal Government not to use the external affairs power for the purposes of intervening in the affairs of the States''. Seeking to destroy the traditional balance under the Constitution between Federal and State powers has been a major feature of the Hawke Government. It started to do it, of course, in relation to the Franklin Dam. It has continually pursued this policy, particularly in relation to the Northern Territory which, although it may not be a State, is on the road to statehood. It has repeated this action in relation to the Lemonthyme and Southern Forests issue. These policies and actions of the Hawke Government-particularly recently, in relation to the Lemonthyme logging issue-have been strongly opposed by the Labor Leader of the Opposition in Tasmania, Mr Batt. They have been opposed by employees in the Tasmanian logging industry and by many other people whose jobs are being threatened by this course of action. They have been opposed by the Australian Council of Trade Unions because it sees the reality of the threat to employment in Tasmania as a result of the policies that the Hawke Government has pursued. It has pursued from day one a policy of confrontation, in particular with the Premier of Tasmania and his Government. One of the first things it did was to send F111 aeroplanes over Tasmania-the infamous spy flights-to take photographs of what was happening in the area in which it was proposed to build the Franklin Dam. That is one of the most provocative acts that any Minister in any Federal government has ever taken in relation to the States. It met with the greatest outrage, not only in Tasmania but all around Australia. Indeed, the action of the then Attorney-General, Senator Evans, has met with such continuing condemnation and derision all around Australia that one has only to talk about spy flights these days and everybody in Australia knows what one is talking about. That was a classic act of totally unnecessary confrontation towards Tasmania, the Government of Tasmania and Mr Gray. Since the Lemonthyme legislation-a most provocative Act-has been passed and proclaimed, the Government has not sent the Royal Australian Air Force to spy on what is happening in the Lemonthyme, but it has chartered aircraft to fly over the area to find out what is going on. The actions and the legislation of the Government have been challenged by the Tasmanian Government. The matter ought to be decided in the High Court of Australia. That is the proper way of deciding it. It ought not to be decided by this confrontationist approach. There was a suggestion by the Prime Minister (Mr Hawke) the other day that the Government may cut funds to Tasmania as a punishment for its action in not accepting the nomination of Mr Devereux. In light of those provocations and confrontations in relation to Tasmania, it is not surprising-it may be wrong, but it is not surprising-that Mr Gray, his Government and his supporters in the Tasmanian Parliament have taken the stance that they have. People, instead of getting themselves into a great stir about this matter in this chamber and elsewhere, should ask themselves-particularly those opposite should ask themselves-why Mr Gray behaved in the way he did. Provocation has always been a defence available under the law. It ought to be understood and examined. Some sympathy ought to be expressed for this behaviour, as it occurred as a result of such confrontation. The Opposition will not be in the business of condemning Mr Gray. We disagree with him. We believe that he has done the wrong thing. We have said that over and over again. But he has been provoked. All the fulminations that we have had again from Senator Tate and all the sound and fury that we now have in respect of this motion signify absolutely nothing. If the Government is really genuine about losing one Tasmanian from the 12 Tasmanian senators, without expressing any worry when honourable senators from any other State or even from Tasmania go off on junkets around the world at the taxpayers' expense, it should examine its own conscience and see why Mr Gray and his Ministers have behaved in the way they have. We are going to be asked yet again to debate and vote upon an issue on which our position has been made perfectly clear from the beginning. There is absolutely no doubt that we will continue to maintain that position in the future. Under the Constitution this is a matter where clearly the legal power resides with the Tasmanian Parliament. If the Government disagrees with that, it can take action in the High Court. From what the Attorney-General, Mr Lionel Bowen, has been saying, I do not think it will take that action. The Attorney-General delivered one of his classic statements when he said that he thought the Government may go close to winning in the High Court. The Government does not need to be told that it is no good going close to winning in courts. One either wins or loses. It is clear that the Government knows it would lose. It is not going to take any legal action because the constitutional position, the legal position, is crystal clear-that is, that Tasmania is within its constitutional rights in taking the attitude it has taken, even though it may be contrary to constitutional convention. I do not believe it is a convention, but that is another matter. But we believe that Mr Gray ought to act on the nomination of the ALP in replacing Senator Grimes. The Constitution was amended in 1977 as a result of legislation which went through this Parliament. Lest there be, as there has been, some talk that there was some omission or mistake in the constitutional provision, I just want to quote what was said in this chamber by the present Leader of the Government in the Senate, Senator Button, in his speech on the Constitution Alteration (Senate Casual Vacancies) Bill 1977. That Bill was brought into this chamber by me, representing the Attorney-General at the time, on 25 February 1977. That proposal was supported by the then Opposition, of which Senator Button was then a leading member. I do not think he was actually the Leader of it, but he was a leading member and he handled this Bill on behalf of the Opposition on 25 February 1977. This is what Senator Button had to say about that constitutional alteration: There are a number of details in this proposal on which we might offer some criticism. Incidentally, he did not proceed to offer such criticism or any criticism. He went on: The fact of the matter is that it is in substance the provision which was approved of by the Constitutional Convention. There is a slight difference. It is in substance the proposal which was approved of by the Joint Committee on Constitutional Review of 1959, although that Committee did not see the way in which it could be carried out. It is a necessary amendment to the Constitution and one which we believe will receive the approval of the Australian people, having regard to the conduct of State governments in recent years. I commend the proposal to the Senate. It will have the full support of the Opposition. That was the agreed position on which the present section 15 of the Constitution, as it now stands, was based. It was based upon a decision of this Parliament-House of Representatives and the Senate-and was supported without qualification by the then Opposition, for which Senator Button was speaking. Let us not hear any more nonsense about there being mistakes, omissions, failures or whatever in the constitutional provision. The Government's predecessors fully supported the proposal that is now in the Constitution. Do not let us have Government members coming in here and saying that there were mistakes in it and all the rest of it. They supported it at the time and it was and is a sensible proposal. But it does leave the final say to the State governments. If we want to change that, there will have to be another constitutional amendment. The fact of the matter is that Mr Gray and his colleagues in the Tasmanian State Parliament have acted within their constitutional rights. As I said, the Attorney-General of the Hawke Government is prepared to say only: `We would go close to winning a constitutional challenge'. He knows that that is the legal position. I repeat that the Opposition supports the principle that-- Senator Coates —Most of you. Senator DURACK —The Opposition supports the principle that the vacancy should be filled by the person nominated by the party of which the retiring or deceased senator was a representative. We have supported that over and over again. We are just wasting time here today debating it again. Senator Sanders —Well, stop talking. Senator DURACK —The Minister introduced the matter and spoke for nearly half an hour. I suppose that Senator Sanders, will have his say as well and continue to waste time. That is the Government's choice. We will support the motion but we believe strongly that, if the motion is to have any significance at all today, it must be further amended along the lines of the amendment I have moved, I commend the amendment to the Senate. Senator SANDERS(Tasmania)(10.46) —Much has been said by Senator Durack about confrontation. He said that the Federal Government is actually confronting the Gray Government, but the Gray Government, since its inception, has existed solely on confrontation. That is its bread and butter, and it is the only thing that keeps Mr Gray in office. Mr Gray diverts the people's attention from the problems of Tasmania-the highest rate of unemployment in the country and the lowest rate of development-by confrontation. That is his stock in trade. In fact, it is not actually Mr Gray's stock in trade but Andrew Tilt's stock in trade. Andrew Tilt is the adviser who gets Gray into all these situations. I think that Andrew Tilt is a closet greenie. He is a very highly paid adviser to Mr Gray. How highly paid he is we do not know, but he gets a lot more money than we in this chamber. Mr Tilt was once a reporter for the Examiner and he was very critical of the wood-chip industry and forestry matters in general. Now, of course, he advises Mr Gray on what to do. I believe that Mr Tilt's ultimate goal is to make the Gray Government look so ridiculous in the eyes of the Tasmanian and Australian people that it will be thrown out on its ear. I would like to think that Mr Tilt has not completely given up on all his moral values and ideologies of the past. I think he is really a greenie mole in the Gray Government. That is the only explanation I can possibly give for the way that Robin Gray is acting. Mr Gray is taking on the very fabric of democracy. He is putting jackbooted footprints on the fabric of democracy with his ridiculous refusal to allow Mr Devereux to take a seat in this chamber. Not one newspaper anywhere in Australia has supported Robin Gray's actions. In fact, most newspapers have been very critical. This is not only an indication that Robin Gray's activities are not proper but also a slap in the face for Tasmania in general. Poor old Tassie sits down there and reaps the ridicule of the nation. It is the butt of everyone's jokes. When I came to Australia from the United States of America on a Fullbright Fellowship and went through the Fullbright indoctrination courses held in Canberra at Brassey House all the participants were asked where they were going. Some people said that they were going to Adelaide, others to Melbourne and some to Perth. I said: `I am going to Tasmania.' I was told: `Oh you poor guy; you still have time to change it, you know'. I said: `No, I am going there'. That was my first inkling of the low esteem in which Tasmania is held in Australia-and it is getting worse. The newspapers are full of it; it is the subject of cartoons. In the Australian of Monday, 11 May a cartoon by Mitchell shows Robin Gray standing on the stump of a huge tree with a chain saw in his hand and saying: `Your move'. The felled log is labelled `The Constitution'. Bob Hawke, looking like a bushwalker, has the felled log sitting on his foot. This implies that Robin Gray has no respect at all for the Constitution and has cut down the tree, in the way that he cuts down all trees in Tasmania, damaging not only the Constitution but also the institution of the prime ministership. A Tandberg cartoon in the Age shows two individuals with a chainsaw-chainsaws now being the State symbol; the State flower of Tasmania is a chainsaw-in an entire felled forest with no trees standing and one fellow saying to the other: `Now we can see the spy planes'. Again, this ridicules Tasmania. Tasmania is a wonderful place and does not deserve this sort of thing. A Nicholson cartoon in the Age of Tuesday, 12 May 1987 shows Robin Gray, with a beer gut labelled `Tasmania', holding up a chainsaw and being addressed by a wigged gentleman who is saying: `I believe the Constitution may be relevant here'. Robin Gray, with his chainsaw, is standing over this legal gentleman and saying `Don't let's split hairs'. Once again, Tasmania is being held up to ridicule. The editorial comment is basically that Robin Gray is doing the wrong thing. An editorial opinion headed `Deadlock born of perversity' in the Age of Monday, 11 May 1987, states: By rejecting the Labor nominee, Mr John Devereux, a joint sitting of the Tasmanian Parliament last week defied the clear intention of the Constitution that a casual vacancy should be filled by a member of the same party. It goes on to say: The Premier claims he is simply upholding the interests of his State. His Government is in dispute with Canberra over logging in national estate forests, of which Mr Devereux is a leading critic. Actually, although I hate to tell the assembled multitude this, Devereux is not a greenie. He supported the damming of the Franklin. He wants to see fair play for everyone in Tasmania. He does not support the conservation cause and does not support logging, either. He wants to see the inquiry go ahead. In Tasmania, under the Gray Government, merely wanting to be fair-minded is no longer allowed. Unless one is fully in support of the Gray Government and the people who run it-basically the woodchippers and the miners-one has no place in society there. This extends right throughout the system, from senatorial appointments right down to the lowliest appointments in the Department of Education or any other governmental organisation. Those who do not follow the Gray party line in Tasmania are out, they do not get a job. Senator Durack talked about the spy flights and the confrontation that the Federal Government is causing in Tasmania. An article in the Age of Saturday, 9 May headed `Tasmanian threat to arrest forest officers' states: The Federal Commissioners who have been asked to investigate Tasmania's National Estate forests could be arrested if they try to enter the area, the State's Minister for Forests, Mr Groom, said yesterday. So here we have people trying to find the facts in Tasmania-but merely trying to find the facts in Tasmania makes one subject to arrest. Talk about confrontation! Gray is the confrontationist here. Over and over again in this logging dispute pleas have been made by the Federal Government for some co-operation on the part of the State Government. The Gray Government is a State Government. Tasmania is not a foreign country; it belongs to Australia. An article in the Age of 12 May 1987 headed `Logging inquiry head pleads for Tasmania's help' states: The head of the Federal Government's Tasmanian logging inquiry warned yesterday that Australia's environmental standing could be badly damaged if the Tasmanian Government, forest industry and unions failed to participate. The article makes the following point: How can we hold up our heads around the world as having a modicum of environmental understanding-at least the same amount as Third World nations-when we cannot even get a study of an area which may be classified as part of the National Estate? When the people who participate in this study cannot even set foot on the ground, of course it is necessary to have spy flights. If the investigators are going to get arrested for merely setting foot in the area, of course it is necessary to have spy flights, and this is what was happening with the F111 flights over the Franklin. There was such a confrontation there that the State police were informed not even to co-operate with the Federal police. It came to the stage where the Federal police wanted to make a phone call-they were up the Gordon River at Warners Landing and the Hydro Electric Commission had phone facilities there-and the State police told the Federal police that if they stepped ashore they would be arrested. The Federal police had to take a boat clear down to Strahan to make a phone call because the State police would not co-operate because of orders from Robin Gray. The situation in Tasmania got so bad that the State police actually cut phone lines in Strahan on the direction of the Government. They cut phone lines to the headquarters of the Wilderness Society and cut the public phone lines. They even cut the lines to the public phone box at the airport, which caused a flight safety hazard because we were not able to phone flight plans in. This is the extent of the confrontationist tactics that the Gray Government runs in Tasmania. To say that the Federal Government is being confrontationist is absolutely absurd. The newspaper articles go on and on; editorial comment is universally in condemnation. Even conservative politicians are attacking Mr Gray. An article in the Age of Monday, 11 May headed `Senate block stupid says Sinclair', states: The National Party leader, Mr Sinclair, yesterday launched a strong attack on the Tasmanian Premier, Mr Gray, for blocking Labor's nominee for the Tasmanian Senate vacancy. Mr Sinclair said Mr Gray's moves would ``backfire'' and that he was ``generating a major diversion when community attention should be on Government mismanagement of the economy''. Mr Sinclair understands the Gray diversionary tactics, and he, like many others, feels they are counter-productive. An article appeared in the Age of Saturday, 9 May, headed `Howard gets caught in Gray's mischief'. This is a comment by Michelle Grattan, the unsmiling correspondent from Canberra for the Age. The article reads: The constitutional chicanery of Tasmania's Robin Gray has put the embattled John Howard under further pressure: pressure to do the impossible, to exert authority over the rogue conservative in the south. Mr Gray is indeed a rogue conservative; he does not care for his Party. Senator Tate —He is not a true conservative. Senator SANDERS —He certainly is not a true conservative. If he were a true conservative he would be upholding the Constitution; he would not want to be tearing it asunder. So certainly he is not a conservative. He is basically interested in one thing, and that is the salvation of Robin Gray's skin. He wants to be re-elected. Unfortunately, in Tasmania this means he has to create a diversion-preferably to create a despised group, which he did with the greenies. The greenies' arguments are starting to prevail. The small sawmillers are now backing the conservationist call for a reduction in woodchipping. Many of the bush workers are sensing that the conservationists are the only ones really interested in the preservation of their jobs and that the woodchip companies and the logging industry do not care. So Robin Gray has to launch another diversionary tactic. So he says: `We are simply not going to allow the Labor Party to have the candidate that it wishes in the Senate'. It is simply political expediency. It has nothing to do with his philosophies, if any; it has only to do with keeping him in office. The Tasmanian Government is operating simply in its own self-interest. Its political self-interest is denying the rights of the people in Australia who actually voted for a Labor Party senator. The Labor nominee, under the system-and I believe it is a very fair system-should be appointed to the Senate and should be allowed to sit in the Senate. For Robin Gray to deny this is simply an obvious case of creating another diversion, another bit of obfuscation, so that people will not realise the terrible state that the Tasmanian economy is in and they will not realise how bad Robin Gray is as a manager of the State's resources. Basically it comes down to the statement `You can fool all of the people some of the time, and some of the people all the time, but you cannot fool all the people all of the time', not even in Tasmania. Senator COATES(Tasmania)(11.00) —We are dealing with the outrageous actions of half of the State Parliament in Tasmania in refusing to appoint a replacement for a casual Senate vacancy in accordance with the Constitution. Senator Durack in his speech raised the question: Why should we bother debating this matter again when we expressed an opinion about it on 19 March? That is the point. On 19 March this chamber expressed an opinion about what should happen in prospect. The matter had not come to a conclusion at that point. There was a hope that the Gray Government in Tasmania would see the light and do the right thing. The problem is now that the matter has come to a head in Tasmania and it is important that this chamber does not just express the opinion that it did on 19 March but makes that formal request of the Presiding Officers of the State Parliament to act correctly and in accordance with the Constitution. Either Senator Durack does not understand the importance of this matter or he does not wish to take it seriously enough. We ought to assert quite strongly that the Senate and this Australian Parliament as a whole should not take the matter lying down. Senator Durack said the Opposition had granted the Labor Party a pair for divisions in this place, but voting in the Senate is not the only responsibility of a senator representing Tasmania, or representing any State. There is participation in the debate in this chamber; there is participation in the committees of the Senate; there is participation in the committees of the parliamentary Party; there is representation within the State and around the country generally, and it is a farce to suggest that the Opposition has assuaged its conscience by giving us a pair in this place. It is not sufficient, and it cannot be maintained to be sufficient. The Opposition ought to more thoroughly support this formal request, instead of Senator Durack saying `This matter signifies nothing', putting it down and raising a pathetic diversion with the Opposition's amendment. The fact is that the various factions of the Opposition and the National Party are hopelessly divided over this matter, and it would be interesting to see, if we actually did have a division on this matter, how they would vote. Senator Archer, one of the senators from Tasmania, is on record as supporting Mr Gray on this matter, and I think it is appalling, especially given his shadow portfolio of Special Minister of State, that he should take that view. He is setting himself up as a potential Minister looking after the upholding of the Commonwealth Electoral Act and law and order, amongst other things, and he has the cheek to oppose the Opposition's support for this motion. Certainly the record shows that other Tasmanian senators-such as Senator Walters, Senator Townley and Senator Watson, among others-actually think that the Tasmanian Government has acted wrongly. Senator Walters said she wanted Mr Devereux in the Senate. Senator Townley dismissed the so-called constitutional crisis as a storm in a teacup and said that Mr Devereux would be appointed eventually. Senator Watson said there was no reason why Mr Devereux should not be appointed to the Senate to fill the vacancy when it occurred. These are their statements before the vacancy actually occurred, as stated in the Mercury of 13 March, but we obviously still have division in the Senate and insufficiently strong support from those opposite. Where is the moral support-even though there was a limited number of speakers on this matter-for this motion from the Tasmanian Liberal senators opposite? It does not exist. They are divided on this matter and they know that their supporters in the community, especially in Tasmania but also throughout Australia, are appalled and embarrassed at their colleague in Tasmania taking the action he has taken. But obviously they cannot actually do anything about it and they cannot even give wholehearted support to this motion. It is embarrassing for us as Tasmanians to have Mr Gray acting in this way-once again, making our State look foolish and disreputable in the eyes of the rest of the country. It is embarrassing to have to apologise continually for the actions of our State Government. Mr Gray suggests that Mr Devereux should not be appointed, basically because he disagrees with him. Apart from the illogicality of it all, that is just not good enough. John Devereux is to come here as part of an Australian Labor Party Government, which has particular views, and it is completely appropriate for him to have equivalent views to those of the Government. But Mr Gray says that, because John Devereux agrees with the Party to which he belongs and with the Government of which he will form part, he is therefore wrong and is not entitled to be elected. He has gone so far as to describe him as anti-Tasmania and has even made worse accusations than that. I wish that Mr Howard, Senator Durack and others in the Opposition could exercise more control over Mr Gray and call on him to end his appalling and unprincipled behaviour. If they fail to do so, they must share the condemnation that Mr Gray is receiving around the country, including from the conservative Press of this country. The amendment moved by Senator Durack, which was also moved in the House of Representatives yesterday, is a total diversion from the central issue. The amendment calls on the Federal Government to preserve traditional constitutional divisions of power and that sort of thing and not to use the external affairs power to intervene in the affairs of the States. The power that the Commonwealth has used in issues that have involved Tasmania has been upheld by the High Court of Australia. I would have thought that the conservatives opposite would uphold the decisions of the institutions of this nation that are set up to ensure that things run properly. The Government totally rejects the Opposition's amendment as irrelevant and as a diversion from the central issue. I listened to most of the debate in the House of Representatives yesterday, and the avoidance of the central issue by Mr Howard and Mr Sinclair was just appalling. At least Senator Durack, in his unconvincing way, spent part of his time dealing with the central issues. But in the House of Representatives yesterday there was just blustering in an attempt to divert attention from the main issue and a whole lot of obfuscation in falling in behind Mr Gray. It is just not good enough to have that sort of mild degree of support from the Opposition. Senator Durack says that the Opposition fully supports the opposing of Mr Gray's action. Perhaps he did not hear the loud `noes' from the Opposition when the motion was put in the House of Representatives yesterday. There was significant opposition to the motion from the Opposition in the House of Representatives. But, of course, members of the Opposition did not dare to call for a division because that would have shown up their internal divisions, the lack of support that Mr Howard has on this matter and his total lack of authority within the Liberal Party throughout Australia. I think the consequences of this matter are much more serious than Senator Durack is willing to acknowledge. Senator Watson —Identify which Tasmanian said that Howard is wrong in his statement. Go on. You are not prepared to, are you? There is not one. Senator COATES —Mr Howard says that he disagrees with the action, but he is not willing to go to the extent of saying that Mr Gray ought to be condemned and disowned. The Opposition is trying to have it both ways. The point I wanted to get to is that those of us who are still Tasmanian Labor senators-as distinct from Dr Don Grimes, who has retired-had better be careful. We had better not dare to die or be forced to retire on the ground of ill health before the end of our terms. I guess this would apply to Senator Sanders as well. Senator Tate, Senator Aulich, Senator Devlin, and I ought to be much more careful for the remainder of our terms about crossing the road. Queensland Labor senators ought to be particularly careful as well about the way in which they live their lives in the future. In 1975 Queensland Premier Petersen emulated Liberal Premier Lewis from New South Wales by tearing up the Constitution. I think it is not overstating the matter too much to say that this could happen again unless a very strong statement is made by the Senate. It is amazing that it is the Liberal Party-and the Tasmanian Liberals in particular-who continually say how important it is for Tasmania to have equal representation with the rest of the States and that the system of equal representation in the Senate is important. Yet, the conser-vatives of this country are effectively saying that Tasmania need not or should not have equal representation in the Senate, apart from giving us a pair in divisions. Senator Durack and the Opposition are being too forgiving of Mr Gray. I should have liked to see a strong statement from certain members opposite. Where has been the strong statement from Senator Alston, for instance? He is the most recent appointee to a casual vacancy in the Senate by a government of the opposite colour. I should have thought that he had a particular responsibility to make a clear statement about this important matter. Where is Senator Newman on this matter? Why has she not said that she, as the most recent appointee of the Tasmanian Parliament to fill a casual vacancy, is embarrassed by the fact that she was appointed with the support of the Australian Labor Party in that State Parliament? But now, the opposite is happening when a Labor vacancy occurs. Senator Walters —She is so good. Senator Button —That is the most revealing interjection you have ever had, Senator! Senator COATES —I am afraid I did not hear it. I try to ignore her interjections. She is obviously not repeating it so that I can hear it. Senator Newman's views are just as abhorrent to me as Mr Devereux's views are to Mr Gray. But we did not say that Senator Newman should not be appointed. She was the legitimate choice of the Liberal Party in Tasmania to replace former Senator Peter Rae, and we went along with that decision as should Mr Gray go along with John Devereux's appointment. Senator Watson —Why doesn't the Labor Party have a secret vote? Senator COATES —Once again, side issues are being raised by Senator Watson because the Opposition is trying to slip away from full support for this matter. He asks why the Labor Party would not have a secret vote. The reason why there is no need for a secret vote is that there is never any need for a ballot at all when there is only one nomination for any position in anything, whether one is talking about a local parents and friends association or an election to the Senate. It is a total side issue, and a secret ballot would not have made any difference. The question is raised about procedure. If the amendment in 1977 was worded as it was and if the procedure was intended to work as we assert that it should, why were the State parliaments still given a role under that amendment? Senator Durack raised some words of Senator Button in 1977, saying that the Labor Party fully supported the amendment but omitting to say that Senator Button said that we would have some criticisms of the proposal. Senator Durack —I did not quote that. I said that he didn't provide any criticism. Senator COATES —That is right-but he said that there would be criticisms. He did not actually go on to explain what those criticisms were. I want to deal with the legitimate question of why the constitutional amendment of 1977, which apparently gives State parliaments the right to make the decision, was not worded differently. Mr Gray says that if the State Parliament is given the right to meet and decide about filling a casual vacancy it should be able to use that right and not be just a rubber stamp. The point is that the State Parliament's role is to be not much more than that. Its importance is to supervise compliance with the formalities. Of course we cannot just have a situation where the Labor Party branch in Tasmania puts out a Press statement saying that John Devereux is its appointee and then he becomes a senator. There has to be some procedure to be gone through, and that is the role for the State Parliament. Senator Durack —What if the person was disqualified? Senator COATES —Exactly. If he is not over 18 or is not a citizen, the State Parliament would not be complying with its duty if it rubber stamped his appointment. That is the extent of its role. It is not to interfere in the internal affairs of the Australian Labor Party in determining its candidate. If all the formalities are in order, the State Parliament should approve the nomination. The reason that the State parliaments were given a role in the 1977 amendment, as in the Constitution at the beginning of 1901, is basically that the States would have been offended if their traditional role in the Senate process were removed. Of course the Labor Party went along with it at the time. It was the best that we could get. We would have had a great outcry, unnecessarily, from the conservatives in this country if we had tried to say that the State parliaments should have been bypassed. The State parliaments should have been able to be trusted in their supervisory role. The terms of the amendment-which were not drafted by us, but we went along with them because that was our only option-pander to the anachronistic concept about the Senate being a States House. The terms of the Constitution as it stands maintain that fiction. Of course, fictions are often the basis for so much of our system, and we accept that. That is the answer to Senator Durack about our attitude to the 1977 amendment. Senator Walters —So you did it deliberately? You left that in deliberately? Senator COATES —We have to accept lots of things in this world which are not perfect. If I had been drafting that amendment I would have made it clearer, but it was a Fraser Government amendment with its tortuous wording to provide a mechanism intended to ensure that the nomination of the party concerned was accepted. Senator Walters —You could have moved an amendment, but you left that as it was. Senator COATES —We were in opposition at the time, Senator Walters, you may remember. The ACTING DEPUTY PRESIDENT(Senator Jessop) —Order! I would appreciate it if Senator Coates were to address his remarks through me. Senator COATES —I apologise, Mr Acting Deputy President. I am being provoked once again by Senator Walters. The Australian Labor Party accepted the wording proposed at the time by the Fraser Government. There was no real option. We accepted-perhaps foolishly-that all State parliaments, following the crisis of 1975, would in future accept the conventions of the Constitution. A question has been raised as to whether the decision of the State Parliament is unconstitutional or whether it is acting totally within its powers. I would like to quote briefly from a comment by a senior lecturer in law at the University of Tasmania, Michael Stokes, who asserts that it is actually unconstitutional. In an article in the Mercury last Saturday he said: The decision of State Parliament not to elect Mr Devereux to the Senate is unconstitutional. This is because the Constitution does not allow a State Parliament the option of not filling a vacancy. ... ... ... Section 15 of the Constitution clearly indicates that it would be unconstitutional for a State Parliament to adopt any procedure for filling a Senate vacancy which could result in no senator being chosen. This is because the primary obligation which that section imposes on a State Parliament is to choose a replacement. The crucial words of the section are `. . . Houses of Parliament . . . shall choose a person to hold the place until the expiration of the term'. Mr Stokes goes on: These words impose a clear obligation to choose a senator. The use of the word `shall' rather than `may' shows that the provision must be obeyed and does not allow a State Parliament to refuse to appoint a sen- ator . . . He goes on to explain about the time scale because the constitutional amendment does not say that it shall do so within a particular time; it just says that it `shall'. All the other words of the Constitution suggest that time is of the essence because it points out that if the State parliament in question is not in session the Governor shall appoint a nominee in the meantime-that is, on the advice of the State government-and if that procedure takes place the State parliament is given only 14 days either to confirm that appointment or to do otherwise. Those time limits indicate that it is not a matter that can be left. As it stands, if nothing happens between now and 30 June next year when the term of former Senator Grimes ends, Tasmania will have suffered a reduction in representation and an unbalancing of the electors' wishes for 15 months, not for just the four or six weeks or so which is normal in these cases while the necessary party and parliamentary procedures are gone through. The Constitution says `shall', and a short period for those procedures is quite clearly envisaged. It is important that this motion, which calls on the Presiding Officers in Tasmania to act, should be carried unanimously-without any dissent at all from anybody on the other side of this chamber. The way the Presiding Officers have acted so far they are complices; they share the guilt for not upholding the convention because they voted on this matter. It is the Presiding Officers, above all, who should ensure that proper parliamentary procedures and convention are followed in this matter. The 1977 amendments give recognition to the fact that the most important division in Federal politics is that between the major parties, not amongst the States. I referred before to how the Constitution in its wording maintains that fiction, but it has other fictions as well. As you know, Mr Acting Deputy President, the Constitution does not refer to Prime Ministers or Cabinets or anything like that. All of those procedures are understood and not spelt out. This is another example of that sort of thing. The point which needs to be emphasised and which has to be pushed with Mr Gray is that John Devereux is and will be the only nominee of the Australian Labor Party. In some ways I envy John Devereux. He is already known nationally. His is a household name. The Devereux affair will go down in history. His library file in this place is already pretty thick. However, he has had to put up with a lot of appalling abuse, not just from Mr Gray but also from a lot of other people, including the so-called Independents in the Legislative Council in Tasmania. As shown on Friday, any other pretenders to the vacancy will suffer immediate expulsion. They will be expelling themselves-there is not any real need for action by the Party, but it has been confirmed-and so be ineligible under the Constitution. That is why the 1977 Fraser amendment was worded as it was. It is the clear intention of the 1977 amendment. It is in the terms of the amendment, in the terms of the Yes case circulated, and in the terms of the second reading debate in the House of Representatives and the Senate. Mr Gray should respect the wishes of the Labor voting people in Tasmania, as represented by our five quotas in this place. As Senator Tate said in his contribution last night, senators are not delegates of State parliaments or State governments, and Mr Gray is wrong in his attempt to dictate how a Tasmanian Labor senator should be chosen or should behave. He has very little support in this matter around the country, including from the conservative Press, even in Tasmania. It is the political expediency of his actions which has outraged and dismayed Australians. He has hopelessly confused-the Opposition with its amendment today is trying to do the same-an issue, forestry, with the fundamental functioning of Australian society. Forestry is an important issue. Senator Button —It is because they cannot see the wood for the trees. Senator COATES —That comment could be made. Forestry is an emotional issue. Mr Gray's attempts to keep that issue on the front page of the Tasmanian papers means that he is refusing to accept the Labor Party's nominee, and that is unforgivable. It has been reported that Mr Gray had another motive in refusing to accept John Devereux as the Australian Labor Party's nominee, that is to exploit the legitimate divisions within the Australian Labor Party over the forestry issue. I suppose that was the childish point that Senator Watson was making when he asked us why we did not want a secret ballot. Mr Gray, to his annoyance and, I assume, that of the Opposition, has not succeeded on this count because the unity and solidarity of the Australian Labor Party in the face of an outrageous conservative attack has seen to that. However, Mr Gray has succeeded in increasing the already public divisions within his own party, the Liberal Party of Australia. Senator Chaney initially said that he thought Mr Gray was within his rights to refuse the Australian Labor Party's nominee, then he changed his mind. I have already dealt with Senator Archer's attitude on this matter. He said: If there are special reasons why Mr Gray does not like the ALP nominee- does not like!- he has every right to reject that nomination. Thus, the personal whim of an erratic State Premier is to decide how the Senate will be constituted. Senator Archer supports him and other members of the Opposition have not been particularly strong in disagreeing with him. This gives a very clear indication of how the conservatives, in contradiction to that term, are willing to cast aside their beloved democratic institutions, such as State parliaments, Constitutions, High Courts and Senates, when they feel embattled by their political opponents. John Howard has further revealed that he deserves no credibility at all as Leader of the Opposition. He is unable to persuade Mr Gray to soften his position and so far he has failed to speak out strongly against the violence that Mr Gray is perpetrating on the Constitution. Mr Sinclair apparently showed enough courage to speak out strongly on this matter by saying that it was a stupidity, but when we looked more closely at what he said we saw that he had called Mr Gray's action `a political stupidity', not a constitutional stupidity. Obviously he thought Mr Gray's action would damage his cause. Once again, his contribution in the House of Representatives yesterday was hardly strong support for the motion. The people of Australia clearly indicated in 1977 that they did not want casual vacancies in the Senate to cause crises. Mr Gray is ignoring the overwhelming wishes of the Australian people. The amendment to the Constitution at that time was carried by a huge margin, which is very unusual for constitutional change in Australia. Mr Gray may be a State Premier-for the time being only-but even in that position he cannot and should not dictate to the Australian Labor Party who its nominee for this vacancy should be. Under the Constitution he is required to ensure that the State Parliament, in its supervisory role of the procedures, provides a replacement for Don Grimes's vacancy and that that replacement should be the Australian Labor Party's choice. Australia has had enough of the reprehensible power play of this politician in Tasmania. It is not his role to involve himself in the internal affairs of the Australian Labor Party any more than we should interfere in the internal procedures of the Liberal Party, the National Party, the Australian Democrats or any other party that seeks to come to this place. We have a legitimate right to expect the State Parliament to review its appalling decision of last Friday, and that is the reason for this motion. It is not just an expression of opinion, as the March decision was; it is a formal request from this chamber to the Presiding Officers of the Tasmanian Parliament to do the right thing. Senator COLLARD(Queensland-Leader of the National Party of Australia)(11.26) —It already looks as if the Senate will sit two weeks beyond the appointed time for rising for the winter recess. Yet today the Special Minister of State (Senator Tate) has brought forward this long, convoluted motion-in order to save a little time I will not read it out-to which he spoke for at least half an hour. We have just heard another Tasmanian senator speak for half an hour and most of what he said could have been said in five minutes. So we generally have a delaying tactic over a motion about which there is general agreement on the part of all political parties in this Parliament. That political agreement was expressed as far back as 1977 when there were debates on this matter in the Senate and a motion was generally agreed to for a referendum in that year. I agree with all the points that my colleague Senator Durack made. He went through the motion in a far more technical and detailed manner than I am capable of and pointed to the debates that had taken place. He also pointed to the provisions that exist already in section 15 of the Constitution. I suggest that, the Government having brought on such a motion at this time, we must at least give it full marks for gall but no marks for integrity. We must also give it full marks for hypocrisy but no marks for honesty. Indeed, that is why Senator Durack has moved his amendment and why I support it in full. It is all right to talk about the conventions of the Constitution in relation to Mr Gray, but what about the other conventions of the Constitution that have been so flagrantly violated in the past two or three years by the Hawke Labor Government? I suggest that this Commonwealth is a child of the States, not vice versa. Neither at the time of Federation nor in any subsequent referendum have land usage decisions been taken away from the province of the States. Yet on many occasions this Government has violated that constitutional convention by using methods and manners which were never meant to be used, thus circumventing what the founding fathers intended. Is it any wonder that Mr Gray has had enough? Is it any wonder that he has had enough of the actions, the flagrant violations of the conventions of the Constitution by this Government? Dare I mention the dams decision? What about the Lemonthyme and Southern Forests (Commission of Inquiry) Bill, which we debated recently? We have also had the admission by this Government that it once again sent spy flights across one of the States, a participant in the Federation of the Commonwealth. What an admission! Then it has the audacity to get up in this place and debate at length, ad nauseam, the conventions of the Constitution. What about the flagrant violations of the convention of the Constitution in my own State of Queensland? What about Moreton Island and Shelburne Bay? Most recently we have seen the emerging State of the Northern Territory seeking to capitalise on its resources, yet the Hawke Government has flagrantly violated the conventions of the Constitution over the Kakadu National Park. It is the utmost hypocrisy and gall for this Government, first, even to mention this and secondly, when there is general agreement on the replacement of senators or the filling of Senate vacancies, to waste the time of the Senate in this way. This is especially so when there is such a backlog in the Government's program which it wishes to complete before June. On behalf of my colleague in the Senate, I fully support the amendment moved by Senator Durack. Question put: That the amendment (Senator Durack's) be agreed to. The Senate divided. (The President-Senator the Hon. Kerry Sibraa) Ayes . . . . . . . . . . . 24 Noes . . . . . . . . . . . 34 —— Majority . . . . . . . . . 10 —— Alston, R. K. R. Knowles, S. C. Baume, Michael Lewis, A. W. R. Baume, Peter MacGibbon, D. J. Brownhill, D. G. C. Messner, A. J. Carrick, Sir John Newman, J. M. Chaney, F. M. Short, J. R. Collard, S. J. Teague, B. C. Durack, P. D. Townley, M. Guilfoyle, Dame Margaret Vanstone, A. E. Hamer, D. J. Walters, M. S. Jessop, D. S. Watson, J. O. W. Kilgariff, B. F. (Teller) Withers, R. G. Aulich, T. Jones, G. N. (Teller)Bolkus, N. McKiernan, J. P. Button, J. N. Macklin, M. J. Coates, J. Maguire, G. R. Coleman, R. N. Mason, C. V. J. Colston, M. A. Powell, J. F. Cook, P. F. S. Ray, RobertCooney, B. Reynolds, M. Crowley, R. A. Robertson, E. A. Devlin, R. Ryan, S. M. Elstob, R. C. Sanders, N. K. Evans, Gareth Sibraa, K. W. Foreman, D. J. Siddons, J. R. Georges, G. Vigor, D. B. Gietzelt, A. T. Walsh, P. A. Giles, P. J. West, S. M. Haines, J. Zakharov, A. O. Hill, R. Black, J. R. Parer, W. R. Richardson, G. F. Archer, B. R. McIntosh, G. D. Bjelke-Petersen, F. I. Morris, J. Reid, M. E. Childs, B. K. Sheil, G. Tate, M. C. (Senator Puplick did not vote, to compensate for the vacancy caused by the resignation of Senator Grimes). Question so resolved in the negative. Original question resolved in the affirmative. Senator Townley —Mr President, under the Standing Orders I would like my name recorded as being against the motion. Debate resumed from 11 May, on motion by Senator Gareth Evans: That the Bill be now read a second time. Senator WALTERS(Tasmania)(11.42) —The House is debating cognately the Australian Institute of Health Bill and the National Health Amendment Bill. I shall concentrate on the Australian Institute of Health Bill, because the National Health Amendment Bill merely points to the Government's lack of control in the field of expenditure. The purpose of the Australian Institute of Health Bill is to set up a new statutory authority. The functions of the proposed statutory authority are that it should collect data, conduct research into the health of the Australian community and evaluate health requirements. All those matters are laudable. I have been a member of at least two committees which have concluded that for proper planning governments need data that are accurate and appropriate. The Senate Standing Committee on Social Welfare, of which I was a member, under the chairmanship of Senator Peter Baume, pushed strongly for evaluation of all Government programs and for data to be obtained on health matters. The Committee made recommendations in respect of both data and evaluation. The report I am referring to was entitled `Through a Glass, Darkly: Evaluation in Australian Health and Welfare Services' and recommended: That the Commonwealth Government direct the Australian Bureau of Statistics to raise to an appropriate level the proportion of its budget spent specifically on health and welfare statistics. That the non-government health and welfare sector be given grants to enable it to report on the data priorities of non-government health and welfare organisations. Those recommendations related to the collection of data which the Committee regarded as a great need. The Committee's membership included Senator Grimes, who has recently retired from this place. The Committee saw the need for the Australian Bureau of Statistics to be given an appropriate budget level to enable it to operate the database. None of us on that Committee-including former Senator Grimes-saw any need for the setting up of a new statutory body to collect that data. The added cost of establishing such a body is mind boggling. In regard to evaluation, our report said: This report asserts that, in order to achieve an efficient, effective, rational and equitable health and welfare system, it is necessary to conduct on going evaluation. Evaluation need not be confining. There is a wide range of possible evaluation methods and no need for any program to be confined to one prescriptive format. Evaluation reports can make it possible to improve programs and rectify mistakes and, at times, they may indicate a need for program termination. The need for evaluation was regarded by our Committee as crucial. But there was no suggestion that a statutory authority should be set up to conduct those evaluations. We recommended: That the Department of the Prime Minister and Cabinet be charged with the responsibility for ensuring that adequate program evaluation is carried out by all Commonwealth authorities, and that it certify annually that the results of such evaluations have been properly reported to the Parliament. We also recommended: That the Departments of Health and Social Security provide a consultancy service fee of charges, to enable organisations receiving health and welfare grants from the Federal Government to evaluate their own activities. At no stage was there any suggestion in our report that there was a need to establish a statutory authority. But we certainly did agree that there was a need. As I have said, all of the functions that the Government has said that the statutory authority should have can be carried out less expensively by existing organisations. We already have over 500 statutory authorities. The Minister for Health (Dr Blewett) said that there will be no additional costs. But if we have a look at the powers that the Minister is giving to that statutory authority, we find that it will be able to conduct business, indulge in land dealings and so on. It is quite ridiculous for the Minister to suggest that there will be no additional powers. According to the Bill, the Institute will be able to: . . . enter into contracts or arrangements, including contracts or arrangements with bodies or persons to perform functions on behalf of the Institute; So it will be able to let contracts. It will also be able to: . . . acquire, hold and dispose of real or personal property . . . occupy, use and control any land or building owned or held under lease by the Commonwealth and made available for the purposes of the Institute. Does that sound as if there will not be any added cost? To expect that there will not be is, of course, just ridiculous. I am very suspicious of statutory authorities and the addition of another only adds to my suspicion. If we look at the annual report of the Health Insurance Commission-again, one of the statutory authorities on which this Government places great reliance-we find that there are 17 breaches of the law. I do not know how many breaches there were in respect of Medibank Private, but the number is quite incredible. The law requires that if the principles applying to 1985-86 are different from those applying to the previous year, this must be reported in the annual report. This, of course, was not done. That implies that there were breaches not only in the Medibank Private section of the report but also in the Australia Card and Medicare sections. There are breaches throughout the whole report of the Health Insurance Commission. Statutory authorities are notorious for breaking the provisions of the legislation under which they were instigated. I certainly have no joy in seeing the setting up of a further authority. The Minister has said that the statutory authority is necessary because it will deal with highly sensitive information relating to private health-related organisations, the health of individuals and the financial position of States and Territories. He said that it is therefore vital that the Institute be independent and be seen to be independent. He said that his priorities in setting up the statutory authority are based on privacy. I do not blame the Minister for being very sensitive about his Department, because his Department just cannot keep confidentiality within its grasp at all. Indeed, on many occasions it has leaked private information, much to the embarrassment of the Minister. But I suggest that the setting up of a statutory authority would make absolutely no difference at all in this respect. We have already had leaks from the Health Insurance Commission, which is also a statutory authority. So the argument for setting up a statutory authority for that reason alone is quite spurious. A reading of the Commonwealth Government Directory makes us realise just what an enormous department the Department of Health is. Under the Department of Health we already have the Australian Institute of Health, the Corporate Resources Division, the Health Advancement Division, the Health Services Financing Division, the Therapeutics Division and the National Health and Medical Research Division. Why cannot one of those areas do the research? Why does a special statutory authority have to be set up to do the health research for the nation? The Department of Health also has an internal audit branch and an overseas representation branch. The Department has responsibility for the Australian Drug Evaluation Committee, the Australian Health Ministers Conference, the Australian Health Ministers Advisory Council, the Commonwealth Serum Laboratories Commission, the Australian Institute of Health Advisory Board, the Executive Editorial Board Australian Prescriber, the Health Benefits Reinsurance Trust Fund and the Health Insurance Advisory Committee. The list goes on for page after page. Why on earth should the Minister want to set up a statutory authority when already all these areas are covered by the Department? If the Department, very rightly, wants additional statistics, let us give this function to the Australian Bureau of Statistics. The Government should give the Bureau the funds to collect those statistics and we would certainly agree with that. Senator Crowley, in her speech the other day, told us that the statistics cited by Senator Michael Baume, when he suggested that the incidence of use under the Government's Medicare program had increased, were wrong. The fact is, as we have been told by the Government, that the statistics taken out under the Fraser Government did not include 1.8 million people. Let us get it quite clear: They were primarily people in Queensland who did not see the need to insure because there is a free health system in that State. They were people in the armed forces who were not insured privately because they were fully covered, and a number of others. So, the Government's figures of the increasing incidence of usage under Medicare take in those additional 1.8 million people. Consequently, Senator Crowley's figures were quite fraudulent. If we look at where the Government should be cutting costs instead of setting up a new statutory authority, we cannot refer to any better source than Professor Penington, because he is the most influential health adviser to this Government. Professor Penington has said that health costs in Australia are out of control and that there is a simple procedure for this Government to follow if it chooses to do so-that is, to stop universal bulk billing. It does not matter to whom one speaks; everybody recognises that the entrepreneurial types of medical practitioners in Australia-there are only a handful of them-will take advantage of universal bulk billing to an enormous degree. The costs have gone out the window. We know without any shadow of a doubt that Professor Penington-as I said, he is the chief health adviser to this Government-has said: `Stop universal bulk billing'. Only the pensioners and the disadvantaged should be bulk billed. If we allow it for every person in Australia and nobody has to pay a penny for medical treatment, abuse of the system will continue. The proof of that, as I said, is the increasing usage of Medicare since the Medicare system was introduced. There is no credibility to the figures Senator Crowley cited during her contribution to the debate. Her figures excluded 1.8 million people; so they have no credibility at all. I ask the Minister: Will the Government take up Professor Penington's recommendations? We were told by Dr Blewett last time the professor made those recommendations, in 1985, that he would examine Professor Penington's statement closely before making a comment. Of course, we did not hear any comment at all from him; he just went to water. He knows only too well that the way to cut costs is to cut back universal bulk billing. But that does not fit in with the ideology of this Government. The ideology of this Government is very clear, as I have said in this place on many occasions. One has only to look to Dr Deeble, who is a good old socialist from way back in the Whitlam era and who has been picked up by this Government and added to its advisers. Dr Deeble said that the categorisation of private hospitals was the first step in bringing the private hospital system under the public system. He said that it was only a small step, but it was the long term aim. He set out very clearly the socialist tendencies of this Government in sticking to universal bulk billing so that eventually, when all doctors bulk bill, doctors will be socialised. Let us make it quite clear: Once the Government pays the wages of all doctors, those doctors are socialised. It is as simple as that. It is a back door method that this Government has used on many occasions. There have been all sorts of rumours about the May statement. We were told by the media yesterday that the gap will be greater for patients in private hospitals. In other words, the patients who can afford to pay the 1.25 per cent levy plus private insurance are paying twice for hospital care because their levy covers the public hospital system. If they do not use it, they pay for it just the same. If they take out private insurance, according to the media yesterday, they will be slugged for additional money. Only 75 per cent of the schedule fee will be returned, instead of 85 per cent. If the Government is serious about that, I assure it that it will be disadvantaging some of the poorest people in Australia. I refer to the health insurance survey of the Australian Bureau of Statistics for March 1986. In that survey the Australian Bureau of Statistics points out, in regard to married couples with dependent children and in receipt of less than $126 a week, that 46.05 per cent of those people take out private insurance. The mind boggles as to how people in receipt of that sort of income can possibly set aside money for private insurance. What makes those couples struggle to do so? What makes couples who are earning less than $126 a week and who have dependent children struggle to pay for private insurance? The point is that they know that they cannot necessarily get their children and themselves into a public hospital, so they take out private insurance. If this Government cuts the rebate for patients in private hospitals to 75 per cent of the schedule fee, it will disadvantage 46 per cent of those people in receipt of the very lowest incomes in Australia. Let the Government understand that point. It is of no use for the Government to introduce new taxes, set up new statutory bodies, tax people even further, make people pay twice, and think that it is only getting at the wealthy in the community; it is not. Even the poorest people in the community recognise that this Government has made such a hash of the health scheme that, because their families are their priority, they are forced to struggle to take out private health insurance. Senator COLLARD(Queensland-Leader of the National Party of Australia)(12.03) —We are debating two health Bills-the Australian Institute of Health Bill 1987 and the National Health Amendment Bill 1987. The Australian Institute of Health Bill establishes a new statutory authority which is completely unnecessary as its proposed functions are already being carried out by the Department of Health. The National Party of Australia therefore opposes that Bill. Its major functions will be the collection, analysis and dissemination of health-related information statistics. It is supposed to promote research into health services and the health of people. It is not supposed to interfere with or reduce the functions of the Australian Bureau of Statistics. Its financial impact is said to be negligible. The intention is quite obvious-that is, to consolidate the little nests of number crunchers that are already scattered throughout the Health Department. It is intended to create a single unit of bovver boys and health restricters. The fundamental premise of Medicare is to provide health care free at the point of delivery. This immediately creates an unlimited demand for services which have to be satisfied from a limited budget. Therefore, the Government has to limit the services it provides. These restrictions, which are being put in place as time goes by, have led to dissatisfaction amongst patients facing long waiting lists and delayed surgical operations, and amongst nurses and doctors, who are now striking, which was once unheard of in both professions. Public hospitals have bed shortages and there is an underusage of private hospitals, and nursing homes are subject to skyrocketing costs. With all this, what have these people been analysing, collating and disseminating so far? Quite simply, as any member of the medical profession will tell us, they have been analysing, collating and disseminating private doctors' prescribing habits, practising habits, home visiting habits, admission ratios and operation audits. They compare each doctor's figures with his area coverage and, if there is any variation, the Department of Health sends a counsellor to counsel him. The counsellor is often some broken down hack, unable to hack it in the world of private care, who has no idea what it means to take responsibility for a patient's life. The Government is now spending $16m on investigating and assessment teams to inspect patients in nursing homes. This work has been done free for generations by general practitioners and matrons. It has been done accurately in the past because patients were responsible for their own bills. It is an insult to patients, doctors and nurses to assert that they cannot assess the value and adequacy of their own health care. In the old Medibank days, Mr Whitlam and Mr Hayden asserted that `Health is too important to be left in the hands of doctors,' and that `A doctor owning a hospital is like a judge owning a gaol'. Both assertions are patently wrong and it is time the Government got off the back of the private health care system to enable that system to lift the load off the Government's back. The greatest instrument for containing health costs is to have each patient scrutinising each account. If the patient is paying, overcharging and overservicing are reduced to a minimum. Senator Walsh —You are against insurance then? Senator COLLARD —Indeed, I am not. Senator Walsh —The patient does not pay if he is insured. Senator COLLARD —But at least he sees his bill and has a fair idea what the service has cost him, and he is fully conversant with the fact that his premiums are a result of the cost of the service in the long run, the same as with car insurance or anything else. It is only when a third party is introduced into the doctor-patient relationship-a third party over which the doctor has no control-that these problems escalate. Under Medicare, when neither the doctor nor the patient is aware of the real costs of the service, there is no incentive to contain costs. Is it any wonder that the nation's health care is now costing the taxpayer a phenomenal amount? In order to reduce the cost the Government now needs to know what is going on; just what mayhem it has caused. It needs figures, so it invents these nests of number crunchers, bovver boys, health restricters and controllers, subject, of course, to the usual pious privacy provisions, which everybody knows are basically a sham. The report of the Senate Select Committee on Private Hospitals and Nursing Homes, entitled `Private Hospitals in Australia: Their conduct, administration and ownership', was recently tabled in the Senate. It is a direct result of the Government interfering in the conduct of the institutions as a third party. Of course, the interference starts with the government subsidy. This subsidy has been built into the economies of the institutions. Once the institutions become dependent on the Government subsidy, the Government is then in a position to control them. This is what has happened to private hospitals and nursing homes in Australia today, and it follows the old proverb: `Whoever pays the piper calls the tune'. The government subsidy has increased all the costs of these institutions and it is because of these high costs that the Government has had to commission its program of restrictions. But it first has to get the figures, and this is what the Australian Institute of Health is all about. The second Bill, being debated cognately, is the National Health Amendment Bill 1987. This is merely a patch-up and a band-aid Bill to correct many of the administrative weaknesses and failures that have come to light during the administration of that horrendous albatross around our neck, Medicare. If evidence were needed to show how cumbersome and inadequate our health care system is, this Bill is it. The National Party of Australia is not opposing the Bill, as it is at least an attempt to tidy up a number of areas in the administration of the pharmaceutical benefits scheme. The maladministration of the scheme under Pharmpay resulted in a processing backlog of 50 million scripts as at last September. The bureaucratic bungling of this scheme led to the Government being chipped by the Auditor-General for instituting an illegal payments scheme for pharmacists. The Bill provides that pathology services performed after a patient has left hospital but while he or she is still under hospital treatment should be eligible for benefit from a registered health benefits organisation in order to provide a safety net for those who are chronically ill and needing multiple prescriptions. As I indicated, the National Party will support the second Bill. Senator BUTTON(Victoria-Minister for Industry, Technology and Commerce)(12.11) —I thank honourable senators for their contributions to the debate, irrelevant as most of them were. Senator Collard —In your humble opinion. Senator BUTTON —I interjected during the honourable senator's speech that it was not, in my view, his best speech, but it was certainly his worst after the one he made earlier today. Senator Walters, in the course of her speech, as will be recorded in Hansard, sought to refer to the Australian Institute of Health Bill, which we were debating, and then said: `I have not got the Bill'. Her speech just demonstrated that point. She talked about everything except the Bill. It is not my purpose in reply to debate the whole range of issues which Senator Walters raised. Basically she is concerned about Medicare, and she has been for a long time, without ever declaring any interest which she might have in it. Senator Collard largely reiterated points which had already been made. I should indicate that the Australian Institute of Health has been the subject of discussion between this Government and the States. It is believed that the co-operation of the States and Territories in the provision of data will be more readily obtained if the Institute is seen to be a collection agent independent of the Department of Health. The States are concerned that such provision will not prejudice their position in negotiation for funding and so on. They will also have requirements about confidentiality, which the statutory authority is probably best able to ensure. There were one or two matters raised by the Australian Democrats, which will perhaps be raised again in the Committee stage. Let me just make the point that the amendments to be moved in Committee of the Whole by the Australian Democrats are acceptable to the Government. Further, there has been discussion on the intention behind he use of the word `researchers' in paragraph 5 (1) (h) of the Bill. I indicate on behalf of the Minister for Health (Dr Blewett) that that is to enable any genuine research person to obtain health information and statistics for the purposes of engaging in health research. The word `researchers' is not confined to academics in tertiary institutions. The main purposes of this legislation were explained in detail in the second reading speech, and I have nothing to add. I commend the Bills to the Senate. Question put: That the Bill be now read a second time. The Senate divided. (The President-Senator the Hon. Kerry Sibraa) Ayes . . . . . . . . . . . 35 Noes . . . . . . . . . . . 27 —— Majority . . . . . . . . . 8 —— Aulich, T. Jones, G. N. Bolkus, N. McKiernan, J. P. Button, J. N. Macklin, M. J. Childs, B. K. Maguire, G. R. Coates, J. Mason, C. V. J. Coleman, R. N. Powell, J. F. Colston, M. A. Ray, RobertCook, P. F. S. Reynolds, M. Cooney, B. Robertson, E. A. (Teller)Crowley, R. A. Ryan, S. M. Devlin, R. Sanders, N. K. Elstob, R. C. Sibraa, K. W. Evans, Gareth Siddons, J. R. Foreman, D. J. Vigor, D. B. Georges, G. Walsh, P. A. Gietzelt, A. T. West, S. M. Giles, P. J. Zakharov, A. O. Haines, J. Alston, B. K. R. Knowles, S. C. Baume, Michael Lewis. A. W. R. Baume, Peter MacGibbon, D. J. Boswell, R. L. D. Messner, A. J. Brownhill, D. G. C. Newman, J. M. Carrick, Sir John Reid, M. E. (Teller)Chaney, F. M. Short, J. R. Collard, S. J. Teague, B. C. Crichton-Browne, N. A. Townley, M. Durack, P. D. Vanstone, A. E. Guilfoyle, Dame Margaret Walters, M. S. Hamer, D. J. Watson, J. O. W. Jessop, D. S. Withers, R. G. Kilgariff, B. F. Black, J. R. Sheil, G. Richardson, G. F. Hill, R. McIntosh, G. D. Parer, W. R. Morris, J. Puplick, C. J. G. Tate, M. C. Archer, B. R. (Senator Bjelke-Petersen did not vote, to compensate for the vacancy caused by the resignation of Senator Grimes). Question so resolved in the affirmative. Bill read a second time. The Bill. Senator POWELL(Victoria)(12.20) —I move: (2) Page 4, subclause 8 (1), at the end of subclause, add the following new paragraph: ``(h) a member nominated by the Consumers' Health Forum of Australia.''. I foreshadowed the amendment during the second reading debate. The amendment brings into the work of the Australian Institute of Health in a very positive way the Consumers' Health Forum of Australia. The Australian Democrats believe that under the Australian Institute of Health Bill as printed the Institute will be made up of academic and bureaucratic appointments. The establishment of the Consumers' Health Forum was a very forward looking and useful exercise by the Minister. Through this amendment we seek to bring the Forum into a very active role in the new Institute, the establishment of which we support. The Forum has very exciting potential, as I said during the second reading debate. The Consumers' Health Forum should be guaranteed membership of the new and vital Australian Institute of Health. We are very pleased to note that the Minister has taken into account our arguments in favour of the Forum which, as I said, has been established by the Minister. We are pleased to have the Government's support for the amendment in the interests of Australian consumers. We believe that the amendment will ensure that the Institute gives emphasis to preventative health measures and has a clear focus on the needs and wishes of the consumers of health care and health services. We are pleased that the Minister has assured us that in relation to clause 5 (1) (h) there will be the widest possible definition of `researchers'. The Australian Democrats hope that the Institute will promote procedures for the automatic recording of adverse reactions to drugs and therapeutic devices, probably under clause 5 (1) (e). I note that in the case of the Dalkon shield, for instance, the voluntary reporting which was available was not very successful and I ask the Minister whether the Institute will assist in the development of procedures to enable ready notification for people who are using therapeutic devices or drugs which are discovered to be causing problems for health consumers. I commend the amendment to the chamber and thank the Government for supporting it. Senator MICHAEL BAUME(New South Wales) —The coalition, or at least the Liberal Party, opposes the creation of the Australian Institute of Health-and we just voted against the second reading of the Bill which provides for its establishment-because we regard it as an unnecessary way of bringing about a desirable end. As a result, the constitution of the Institute, as outlined in clause 8 (1), is within that framework of opposition. The Liberal Party certainly takes the view that this whole structure is unnecessary. Let me outline what the structure is: According to the Bill, there should be 11 members of the Institute; and the amendment moved by the Australian Democrats proposes that there should be 12. There would be a chairperson, the director, three members nominated by the Australian Health Ministers Advisory Council, the Australian Statistician, the Secretary of the Department, a member nominated by the Public Health Association of Australian and New Zealand, and three members nominated by the Minister. Now the Democrats have proposed that a member be nominated by the Consumers' Health Forum of Australia. This simply demonstrates and underlines the phoniness of this whole proposal. We heard during the second reading debate the proposition that there had to be an independent body because the State health authorities do not trust, do not get on with and are in continual warfare with the Federal authorities, and that it is vital, therefore, to have a separate statutory body like this. We denied that in debate. Now we see that the Secretary of the Department, who is apparently not trusted, not liked and does not get on with the State authorities-they are in such constant warfare that a separate Institute has to be created-is going to be a member of that Institute. The Government must really be pulling its own leg. The structure of this body underlines the nonsense involved in the argument that the only way in which to solve this problem is to have a separate statutory body, the Institute of Health. It was demonstrated quite properly in the second reading debate that one can achieve the objectives of this body without creating such a structure at all. It was intriguing that at the conclusion to the second reading debate, the Minister for Industry, Technology and Commerce (Senator Button) did not even bother to counter the very sound points made by the Opposition. For example, he did not counter the point that one of the many recommendations about improving the source of information research in this area which this Institute is supposed to achieve supported the creation of a statutory body like this. That was not responded to by the Government. It seems to me contemptuous of this place that we should have a round-up to a second reading speech such as that provided by Senator Button. So the opportunity given to us in the Committee stage must be taken to dramatise those areas referred to specifically in the clauses where the Government arrogantly disregarded the sound objections made by the Opposition to the creation of this body. For example, we see that the Australian Statistician is included in the constitution of the Institute. I suppose, if we are going to have to have this Institute, it is useful to have him as a member. However, I am surprised that the Government wants him there, having heard the incredible accusations made by Senator Crowley, for example, about his refusal to provide the statistics in an adequate way despite continual requests from the Government. There was a recognition apparently from Senator Crowley that this Government is incapable of requiring its public servants to act in a manner which suits it. If the Australian Bureau of Statistics was incapable of performing this function, as Senator Crowley insisted it was in her speech in the second reading debate, I must say I find it most curious that the Government should appoint the person who is in charge of this body, which does not do what the Government tells it to do, to join the Australian Institute of Health. The Government is really having two bob each way. Either the Australian Statistician is competent, capable, willing and able in this area or he is not. The reality is that he is competent; he is capable; and, given proper governmental direction, he would certainly be able to provide the sorts of statistics that are required and which, as we demonstrated, are not being provided at the moment, largely because it appears-- Senator Crowley —On a point of order, I would like to be clear, on a ruling from you, Mr Chairman, that the Opposition senator is not actually debating issues and is in fact taking a second reading position on this point. Could I be advised whether he is not actually straying from the Committee stage? The CHAIRMAN —The Committee is considering the Bill as a whole and Senator Michael Baume's remarks are in order. Senator MICHAEL BAUME —Thank you, Mr Chairman. Specifically I am discussing the fact that the Australian Statistician is included in the constitution of the Institute, despite the fact that Senator Crowley has behaved in such a contemptuous way of him and his ability to provide statistics in this area. Senator Crowley —That is a lie. That is not what I said. Senator MICHAEL BAUME —I recall only too well that Senator Crowley said that the Statistician was not providing the information required, that he had no interest in doing so and that he had failed to deliver what the Government itself wanted. Senator Crowley —Wrong. Senator MICHAEL BAUME —If the Senator wants to deny that, she should produce what she said in Hansard. Senator Crowley —I did. You go and do the Hansard. Senator MICHAEL BAUME —The reality is that this whole question of statistics is one of major concern. I refer to Hansard of 29 April when Senator Crowley, for example, accused me of misrepresentation of the facts. At page 1992, she is reported as saying: . . . he needs to do some more homework. The senator said that I should not falsify figures, and talked about `misrepresentation of the facts'. These allegations by Senator Crowley emerged because she claimed that the statistics I was using were inaccurate and the statistics that she had were truthful. Senator Walters —But she didn't understand them. Senator MICHAEL BAUME —Exactly. As Senator Walters said, she did not understand them. The reality is that when, in much more moderate terms than Senator Crowley used about me, I responded to her even moderately in kind, she bleated that she was being grossly and disgracefully attacked. Now look, Senator Crowley, you know, presumably, something about heat and kitchens, and I promise you that if you behave-- The CHAIRMAN —Order! Senator Michael Baume will address his remarks through the Chair. Senator MICHAEL BAUME —I can assure Senator Crowley that if she wants to indulge in this kind of personal attack on me, as I have outlined already by quoting it, she will receive exactly the same kind of response. I point out to her that when she bleats, as she did yesterday, that it was unfair and disgraceful of me to respond in kind to her, she is adopting double standards. Now that we know exactly where we stand, Senator-through you, Mr Chairman-I think we can deal with this whole question of whether or not the composition of this body is necessary. I am making the point that it is totally unnecessary except that there is a clear need for honest statistics in this area, as is demonstrated by the Government's misuse of those statistics. There has been not one response by the Government in this debate to the clear fact that I demonstrated that it is impossible for the Government's claim, for example, about the incidence of services per head having declined under Medicare and bulk billing, to be true when in fact each Budget since then has indicated a 7 or 8 per cent or so increase in utilisation per head. As Senator Walsh knows, one cannot increase utilisation per head every Budget and then try to pretend that some phoney figures suggest that it has fallen. Government senators not only suggested but asserted that utilisation had fallen under Medicare and bulk billing. That is patently false, yet Senator Crowley repeated it yesterday after having had that fact demonstrated to her. So there can be no doubt of the need for better statistics. The Opposition's complaint is that the structure as outlined in clause 8 is the wrong way to go about it. The figures were quite wrong, and there has been no concession or admission-or even discussion-of that by the Government in this debate. Not only were the Government's figures quite wrong, but they were self-evidently wrong in that they excluded in the comparison to 1983 1.8 million people and then tried to say that that related directly and strictly to the figures which now, of course, include the total population; and, as I pointed out, there was that one hidden word. The reality is that there is a difference in the degree of cover involved in the 1983 figures, as I understand them, and the 1986 figures, which the Government has been quoting as showing a fall in utilisation. There is no doubt that there is a need for honest figures in order to keep the Government honest in this area. That is why, as I said, it is intriguing that the Government is now including the Australian Statistician in the membership of the Institute, having claimed that he was not doing as he had been asked; that he had somehow failed in his duty. I suggest that Senator Crowley go back and reread her speech. She may not have intended to convey that impression, but she certainly did convey it, and in fact I interjected on this matter at the time. Whether or not the Consumers Health Forum of Australia would be an appropriate body to be added to this Institute is clearly a matter on which I am not going to take a strong stand, because, quite frankly, I am opposed to the existence of the Institute anyway. It seems to me that increasing the size of the Institute from 11 to 12 members is not a matter of great moment. I should have thought that, if there were a need for a representative from the Consumers Health Forum of Australia, that could well be met under the existing structure as outlined in this Bill, with three members to be nominated by the Minister. Why could not the Minister give an undertaking that one of those three would represent consumers? Without making any particular comment on the Consumers Health Forum of Australia, I point out that there has been a tendency for consumer groups in some areas-I am not necessarily saying in this area-to represent vested interests that are not necessarily the interests of consumers. It may well be a trend that does not necessarily lead to better government. The Opposition, having opposed the creation of the Institute, will certainly oppose this amendment as well but does not intend to call for a division on the matter. Senator CROWLEY(South Australia)(12.38) —Mr Chairman, I claim to have been misrepresented. I wish to make it clear that the comments by Senator Michael Baume attributing to me remarks that were critical of the Australian Bureau of Statistics are quite wrong and misrepresent grossly my attitude and what I said. I urge Senator Michael Baume to read Hansard to get an accurate account of what I did say on the ABS. I was simply citing examples from two documents in particular where claims were made by the ABS about itself or by the Better Health Commission about the ABS. To attribute those judgments to me is to misrepresent my view. I was trying to find reasons to make clear why collaboration with the Australian Bureau of Statistics was the preferred way to go. It was not, as Senator Michael Baume continues to claim, my view that the ABS had failed or had been mischievous or insufficient in its practice at all. I believe that the honourable senator, in continuing to make that claim about my remarks, is misrepresenting me. Amendment agreed to. Senator WALTERS(Tasmania)(12.39) —There is no doubt that Senator Michael Baume has caught Senator Crowley criticising the Australian Bureau of Statistics. For her to try to back off now by citing criticisms of the Australian Bureau of Statistics and saying that they were not her criticisms but that she was using them as evidence is really quite a stupid way to go about things. The fact is that Senator Crowley was caught being critical of the Bureau, which she does not like because it does not sound too good. Of course it does not sound too good, because the Bureau is a completely independent body of great integrity. For Senator Crowley to try to back off now is just stupid. The Opposition has said that the Bureau of Statistics is indeed a very credible organisation. It is totally independent, as every senator in this place would know. There is no doubt at all, at least on the Opposition benches, about the Bureau's credibility, and I would very much like to see it being given the money to enable it to collect the statistics that everyone in this place agrees are necessary. Senator Baume has just indicated that statistics are thrown around this chamber like confetti, and that is because we have not got proper statistics, particularly in the health and welfare areas. Several committees have said exactly this-that we need more reliable and better statistics. We have had this situation in other areas, such as the welfare area, where the numbers of homeless youth drift from one million to a couple of hundred thousand. Senator Elstob —But we cannot take notice of the Liberal Party's corrupt statistics. Senator WALTERS —As Senator Elstob would know, because he and I sit on the Standing Committee on Social Welfare, we have not a clue what the statistics are. Senator Elstob —Yes, we do. Senator WALTERS —Senator Elstob sits on the Committee with me and he acknowledged in its report that we did not know what the statistics were. We definitely need a better database not only in the area of health but also in the area of welfare. There is no argument there. The only argument is whether we need to set up a costly statutory body to collect the data. We already have the Australian Bureau of Statistics. If it is given the right amount of money it can collect the data without the cost of establishing a whole new statutory authority that needs land, offices and the whole thing. Absolutely unquestionably, the taxpayers will not put up with this Government spending any more of their money when facilities are already available to provide the database and to allow the research and the necessary evaluation to be undertaken. There is no doubt at all that the taxpayers will not tolerate their money being wasted on the establishment of yet another statutory authority. We have, as I have already said, over 500 statutory authorities, and there is no intention in the Opposition's mind of allowing yet another to be added to that list. Senator MICHAEL BAUME(New South Wales)(12.44) —The point that has yet to be made, largely because of the inadequate response by the Government, and one that must be made in these circumstances, is that the Government has not in this Committee debate, or in the second reading debate, established any need for a statutory body such as that being created by clause 8. The failure to establish a real need is demonstrated by the composition of the Australian Institute of Health, as recommended in clause 8. Consideration interrupted. Sitting suspended from 12.45 to 2 p.m. Senator BUTTON(Victoria-Leader of the Government in the Senate) —by leave-I inform the Senate that Senator Tate is absent from the chamber for Question Time today as he is attending the funeral of Sir James Plimsoll, the late Governor of Tasmania. Any questions which would normally be directed to Senator Tate in relation to his portfolio or those that he represents should be directed to Senator Ryan. Senator CHANEY —My question is directed to the Minister for Finance both in that capacity and as Minister representing the Minister for Employment and Industrial Relations. The Minister will recall my asking him last week about bans imposed by the Australian Postal and Telecommunications Union in a dispute with the Commonwealth Government about proposed changes to workers compensation provisions. He will further recall saying that the matter had gone before the Australian Conciliation and Arbitration Commission and that, if the campaign aimed at sabotaging the collection of public revenue continued, the Government would have to consider what action it would take. I ask the Minister: Is he aware that the union is now in open defiance of an Arbitration Commission ruling to lift the bans which are stopping mail deliveries to branches of the Australian Taxation Office and preventing collection by the Government of hundreds of millions of dollars in tax payments? Are the bans already having an impact on public debt interest payments-a potential result of the dispute acknowledged by the Minister last week? If not, how long will it be before this happens? On the eve of the Hancock report legislation, which will make it harder for employers to resist union pressure, will the Government reconsider its refusal to re-introduce the legislative provisions which it repealed and which gave it power to deal quickly and effectively with its employees who refuse to do the work for which they are paid? Senator WALSH —The answer to the last part of the question is no because it is unnecessary. Stand-downs of the people concerned have already taken place. That action was taken very rarely by the Fraser Government. Senator Chaney says he did it once. It might have happened on one or two occasions, but it certainly did not happen very often and it did not happen very quickly. As for the rest of the question, I repeat-I ask the unions to note-that this Government will not tolerate the sabotage of public administration by union industrial action. Senator CHANEY —I ask a supplementary question. I thank the Minister for that reply, but I ask him: When did stand-downs commence and what is the number of officers who have been stood down? Senator WALSH —This is subject to correction, but I think there were some last Friday. I do not know whether there have been some since, and I do not know the number. I will find out. Senator AULICH —Has the Minister for Industry, Technology and Commerce seen reports in the Tasmanian media which are critical of the Government's decision, announced last week, on future protection arrangements for the processed vegetable industry? Is there any justification for the alarm expressed by the Managing Director of McCain Australia Pty Ltd, Mr John Clements, and by Mr Nick Evers, the Tasmanian Minister for Primary Industry, about the future of the processed vegetable industry in Tasmania, particularly in the potato products sector? Senator BUTTON —I have had some of these comments drawn to my attention. It is an issue in respect of which both Mr Clements and Mr Evers, the Tasmanian Minister, have expressed concern, and also Mr Lawrence of the Australian Vegetable Industry Council is reported as expressing concern. I find the comments which have been made alarmist rather than alarming, which is the word that Senator Aulich used in his question. Last week the Minister for Primary Industry and I made an announcement of the Government's decision in response to the 1986 report of the Industries Assistance Commission into the potential for the development of the fresh vegetable and vegetable products industry in Australia. In a minute I want to come back to what the Government decided about that matter. I just make the point that the Industries Assistance Commission report was published in April 1986 and it was in November 1986 that, in full knowledge of the fact that the IAC report had been published and recommended a 10 per cent tariff rate for processed vegetables, the McCains company moved to Tasmania. That matter was fully within its knowledge at the time. I might go briefly to the decision which the Government made. The primary aim of that decision is to assist the sector to become more export oriented and attuned to market needs. The Government was very clear in relation to the regional significance of the industries, and I believe the decision taken reflects this understanding and the Government's intention to assist, not impede, the development of those industries. The decision, in summary, provides a final general tariff rate of 10 per cent for processed vegetables and fresh mushrooms, and minimum rates for fresh and unprocessed vegetables. This will involve declines in protection for some highly protected sectors and increases in protection for some others, so that there is a uniform rate of 10 per cent. There will be a phased in introduction of new rates, with more liberal phasing in for tomato and potato products. Tariff reductions will be phased in over periods of up to seven years to assist adjustment processes in the industry. Rates will commence to fall from 8 May 1987. Removal of a number of by-laws and the import prohibition of fresh potatoes are other issues dealt with in the decision. The Government's expectation is that the new protection regime, combined with a wide range of development measures that we have under way, will enhance the growth and export prospects of the industry. Those development measures include the plant variety rights legislation, a review of export inspection regulations, additional funds for rural adjustment, a $25m program over five years to assist innovative agricultural marketing programs, the introduction of the national industry extension service- Senator Withers —Put it in a book. Senator BUTTON —I know it is long, but it is very important for vegetables. I thought it might have interested the honourable senator, for that reason. The development measures also include the preparation of an export strategy for Australian processed food. Consumers should also benefit from these changes. I want to indicate the general import of the decision and say that the criticisms which have been made are not to the point and are alarmist, as I said, rather than alarming. Senator WALTERS —I direct my question to the Minister representing the Minister for Employment and Industrial Relations. I refer to an article on the front page of today's Canberra Times which alleges that payments of $116,176 have been paid to the Union of Christmas Island Workers since 1984 under an arrangement agreed to by the then Minister for Territories and Local Government, Mr Uren. My questions are: When did the Minister first become aware of the agreement? What action has been taken to ensure that it is not continued? Has any documentation been required or asked for in relation to the $20,000 a year payment for marketing services? Is this grant paid to the union or Mr Bennett? Is Mr Bennett a member of the board of the Phosphate Mining Company of Christmas Island Ltd? If so, is there a conflict of interest between Mr Bennett's union and the authority's duties? Senator WALSH —I saw the report. I do not have any definitive note on it, but I understand that there was a payment but that it was made from the Christmas Island Phosphate Mining Company which, I think, is its correct name. I glanced at the Canberra Times article only briefly but I thought it at least implied, if not stated, that it was paid by the Department of Employment and Industrial Relations or the Department of Territories. I understand that it was paid by the company. I do not know the rest of the details. I will seek them from the Minister, although I am not sure from which Minister I should seek them-probably not, however, Mr Willis. I will contact whoever is appropriate. Senator ELSTOB —Can the Minister representing the Minister for Aboriginal Affairs say whether the Government is satisfied with the participation rate by Aborigines in government employment and training programs? Has the Government considered the benefits of running a high profile campaign giving actual examples of employment and training opportunities taken up by unemployed Aborigines? Does the Minister agree that such a campaign would give realistic incentives to unemployed Aborigines and, at the same time, counteract the usual negative publicity given to Aborigines? Senator RYAN —In reply to the first part of Senator Elstob's question, I stress that our Government is not yet satisfied with the extent of participation by Aboriginal people in government employment and training programs. Although there has been a great increase in the participation by Aboriginal people in these programs, both in mainstream programs and in those specially designed for Aborigines, the Government considers that the rate of participation needs to be greatly improved. In August 1986 the Government announced the establishment of the Aboriginal employment development policy to address these issues. This policy represents a fundamental shift from welfare dependency, or the approach of the past, towards measures to enhance Aboriginal independence. The details are being developed currently for further consideration by the Government. The initial promotion of the Aboriginal employment development policy occurred in late 1986 and further promotion will be undertaken as further details of the policy are announced. One of the new AEDP programs-the Aboriginal employment action program-which is administered by the Department of Employment and Industrial Relations, involves facilitating the development of improved Aboriginal recruitment and training practices in the corporate sector. This program promotes private sector employment for Aborigines which, I am sure Senator Elstob will agree, is just as important as public sector employment opportunities. I agree that such promotion is important as it informs the Aboriginal community of the employment and training opportunities available, as well as presenting a positive image to the wider community of the fact that Aborigines want to work and not depend indefinitely on welfare payments. Senator MACKLIN —I refer the Minister for Resources and Energy to the report of the Senate Standing Committee on Constitutional and Legal Affairs entitled `The Role of the Parliament in Relation to the National Companies Scheme'. Is it the case that in a submission to that Committee, the former Commonwealth Solicitor-General, Sir Maurice Byers, who is now the Chairman of the Government's Constitutional Commission, argued that the Commonwealth, through its corporations power, had the power to control the mining and trading activities of companies, a position agreed to by the Senate Committee? If so, is it not the case that the Commonwealth has ample scope to use these powers to halt sand mining on Moreton Island if its sand minerals are sold domestically? How does the Government reconcile the arguments of the Senate Committee report with the curious and apparently increasingly isolated stance of the Minister for Arts, Heritage and Environment, Mr Cohen, who only three weeks ago told the Brisbane Courier-Mail that the Government does not have the power to intervene over the mining of Moreton Island? Senator GARETH EVANS —The Government is indebted to Senator Macklin for his continued support of a wide-ranging reach for the corporations power, in particular in the context of national companies and securities legislation. That is a campaign after my own heart and after the Government's own heart as the Attorney-General, Mr Lionel Bowen, has made clear recently. In that context there is no doubt whatsoever about the scope and reach of the corporations power, nor is there any doubt about the propriety of using the corporations power in order to advance manifestly sensible national objectives. I hope that in due course, and sooner rather than later, we will have a national companies and securities scheme reflecting that, the interests of the business community and, increasingly, the views of all parties in this country about the way to go in that respect. On the question of the use of the corporations power to achieve other policy objectives, such as environmental controls and so on, it must be acknowledged that the availability of that power, technically speaking, is much more problematic. I am aware that opinions have been expressed by people such as Sir Maurice Byers, whose opinions I very much respect, that the corporations power will extend to just about any kind of activity in which trading, foreign or financial corporations engage. However, there are others who take the view that the power in question extends only to the trading activities of such corporations or matters pertaining to their essential character as corporations, which is the sort of thing that companies and securities law is all about. I do not believe, the Government does not believe and clearly, from what Senator Macklin says, Mr Cohen does not believe that the power is conspicuously, self-evidently available in the context of environmental issues of the kind to which Senator Macklin refers. Whether it is or not is something to which the Government would have close regard in considering its approach to such issues. Obviously, a whole variety of policy considerations, apart from the question of the availability of constitutional powers, is relevant there and on these policy issues I refer Senator Macklin not to me, as either Minister for Resources and Energy or Minister representing the Attorney-General, but rather to the relevant departments, including the Department of Arts, Heritage and Environment. The PRESIDENT —I draw the attention of honourable senators to the presence in the President's Gallery today of a distinguished visitor, the Hon. John Trainer, Speaker of the South Australian Parliament. On behalf of all honourable senators, I extend a warm welcome to Speaker Trainer and his wife, Rosemary. Honourable senators-Hear, hear! Senator CROWLEY —My question is directed to the Minister for Finance, who represents the Treasurer and the Minister for Employment and Industrial Relations. I refer to an article in Monday's Canberra Times reporting a meeting of the Council of the Australian Small Business Association, Australian Capital Territory branch, at which it unanimously resolved: To support the general principles of the doctors' current dispute, in so far as they should be able to achieve a contract for services to ACT public hospitals which is based on a fair and reasonable claim, and in line with payments to doctors practising in NSW. What would be the fiscal, industrial relations and macroeconomic implications of settlement of the Australian Capital Territory doctors dispute in the terms of the Small Business Association's resolution? How would these implications impinge on small business? Senator WALSH —The answer to the last part of the question is that if the Australian Capital Territory doctors union were to get away with its current pay grab which it is pursuing with an industrial campaign including work bans, the result would be catastrophic to small business, big business and everybody else. The `general principles' referred to by the Small Business Association include the 60 per cent pay grab which the Australian Capital Territory doctors union is currently trying to achieve. There is also a reference in the quotation to payments in line with those of doctors practising in New South Wales. The New South Wales determination from Mr Justice Macken, which was for a sessional payment and not a fee for service, as has been the custom in the Australian Capital Territory, included pay increases of up to 119 per cent. That was a disgracefully irresponsible determination which should have been overturned by legislation. It was not within the power of this Government to do that. The Australian Small Business Association, Australian Capital Territory branch, is endorsing an attempted 60 per cent pay grab by the doctors union, pursued through a campaign of work bans which, if spread right across the economy-and it is the avowed aim of the doctors union to have this spread throughout the country-would mean an inflation rate of about 45 per cent, nominal interest rates probably above 50 per cent and a dollar probably worth about US 50c and falling rapidly, followed very quickly by an enormous number of small business bankruptcies. This statement by the Association reveals either that its members are people who are unable to grasp the reality of what they are endorsing or that it is just another ratbag Right organisation dedicated to attacking this Government, regardless of the issue, and consistently adopting an anti-Government stand. In other words, it is consistently inconsistent about everything but attacking the Government. Senator BROWNHILL —I address my question to the Minister representing the Prime Minister. Is it a fact that when this Government came to power in 1983, Australia's gross overseas debt was of the order of $30 billion? Is it also a fact that at the end of 1986 Australia's overseas debt had risen to $105 billion, a threefold to fourfold increase? What policies of his Government have caused this debt, which took 83 years since Federation to reach the high level of $30 billion, to be more than tripled in the very short period of just 3 1/2 years? Do the reasons include excess government spending and borrowings domestically, so forcing local private sector borrowers off-shore? Will the Government play its part by at least cutting out hundreds of indefensible silly grants, such as $3,100 to study the ritual significance of bark cloth in Fiji, $5,750 to study the songs and dances of the Chinese new year, and $88,000 as a community employment program grant to two Aboriginal women on the Gold Coast for them to learn the total concept of breastfeeding? Senator BUTTON —Senator Michael Baume had a lot to do with this question; he put the honourable senator up to it. The question at least reveals Senator Brownhill's capacity in literacy-he was able to read the question-but I can go no further than that in terms of praise. His question reveals a degree of economic illiteracy which I hope is not characteristic of the new Nationals, which emerged from this old collection of flotsam and jetsam that we have had here for so long. It is true that the gross national debt of this country has increased. I would imagine, without being able to provide precise figures off the cuff, that one of the reasons for that is that the value of the Australia dollar has gone down considerably. Senator Walters —Ha, ha, ha! Senator BUTTON —Senator Walters laughs. I do not know whether I need explain that to her but I think Senator Brownhill understands the point. Senator Walters —Why do you think it has gone down? Senator BUTTON —Because it was floated, because it was overvalued at the time of the Fraser Government in order to keep inflation down. I am not an advocate of what Senator Brownhill would describe as silly grants. It is just a question of whether we would agree that they were silly or not. They are matters of subjective judgment. I have not been through all those grants, but I do not think Senator Brownhill will solve our economic problems by ticking off four or five such items. Perhaps I may be so humble as to suggest that he go back to the drawing board and try to correlate the gross national debt, which incidentally fell in the last quarter for the first time for a long period. Senator Chaney —Net or gross? Senator BUTTON —It fell in net terms. If Senator Brownhill tries to correlate that figure with the grants he is talking about and comes back to ask another question, I shall have another go at it. Senator BROWNHILL —I ask a supplementary question of the Minister. Do the reasons include excess government spending and borrowings domestically, so forcing local private sector borrowers off-shore? Senator BUTTON —That is a matter of judgment. If one looks at the Government's view, expressed by various spokesmen, the answer would be to some degree yes. Senator JONES —I direct my question to the Acting Minister for Foreign Affairs. Has the Minister's attention been drawn to recent media reports of illegal activities by United States trawlers in the South Pacific? Has there been any detection of such activities in Australian territorial waters? What are the international criteria for fishing by foreign boats within the exclusive zone of individual South Pacific nations, including Australia? What avenues of interrogation, surveillance, detention and punishment are available to countries in the South Pacific whose territorial waters could have been trespassed upon by outside nations? Senator GARETH EVANS —Mr President- Senator Lewis —What about the Soviets sitting off-shore at Portland and getting stuck into all those fish! The PRESIDENT —Order! Senator GARETH EVANS —I thought you were going to ask Senator Lewis to answer the question, Mr President. Senator Colston —You have to draw the line somewhere. Senator GARETH EVANS —Senator Colston is correct. My attention has been drawn to the reports of illegal fishing activity by United States trawlers. It would not be for the first time, as the Solomon Islands people are well aware. On 5 May Kiribati arrested a United States tuna vessel called The Tradition for allegedly fishing without a licence in Kiribati's exclusive economic zone. This follows reported sightings by Royal New Zealand patrol aircraft of a number of United States fishing vessels in Kiribati's EEZ. Australia hopes that the incident will be resolved quickly. Last week the meeting of the Forum Fisheries Committee issued a communique which was strongly critical of the activities of the United States tuna fleet. The multilateral fisheries access treaty between members of the Forum Fisheries Agency and the United States Government, which was signed in Port Moresby last month, will avert such incidents when it comes into force. We hope that that will be so by the end of the year. Until the treaty enters into force, fishing by United States vessels in the region could be covered by interim arrangements between the United States tuna industry and the island governments. At the signing ceremony in Port Moresby, representatives of the governments of Kiribati and the United States, as well as other signatories, expressed strong support for the treaty as a means of successfully responding to a major long-standing regional problem. There have been no reports that the view of any of the signatories on the desirability of ratification of the treaty has been changed by the arrest. In fact, if anything, the arrest confirms the desirability of early ratification of the treaty. The treaty requires ratification by 10 members of the Forum Fisheries Agency, including Kiribati, Papua New Guinea and the Federated States of Micronesia, before it enters into force. Australia has sent its instrument of ratification to the Government of Papua New Guinea, which is the depository. There has been no detection of any fishing by United States tuna vessels in Australia's territorial waters, to answer that part of the honourable senator's question. International law recognises the sovereign rights of coastal states to explore, exploit, conserve and manage fisheries as well as other resources in the EEZ to which they are entitled. The avenues of interrogation, surveillance, detention and punishment available to coastal states in the South Pacific in cases of trespass in their territorial waters are determined by the coastal state involved. For example, both Australia and New Zealand, in consultation with the island states, undertake surveillance in the South Pacific to this end. I think that answers all the different parts of the honourable senator's question. If there is anything else, I would ask him to put it to me. Senator KILGARIFF —I direct my question to the Minister representing the Minister for Aboriginal Affairs. I refer to the question which was asked this week of the Minister by Senator Townley and to her response. Senator Townley asked whether Michael Mansell of the Tasmanian Aboriginal Centre, who is planning a trip around Australia to talk to Aboriginals regarding his recent trip to Libya, will have any part of that trip financed by the Tasmanian Aboriginal Centre. Will the Minister further indicate whether Mr Mansell will be in receipt of any salary which is paid with Commonwealth funds during the period of his trip to talk with Aboriginal people? Was Mr Mansell paid his salary for the duration of his visit to Libya, where he attended the Gaddafi conference? If so, what action, if any, does the Government propose to take, to recover any of the moneys which have been paid to Mr Mansell for this period? Senator RYAN —Yesterday at the conclusion of Question Time I gave the Senate some supplementary information-Senator Kilgariff may not have been in the chamber at the time-which addressed the matter of Mr Mansell's payment from the Tasmanian Aboriginal Centre. Speaking from memory, I would say that Mr Holding reported on a meeting he had had with the Secretary of the Tasmanian Aboriginal Centre. A number of questions were put to the representative of the Centre concerning the payment of Mr Mansell and his standing with the Centre. Mr Holding undertook to make that information available when he had it. He did not have it as of yesterday, but I shall seek the information and the additional information sought in Senator Kilgariff's question and make it available to him as soon as possible. Senator COOK —My question is directed to the Minister representing the Minister for Employment and Industrial Relations. Has the Minister's attention been drawn to the latest statistics on industrial disputes in Australia, released by the Australian Bureau of Statistics today? Do those figures indicate that the level of industrial disputation in Australia continues to be low compared with the years of the Fraser-Howard Government? To what extent is this improvement the result of the Hawke Government's policies? Senator WALSH —I have seen the statistics referred to. In the 12 months to the end of January 1987, the total number of working days lost due to industrial disputes was 1.4 million, which is not quite as good as the 1.2 million in the year to January 1986 or the 1.3 million in the 12 months to January 1985. It does, however, compare quite startlingly with the figures for the Fraser-Howard years. In 1980 four million days were lost due to industrial disputes. These figures are all, incidentally, for the 12 months to January. In 1981, 3.3 million days were lost and, in 1982, a staggering 4.4 million. Thus, in that 12 months period ending January 1982, more working days were lost because of industrial disputes than in the whole three years to January 1987. Also, something like half a million more people, and possibly a few more than that, are employed now than were employed at the beginning of 1982. Given that evidence, it is rather startling that the people who presided over a level of industrial disputation approximately three times that which has prevailed in recent years want to return to the system which produced both the wages explosion of 1981 and 1982 and the industrial disputes that went with it, and would sweep away the achievements of this Government. Recent detailed econometric research by two Australian National University academics demonstrates that the policies of the Hawke Government have had a great deal to do with what has been achieved. The academics are Drs Beggs and Chapman, who recently released a paper entitled `The Effect of the First Three Years of the Accord on Australian Industrial Disputation: The International Context'. I refer to a couple of the highlights in that paper. I mention firstly, as I mentioned yesterday, that Beggs and Chapman utilised a wide range of methods to demonstrate the difference between industrial disputation in Australia and in 13 other Organisation for Economic Co-operation and Development countries during the first three years of this Government's life. Whereas in the 13 OECD countries there was a decrease of 36 per cent, in Australia there was a decrease of some 59 per cent. I will quote directly from the paper. In regard to the validity of those international comparisons, Beggs and Chapman said: . . . it is apparent that the Australian data are relatively comprehensive. It follows that collection and inclusion criteria are such as to exaggerate industrial disputation in this country compared to most other countries. In other words, they are saying that the bare statistical conclusion actually understates the magnitude of the achievement in Australia. Finally, I say again that I am amazed that, given empirical evidence as decisive as this, there are still people who would, if they could, go back to the system which produced the vastly inferior results-indeed, the catastrophic results-of the early 1980s. Senator ALSTON —My question is directed to the Minister representing the Minister for Trade. I refer to the Government's short-sighted decision last year to close down the Australian Embassy in Lima. Is the Minister aware that since that time New Zealand, which immediately upgraded its mission, has launched a major export drive to promote dairy and sheep products in Peru and in Chile via major New Zealand companies such as Fletcher Challenge and Carter Holt Harvey? Is the Minister also aware that the New Zealand Dairy Board has invested about $500m in extensive pinewood projects and a virtual takeover of the local dairy industry? In the light of this sustained burst of activity and the Japanese Government's recent decision to allocate some $US30 billion in aid and trade to South America, has the Australian Government written off the continent as a potential expansion region? What is the Australian Government doing to counter the New Zealand menace? Senator BUTTON —I am glad that, with the wisdom of hindsight, Senator Alston is able to describe the decision made last year as short-sighted. It was not seen to be so at the time by any commentators or, indeed, any members of the Opposition-not that that is particularly relevant, I concede. I am fully aware, first of all, of the New Zealand initiatives in some countries in South America-which go beyond Peru, I believe-in terms of developing particularly agricultural markets of one kind or another. Initiatives of that kind have been taken by a vast range of countries around the world-- Senator Alston —Not Australia. Senator BUTTON —Yes, there are. Senator Alston —Not in Peru or Chile. Senator BUTTON —No, but New Zealand has not taken initiatives in other countries where there are Australian initiatives. That is the point I am seeking to make. There is no sustained burst of activity proposed at present to counteract what the honourable senator has described as the New Zealand activity in Peru, and I am very doubtful whether there will be. Australia's trade relations with the various countries of South America are represented by Austrade and diplomatic posts in a variety of capitals mostly in countries which have significantly larger populations than that of Peru and therefore greater export potential-and that is the way I believe the situation will remain. But if the honourable senator has any further suggestions the Government will, of course, look at them. Senator REYNOLDS —Can the Minister for Resources and Energy advise why two Ipswich coal mines have been selected for closure by the Queensland Government? What impact will the closures have on unemployment in this region? Was the decision related to the Queensland Government's intimidation of mining unions responding to anti-worker legislation in that State? Senator GARETH EVANS —I have seen the reports on the closure of Westfalen and Box Flat coal mines near Ipswich, which are owned by the Bundaberg Sugar Company. I understand that some five mines are involved, employing around 250 people, with closure to take effect next month, on 12 June. It has been known for some time that mines in the Ipswich area supplying coal to the Queensland Electricity Commission would risk closure if a satisfactory arrangement for the future supply of coal to southern Queensland power stations could not be negotiated by the mine companies and the Electricity Commission. In recent years, producers in the West Moreton coal fields have recognised that, as their share of Queensland domestic coal consumption has fallen, they have had to look to supplying export markets to ensure continuation of mining. The region did export nearly 1 1/2 million tonnes of steaming coal last year. But, clearly, at current steaming coal export prices, further market penetration, given the relatively small volumes that are available to these mines, would be very difficult. In the past some West Moreton miners have been able to find employment in the coal mines in northern and central Queensland, and some of those retrenched as a result of the Westfalen-Box Flat closures will be looking to find employment elsewhere in Queensland. It is to be hoped that previous redeployment arrangements developed by the Queensland mining companies and the coal unions will be used to maximum effect. Clearly, in the present circumstances, it is not possible to be greatly optimistic about the employment opportunities. The closures are a direct result, it should be understood, of the State Government's decision to phase down the Swanbank power station as part of its plan to discontinue the operation of older, higher cost generating plant. Currently, Swanbank's coal stocks stand at more than one million tonnes, compared with an annual `burn' of about 300,000 tonnes. I notice that the Queensland Premier is apparently silent on the problem. Perhaps that has something to do with the fact that while his policies aggravate the hardship of workers in the West Moreton fields the Rolls Royce of the new power stations, at Tarong, is on the very borders of his own electorate. In August 1985 the State Labor Party's shadow Minister for energy and resources matters, Mr Ken Vaughan, speaking in the Queensland Parliament, drew attention-I think very rightly-to the bad planning by the Government and the fact that well over $30m of Queensland taxpayers' money has been spent on power stations which will be closed down. He said that because of extremely bad planning the State currently has power stations capable of generating 4,800 megawatts while the maximum demand is about 3,500 megawatts. Because of Government propaganda about all of the industries flocking to Queensland from the rest of Australia and overseas, the Queensland Electricity Commission has had to plan power needs in accordance with the propaganda rather than with the reality. There have been a series of such phantom industries, which include two coke plants, a chemical plant, a pulp mill, a steel mill, a coal-to-oil plant, an oil-from-shale plant, two or three aluminium smelters, a uranium enrichment plant, and a number of other power consuming industries. None of them has materialised and electricity consumers, as a result, have been left with a huge bill to pay. Ken Vaughan placed all of these matters on the record in the Queensland Parliament on behalf of the Opposition, as I said, a couple of years ago. He has been proved to be absolutely right. Those chickens have come home to roost. As a result of the monumental misplanning of the Queensland Government, the talking up of non-existent booms, the encouragement of non-existent industries, the requirement that State utilities plan on the basis of fantasies rather than reality, mines are being closed and jobs are being lost-and in areas which are least equipped to cope with that. It has been yet another disgraceful record on the part of the Queensland Premier. It should leave no doubts in anyone's mind not only about the folly of his grander aspirations to strut the national stage but also about the absolute economic devastation and havoc he has wreaked in his own State during his unfortunate years of stewardship there. Senator LEWIS —My question is directed to the Minister for Veterans' Affairs. The Minister will recollect that it was claimed that the new veterans' entitlements legislation would drastically reduce the delays in processing claims and appeals and that initially this happened. Is it not a fact that, because of the new requirements for the veteran to furnish proof and because determinations are based on the balance of probabilities, claims have now been reduced to a mere trickle? In these circumstances, can the Minister explain why delays are now back to about 10 months for a repatriation determination and even longer for an appeal? Senator GIETZELT —The purpose of the new determining system was to overcome a very bad situation in which delays in processing claims for pension entitlements and assessments were in excess of a year-between 300 and 400 days. The aim of the new legislation was to reduce the waiting period for the single determining officer process, which was an innovation in the determining system, to 90 days. That has been achieved in about three of the six States. It is anticipated that within the next few months it will be the practice throughout the determining system; veterans will be able to have their cases dealt with at the primary level within the 90 days. That is regarded as being the best possible result from the veterans' point of view, having regard to the fact that records have to be provided and assessments made on the evidence produced by both the Department, in accordance with the Act, and the veteran. When the veteran is not able to convince the single determining officer, the matter goes on appeal to the Veterans' Review Board. It is true that there is an unacceptable delay at that level. I attended a conference on Monday in Melbourne. I raised with the officers of the Veterans' Review Board the current difficulties that are being faced by veterans in having their applications dealt with at the second and final level. What emerged from that conference was a tendency on the part of many persons in the system not to be ready at the point at which their cases should be dealt with by the Veterans' Review Board. Other applicants in the queue are placed at a disadvantage if the advocates, who do a lot of excellent work in preparing the cases for the veterans, are not able to proceed, despite the fact that they have indicated prior to the hearing that they are ready to proceed. Steps have been taken and resources have been allocated. There has been an overall reduction of about one-third in the number of those who were waiting in the system when I became the Minister. So, contrary to what has been asserted-I think there is an assertion in Senator Lewis's question-there has been a dramatic reduction in the waiting time. Senator MAGUIRE —My question, which is directed to the Minister representing the Treasurer, relates to the proposed spending cuts in government health outlays outlined in the Monash University's Centre of Policy Studies book entitled Spending and Taxing which was released last week. Is the Government considering implementing any of the savings options outlined in that book in relation to health? Can the Minister provide any information as to whether the Centre's proposed cuts in health outlays have the support of professional associations with interests and expertise in the health area? Senator WALSH —As far as I know, the only professional organisation which has commented publicly on the health spending cuts proposed in the book entitled Spending and Taxing is the Pharmacy Guild of Australia. Although the Pharmacy Guild has been providing financial support to the Centre of Policy Studies, which published the book, the Guild was very quick to distance itself from the recommendations in the chapter on health because it found the recommendations extremely embarrassing. That chapter recommended the abolition of the pharmaceutical benefits list, the compulsory prescription system, and the dilution of training requirements for persons retailing pharmaceuticals. All of those recommendations have been condemned by the Pharmacy Guild as being contrary to the best interests of the Australian community. It is perhaps the first of what I am sure will be many demonstrations that to many groups deregulation and the withdrawal of government is a great idea as long as it applies only in the abstract or to somebody else. When it affects a particular group-I would be interested to hear Senator Townley's views on this-and these recommendations are seen to impact adversely on a group, even on a group which has been funding the Centre of Policy Studies, it says: `Enough; this must not be done'. Mr Matthews, the Guild's National President, has been reported in the Australian Financial Review as having said that Australia has now the most `effective prescription insurance systems in the world'. He also said that the suggestion to abolish the list of approved pharmaceutical benefits was not worthy of serious consideration. He criticised that chapter in the COPS book as being uninformed, superficial, uneducated and irresponsible. I think one should add to that that the effect of what is advocated there would be to add about 6 per cent to the consumer price index as well, and to set up a health delivery service modelled on the United States experience which would ultimately be vastly more costly than the present system. In the United States 11 per cent of gross domestic product is spent on health services and in Australia the figure is 7 1/2 per cent. If we were to go down the American road, as well as the initial 6 per cent increase in the CPI we would have a much bigger kick in the CPI later because an additional $9 billion would be spent on health services in reaching the US level of 11 per cent of GDP. It is interesting to note that the Pharmacy Guild seems to have got much less value for its dollar in sponsoring the COPS team than, for example, the Housing Industry Association, building materials having been exempted from the proposed list of commodities which should be subject to a value added tax, recommended by the Centre of Policy Studies some time ago. Finally, I would invite other professional bodies, and in particular Dr Bruce Shepherd, who is indirectly, through the Australian Federation of Employers, a funder of the Centre of Policy Studies and the national priorities project, to give their views on those recommendations in the health chapter. Senator TOWNLEY —I ask a question of the Minister representing the Minister for Health. I refer to osteoporosis, a complaint also known as brittle bones, which affects millions of people around the world and in which the loss of bone tissue weakens the skeleton and makes it prone to fracture, particularly of the hip, and for which several calcium compounds, amongst other things, have increasingly been advertised recently as treatment. As this is a problem for many people, particularly the elderly in Australia, will the Minister ask the Department of Health to examine the matter and to issue a statement concerning the complaint, such statement dealing with the effectiveness or otherwise of self-treatment and the age at which any treatment should commence? Senator RYAN —I do not have a specific brief from either Senator Tate or the Minister for Health on this matter, but I can say in my capacity as Minister Assisting the Prime Minister on the Status of Women that I have been reading the media reports on this disease which I think afflicts elderly women more than elderly men. Senator Chaney —Close. Senator RYAN —Mr President, I think that the interjections Senator Chaney is making here are quite improper. One of the great benefits of an elderly woman is that she does not have so many elderly men around making a nuisance of themselves because they have all died from other diseases, not particularly this one of the bones. I have noticed that there have been advertising campaigns, both of calcium tablets or calcium supplements and of low fat dairy products, each of which is claiming to have some preventative effect. I think they have been aimed mainly at women in this age group. I have also noticed recent articles challenging the effectiveness of the calcium supplements. Senator Townley's question clearly touches on a matter of great public health interest, particularly but not only, to women. I will certainly pass on his request to Dr Blewett that the Department of Health make a statement from which the consumers can draw some sensible inferences about what course of action they should take to prevent this apparently preventable disease. Senator FOREMAN —My question is directed to the Minister representing the Treasurer. Is the Minister aware of the Steve Martin column in this morning's Daily Telegraph, and in particular the comment regarding tonight's expenditure statement? It states: If the Government fails to pass the `is it being fair dinkum' test, then Australia's already serious troubles will worsen. What tests does the Government believe should be applied to the success of the May statement? Senator WALSH —I have seen the column in the Daily Telegraph written by Steve Martin, who incidentally is not a member of the House of Representatives but is a member of the Senate; I understand it is one of the various disguises of Senator Michael Baume. It is from Senator Baume's piece that Senator Foreman has quoted `if the Government fails to pass the test' et cetera. I am not sure who will be marking the test, but I predict that the response of the Opposition will be along the lines of saying that we should not have cut back on anything that we have cut back on but that we should have cut back in total by more than we have. I predict that that will be the response of the Opposition. We will still be waiting interminably for the Opposition to spell out the details of the tough fiscal policy which it says it would adopt if in government, because apart from a piddling $32m worth of specific cuts all that we have heard from the Opposition is promises to throw away anything up to $8 billion or $9 billion in revenue through bringing in a 35 per cent maximum tax rate; abolishing the capital gains tax; abolishing the fringe benefits tax; paying pensions to millionaires; bringing back negative gearing and all of the other tax rorts over which Mr Howard presided for all the years that he was Treasurer. However, I will be very interested to see whether my predictions are borne out. I am quite confident that in the main the response will be that almost all the cuts will be said to be terrible, inhuman and likely to induce the demise of Christian civilisation in Australia as we know it, but in the aggregate we should have cut more, although how this should have been done will not be specified. In response to the last line in the question, it is worth noting that in response to the question `Will the Opposition's reply to tonight's economic statement be a big test for John Howard?' Mr Macphee this morning said: It's a very big test for him and for the Opposition, we have to have a position which is economically credible, at the same time socially acceptable. I believe Mr Macphee will be disappointed. Senator CHANEY —My question is directed to the Minister for Finance and it follows his readiness to discuss what the Opposition's response will be to the mini-Budget. I would like to ask him a question about the Government's position on the mini-Budget. Does the Minister agree with the Institute of Family Studies that a single income family with three children and a dependent spouse requires an income of something over $40,000 to live at the same standard as a single taxpayer with an income of $24,000? Is it a fact that the value of the family allowance and the dependent spouse rebate, which for most of such families are the only concession which is made by this Government to deal with that very significant cost difference, has already declined in real terms by about 25 per cent under Labor? Will the Minister assure the Senate that single income families will not be further harmed in the forthcoming mini-Budget, because they are already bearing the heavier proportion of the burden which has been inflicted on individuals by this Government? Senator WALSH —For the last two months or so various people in the Senate have been playing the game `See if you can get Walsh or someone else to let us know what is going to be in the economic statement'. Having failed until now, I must say I am surprised that Senator Chaney is still trying, on the afternoon of the day on the evening of which the statement will be delivered, to get me to make specific comments about initially what was likely to be in the statement and now what is in the statement. Senator Chaney will just have to wait until half past seven this evening or a bit later to find out. Senator CHANEY —I ask a supplementary question. The Minister, in his typical way, has totally ignored the substance of the question. As a matter of fact, does the Minister agree with the Institute of Family Studies that a single income family with three children and a dependent spouse requires an income of something over $40,000 to live at the same standard as a single taxpayer with an income of $24,000? I point out to the Minister that answering this question in no way requires him to trespass on his precious mini-Budget. Does the Minister agree that that is a fact? Further, does the Minister agree as a matter of fact that the value of the family allowance and the dependent spouse rebate, which, as I said, virtually are the only concessions allowed by this Government to the cost of dependency, has declined in real terms by 25 per cent under the Hawke Government? Senator WALSH —Implicit in the last part of the question is a commitment by Senator Chaney to add another $700m, which would be the cost of a 25 per cent increase in the things that he mentioned. That is yet another $700m to the $14 billion to $16 billion credibility gap that his Leader already has. As to the questions of fact or the assertions from the Institute of Family Studies which Senator Chaney quoted, I have not worked out the arithmetic. After tax incomes can be determined on a factual basis. Once one goes beyond that factual base, a much greater element of subjectivity comes into it, along with other relevant factors such as whether or not the family or household is paying rent, and so on. I have not seen the detailed assumptions and qualifications which are behind the assertion of the Institute of Family Studies. Senator GARETH EVANS —Yesterday Senator Lewis asked me a question about the commemoration of the Battle of the Coral Sea. I have confirmed, by reference to the Minister for Defence, that there was no change whatsoever this year in the scale of commemoration of the Battle of the Coral Sea or in the level of publicity sought. Accordingly, there is no foundation for all the snide innuendos and assumptions which underlay Senator Lewis's question. I can only put down his state of ignorance about the scale of the commemoration to his pre- occupation with the internal brawls and battles on his side, because in reality the scale has been as great as previously. As in previous years a program of commemorative activities was arranged jointly by the Government, the United States Embassy and the Australian-American Association. This year's program was very similar to previous years' programs, and involved formal remembrance ceremonies, social functions, and sporting events throughout Australia. The main remembrance ceremony was held in Canberra at the Australian-American Memorial in Sir Thomas Blamey Square. The Government was represented by the Minister for Defence, who laid a wreath on behalf of the Prime Minister and Government of Australia. The Minister spoke on the significance of the Battle of the Coral Sea and our alliance with the United States. This year, as in previous years, the President of the United States sent his personal envoy to the celebration. The Presidential envoy was to be Mr James A. Baker, United States Secretary of the Treasury. Due to unforeseen circumstances in the United States, Mr Baker was replaced at short notice by another high-ranking member of the United States Government, Mr John O. Marsh, United States Secretary of the Army. The United States also sends a high-ranking military representative to these celebrations, but this year they sent two. Admiral James Lyons, Commander in Chief of the United States Pacific Fleet, visited Brisbane and the Gold Coast, and Vice Admiral P. D. Miller, Commander United States Seventh Fleet, visited Darwin and Perth. This was Admiral Lyons' second visit to Australia this year. During his February visit to Perth, Sydney and Canberra, he held a Press conference and received considerable public attention. Again, he held a press conference in Brisbane on 28 April in association with his Coral Sea visit, which was reported on television. Senator GARETH EVANS —Yesterday Senator Jessop asked me a long question about the visit to Australia by Mr Luis Jalandoni. I seek leave to incorporate in Hansard the lengthy text of the answer. Leave granted. The answer reads as follows- Mr Luis Jalandoni, who describes himself as the `international representative' of the National Democratic Front of the Philippines (NDF), is visiting Australia on a public speaking tour, at the invitation of a private group. The NDF advocates violent action against the Government of the Philippines. It is an illegal organisation in the Philippines. The New People's Army (NPA)-the military wing of the Communist Party of the Philippines (CCP)-is described by the NDF as its main armed force. The NPA is engaged in armed insurrection against the Government of the Philippines. The Minister for Immigration and Ethnic Affairs approved the issue of a visa and Mr Jalandoni arrived in Australia on 1 May. Prior to his entry Mr Jalandoni was cautioned about refraining from advocating the cause of violence whilst in Australia. The decision to approve a visa in no way implied any recognition of Mr Jalandoni's status as an international representative of the NDF, nor acceptance of any claims by the NDF to international recognition. The violent activity espoused by the NDF, against the democratically elected Government of the Philippines, is opposed by the Australian Government and is viewed as totally contrary to Australian values. This point was made directly to Mr Jalandoni by an officer of the Department of Foreign Affairs in the course of a general discussion about the Philippines on 12 May. This meeting took place at the request of Mr Jalandoni. The Departmental Officer also made clear to Mr Jalandoni that the Australian Government welcomes the restoration of Democratic institutions in the Philippines since President Aquino took office and strongly supports her Administration's commitment to maintain constitutional Government and the Democratic process. Prior to issue of a visa to Mr Jalandoni the Government was not aware that he had attended the recent World Matabah conference in Misurata, Libya. Mr Jalandoni has subsequently acknowledged his participation in that conference. We have noted a report in a Philippine Newspaper that, at the recent meeting of so-called revolutionary movements held in Misurata, Libya, Mr Jalandoni is said to have stated that the NDF is seeking help from Foreign ``Anti-imperialist Forces'' in the ``militant fighting against U.S. imperialist Aggression'' in the Philippines. The Government has seen unconfirmed reports that the NDF is proposing to open an office in Australia, including the report in the Far Eastern Economic Review of 26 March. That report did not as claimed by Senator Jessop, suggest that the reason for Mr Jalandoni's visit to Australia was to open a disguised front office for the NDF. The Government is not aware of any such plans. The Government assumes that as the Matabah is a Libyan-front organisation there would be some form of Libyan funding behind the establishment of any Matabah office in Australia. Senator GARETH EVANS(Victoria-Manager of Government Business in the Senate) —by leave-I give notice that, on the next day of sitting, I shall move a motion to the effect that-and I will seek leave to incorporate the detailed text in Hansard-the Senate sit for three weeks, rise for one week and sit for two further weeks, namely until 3 July; that our sitting days be from 10 in the morning until 10.30 in the evening for those days where no such time constraints are presently imposed; and that as from our resumption back here on 26 May, Government Business take precedence of General Business on Thursdays. I seek leave to incorporate the text of the motion in Hansard. Leave granted. The motion read as follows- That, unless otherwise ordered- (1) The Senate at its rising on Thursday, 14 May 1987, adjourn till Tuesday, 26 May 1987 at 2 p.m. (2) The days and hours of meeting for the week 26-29 May 1987 be as follows: (a) Tuesday, 26 May 1987- 2.00 p.m.- 6.30 p.m. 8.00 p.m.-10.30 p.m.; (b) Wednesday, 27 May 1987- 10.00 a.m.-12.45 p.m. 2.00 p.m.- 6.30 p.m. 8.00 p.m.-10.30 p.m.; (c) Thursday, 28 May 1987- 10.00 a.m.- 6.30 p.m. 8.00 p.m.-10.30 p.m.; and (d) Friday, 29 May 1987- 9.00 a.m.-12.45 p.m. 2.00 p.m.- 3.45 p.m. (3) That the days and hours of meeting for the week 1-5 June 1987, be as follows: (a) Monday, 1 June and Tuesday, 2 June 1987- 2.00 p.m.- 6.30 p.m. 8.00 p.m.-10.30 p.m.; (b) Wednesday, 3 June 1987- 10.00 a.m.-12.45 p.m. 2.00 p.m.- 6.30 p.m. 8.00 p.m.-10.30 p.m.; (c) Thursday, 4 June 1987- 10.00 a.m.- 6.30 p.m. 8.00 p.m.-10.30 p.m.; and (d) Friday, 5 June 1987- 9.00 a.m.-12.45 p.m. 2.00 p.m.- 3.45 p.m. (4) The days and hours of meeting for the week 9-12 June 1987, be s follows: (a) Tuesday, 9 June and Wednesday, 10 June 1987- 10.00 a.m.-12.45 p.m. 2.00 p.m.- 6.30 p.m. 8.00 p.m.-10.30 p.m.; (b) Thursday, 11 June 1987- 10.00 a.m.- 6.30 p.m. 8.00 p.m.-10.30 p.m.; and (c) Friday, 12 June 1987- 9.00 a.m.-12.45 p.m. 2.00 p.m.- 3.45 p.m. (5) The days and hours of meeting for the week 22-26 June 1987, be as follows: (a) Monday, 22 June, Tuesday, 23 June and Wednesday, 24 June 1987- 10.00 a.m.-12.45 p.m. 2.00 p.m.- 6.30 p.m. 8.00 p.m.-10.30 p.m.; (b) Thursday, 25 June 1987- 10.00 a.m.- 6.30 p.m. 8.00 p.m.-10.30 p.m.; and (c) Friday, 26 June 1987- 9.00 a.m.-12.45 p.m. 2.00 p.m.- 3.45 p.m. (6) The days and hours of meeting for the week 29 June-3 July 1987, be as follows: (a) Monday, 29 June, Tuesday, 30 June 1987 and Wednesday, 1 July 1987- 10.00 a.m.-12.45 p.m. 2.00 p.m.- 6.30 p.m. 8.00 p.m.-10.30 p.m.; (b) Thursday, 2 July 1987- 10.00 a.m.- 6.30 p.m. 8.00 p.m.-10.30 p.m.; and (c) Friday, 3 July 1987- 9.00 a.m.-12.45 p.m. 2.00 p.m.- 6.30 p.m. 8.00 p.m.-10.30 p.m. (7) That from 26 May 1987, Government Business take precedence of General Business on Thursdays. Senator GIETZELT —Yesterday Senator Zakharov asked a question about the need to preserve the right of peaceful protest currently available in the existing Parliament House when the new Parliament House is in operation. The Government accepts that peaceful assembly is a recognised democratic right. The Minister for Territories advises me that the precincts of the new Parliament House are yet to be defined. So, the question of maintaining the existing arrangements for peaceful protest have yet to be determined by the Joint Standing Committee on the New Parliament House, which has canvassed a number of available options for retaining that existing right. The options range from inclusion of only the precincts of the building itself through to the larger area defined by the inner kerb of State Circle. So, in accepting the basic principle, the Government recognises the need to maintain the existing arrangements for peaceful public protest. The Government is considering the 1985 report of the Committee on how best to preserve that right. The PRESIDENT —I present the sixth report for the sixty-second session of the Standing Orders Committee. Ordered that the report be printed. The PRESIDENT —I inform the Senate that I have received the following letter, dated 13 May, from Senator Vanstone: 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 Government to reconsider the allocation of the Coastwatch contract to ensure adequate surveillance of Australia's northern coastline.'' Yours sincerely (AMANDA VANSTONE) Senator for the State of South Australia Is the proposal supported? More than the number of senators required by the Standing Orders having risen in their places- Senator VANSTONE(South Australia)(3.07) —I move: That, in the opinion of the Senate, the following is a matter of urgency: The need for the Government to reconsider the allocation of the Coastwatch contract to ensure adequate surveillance of Australia's northern coastline. I am sure that most Australians do not need to be told just how carefully and for what reasons we need to watch our northern coastline. As Michael Yates, a journalist for the Melbourne Herald, put it on 19 March: There are about 12,000 kilometres of rugged and mostly unpopulated coastline between Broome, Western Australia, and Cairns in Queensland. This is the top end: The front line in Australia's battle against hostile neighbours, drug runners, illegal fishermen and immigrants. It is a battle that many people believe we can never win. I am sure that that quote outlines just why coastal surveillance is so important to Australia. The contract for coastal surveillance is let out by tender to private operators. Over the past three years that contract has been carried out by a firm called Skywest. Early this year the tender for a new contract was let out to another firm. On 12 March the Acting Minister for Transport, Mr Scholes, announced the award of the contract to Amann Aviation Pty Ltd. There were eight tenderers. The Minister said: This Australian company, which will be based in Darwin, won the $17.7m contract from a field of eight tenderers and is expected to begin aerial surveillance in early May. There are a number of interesting points in that statement. The Minister said `this Australian company' as if it already exists. However, he then acknowledges his error by saying `which will be based in Darwin'. The word `will' implies the future and that it is not based in Darwin at the moment. My information is that the company which has won the contract is not based anywhere at the moment-that it is not yet in existence. Nonetheless, that is basically what happened. Eight firms tendered for the coastal surveillance contract, and one firm, referred to as Amann Aviation-not the firm that has handled this matter in the past-won the contract. The Minister for Transport, Mr Peter Morris, said on 18 March that he was quite satisfied that the tender had been properly let. He said: The Tender Committee was satisfied that the successful tenderer had sound financial backing, fully understood the requirements of the contract on offer, had made realistic provision for costs, and that it had the necessary arrangements in hand to enable an early start up. He was presumably referring to the Acting Minister's statement of early May. The current contractor, Skywest Airlines Pty Ltd, is a firm of 20 years experience. At the time of tendering it employed 161 staff, including 59 pilots; operated 29 aircraft, including three fan jets; and operated scheduled airline services from Perth to 13 destinations and from Port Hedland to five destinations. It was a very experienced firm, and it did not get the tender. In other words, its contract was not renewed. The contract has gone to the would-be firm referred to as Amann Aviation. Senator Peter Baume —Is it incorporated? Senator VANSTONE —I think it is appropriate to ask what is Amann Aviation and whether, as Senator Baume asks, it is incorporated. I was informed in Estimates Committee E that Amann Aviation was owned by Robert Amann and his wife; Joseph Gostner, the chief pilot, and his wife-those four people holding together a 50 per cent share-and a company called Continental Venture Capital Ltd, owning the other 50 per cent. But it is interesting to note that the information given in the Estimates Committee indicates that the officer from the Department of Transport answering the question was not too sure of the facts. I will come back to that matter. I am informed that a search done yesterday, admittedly, by one of the unsuccessful tenderers-but I have no reason to believe that the search was not properly conducted-does not show Amann Aviation as being an incorporated company anywhere. There is a firm called Myruse Pty Ltd-perhaps `ruse' is the appropriate terminology for that contract-and that firm does have as its principals Robert Amann and a number of other people, but there is no application to change the name to Amann Aviation Pty Ltd, nor can any incorporated company in the name of Amann Aviation Ltd be found. So the contract has been let to a company that does not yet exist. It has been let to someone who had the limited experience of a charter and freight business at Camden in New South Wales and in central Queensland for the last five years. I am told that Amann Aviation, as it is to be, half of which is owned by Continental Venture Capital Ltd, is a company listed on the second board of the Sydney Stock Exchange. I am also told that its 1986 annual report suggests that the biggest deal the firm has been involved in up to date is a $1.4m contract, yet it is now participating in a $17m contract. It is worthwhile to note that the Federal Minister for Transport denies there has been anything wrong in the allocation of this contract-no impropriety and no failure adequately to assess the capacity of Amann Aviation. A newspaper article states: A ministerial spokesman said the tender board was obliged to choose not only the cheapest- in fact Amann Aviation was the cheapest- but also the most technically competent. It is required to consider each tenderer's technical and professional expertise, facilities and financial backing. Yet, as I have said, the contract for the coastal surveillance of the northern coastline of Australia has not been renewed with Skywest, the firm that has adequately performed that contract for the past three years. It has not been given to anyone with any great experience in the aviation industry; it has been given, effectively, to a Mr Amann and his wife and a company that they are planning to set up. I cannot see how, that being the case, the Minister can possibly say that the tender assessment committee did anything other than simply give it to the lowest tenderer, because if one looked at the technical capacity and experience of Amann Aviation, being a two-bit charter pilot operation, one could not possibly say that one would award the contract to that firm. What has the reaction been to the awarding of the tender to the so-called Amann Aviation? The Minister will undoubtedly say, as others have, that whenever a $17m tender is let the unsuccessful tenderers are unhappy, and one would accept that, but the complaints have not come only from them. The Australian Federation of Airline Pilots, which has no peculiar interest in seeing that one company or another gets the contract, said this: The Government in believing that a person with a totally inadequate aviation background, no maintenance facilities, no check and training organisation, no appropriate licences and no management structure, just a line of credit from a high interest finance company and a bank, can establish the nationally vital coast watch services in the remote areas of Australia commencing in under two months and fully operational in six months, demonstrates the almost complete lack of understanding of aviation by the Minister. The awarding of this tender is absolute nonsense. No one has pointed out to me any particular interest that the Australian Federation of Airline Pilots could possibly have in this matter. A headline in the Australian Financial Review of 17 March indicates the concern that other people have. It reads: `Grant of coastwatch tender to ``unknown'' criticised'. A headline in the Australian of 31 March reads: `Ability of coast watch operator questioned'. A headline in the Sydney Morning Herald of 6 April reads: `Dogfight rages as aviation novice gets $17m coast watch contract'. The General Aviation Association had this to say: There is no possible way this company could qualify for this contract as they do not meet any of the requirements of the tender documents. We find it extremely difficult to understand the logic behind the granting of the coastwatch contract to Amann. So it is not just the unsuccessful tenderer that is unhappy, but the deed has been done. The Government has made the decision to give the contract to Amann, so we might well turn our minds to how the Government is planning on handling the handover to Amann Aviation, as I understand it is going to be, from Skywest-how it is planning to phase out the old and bring in the new. Skywest's contract was to expire on 31 March, and late in February or early March, presumably when the Department knew who was going to get the tender, it was invited to extend its tender from the end of March to the end of June to accommodate the changeover, irrespective of who got the new tender, whether it was Skywest or someone else. On 12 March Skywest was notified that it did not have the contract but that the tenderer who had been awarded the contract had told the Department that he would have aircraft here in April, possibly with some bases operational in early May-we will see later that that is either a blatant lie or a joke-and that all his aircraft would be here and he would be fully operational by 1 July. At the end of March the scene had changed. Department of Transport officers told the current tenderer that they had advised the unsuccessful applicant not to go ahead so quickly and that they wanted to extend the implementation of the phase-over. They said they wanted an extension. They asked Skywest, the current holder of this contract, whether it could provide an extension to cater for the incompetent bungling of the Department of Transport and the Department of Aviation and, for that matter, any public servant involved in this matter. So the unsuccessful tenderer has been asked, in effect, to pick up the bits left by the mess created by this Government. The unsuccessful tenderer, of course, has pilots resigning. He has spotters resigning. They know that their company, the company for which they currently work has not got the contract. They have wives and children to feed and they have to find other jobs. Yet the Government is going to this firm that it has told that it will not have the contract and asking it to hold the situation together until the Minister gets his act together. It is very difficult to recruit staff for part time jobs when the people cannot be told how long they will be needed. That is the situation with the vital surveillance of our northern coast at the moment. It is an absolute bungle. The Government has not only awarded the contract to someone who is manifestly incapable of carrying it out; but it cannot even manage the switch to that person from the person who previously had the contract. It is relevant to note that the Skywest firm, which had the contract, has been negotiating with the Government in the best of faith to sort out some circumstances under which it can help us and the Government by continuing with this contract. It has made a very detailed offer to continue under certain circumstances. The firm indicated that it required acceptance of that offer within seven days of the date of sending the letter, and that is today. My last conversation with the chief executive of Skywest indicated that the Government has not yet accepted that offer. The Government obviously treats the coastal surveillance of northern Australia as something to which it does not need to pay attention and on which it does not need to concentrate and to do well. The Opposition canvassed these matters in the Estimates Committee. One might think when one is there that one is reasonably successful, however from the Estimates Committee transcript I see no less than eight occasions on which I was given an answer by the Department which proved to be not quite right when I checked the facts. Let me deal with the first one: Who is the tenderer? Dr Kay, an officer of the Department, said that the tenderer was trading under a different name, as R. and P. Amann Aircraft Hire. Senator Lewis then commented: That was a business name . . . Dr Kay responded: It was a small company. Senator Lewis proceeded: But it was not a company at all, it was a business name. Dr Kay then said: Yes, it was a registered business name. In other words, if one persists for long enough, one will get the right answer. That is not what I thought was the function of Estimate committees. Senator Robertson —What are they, then? Senator VANSTONE —The Government Whip may well ask what they are. They ought to be committees where one does not need to persist to get an honest and direct answer. In my view, misleading answers were given to some questions. Details were not appropriately given with respect to the tender assessment committee. We were told that people from all sorts of departments were on, and we were not told that the person from the Department of Aviation showed up at only three of the six meetings. We were told also that there was only one operator who had experience in this area; yet I am informed that there are at least two other operators apart from Skywest who had experience. It is not a big point, but it indicates that the person who was answering at the Estimates Committee was not, in fact, fully informed on the subject and did not have it all on board. We asked questions about the taking on of Skywest staff, and we were told that a transport officer who went around with Amann speaking to Skywest staff left the meetings whenever the question of recruitment was discussed. I have been told that that is absolute rubbish. I do not know who is lying. I do not know whether the person of the Estimates Committee was deliberately misleading me or whether he has been misled, but somebody surely has. We were told that at the time of tender the aircraft had to be indicated by tail number; yet now we find a number of things indicating that that is a load of rubbish. We were told that negotiations were proceeding at a time when Skywest said that it had not even had an implementation plan from the Government. I could go on about that but I shall not. We now have more information to reinforce our concern. Dr Kay, the Chairman of the tender assessment committee, indicated in a number of places the tender assessment committee's satisfaction with the capacity of Amann to carry out this contract. But we now find out that the aircraft we were told that it had bought-one of which was here and more of which were coming-are not suitable. Aircraft are coming which are different from what we were told at the Estimate Committee not very long ago. We are not told that the plane that Amann was to buy, the 680 FL Commander, overheats and burns out engines at a typical surveillance speed of 140 to 160 knots. We might now very much question what will happen because, as anyone knows, when one changes aircraft one has different capital costs, different modification costs, different insurance costs, different air navigation charges, different airframe maintenance costs, different engine and propellor overhaul costs, different spare parts costs and so on. In other words, the whole ball game changes. There is now a clear indication that Amann Aviation was never at any stage in a position to carry out this contract adequately. The Opposition claims today that this is a serious matter. I have indicated that the surveillance of the northern coastline is very important to Australia. I have indicated that a tender process was put in motion and that the successful tenderer is regarded by every commentator other than a Government one as being incapable of carrying out that contract. I have indicated that the changeover from the old to the new is being bungled in the extreme, and the people to whom we are looking to carry on the job are desperately trying to get from the Government some indication of what it wants. I have also indicated that either we were misled at the Estimates Committee or the Department was misled-one or the other-and that we now have information which confirms absolutely that the Department could not have been satisfied with respect to the capacity of Amann to carry out this contract. Accordingly, it is a matter of urgency that the Government should reconsider the coastal surveillance contract to ensure adequate surveillance of our northern coastline. Senator GIETZELT(New South Wales-Minister for Veterans' Affairs)(3.27) —I cannot for the life of me understand how any person can claim that this is a matter of urgency and of such importance as to justify spending two hours debating the acceptance by the Government of a contract dealing with the surveillance of our coastline. Questions have been asked of me in the Senate, and a great deal of time was spent at the Estimates Committee by Senator Vanstone and Senator Lewis, in an endeavour to establish whether a proper process was involved in dealing with this tender and this contract. One can only wonder why Senator Vanstone has been chosen to carry the bag for Skywest. The truth is now out, of course: She has indicated that she is the spokesperson for Skywest. Senator Chaney —Mr Deputy President, I raise a point of order. It is quite disorderly to impugn the motives of the honourable senator. The expression that Senator Gietzelt used concerning Senator Vanstone is thoroughly objectionable to me, and I believe to the Senate, and it should be withdrawn. The DEPUTY PRESIDENT —The remarks of Senator Gietzelt did imply improper motives to Senator Vanstone and should be withdrawn. Senator GIETZELT —If Senator Vanstone has any objections, I am quite happy to withdraw the remarks, but she herself said she had been in touch with Skywest and she had been told certain things. If she is prepared to carry its bag in this place, one is entitled to say that she is the spokesperson for that organisation. The DEPUTY PRESIDENT —Order! Senator Gietzelt, you must not repeat the remarks that you have been ordered to withdraw. You should withdraw again and not continue on that line. Senator GIETZELT —I withdraw, Mr President. Senator Vanstone —I raise a point of order. The DEPUTY PRESIDENT —Is it a new point of order? The remark has been withdrawn. Senator Vanstone —I did not understand, Mr Deputy President, that the remarks had been withdrawn. I understood the Minister to say that if I objected they would be withdrawn, and I indicate that I do object. The DEPUTY PRESIDENT —On the second occasion he did withdraw the remarks. Senator GIETZELT —Senator Vanstone has said nothing new or startling in this debate. I really find it hard to appreciate why so much concern and so much enthusiasm are being expressed by the Opposition on this issue. It is obviously part of a very concerted campaign being waged by Skywest to try to upset a legitimate and properly conducted public tender process, as a result of which Skywest lost a very lucrative contract. That is accepted, but with every tender there is a winner and a loser. In this case, there are losers. Even if all the things that Senator Vanstone and her colleagues have raised over the past couple of months were substantiated in respect of Amann Aviation Pty Ltd, Skywest would still not have succeeded because it was the third lowest tenderer in this process. The Government takes the view, correctly, that it has an obligation not only to assess in the proper due processes the viability of the tenderers but also to save the public dollar, to save taxpayers' funds. It has done that precisely in the way in which it has dealt with this tender. Since the announcement was made that the three-year coastal surveillance contract had been awarded to Amann Aviation Pty Ltd a barrage of sniping criticism has been levelled at the Government, and at me personally, alleging a whole host of improprieties. The Government and I reject that any evidence at all has been produced, other than assertions and allegations by a loser in the tendering process. All of them have emanated from Skywest. When one considers the hundreds of tenders with which government deals from time to time, it is a matter of regret that we should be spending so much time and energy on one particular complaint which has not been substantiated and for which there is no basis of fact. We have heard today exactly the same sort of nonsense as Senator Vanstone and her colleagues parroted in the Senate Estimates committee and in questions that have been asked from time to time. They have not addressed some of the more important policy issues involved-for example, the rationale of coastal surveillance, which we accept is a very important objective for government and which the community expects. There is a need for protection of our country from agricultural diseases, illegal immigration, illegal fishing, drug running and all other matters that can be put under the general heading of misdemeanours or crimes. All we get is a rehash of the diatribe which amounts to nothing more than a squeal from the Opposition which clearly is batting for Skywest, which lost the contract. Let us look at what has been said-that the Government has been improperly handling a particular contract. Firstly, it is the cheapest and most dubious of all the tactics to suggest that the Government has acted improperly. It was a scrupulously fair contest in which various government departments were involved in the contract processes. A committee ws set up involving the Department of Transport, the Department of Primary Industry, the Department of Aviation and the Australian Federal Police. Is the Opposition really saying that that group of men and women has acted improperly in some way in making a recommendation to government? Of course that is what it is alleging; that is what it is asserting. Senior members of the Opposition know the processes by which interdepartmental committees are set up from time to time to deal with these matters. Responsible senior officers write the terms of reference and the tendering documents and then invite public interest. On the basis of that they then assess those who seek to have their tenders considered. The Department of Transport has the responsibility for organising the logistical basis of the Federal Government's coastal surveillance program, but it provides this service for other departments which, as clients, pay for the service according to their perceived needs. Many flights are scheduled by the Department of Transport in Canberra. The clients include the Department of Primary Industry, with respect to quarantine and fishery surveillance, and the Australian Federal Police, which has responsibility for law enforcement, including drug problems. The current contract for littoral surveillance of the north Australian coastline from Broome in Western Australia to Cairns in Queensland was let to Skywest in April 1983, with a subsequent 12-month extension and another 3-month extension which was taken to 30 June this year. The new tender is for five bases and was advertised in August 1986. Eight tenders were received, of which six conformed with the specifications. Even within that process, there would be areas of disagreement. The three lowest offers covered all five bases-Broome, Darwin, Gove, Weipa-or alternately Thursday Island or Bamaga Island-and Cairns. All were technically able to meet the tender specifications. I might add-I cannot emphasise it too much-that the calling, the handling and the assessment of tenders for the coastal surveillance contract were conducted fully in accordance with procedures applying to all Commonwealth purchasing. They ar not procedures that were brought in in March 1983; they are procedures which have operated for decades under the way in which the Commonwealth deals with such matters. Not only were the guidelines adhered to but also they were augmented by the establishment of a special tender assessment committee of the type to which I have previously referred. Each tender was carefully assessed from the standpoint of compliance with every aspect of the tender specifications. Interviews were held with each of the three lowest tenderers-Amann, Lloyd Aviation Jet Charter Pty Ltd and Skywest. Because the lowest tenderer, Amann, was new additional and particular care was taken to assess whether that organisation was capable of doing what was done in 1983, to check as thoroughly as propriety would permit-that is, we are dealing with matters of confidentiality and privacy-the company's bona fides and competence. Its potential competence was also examined. Independent checks by the committee were conducted with the police and with potential financiers. The Government, through its committees, took every available opportunity to check out the bona fides and the competence with which the successful tenderer would be able to meet the Government's requirements. The tender assessment committee was obliged to, and did, satisfy itself that the lowest tenderer, Amann Aviation, has sound financial backing and fully understood the requirements of the surveillance contract and what was entailed from an operational and management standpoint. What more could be asked of any organisation, whether it be government or private, in respect of this matter? The committee assured itself that Amann had made realistic provisions for costs and had the necessary arrangements in train to enable an early startup in the event that the tender was successful. It was entitled to do that, and it did so. Despite this scrupulous and thorough analysis, we still have this concerted campaign being waged by Senator Vanstone and her colleagues, obviously on behalf of a dissatisfied person. Senator Vanstone —On a point of order, Mr Deputy President: I take objection to the Minister's remarks. The implication clearly has been raised again that the Opposition-me in particular-is putting this matter on behalf of an unsuccessful tenderer. I would have thought that, had the Minister been listening to my speech, it would have been abundantly clear that that is not the case. The DEPUTY PRESIDENT —Order! The honourable senator's point of order is valid. I ruled on that point before, Senator Gietzelt. That should be withdrawn- Senator GIETZELT —What the Opposition is seeking-- The DEPUTY PRESIDENT —It should be withdrawn, Senator. Senator GIETZELT —It is withdrawn. The Opposition is seeking to say that the Government has acted improperly. It is seeking to denigrate the Government, the public tender process and Amann Aviation to a point where the whole contract will be overturned. It knows that that will not happen, so why are we being subjected to this continual barrage of innuendo and allegations against the propriety of the Government and the officers concerned? The purpose would be to enable Skywest to resubmit its tender and retain the cash flow that it needs to keep its total operation running in the manner to which it has become accustomed. If Skywest felt that it had the matter all sewn up-and one is entitled to draw the conclusion that it did not have a competitive price-of course the Government was not only entitled but also obligated to go beyond the tender price submitted by that company. Let us have no confusion about the motives behind the motion or the activities of Skywest. That company has lost a lucrative contract in a fair and square contest. It is upset with the umpire's decision and it is making sure that its views are being expressed in the Parliament. It is a very poor reflection on the Opposition that it should make the assertions that it has made about this contract. The Opposition has not been able to produce any evidence that Amann could not carry out its responsibilities. The same sort of licence is being given to Amann as was given to Skywest when it was the successful tenderer against another company in 1983. That company was entitled to feel aggrieved at that time. The Government was satisfied that the successful new tenderer-Skywest-had the maintenance and staffing infrastructure already in place. It also had some of the equipment, even though some upgrading was required. Any small business, any person seeking to enter this area, would need to set out the expenditure, equipment and certification required. Amann has satisfied the Government that in each of these areas it can carry out its tender obligations successfully. One cannot deny that the loss of a contract potentially worth more than $18m over the next three years would be a severe blow to any organisation. However, business is business. Small business is small business. Competition is competition. It is precisely those processes to which members of the Opposition are objecting. It is the Government's responsibility to ensure that taxpayers' money is properly spent. Should we overturn the recommendation of a properly constituted committee and a properly constituted tender process? If so, on what grounds? Senator Vanstone has not given us any ground and I do not believe that any other honourable senator will be able to do so. Where is the evidence that there has been impropriety or lack of good business competence? Nothing that Senator Vanstone has said today has any basis at all; it is just innuendo, allegation, gossip and guesswork. On the question of public expenditure, Amann's bid was 28 per cent lower than the current contract amount being paid to Skywest. That is a considerable saving-28 per cent difference. Yet members of the Opposition, who spend half their time talking about waste watch operations and the way in which taxpayers' money has to be protected, complain when this is applied in practice, not in rhetoric, allegations and gossip. The Government is being put on trial by these inane and weak allegations from Senator Vanstone and obviously her colleagues. The largest single complaint being put out by those who backed Skywest's tender is that Amann Aviation is new and unknown. That is an old scare tactic from way back. This is supposed to be the Opposition that claims to represent small business. This is the Opposition that claims we must save money, wherever that can be done. This is the Opposition that believes in competition. Yet when the Government applies these basic business principles to its tendering processes, it does not get support from the Opposition but criticism, allegations, innuendoes and suggestions of impropriety. Impropriety on whose part? That of the Minister for Transport or that of senior officers in the Australian Federal Police, the Department of Primary Industry, the Department of Aviation or the Department of Transport? To whom does this allegation of impropriety apply? All we have is a consistent whinge by someone who lost in a fair and competitive way. It is about time that the Opposition accepted the fact that in every possible way the Government has operated this contract in a competent, business like fashion and in a way which will save the taxpayers about $3m. To that extent, the Government stands on its record and not on the rhetoric of the Opposition. Senator MASON(New South Wales)(3.46) —I have listened with some care to the speeches of Senator Vanstone and the Minister for Veterans' Affairs (Senator Gietzelt) on this matter of urgency. Although I have no brief for or knowledge of Amann Aviation Pty Ltd-I do not know it from a bar of soap-I am concerned at the virulence, especially by way of interjection, with which this business firm has been attacked. Presumably it attempted to get a contract and was successful. I really cannot see that that sort of attack is justified and should be made here under privilege. It is not an argument against any organisation that it cannot do a thing because it has not done it before. The theory that nothing must ever be done for the first time is too common in government and it is quite improper that it should be raised here. It has been put to the Senate that Skywest Airlines Pty Ltd should continue to have the contract, despite the fact that if the Minister's figures are to be believed-I have no doubt that they are reliable and the Opposition can tell me if they are not-Amann's tender was 28 per cent lower. We all know of the traditional situation in which the person doing the job puts in a tender and loses because somebody else undercuts him. But that is business, as Opposition senators ought to know. That is what it is all about. Although Amann has not done this job before, it is a fairly routine aviation task. It does not involve the running of a responsible passenger service or an air ambulance, or anything like that. It is a routine task, the parameters of which can be laid down and established fairly readily. I take it that that has been done and I assume that the Government, in accepting the tender, has satisfied itself that certain requirements will be met within a certain time. The only other point of substance which the Opposition has raised is that there has been an aircraft change. I would have thought it was proper and responsible that if Amann-whoever it is-found on investigation that the aircraft it proposed to use was not satisfactory for prolonged running at surveillance speeds in tropical temperatures, it should change the aircraft. I agree that something would have been wrong had the tenderer decided to proceed with that aircraft, after it was established as unsuitable. There would have been the risk of a high rate of breakdown and things of that kind. As I understand it, that is not the case. The people concerned understood that that aircraft was not suitable for that function and as a result they are changing it. It would seem that this change of aircraft has caused delays in implementation. I would have thought that that would be so. The Minister has not said it, but perhaps a later Government speaker-if there is one-might check that out. I think it would be useful for the Senate to know whether the delays were due to the aircraft change. From any reasonable point of view it would seem that that might be the case. This matter of urgency takes up the Senate's time unnecessarily. At least it will have the advantage of putting Amann and the Government on their toes. I assume that since Amann is aware of the degree of opposition here to its successful tender and the feeling that Skywest should have got the contract, it will do its very best to do the job properly. I think that any reasonable business would do that. Senator Knowles put her finger on the point when she inadvertently, or perhaps advertently, agreed with the Minister that surveillance was important. This urgency motion is important because of the larger issue it raises, which is the security of northern Australia. The Democrats are not convinced that the Opposition has made any kind of case to justify the reconsideration of the coastwatch contract at this stage. We do not propose to vote for the urgency motion. We do not believe that it is a matter of urgency for the Senate. However, we agree that surveillance should be improved. We must consider that matter. I feel it proper at this stage of the debate that we also consider, as should have happened at the beginning, Australia's surveillance problems in the north, with particular regard to the defence of this continent, because Australia is not adequately defended. The Government's recent review of Australia's defence capabilities clearly demonstrated this. The adequate surveillance of Australia's vast and largely uninhabited coastline in the north and west and our huge exclusive economic zone must be one of the most difficult defence tasks in the world. We need a consensus of view and co-operative effort rather than too much quibbling over details, and statements that people will fail before they even start, which is not a very constructive thing to say-and in this case presumably referring to people who have already spent money, bought aircraft and are setting up bases. It seems to me that to go back to square one is not really helping our task. Australia must have adequate means of surveillance of the coastline and its neighbouring waters. What we need in this modern world-the Democrats have said this before, and I say it again-is a computer-monitored coastal surveillance system which could be locally designed and manufactured, which Australian industry has the potential to do. It would be an automatic high technology system. One strategy for automatic monitoring would be a system of registering changes of movements that are checked against known and expected changes. Detailed scans could be carried out at any point where significant aberrations were pin-pointed. This would make surveillance of the entire coastline feasible, allowing the detection of smuggling and illegal entry. The real point in considering the degree of surveillance is that it should depend wholly on other circumstances. Those circumstances bear on the risk to Australia and the security or otherwise of our northern approaches. Granted a situation like the present one, in which most of our defence forces are located in the south eastern section of Australia and are known by a potential enemy to be in that part of the continent and not capable of being moved to the north and west quickly, and granted a possible future zonal rivalry in the waters to our north, it is possible to see a situation in which any amount of surveillance that we could muster-ten times what we have now-would not be enough. When most of our population is in the south and very few of our resources are in the north, we could have a situation in which that northern area is virtually in a state of siege. We probably could not afford or handle such a situation adequately. We have to use diplomatic and other means to ensure that that situation does not develop. That is the most important consideration at the bottom line of any discussion of surveillance of the northern approaches. On the other hand, given an effective neutralising of our northern approaches, given good relations with our neighbours and given a good defence presence in the north, the surveillance issue does not assume the importance it would otherwise do, and necessarily so. When I talk of a good defence presence, I mean the reality and the appearance to nations outside Australia of forces sufficiently powerful, flexible and mobile to discourage any thoughts of attempting invasion of this country. Those forces ipso facto-their mere presence, the fact that they are exercising in the northern waters-would discourage the other areas of surveillance that would concern us, being illegal entry and smuggling. It is important to realise when talking about the present coastwatch contract, which implies basically a fairly crude surveillance technique-an aircraft flying over areas regularly or irregularly and using spotters-that the ability to evade such a system is so easy on relatively low profile activities, such as drug smuggling and illegal immigration, as to be laughable. People have to work to some sort of schedule. If one wanted to drop somebody in and get past aerial surveillance of this kind, it would not be difficult to do so. One has only to watch for a while and to note the schedule of the aircraft. Senator Kilgariff —No night surveillance. Senator MASON —No night surveillance, as the honourable senator says. The situation is completely open-a net whose mesh is wide open and which allows small fish and even large fish to slip through without difficulty. If one is to take the position seriously, we should not have the token system we have now. We should be looking at our scientists achieving purely automated radar systems which can use electronic means constantly to monitor what is going on in the north, and to pick up areas of aberration, so that they can be investigated closely. This is where aircraft are desirable and necessary. Plainly, once an area of aberration is picked up, it must be investigated. As the situation now is, the areas of aberration, especially regarding low profile activities, will escape detection. Whether it is Amann or Skywest that operates the system will not make the slightest difference. That is a matter of serious concern to this country. While our surveillance methods are of that kind, the Australian Democrats believe that it is essential for us to pursue with intelligence the diplomatic and strategic options that are available to us. We see our best means of defence as the maintenance of close friendly relations with our neighbours and the removal of prime nuclear targets from Australian soil, targets such as North West Cape and Pine Gap. In this context, it is of vital importance to the South Pacific region, and indeed to the world, that a workable and thorough South Pacific Nuclear Free Zone Treaty is established and strictly enforced as soon as possible. Without that there will be tensions, strains, rivalries and perhaps countries allying themselves on one side or the other, as we are beginning to see even now. If those zonal rivalries arise it could greatly increase the danger to Australia and greatly increase the need for surveillance, to the point where it became an almost impossible burden for the community to bear. The Government will also be aware, of course, that the South Pacific Nuclear Free Zone Treaty makes it a binding legal international obligation on Australia that Australian uranium cannot be exported. The Government, for the good of international relations, particularly in the Pacific zone to our north, ought to realise that it can no longer allow the export of Australian uranium to France. By crossing that bridge, the Government would begin to approach something which would give us a rational, controllable situation to our north. That is necessarily the first step that has to be taken towards the rationalisation of a situation which otherwise will become intolerable. The most likely physical threats to Australia, as I have said, are the threats of smuggling and illegal immigration. They are particularly insidious because of their low profile and physical presence, which make them very difficult to detect, and of course because of their potentially massive harmful effects. Invasion and conquest of an Australian territory or protectorate must also be considered, as must the invasion of a close ally of Australia such as Papua New Guinea. These are far more likely threats than a physical attack on Australia itself. We cannot consider surveillance of the north without considering our relationship with Papua New Guinea. I noticed that yesterday Senator Walters in another context called the Democrats left wing because we had advocated some sort of defence relationship with Papua New Guinea. Indeed, I did advocate such a relationship, but my reasoning was sound and very much in the context of this debate, namely, that it is necessary for us to consider Papua New Guinea as probably the most important place that is necessary to be defended other than our own territory-and possibly as important as our own territory. If one goes to the Torres Strait and looks at the areas of low sandbanks and narrow waters, one can see that New Guinea is our northern gateway to the rest of the world. Any threat to the security of Papua New Guinea is a threat to the security of Australia. If Senator Walters does not realise that, I suggest that she is living far too far away in the south, in Tasmania, to understand what happens up in the north. But Tasmania, regardless of its problems, is still, as I understand it, a part of Australia. Senator Walters ought to do her homework on this matter and get herself a little more informed. It is worth noting that invasion and conquest of part of Australia-let us say, north-western Australia-and conditions of a world war or of total anarchy resulting from a world war would create a situation which would make it very difficult indeed for Australia to regain that territory. This may seem a truism, but it is the bottom-line consideration of great importance to us-or it should be. The upshot of all this is that we must start from scratch and rethink our entire coastal defence policy, because adequate coastal defence is the only way in which we can handle that surveillance problem. There is, I think, some indication that the Government is doing that. We have encouraged that while we have been in this Parliament. We have encouraged the Government not to think of a blue water navy but of fast, mobile ships-perhaps hydrofoils-all missile armed, that can deal with the coastal situation and we are delighted to see that that is now being done. We should have a modern small ship navy, augmented by submarines-we agree on the submarines-with wire guided torpedoes and fast, heavily armed missile ships possibly, as I have said before, in hydrofoil combination. All the material is there. This is the real bottom line for surveillance. This argument over whether Skywest or another company, Amann, should have the contract is, frankly, a very minor and somewhat sordid intrusion on an important subject. The ACTING DEPUTY PRESIDENT(Senator Colston) —Order! The honourable senator's time has expired. Senator KNOWLES(Western Australia)(4.01) —I will state the matter of urgency we are debating today: That, in the opinion of the Senate, the following is a matter of urgency: The need for the Government to reconsider the allocation of the Coastwatch contract to ensure adequate surveillance of Australia's northern coastline. What we are really considering in this debate is the true protection of the northern coastline of Australia from the people that Senator Vanstone mentioned earlier-drug runners, illegal fishermen, illegal immigrants and hostile neighbours. We saw probably the greatest display of ministerial ducking, diving and weaving that we have seen on this subject from the Minister for Veterans' Affairs (Senator Gietzelt) when he addressed the Senate earlier and said that the matter was not important enough to discuss in this place. He said that a matter of urgency about Australia's surveillance is not important enough to discuss in this place. It is absolutely disgraceful to say that that is not an important issue for this Parliament. He also made the assertion-as he has done repeatedly in this place-that when this contract was granted to Amann Aviation Pty Ltd, it was in the same position as Skywest Airlines Pty Ltd was in when it got the tender in 1982. The Minister continually said `1983' when attempting to correct himself after saying `1984'. He would not have the faintest idea when Skywest got the contract: It was back in 1982. As Senator Durack pointed out to the Minister on 31 March, Skywest had been in business for over 20 years; had employed 161 staff, including 59 pilots; was operating 29 aircraft; and was running scheduled services from Perth and Port Hedland to many destinations in Western Australia. Skywest sent the Minister a copy of its record, yet again the Minister today had the audacity to say that Skywest was in the same position as Amann. Let us look at the position of Amann. This Government is undertaking-and continues to undertake-a snow job of absolute blizzard proportions on this Parliament. The Australian people will not wear it when this contract collapses. The Minister for Veterans' Affairs, Senator Gietzelt, who represents the Minister for Transport and Minister for Aviation (Mr Peter Morris) in this chamber, has deliberately not answered any questions asking for clarification put to him by Senator Durack, Senator Archer and me over a number of weeks. That is a disgrace of the largest proportions. But the facts, as of this day, are as follows: Amann, as it was when it was awarded the contract, was a $2 shelf company-a position far different from that of Skywest when it was awarded the contract. In order that Senator Robertson and Senator Reynolds, the Labor senators who are to follow me in this debate, do not also say that I am simply pushing a barrow for Skywest, I will say right here and now in unequivical terms that I am not simply pushing a barrow for Skywest; I am pushing a barrow for the continued secure surveillance of the northern coastline. To return to Amann, it had a totally inadequate aviation background, no maintenance facility, no check and training organisation, no appropriate licences and no management structure when it was awarded this contract. And this is the company that this Government considers is at a suitable stage to to take over this business. Dr Kay, who gave evidence to Estimates Committee E on 9 April and who is the Acting Senior Assistant Secretary, Safety Operations and Pollution Branch, Maritime Safety Division, said that, yes, Amann was trading under a different name when it got the contract; yes, it was a small company; and yes, it was only a registered business name. That is the type of business background to which this Government has given the contract. Its experience is nil. I believe it had only one aircraft. The company was run by a man and his wife, and I believe that now it also has a pilot and his wife. I suppose the local cat and dog and mouse and anything else that runs around, if it wants to, can be part of it. We are very concerned about the staff and the training of professional people. I have had the privilege of going out on a coastwatch exercise. The pilot and the observers were some of the most professional people I have had the privilege to watch operate. The way in which they conducted their business was absolutely scrupulous. These professional people were promised that they would be considered by Amann for continuing employment. They have consistently asked for assistance both from members of parliament and from the Department to ensure that they get some continuity. They had the audacity to ask questions about salaries, zone allowances, leave entitlements, medical cover and the like. Presumably because of this these pilots who are experienced in this business have now been overlooked. They were advised yesterday that it looks as though only three pilots from Skywest will be taken on. Heaven knows what the fate of the observers will be. Senator Boswell —I wonder where the money is coming from. Senator KNOWLES —Exactly. I wonder where its money is coming from, too, because Amann is offering about $9,000 per annum less to pilots starting with it, hoping to high heaven that it can raise the amount later on and get the extra money from the Government so that it does not come out of its pocket. It is a great tragedy. As I mentioned earlier, these people have written to members of parliament asking for assistance for their livelihoods and for their families. Yet a senator from this Parliament, Senator McKiernan, wrote back to those people saying, in effect: `Sorry to hear about your problems, but join a union and they will all be solved'. That was the thrust of a letter from Senator McKiernan. For those who are interested, Senator McKiernan has a very long record with the unions. Therefore, his impartiality is not evident on this problem. The role of Mr Ramsey is another thing. Mr Ramsey, from the Department, went around some of the bases and, when he got to Broome at 6 p.m. on a Saturday night, he asked the co-ordinator that a meeting be held at 8 a.m. on Sunday. Of course the co-ordinator could not get in contact with all the people on the Saturday night and he advised Mr Ramsey that they could not meet until a later stage. This man, whom this Government and the Department said was not present at the negotiation stage of determining staffing requirements, said that he would be there for those meetings, and he insisted that the meetings be arranged for a time when he would be there; he had to be there for the meeting with staff. The co-ordinator also found then that that meant a re-organisation of a scheduled coastwatch flight. Mr Ramsey specifically downgraded the coast- watch to have all staff present. Flights were curtailed on his authorisation so that the staff and he could be present. This Minister, this Government and this Department have said that that man was not present. Yet he deliberately curtailed coastwatch flights to make sure that the meetings took place. This contract has already been extended from 31 March to 30 June. Skywest has been told that it may get a further extension, or that it may be requested to take out another extension. It has requested that the Government advise it by today whether it will have to take the job on for a further three months. At 1 o'clock Perth time the Skywest managing director was going to phone me if he had heard anything. He has not done so. It is now ten past four, eastern standard time. He has not heard from the Government as to whether it needs Skywest to carry on the contract. Yet today is the deadline. Skywest has offered to extend the contract at the normal rate plus 15 per cent. It is in a very difficult position. It does not know whether its pilots are staying or going. It appears that most of them are staying because they have been overlooked by Amann. But it does not know whether its observers are staying. The Government says that it wants observers to do further training. How on earth can the observers do further training before joining Amann if they are expected to stay with Skywest? Mr Ramsey said that they will find that one day they are paid by Skywest and the very next day they will be paid by Amann. Unless they do their comprehensive training overnight, how on earth can they do their training and at the same time maintain critical surveillance on the northern coastline? Understandably, Skywest is winding down its staff and the service is definitely at risk. We are concerned about the service being at risk. There was only a three-quarters of a million dollars difference between Amann's tender and the next one. Yet the Minister, only a little while ago, said that the difference was $3m. Once again he has not told the truth to this Parliament. Amann has changed its aircraft. Yet Dr Kay, in response to the question by Senator Lewis, `Did you satisfy yourself that this company would be able to provide adequate aircraft?', said: `Yes'. Obviously, the answer should have been no, because it has now had to change its aircraft. There is a difference in the cost of aircraft of $250,000 per aircraft. Senator Vanstone read out a great shopping list of problems associated with the change of aircraft; so there will be many more costs involved in what will now be the aircraft brought in by Amann. Yet Amann and the departmental representatives at Estimates committee hearings, said that the aircraft had been ordered and that the modifications were under way. How on earth can the aircraft have been ordered and the modifications be under way when the company is now saying: `We cannot get the aircraft and we are now getting another one'? Senator Vanstone —They said that they would be arriving soon. Senator KNOWLES —It has said that they are arriving soon; it has said that for weeks on end. The Minister has not answered questions. The situation as to continuing viability is absolutely outrageous. The continuing viability is at risk because of the costs that this company will have to incur. It admitted that it did not take on this contract with profit in mind. It admitted that when it took it on. Mr Amann stated publicly that he wanted a higher public profile in aviation and therefore tendered for this contract with no profit in mind. The Department of Transport is also fully aware that Amann Aviation has a paid up capital of $2 and presently has a total reliance on this contract. It has no other activities from which it can expect to fund the loss on the coastwatch contract. Questions must now be asked as to how long Amann will be able to sustain coastwatch operations before compounding losses force his withdrawal, voluntarily or otherwise, and therefore how long it will be before Australia will suffer a total breakdown in surveillance of its northern coastline. This question must also be considered in light of the fact that people have been asked to withdraw operations in certain areas. The switch by Amann Aviation to a totally different type of aircraft has not just impacted on its own commercial viability; it has also prejudiced the entire activity of surveillance of the northern coastline and has therefore directly impacted on the national interest. That is just not good enough. The other aspect that is relevant in this debate is the balance of payments. We are currently in a balance of payments crisis; yet aircraft at approximately $580,000 each are being bought overseas. The Minister told the Estimates Committee that he could not care less about the impact on the balance of payments. Senator Gietzelt said; I am not aware of any and I do not think it was necessary to do so. It is just outrageous to think that in the current climate it is not being treated seriously by this Minister. To wrap it up, the absurdity goes one stage further. The letterhead of a letter that was received by pilots yesterday from Amann had a photograph of a Skywest plane, showing the Skywest logo and the Skywest call sign. There was a photograph of a Shrike Commander on a letterhead from Amann. The ACTING DEPUTY PRESIDENT(Senator Colston) —Order! The honourable senator's time has expired. Senator ROBERTSON(Northern Territory)(4.16) —I think I should read the motion because although there have been two speakers from the Opposition their contributions did not have a great deal of relevance to it. Senator Knowles alluded to it briefly during the course of her remarks. The motion reads: That, in the opinion of the Senate, the following is a matter of urgency: The need for the Government to reconsider the allocation of the Coastwatch contract to ensure adequate surveillance of Australia's northern coastline. I, as much as anyone in this place, am aware of the need for coastal surveillance of the northern coastline. I am not the least bit interested in who does it, as long as it is done effectively. Perhaps I ought to remind the Senate of what the needs for coastal surveillance are. They have not been mentioned so far, although Senator Mason, in a very reasoned address, referred to them. Firstly, we must look at the problem of drug running, either by boats or by aircraft, in the Northern Territory. The Senate will know that aircraft can land on many of the smaller strips in the Northern Territory, and they are a problem. The second reason for coastal surveillance is to watch out for illegal visitors. I use that phrase when I refer to Indonesian fishermen because they often become illegal immigrants when they land on the coast. I also refer to illegal visitors in the sense of those on pleasure craft who bring pets with them or, if nothing else, dump their garbage along the coast. Of course, as everyone knows, that brings the possibility of exotic disease. The third area, which is most important, is that of illegal fishing-not so much by the small Indonesian illegal fisherman; rather, the poaching by the major concerns and the fishing by Australian or joint venture boats outside the defined areas or outside the times when it has been agreed fishing should take place. Northern surveillance has been a long time interest of mine-basically, I suppose, because I am from the Northern Territory. The Northern Territory, Queensland and Western Australia are the areas which are most involved because they are the front-line States and Territories. I indicate that my concern about surveillance is real. Once again I indicate that I have no interest in who gets the contract, as long as we have effective surveillance. I appreciate the concern of Senator Vanstone. Quite clearly, the matter has less relevance to South Australia specifically, although obviously she is interested in Australia generally. She raised this matter during Estimates committee hearings. Most of the topics she raised today were dealt with during those hearings. She raised four new issues, and I will deal with them very briefly. She said, firstly, that the 680FL motors were overheating. We know this, and the contractor has agreed to provide different and better engines and aircraft at no extra cost. Secondly, she said that extra registration and insurance costs would occur, and this would mean that the contract would go up. Quite clearly, the contractor has agreed that there will be no additional cost-it would be outside the tender. Thirdly, she said that the company has no base in Darwin. I assure her that the company has an office and staff in Darwin at this present time. She talked a great deal about Amann being a $2 company, and I will mention that later. However, I have evidence here that Amann Aviation Pty Ltd is the new name of Myruse Pty Ltd, which was registered in New South Wales. Hansard will show that during the time of the Fraser Government I asked many questions about coastal surveillance. There were problems with the former contractor during the time of Senator Vanstone's Government. The contractor had a set schedule and flew every day at the same time. As a result, fishermen simply hid in the mangroves, waited until a plane had gone over and then went about their business. Untrained staff were recruited by the company. I remember one case that I brought to the attention of the Senate of a honeymoon couple who took on the job of being spotters. I hope that these are not the qualified, professional people that Senator Knowles referred to. The total project was not co-ordinated, and I believe that that was one of the major problems. If action was required, it took too long to do something and the boats moved away. The present Government set out early in its period of office to correct the identified problems. The Australian Federal Police was put in charge through its control centre, and it introduced better procedures and the training of the staff by the Department of Transport. I have an interest also because the Senate Standing Committee on National Resources, in its report entitled `The Adequacy of Quarantine' had this to say: The Committee recommends . . . the surveillance program be reviewed immediately, particularly in regard to the training of observers, the need for staggered flight times and the provision of the necessary facilities to respond to surveillance sightings. All of this was taken note of by the present Government and incorporated into the new tender. Let me sum up this section by saying that the present Government understands the problem and has taken appropriate action, and we are discussing that action today. The history of the current situation has been covered by previous speakers. There were some inaccuracies which I will come to later. But let me make this point: Surveillance is now operating and will continue to operate. There are plans in position for Amann to take over on 12 September, or whatever date has been agreed to. So the fact that we have surveillance operating makes a farce of the search-- Senator Boswell —What is the date? Senator ROBERTSON —The honourable senator will have his opportunity to speak. There has been adequate surveillance. The Opposition has asked for this and it has got it. So this urgency motion is an utter farce. The surveillance is being carried out at present by a contractor who is favoured by the Opposition. I am going to outline later why the contract was not let to Skywest. However, this was certainly not because there was any dissatisfaction with the service. We are happy to extend its time to June, and further if necessary, so that adequate surveillance can be continued. Senator Vanstone —When are you going to let them know? Senator ROBERTSON —This decision had nothing to do with the adequacy of surveillance. That company is totally aware of the situation. I think the honourable senator has been misled and she should settle down a bit. Criticisms of the Amann operation were put by the Opposition to a Senate Estimates committee. Although those criticisms have been answered, they have not been accepted. They have been put publicly through the media. They have been put through Mr Lloyd in the other place and they have been answered there. Let me repeat those criticisms. We are told that this company is a $2 shelf company. Myruse has operated a charter company for five years. That is the company we are speaking about. It is suggested that Amann has no staff and no facilities. It intends to buy these, as would any other business. One certainly would not go out before one was awarded a contract and start buying up bases or aircraft or recruiting staff. The staff will be recruited, as indicated quite clearly by Senator Mason and the Minister for Veterans' Affairs (Senator Gietzelt). The 15 questions that were put to Amann were answered, and I understand that the Sydney Morning Herald aviation expert, Mr Ballantyne, commented that these were all acceptable answers to the questions put by the Opposition. Let us look at Amann Aviation. The principal is a businessman, Robert Amann. He is a private pilot and he is in partnership with the chief pilot and the wives of both men. He is not a novice in the industry, as has been indicated. He has been involved in it for some years. He has operated a charter and freight company out of Camden airport. But nevertheless, as indicated so well by Senator Mason, one does not have to have experience in every field to move into it. One wonders how many of the businessmen sitting opposite us at the present time had experience when they moved into their ventures. They have the money and they buy the expertise. But Mr Amann has his chief pilot. He is a private pilot and he has expertise in running the business. He has purchased 14 Commander aircraft, and we have already mentioned these. There have been problems with the contract. This is accepted. Only four aircraft have arrived and the rest will be here in early July. Perhaps that is not good, but that is his worry. He has to have them here to take over at the agreed time. But once again, the purpose of the motion which is in front of us is that there is not adequate surveillance. I come back to the point that regardless of any problems that Mr Amann may have-and he has not got any-surveillance is being continued-it is being carried out by Skywest, the company favoured by the Opposition. Let us look at the aircraft that he has bought. Despite the fact that Skywest sent a couple of its men to trail Mr Amann around the United States of America, they still cannot find out where he is getting the planes from. It is rather interesting that Skywest, the group that is being pushed by the Opposition at present, has thought it necessary to send two people to the United States to trail Mr Amann to try to find out about his business venture. It does not reflect very well on that company. The aircraft which have been bought-we know the details about them-are more suitable for surveillance. They are descended from the aircraft purpose-built for the US Army and the US Air Force. They are much better than the units that Skywest is operating. The units are ideally suited for northern surveillance. They are larger, more powerful and they have a 30 per cent greater cruising range of 1,300 miles as against 1,000 miles. In addition, they can carry more surveillance equipment and more personnel and they can travel at a greater speed should that be necessary. Let us look at the tender that has been shouted about so much today. Firstly, the tender value, which has been published, was $17.7m. The proposition that was put by Amann was, according to my figures, $2.5m lower than Skywest. Senator Knowles —Not lower than Lloyd Aviation. Senator ROBERTSON —I did not say anything about Lloyd Aviation; I said that it was lower than Skywest. Senator Knowles —Yes, but you are misrepresenting the circumstances. Senator ROBERTSON —No. The honourable senator is being stupid again, as she was before. Senator Knowles —You misrepresented it. Senator ROBERTSON —The honourable senator misrepresented the Minister and told an untruth, for which I did not pull her up. Senator Knowles —I did not. Senator ROBERTSON —Yes, the honourable senator did. Senator Knowles —Mr Acting Deputy President, I raise a point of order. I seek a withdrawal. I have not told an untruth and I ask the honourable senator to withdraw that statement. The ACTING DEPUTY PRESIDENT(Senator Colston) —If the honourable senator requests that the statement be withdrawn, I would ask the honourable senator to do so. Senator ROBERTSON —Yes, I am happy to withdraw it. What the honourable senator said quite clearly is known and will be shown in Hansard. Skywest was the third lowest out of eight. The tender is for a three-year contract and was awarded after evaluation by the Department of Transport, the Department of Aviation, the Department of Primary Industry and the Coastal Protection Unit of the AFP. Also, the financial arrangements entered into and available to Amann were investigated by those who were evaluating the tender. Agreement was reached by Skywest for extension of its contract to 30 June to ensure that there would be an orderly handover. It certainly is a fact that Skywest was the only tenderer currently operating aircraft. Out of the eight who put in names, Skywest was the only one, as I understand it, which had aircraft operating. But that is not surprising. I would think that not many firms would keep 14 planes on the ground in the likely eventuality of getting a contract. Even if Amann Aviation had not been awarded the contract, Skywest would not have got it because it was third on the list. There are 1,200 kilometres of coastline to be patrolled by 14 aircraft, each with a pilot and two observers-exactly the same as the Skywest procedure. That is the job that Amann will go ahead and do. Senator Vanstone —When? Senator ROBERTSON —When it is required to under the terms of the contract. She has no indication that it will not be doing it. The time is clearly set out when it will be doing it. Let me list our conclusion. Firstly, the Government appreciates the need for surveillance and has organised appropriate organisation under the Australian Federal Police. Secondly, the contract to Amann followed the normal guidelines and satisfied procedures set by this Government and by previous governments. Amann Aviation was investigated in all aspects and found suitable. It was successful for a number of reasons including the cost tendered and the type of aircraft it was prepared to buy. There is no need to reconsider the allocation-everything is proceeding. At present there is adequate surveillance, and this will continue. In other words, this so called urgency motion is a farce and a waste of time. In the one minute left to me I will further emphasise the points made by the Minister. First, the tendering process is absolutely proper and strictly controlled and that was the case on this occasion. Secondly, the Government is not in the business of overturning contracts because of rumours and gossip. Nor is the present Government in the business of rigging contracts for rich and powerful friends. We go through the normal tendering procedures. Senator Reynolds —That happens only in Queensland. Senator ROBERTSON —As Senator Reynolds says, that happens in other parts of Australia. I think it is most unfortunate that this motion has been moved. Not only are we wasting time debating it, but one wonders why it has been brought before the Senate today. It seems most unfortunate that the normal procedures of government-the letting of tenders, investigating them and making sure that they go to the right person-have been overlooked in this case. One wonders, if the tender had been let to Skywest at an additional cost of $2.5m, what Senator Michael Baume and his Waste Watch Committee would have had to say about that. One wonders what the rest of the Liberal Party would have to say about a tender not being let to a contractor who was able to offer the service that was required at a cost much lower than that proposed by the next tenderer or the person operating at present. I repeat, the urgency motion moved by Senator Vanstone is a farce and a waste of time. One must question why she has raised the matter in the Senate today. Senator BOSWELL(Queensland)(4.31) —I believe that the Senate is indebted to Senator Vanstone for raising this matter of absolute importance to the nation. I think that everyone should be very thankful that she has had the gumption to bring it forward. At the outset of my contribution I make it quite clear that I am not pushing Skywest's barrow-neither am I condemning Amann Aviation. I bring before the Senate the irregularities in the way the contract has been let. I have been in business for many years so I know that one cannot let a contract to a firm in these terms. The contract was let in the name of R. and P. Amann Aircraft Hire, which is a registered name but not that of a registered business or proprietary limited company. The contract was let in the name of Amann Aviation Pty Ltd. That is the first irregularity. One cannot let a contract, or go to contract, in one name and receive the benefit in another name. That is the first irregularity. The second irregularity is that there is no such firm as Amann Aviation Pty Ltd-at least, until yesterday that firm was not registered. That is the second irregularity. The Government, having found those two irregularities, should have immediately cancelled the contract. It should have said that everything was not in order and retendered. That would be the obvious thing to do. Any government that calls for tenders for the items it needs would have responded in that way. The third irregularity-and the arrangement is full of irregularities-is that the contract was let for 14 S80FL Sky Aero Commander aircraft. However, we now find that that is not what the tenderer is supplying. The tenderer is supplying a different aircraft. If the Department of Aviation was not satisfied with 14 S80FL Sky Aero Commander aircraft, it should have said: `You do not win the tender because the planes are not acceptable'. The Department should have specified what was an acceptable plane. The contract has been awarded, but now different aircraft are to be used. The more times we go over this matter the more irregularities come to light. The main problem as I see it is that the aerial surveillance contract for the Great Barrier Reef expires on 30 June. Until now no tenders have been called. That frightens me as a Queensland Senator, because on 30 June there will be no aerial surveillance of the Great Barrier Reef. We know from experience that, if there is no surveillance, we offer an open, lay down misere to clam poachers and a number of other people to go on to the reef. As a Senator for Queensland I am particularly concerned about that. I am concerned about surveillance of the northern coastline, about the many uninhabited miles of coastline around the gulf and the estimated 1,500 airstrips throughout northern Australia, many of which date from World War II and are extremely isolated. In March the intergovernmental standing advisory committee on coastal surveillance and protection, at a meeting in Cairns, warned that strong and effective surveillance of northern Australian airstrips was vital in the war against illegal drug importation. I agree with that. There is more to coastal surveillance than just monitoring against attempts to import illegal drugs: We must look at defence activities, illegal immigration, Customs requirements, the illegal exporting of Australian fauna and flora, safety and rescue regulations and fishing. I know that fishermen are very concerned because they rely on coastal surveillance to enforce their closures and protect their fishing grounds against foreign fishing vessels. There is no doubt in my mind that Amann Aviation is still unprepared and is not nearly ready to take on this very important task of monitoring the surveillance of Australia's coastline and the Great Barrier Reef. I asked numerous questions in Estimates Committee E. For instance, I asked when the planes would be available. Dr Kay replied that the intention was certainly to have the first four in Australia before the end of May. I point out that the end of May is in two weeks time. I do not believe that the planes have even been purchased; they certainly will not be out here by the end of May. I asked a number of other questions, including what would happen if the planes were not out here by 30 June, which is when the contract with Skywest Airlines Pty Ltd expires. I was told that an extension would be arranged. I have been told today by a reliable source that the extension has not been arranged. No decision has been given by Dr Kay's Department as to whether Skywest will be asked to continue to 30 September. I am frightened that as of 30 September the Amann planes will still not be available. If they are available, will they be the types of planes that can handle this particular job? I am told that the planes that have been purchased-or that the company has said it will purchase-will not be able to handle the coastal surveillance role. I am told that they are unsuitable for low level flying at low speeds, which is what coastal surveillance is all about, because they are pressurised and have turbine engines. They are designed for high altitudes and high speed flying. I again asked Dr Kay how fast these planes need to go, and I was told that the speed required for normal operations is between 140 and 160 knots. These planes, admittedly, can get down to a speed of 140 knots, but that is not the speed-or height-at which they are designed to fly. We will find that they will not be able to perform those types of duties without breakdowns and so forth occurring. The other reason that we are saying that Amann Aviation is not in any position to take on this surveillance role is that at the moment it has no personnel. It has told the Skywest pilots and observers that they are not required. Within three months the company will not only have to find 14 planes, which its does not have, but it will also have to train 60-odd personnel. I asked when some of the bases would be taken over, and I was told that under contract Amann Aviation would take over Darwin on 16 July; Gove on 17 July; and, I think, Weipa on 18 July. I ask the Senate how that company is going to take over those bases and have personnel working in those bases when it does not even have the planes. The planes that should have been out here on 4 May have not been purchased. My fear is-and it is a very significant fear-that by 30 September the planes will still not be ready, but the point that the urgency motion gets to-the very thrust of the argument-is that if tonight Skywest is not notified whether it will be required to service the coastal surveillance, it will pull the plug as from 30 June and Australia will have no coastal surveillance, the Great Barrier Reef will have no coastal surveillance and the Government will not be able to protect Australia. That shows how this Government has completely bungled the whole operation, because in two weeks time there is going to be no coastal surveillance throughout Australia unless we can get the Royal Australian Air Force or someone else to do it. I do not know who else would possibly be able to do it, but the whole of Australia is going to be unprotected from drugs being imported and birds being exported. We will not be able to protect the fishing grounds. This is a very serious position. To my way of thinking, to offer a $17.6m contract to someone who has a $2 company is inexcusable. I have had to start a business. I went out and started on my own and developed a reasonably good business. I did not go out as a retailer and try to end up owning Myer's overnight, and that is what Amann Aviation is being asked to do. The Government is asking a very small company to provide a very large service. If it does not work the company will go to the Minister in two or three weeks time and say: `We ran into terrible problems. We couldn't get the planes. The planes we bid on were not what we needed, but I am terribly sorry about it. We will withdraw and we will lose our $2 company and we will lose $2'. Australia will lose millions of dollars. The fishing industry will be in trouble, drug runners will be able to come in to Australia, and all Amann Aviation will lose is its $2. It is an intolerable position when Australian security is put at risk. The whole security of Australia is put in the hands of a $2 company. That is how stupidly this Government has carried on. I am not here to denigrate in any way anyone that is prepared to have a go; I welcome it. I am a small businessman myself, and I think anyone who has enough initiative to get up and go should be encouraged, but it is absolutely stupid that someone who has to spend $17.6m puts up a $2 company as security. It is just not reasonable. In the few minutes that I have remaining of my contribution, I would like to bring up the matter that I alluded to earlier, the coastal surveillance contract-this is a separate contract-for the Great Barrier Reef. It has been another case of bureaucratic bungling. I am sorry that Dr Kay is here; I do not normally like to attack public servants because they have no way to defend themselves. I apologise to him, and it probably is not his fault. I have the highest respect for public servants. The contract expires on 30 June-a mere seven weeks away. Up to date no new tenders have been called. The Department of Transport says it needs guidelines from the Department of Arts, Heritage and Environment, which foots a lot of the bill for the reef surveillance. This Department has had three years to decide guidelines and set the relevant parameters yet it has not done so. It is a classic case of bureaucratic buck passing at the expense of the industry. Many people want to tender for the contract. They have to make commercial decisions such as on importation of planes and location of businesses, yet they cannot do so until the tenders are put out and the requirements of the Government are made known. The ACTING DEPUTY PRESIDENT(Senator Colston) —Order! The honourable senator's time has expired. Senator REYNOLDS(Queensland)(4.46) —I find it quite extraordinary that Senator Vanstone should bring on this matter as an urgent debate this afternoon. Today is the day of the presentation of an economic statement. Today is a day when we have a large number of tertiary students camped out on the lawns in front of Parliament House concerned about future funding of tertiary education and particularly concerned about the Liberal Party policy to charge full fees. It is also the policy of the National Party, if that Party is really relevant. It is only a few days since we heard the most outrageous allegations of corruption in the Queensland Police Force and the concern about drug trafficking, particularly in far north Queensland, and the involvement of well known families. Senator Vanstone —Why don't you move a motion on something else? Senator REYNOLDS —I wonder why Senator Vanstone is so concerned about this particular issue. I doubt if there is very much northern coastal surveillance needed from the leafy suburbs of Adelaide. I find her preoccupation with this issue rather extraordinary because I would not have expected her to see it as a priority with so many other issues that are happening to her and her Party. Senator Boswell talked about irregularities, how frightened he is and what fear he has about the future for coastal surveillance in northern Australia. I find it difficult to take seriously the hypocrisy of Senator Boswell from the Queensland National Party saying that he is concerned about coastal surveillance when a national television program has already revealed that there is corruption in the Queensland Police Force and that a judicial inquiry will be held, and probably the National Crime Authority will also be obliged to investigate the seriousness of many of those allegations. But, of course, that is not the only hypocrisy that we have heard this afternoon. I find it quite hypocritical that Opposition senators favour one company over another when the Amann Aviation tender was 28 per cent lower than the Skywest tender. This comes from Senator Boswell, Senator Vanstone and Senator Knowles. I have heard their parties talk a great deal about cost cutting. In fact, Senator Vanstone might like to be reminded of what Mr Howard has said about cost cutting. He said: I intend to cut spending far more heavily than any government has previously cut spending. Mr Peacock similarly has said: It's no use making 5 per cent cuts across the board as the programs roll on. We must cut the big ticket items. When we take office there will be howls of protest as we cut program after program. Yet this afternoon Senator Vanstone and Senator Knowles have argued that more money should be spent on this contract and that it would be a good thing to spend in the vicinity of $2.5m more. I also refer to the questions that were asked during an Estimates Committee meeting on 9 April. Senator Lewis was very concerned about the tender price. He was advised that there was something of the order of $750,000 difference between the lowest conforming tender and the second lowest. Senator Lewis is a member of the party that is so concerned about the need to cut costs. Senator Michael Baume, who is in the chamber, often reminds us of his Waste Watch Committee. However, I note that he is not speaking in the debate this afternoon. Senator Lewis says: `Oh, only three-quarters of a million dollars!' That is how concerned he is about the cost cutting measures that the Opposition claims to stand by. Let us look very closely at the absolute propriety with which this tender has been awarded. Public advertisements for tenders for the provision of aerial surveillance services were placed in the national Press in August 1986. Eight responses were received prior to the closing date of 25 November 1986. The tender evaluating committee, especially established to consider offers, had representations from the Department of Transport, the Department of Primary Industry and the Australian Federal Police and the Department of Aviation. The Committee actually interviewed the three lowest price tenderers to establish the financial and technical compliance of the tenders submitted, and the Government guidelines on tender evaluations were scrupulously adhered to. Perhaps I should remind Opposition senators of the guidelines for Commonwealth purchasing. They are: Firstly, in relation to equal opportunity, through public invitation of tenders, Commonwealth Purchasing Gazette and Press, as well as notification to potentially interested tenderers. Secondly, in relation to fair dealing, clear specification of requirements; absolute equality of information provided to each tenderer; and common basis of evaluation. Thirdly, in relation to probity and accountability, fair application of evaluation criteria; scrupulous handling of tenders; respecting commercial nature of information; and follow correct procedures. Fourthly, in relation to the best value for money, acceptance of lowest priced tender meeting specified requirements. The Hawke Government is a responsible Government. It accepted the lowest tender because it has to be accountable, unlike Opposition senators who come into this place and make way out allegations hoping that they might get themselves reported in the local Press. However, what Adelaide constituents are going to think of Senator Vanstone being so concerned about northern surveillance is, I am afraid, beyond me. But let me get back to the present situation in regard to the current status of Amann Aviation. The contract with Amann Aviation requires that the company provide the full surveillance service from 12 September. I am not quite sure why Senator Boswell made a speech about how frightened he is about some deadline in his mind of a couple of weeks or the end of June-- Senator Vanstone —Because the takeover contract is not settled. Senator REYNOLDS —The contract requires that the company provide the full surveillance service from 12 September. Perhaps Senator Boswell is far more concerned about the outcome of the judicial inquiry into corruption allegations in Queensland than he is about coastal surveillance, as outlined here this afternoon. Amann Aviation is currently in the process of obtaining the required Department of Aviation approvals and clearances. The company has upgraded its aircraft and will now have the model fitted with turbine engines. The aircraft will have the same surveillance capability as the present aircraft that are being used but will have improved performance and passenger carrying capability. The first five aircraft will be due late in June or early in July. The company, as I think has already been spelt out, has appointed an operations manager, a chief pilot and a check and training captain. These details have been repeated again and again-by the Minister for Transport (Mr Peter Morris) and by the Minister for Veterans' Affairs (Senator Gietzelt) in this place. Yet Senator Vanstone and others choose to waste the time of the Senate in this quite trivial debate that we have heard this afternoon. Let me correct a couple of other inaccuracies that have been peddled here this afternoon. The contract with Amann Aviation is for the provision of surveillance services. It does not specify any particular type of aircraft, but it does specify minimum standards. Furthermore, comments were made about when Skywest took over the contract. Skywest took over the whole operation in only 1983, even though it had parts of the contract prior to that date. I think Senator Knowles expressed a sudden concern about pay rates. I have never really considered her in the role of advocate for fair industrial relations. I assure her that pilot pay scales have been negotiated with the Airline Pilots Federation. They are covered by the award. The observer pay scales are currently being negotiated with the individuals concerned because they had not previously been covered by an award. So some of the comments that have been made in this place this afternoon are completely inaccurate and quite spurious. Let us look at surveillance. I am especially concerned about this issue because, living in far north Queensland, I have heard a number of rumours and allegations in the past couple of years about the need for increased surveillance in far north Queensland. I am very pleased with the efforts of the Government to upgrade surveillance in that area. The Australian Federal Police took over the co-ordination task from the Department of Transport, following Government consideration of the Beazley report in 1984. The Department of Transport continued to provide staff to the unit and to handle certain administrative matters, including, obviously, the letting of contracts. But the Australian Federal Police was given the co-ordination role, with good reason as it was felt that better direction could be given to coastal protection if it were handled by the Commonwealth's main law enforcement agency. That did not happen under a previous government. That priority was established by this Government. A standing advisory committee on coastal protection and surveillance, which comprises both Commonwealth and State officers, meets at least annually, and there is, in addition, a standing interdepartmental committee of Commonwealth agencies that are vitally concerned with coastal surveillance. They include: The Australian Federal Police, the Department of the Special Minister of State, the Department of the Prime Minister and Cabinet, the Department of Primary Industry, the Department of Immigration and Ethnic Affairs, the Department of Arts, Heritage and Environment, the Department of Health, the Department of Defence and the Australian Customs Service. The Coastal Protection Unit is staffed by the Federal Police and civilian officers and staff of the Department of Transport. Customs and Defence have liaison officers posted to the Unit to act as advisers in relation to responses to sightings. Defence usually responds to fisheries breaches, while Customs handles all other responses, apart from search and rescue, in which it gives whatever assistance is required. There are approximately 200 surveillance flights per month, undertaking visual search of the littoral area between Karratha in Western Australia and Townsville in Queensland, at an average of seven to eight flights on any particular day. Each flight generates a telexed report to Canberra, which in turn is forwarded to Customs officers and other recipients around Australia. In addition, there is immediate follow-up of particular sightings with Customs vessels around the coastline covered by the program as they are routinely tasked to follow up any sightings in their area of operation. In the minute of my speech remaining I will say that I certainly believe that much more serious issues are raised about coastal surveillance than the ones that we have heard this afternoon. I will certainly be asking the two relevant Ministers responsible for Federal Police and Customs whether they will be passing on to the Queensland judicial inquiry into unusual activities in the far north any information reported to them over the last few years that they have not been able to resolve with the Queensland Police Department. The ACTING DEPUTY PRESIDENT(Senator Colston) —Before I call Senator Vanstone, I remind the Leader of the Opposition, Senator Chaney, of standing order 401. Senator VANSTONE(South Australia)(5.01) —in reply-This afternoon we have been debating the letting of a contract for coastal surveillance of northern Australia. The Government's response in this area has been inadequate, pitiful in the extreme, particularly in the speech of Senator Reynolds, almost to the point that its response has been disgraceful, taking no notice of the very detailed points that have been raised by a number of speakers. The suggestion has been made that the Opposition has raised this matter of urgency with some sorts of improper motives, as if there is some interest to be had in ensuring that the current contractor keeps the contracts. Nothing of the sort is true, and no evidence was offered by any honourable senator to suggest that that could be true. It is just blind debating in the gutter by the Government to avoid addressing the issues. Allegations were made by Senator Robertson that Skywest Airlines Pty Ltd has sent people to the United States of America to follow representatives of Amann Aviation Pty Ltd around. A member of my staff has spoken to Mr Ring, the Managing Director of Skywest, and I am reliably informed that he categorically denies that Skywest sent anyone at all to the United States to follow Amann. Of course, it is entitled to ask its contacts, agents or representatives in the United States to provide information on what Amann has been doing, and it has done that; but there is nothing wrong with that. The allegations that were made by Senator Robertson should be withdrawn. At the earliest opportunity he should apologise to Skywest for the inferences that he made. Today the Opposition has said a number of things. Firstly, it has said that coastal surveillance is important for a whole variety of reasons that have been adequately outlined by nearly every speaker. We have not said that who gets the contract is important-not at any time-nor is that the purpose of this debate. We have said that it is important that whoever gets the contract can do the job, and can do it well. Further, we have raised the concern that the contract was awarded to people who, on the face of it, could not have been reasonably assessed as being capable of doing the job well. The contract was let to a gentleman who had a registered business name and only limited experience of a tourist charter business and who is referred to by significant aviation bodies as an unkown or a novice in the aviation industry. We have indicated that the Government, having mentioned at an Estimates committee meeting its belief that the tendered planes were adequate, must now realise that they were not and that the tender has been let to a group that is unable to meet the contractual requirement. We have further indicated in this debate that the Government is bungling with respect to the handover from the current operator to the new operator, Amann Aviation, and that there is a very real concern that the surveillance of northern Australia during that handover period and longer, if our belief is true-namely, that Amann will not be able to complete its contractual requirements-will fall apart because Skywest, the current operator, cannot be expected permanently to come to the help of the Government and indefinitely, on an uncertain basis, continue the coastal surveillance of northern Australia. I repeat that in this motion there has never been any suggestion that the contract should go to any firm other than one that can do the job. The suggestion that we have made is that the tender has been let to someone who clearly cannot do the job and that the Government therefore must reassess the letting of that contract so that it can assure that the northern coastline of Australia is appropriately kept under surveillance for all the reasons that were pointed out by a variety of speakers. Question put: That the motion (Senator Vanstone's) be agreed to. The Senate divided. (The President-Senator the Hon. Kerry Sibraa) Ayes . . . . . . . . . . . 27 Noes . . . . . . . . . . . 33 —— Majority . . . . . . . . . 6 —— Alston, R. K. R. Knowles, S. C. Baume, Michael Lewis, A. W. R. Baume, Peter MacGibbon, D. J. Boswell, R. L. D. Messner, A. J. Brownhill, D. G. C. Newman, J. M. Carrick, Sir John Parer, W. R. Chaney, F. M. Reid, M. E. (Teller)Collard, S. J. Short, J. R. Crichton-Browne, N. A. Teague, B. C. Durack, P. D. Vanstone, A. E. Guilfoyle, Dame Margaret Walters, M. S. Hamer, D. J. Watson, J. O. W. Jessop, D. S. Withers, R. G. Kilgariff, B. F. Aulich, T. Haines, J. Bolkus, N. Jones, G. N. (Teller)Button, J. N. Macklin, M. J. Childs, B. K. Maguire, G. R. Coates, J. Mason, C. V. J. Coleman, R. N. Morris, J. Colston, M. A. Powell, J. F. Cook, P. F. S. Ray, RobertCooney, B. Reynolds, M. Crowley, R. A. Robertson, E. A. Devlin, R. Ryan, S. M. Elstob, R. C. Sanders, N. K. Evans, Gareth Vigor, D. B. Foreman, D. J. Walsh, P. A. Georges, G. West, S. M. Gietzelt, A. T. Zakharov, A. O. Giles, P. J. Hill, R. Black, J. R. Archer, B. R. Richardson, G. F. Puplick, C. J. G. McIntosh, G. D. Sheil, G. Tate, M. C. Bjelke-Petersen, F. I. McKiernan, J. P. (Senator Townley did not vote, to compensate for the vacancy caused by the resignation of Senator Grimes). Question so resolved in the negative. Senator CHANEY(Western Australia-Leader of the Opposition)(5.15) —I move: That the Senate take note of the paper. I do not wish to say very much at this stage, but the tabling of the report of the President of the Australian Conciliation and Arbitration Commission gives me an opportunity to indicate that the Government has announced its intention to make very substantial changes to the conciliation and arbitration system. Whether by accident or design, details of this legislation have apparently been leaked to the news media before these have been made available to the Parliament. I wish to put on record my concern about the suggestion that has appeared in a number of newspapers, principally in the Australian this morning, that a central feature of the legislation which the Government is to bring down will be the expansion of the role of the Conciliation and Arbitration Commission or its successor. That new body will have the power to make decisions on whether employers can have access to the remedies contained in the Trade Practices Act. It is quite clear from the surveys that have been taken, both by newspapers and by the Hancock Committee of Review of the Australian Industrial Relations Law and Systems, that there is enormous public disquiet about the state of our industrial relations system and the fact that the trade unions seem to have the capacity to run all over the other elements of the system. When it is indicated, as it was this morning, that the central thrust of the Government's legislation will be to reduce the capacity of employers to withstand abuses of trade union power and take action when unionists behave in an illegal fashion, there is room for a great deal of concern. The Opposition will examine very carefully the legislation which the Government is to bring down tomorrow from the point of view of ensuring that the limited remedies currently available to employers who are faced with illegal conduct under the Trade Practices Act, with breaches of the common law or perhaps even breaches of the Crimes Act, do not see their means of redress blocked by the proposed legislation. The suggestion that the Australian industrial relations system needs altering by reducing the capacity of the community, government and employers to withstand trade union activity which is outside the law would receive an enormous horse laugh right around Australia. It is clear that there is very great public concern and, indeed, trade unionists themselves believe that the unions have too much power and are capable of overriding the rights of the individual and of the general community. In those circumstances I put the Government on notice that it will face very strong opposition from the Liberal Party of Australia. I believe that we will be joined by the National Party of Australia which, like the Liberal Party, would not want to see the balance in the system disturbed in the way that it is suggested this legislation will disturb it. We will look to the support of the Australian Democrats to try to ensure that the conditions precedent to the use of existing remedies are not made such as to deprive those remedies of their effect. It is little consolation to read in the newspapers that the Government will insert some new capacity to impose penalties of up to $5,000, using the conciliation and arbitration authority, whatever it may be called after tomorrow's legislation is dealt with, when one compares that with the economic cost and the degree of destruction that can be caused by trade union activities outside the law. The recent dispute involving the Plumbers and Gasfitters Employees Union of Australia was brought to an end only by a $280,000 penalty. One realises just how contemptuous this Government is of maintaining a decent balance in this area when it suggests that one can substitute that sort of remedy for penalties of something like $5,000. That will be laughed at by those elements in the trade union movement who, in the past, have shown themselves ready to thumb their noses at the Conciliation and Arbitration Commission. Today at Question Time I asked about the postal workers. Again, one sees a flaunting of the power of the Australian Postal and Telecommunications Union against the directions and wishes of the Conciliation and Arbitration Commission. That is the sort of thing of which most Australians are heartily sick. Senator MESSNER(South Australia)(5.20) —I echo the remarks of my Leader, Senator Chaney, on the apparently leaked reports of the new Hancock legislation in the newspapers today. Several aspects have been emphasised by Senator Chaney which deserve to be reiterated. I refer particularly to the Government's intention to subvert the application of sections 45d and e of the Trade Practices Act. The whole point of that legislation is to protect business, the consumer and the ordinary person in the community against the predatory attacks of trade unions which seek to exploit their power at tremendous cost to the consumer, adding millions and millions of dollars to the ordinary living costs of the Australian community. This is what this Government is on about. It is making sure that the trade unions are free, with minimal penalties being applied, to exploit their power against the interests of the ordinary consumer. The trade practices law is there to protect the consumer. I notice in an article in today's Australian that the Government thinks it is pushing its constitutional power in this area to the limit. That does not surprise me. I believe that the Government will face more than a challenge in this Parliament on this legislation in terms of numbers. Certainly the Liberal Party will oppose the legislation, as I believe will the National Party of Australia, and we hope that the Australian Democrats will also join with us, but there remains the great clout in the courts that will be tested no doubt by the States and, of course, by private businesses which seek to ensure that the principles of the legislation as we know it are upheld. These moves will have widespread ramifications for the whole community. This comes at a time when Australia is suffering an economic recession, when the cost of living is rising beyond the control of ordinary consumers, when people are losing their houses as a result of record interest rates and are unable to buy cars because prices have risen by more than 30 per cent in the last year, and when people are unable to look after themselves and maintain their standards of living for themselves and their children because of high taxation. The Government wants to allow a wide, sweeping range of new laws virtually to exempt trade unions from any kind of legal action. This will add substantially to the cost of living. Clearly that is ridiculous, absurd and ludicrous, but it is the sort of thing that this lunatic Government does from time to time. One has only to observe what the Government has done with its taxation laws, such as on the fringe benefits tax and capital gains tax, which are totally destructive of incentive for investment and which will take us in exactly the opposite direction to what is required. I believe that if the reports in today's newspapers prove to be true, Australia is in for a new dark age in industrial relations. We shall see the development of a supremacy by the trade unions the like of which this country has never seen before. This has come about because of this Government's intention to give way to the pressure of the Australian Council of Trade Unions. The time of reckoning has come for this Government. It must now pay the piper in the trade union movement, and this is how the Government will repay to the trade union movement debts which have been accumulated while it has been in government. It is being done by the passage of this kind of legislation which will remove the safeguards from Australians, ordinary consumers and ordinary individuals in the community. Senator COOK(Western Australia)(5.25) —The Senate is debating papers, and the paper it is now debating is the thirteenth annual report of the President of the Australian Conciliation and Arbitration Commission. That is a rather uneventful occurrence in the Senate, but the reason why today it has excited particular passions and driven Opposition members to flights of rhetorical fancy is that it is a report which will result, one hopes, in the passage of the Hancock legislation when it is introduced by the Federal Minister for Industrial Relations (Mr Willis), I understand tomorrow. I understand the Commission will be substantially restructured and vastly improved, following the result of an exhaustive inquiry, the Hancock Committee of Review into Australian Industrial Relations Law and Systems. That inquiry was lead by a distinguished professor of economics, Professor Hancock. It was assisted by George Polites, the former Executive Director of the Confederation of Australian Industry, and Charles Fitzgibbon, a former senior Vice-President of the Australian Council of Trade Unions. Thus, the inquiry was balanced neatly between practitioners at the coalface of industrial relations and academic experts and researchers. The inquiry took a massive volume of evidence and has reported to this Parliament. No doubt the Minister, in laying down the legislation tomorrow, will explain it. The report is significant because it comes forward at a time when as the Minister for Finance (Senator Walsh) told me at Question Time today, industrial relations disputes have been vastly reduced compared with the period of office of the last conservative Government. I do not have the figures before me, but I recollect that he was talking of the Fraser years, which averaged a loss of about four million man days. The report for this past year shows that 1.1 million man days were lost in industrial disputes. Thus, there is a direct comparison, as has always been the case in industrial relations, between the way in which a Labor Government is better suited to handle the vexed field and the way in which a Liberal government or conservative government believes that industrial relations should be conducted; that is, in such a way, to take the example of the Fraser Government, as to exacerbate problems rather than solve them. Indeed, we have in Australia at the moment the spectacle of the Queensland Government enacting, though not proclaiming into law, legislation which is a travesty and mockery of anything that anyone could consider as reasonable in industrial relations. We have the spectacle in the Senate of senators no less distinguished than the Leader of the Opposition (Senator Chaney) citing newspaper reports and attacking the Government on the basis of those reports. There has been a deafening silence from the Opposition on dealing with the Sir Joh Bjelke-Petersen legislation in Queensland-legislation which from all points of view is a distortion and caricature of the creation of a commission which will be able to arbitrate and gain respect in the community as a body through which genuine and deep grievances can be resolved. I do not intend now, on the basis of newspaper reports, to debate what Senator Chaney or any of the other speakers have said. However, it has been my long experience in industrial relations that at least two things should be done in legislation. I do not know whether they are done in the legislation that will be brought forward tomorrow, but in any new legislation at least two matters should be attended to in order to give a modern industrial commission the compass of authority in industrial relations fields that could not have been forecast or expected by our ancestors who drafted the provision in the Constitution to enable the Federal Government to make laws in this area. The first is that some attention needs to be given to the definition of a worker. With the change in work practices over time, one finds that the old definition is no longer adequate. The second area relating to what is an industrial matter, a legal definition based on the old legislation, should be broadened because matters which are palpably now within the industrial environment, industrial democracy being one of them, are prevented from being dealt with by the Conciliation and Arbitration Commission. If what the Minister does tomorrow opens up those areas, they will be a boon to a new refurbished, revitalised and relevant industrial authority that is able to meet the real needs of employers, who after all are a major user of that Commission, and employees through the unions who use it in order to establish and maintain rights and improve living standards. The Australian Conciliation and Arbitration Commission, in the period under report, has played a key role in setting some of the parameters on wages and salaries in Australia. This has helped this Government to get a greater control over the economy than it had previously. The ACTING DEPUTY PRESIDENT(Senator Jessop) —Order! The honourable senator's time has expired. Senator MICHAEL BAUME(New South Wales)(5.30) —There is one conventional item in this annual report to which I think the Senate needs to have its attention once again drawn, and that is the role of Mr Justice Staples, who is listed once again in the annual report as a member of the Australian Conciliation and Arbitration Commission but who, once again, is not listed on any of the panels set out at the back of the report which outlines the functions and roles of individual deputy presidents and commissioners. This raises once again the question of why Mr Justice Staples is being refused the opportunity to undertake the task to which he was appointed. This exclusion has continued for many years. The matter has now dragged on for so long that any hope that the Government may have had that Mr Justice Staples might have withdrawn in frustration from this role have now clearly been dashed. The cost to the taxpayers of Australia of maintaining Mr Justice Staples in this position while he is prevented from working in it, must by now have reached many hundreds of thousands of dollars, taking into account the number of years involved and the costs of the facilities provided. The Government continually seems to duck this question whenever it is raised-and it has been raised repeatedly. It would seem that either Mr Justice Staples has a job which he should be doing or the Government should face up to the fact that the Government does not wish him to do any job. However, it seems patently absurd to continue the present situation. It is particularly absurd in the context of the Commission moving its premises from the rent free court building in Sydney into expensive rented premises in Woolloomooloo, which, of course, is an inconvenient location according to the great bulk of people who have to appear before the Commission in its Sydney hearings. I stress that this move to Woolloomooloo affects only the Commission's Sydney hearings. The cost and the justification of this move-at least insofar as the Government has conveyed such justification-both appear to be unreasonable. The Commission has made this move for its Sydney hearings because there was not enough accommodation on those occasions when all the deputy presidents were meeting and hearing matters in Sydney. I am reliably informed that there were not a enormous number of occasions when there was an over supply of deputy presidents as against rooms. Yet there are plenty of other rooms available within a one, two or three minute walk of that building in Sydney, which is in the centre of the legal area. Despite that, the Government chose to move the Commission's Sydney hearings at enormous expense-something like $13m overall, as I recall-down to Woolloomooloo. The annual rent is something like $2.9m. The Commission will have to replace its law library. It is grossly disgraceful, wasteful expenditure. The lack of an adequate government response to continual protests that I have made on behalf of the Waste Watch Committee about this kind of expenditure-this lack of response of any effective nature-seems to me to underline the fact there is no response of which the Government is coherently capable on this matter. This is clearly a reckless use of government money. There is no sound reason why this Commission could not have continued in its rent free area. I simply must admit that I wonder what motivated the Government to agree to this move. Senator COONEY(Victoria)(5.35) —I take up a couple of points raised by Senator Michael Baume in his usual robust style. First of all, as far as Mr Justice Staples is concerned, that is a tragic story that has occurred over the years. I think we would all have to agree that he is a man of high principle. It is quite clear that not everybody has agreed with his approach to things. Nevertheless, as I said, he is a man of high principle. It is not for the Government to set what work he does; that is a matter for the President. It would be improper for this Government to attempt to interfere with the proper running of the Australian Conciliation and Arbitration Commission. While the President does not allocate him work the situation continues as it is. In respect of accommodation, I simply say this: Again, it would be wrong for this Government to interfere with a process, which is akin to a judicial one, and that ought to be remembered when Senator Baume's remarks are properly taken into account. The chief objectives of the present Act are set out on page 3 of the report. As Senator Cook has said, legislation giving a basis for an extensive revision of this Act will be brought into Parliament tomorrow by the Minister for Employment and Industrial Relations, Mr Willis. The objects of the present Act are set out as follows: (a) to promote goodwill in industry; (b) to encourage, and provide means for, conciliation with a view to amicable agreement, thereby preventing and settling industrial disputes; The report then goes on to list other objectives. The matter of industrial relations will be much discussed in both chambers over the months ahead. In my view, it would be counter-productive if that debate were put forward and continued on the basis of the unions being blackguarded, as they were this afternoon. They were brought into contempt; they have been, as it were, made the scapegoat for the problems that Australia faces. That is a wrong perception and a wrong description; and it is a dangerous one if we are to have an industrial relations system that works. If, on the other hand, we are to have a debate over the ensuing period on the basis that two groups or perhaps more are involved; that conciliation takes place between people representing the workers, the employees of this country, and people representing organisations which represent the employers; that both have an interest in the economy of this country and in the industry of this country going ahead; it could be a very useful debate. If, on the other hand, we are to experience over the next weeks and months a continual harassment and torrent of abuse heaped upon the head of one particular section, I am afraid the debate that could have been very useful, that could have produced an industrial relations system which is an improvement on the present one and that could have been such a good debate, will flounder. Just as people have to recognise that employers and employer organisations are built up mainly of people of goodwill who want to do something, so this chamber, this Parliament and this country have to realise that the unions, which have produced so much good over the years-by way of bringing compensation to injured workers, improving conditions, making machinery safe and giving workers a place in the sun-are very much a central feature in the industrial relations system of this country, and a proper respect and regard should be had for them. Question resolved in the affirmative. Senator FOREMAN(South Australia)(5.40) —I move: That the Senate take note of the paper. I take this opportunity to make a few remarks on the annual report of the Arbitration Inspectorate because of the importance of the report itself and the work behind it. The report details the work of the Arbitration Inspectorate in the financial year 1985-86 and lists areas of concern such as the number of award investigations carried out by the Inspectorate. At the heart of the report is the maintenance of Federal awards. At present 1,677 awards are in force federally and, of an estimated 5.6 million wage and salary earners, two million are presently covered by Federal awards. In my home State of South Australia the percentage of wage and salary earners covered by Federal awards is 33.9 per cent, or slightly more than one-third. This percentage is smaller than the percentage for State awards, which covered 52.8 per cent of the work force. Yet the number of South Australians covered under Federal awards was significant and appeared to have been growing in 1985-86. Some 305 new awards were made during 1985-86. The vital task of the Inspectorate is closely to scrutinise the awards. The job of the Inspectorate is to ascertain whether awards are maintained in all the relevant areas and to investigate complaints relating to employer non-compliance. The Inspectorate was established in 1928 to ensure compliance with awards. The arbitration system goes back to 1904, after three years of Federation. Since that time the Inspectorate has been the instrument to enforce legitimate award entitlements for workers. In 1985-86, 119,536 award inquiries were received by Inspectorate offices throughout Australia. This figure represents a 15 per cent increase over the figure for 1984-85. The number of inquiries per working day has shown a considerable increase. Since 1983-84 the number of average daily inquiries to Inspectorate offices has grown from 407 to 479 in 1985-86. The enforcement of awards has resulted in $4,069,946 being recovered from employers, as opposed to $3,721,578 being recovered in 1984-85. This has meant that $348,366 more has been recovered in award payments than in 1984-85. Members of the Opposition, of course, have a problem in the area of award determination and enforcement. We are not sure what policies they are now ready to promote, but until their recent problems they spent a great deal of time talking about flexibility. The Opposition appears to believe in flexibility-the flexibility to dissolve awards, to revise awards downwards or for opting out of them altogether so that legitimate wage justice can be white-anted. Australians from all walks of life and over many years have seen the necessity to have awards in place. Workers under the arbitrated award system receive commonality of pay and conditions, and the strength and popularity of the arbitration system have resulted from general public acceptance and perception of the basic fairness of this system and of determined awards in general. The report, I am pleased to say, shows that the Inspectorate has obviously established a good working relationship with employers and employees alike. The overwhelming number of award violations by employers was rectified voluntarily. In fact, in 1985-86, 4,684 employers agreed to rectify the matter before other machinery came into force. The machinery to enforce legitimate awards is, and has been, in place for many years. It is pleasing to note, though, that this machinery can be effective if compliance with the law is flouted. In 1985-86, 79 employers were referred for prosecution and of these one case was withdrawn and all the others were found proven by the court. One of the major functions of the Inspectorate is the provision of information. Many inquiries are made of the Inspectorate, of which the majority indicate no breaches of awards. I note in the report that, in respect of formal award complaints, 57.4 per cent of these were upheld in 1985-86. The DEPUTY PRESIDENT —Order! The honourable senator's time has expired. Question resolved in the affirmative. Consideration resumed from 7 May, on motion by Senator Coates: That the Senate take note of the report. Question resolved in the affirmative. Debate resumed from 6 May, on motion by Senator Giles: That the Senate take note of the report. Senator ZAKHAROV(Victoria)(5.46) —In speaking to the report of the Senate Select Committee on Private Hospitals and Nursing Homes entitled `Private Hospitals in Australia', I would like to speak first about some of the points raised by Senator Brownhill in his contribution to this debate. Senator Brownhill spoke about the value of `freedom of choice' in the health sector. Freedom of choice, I believe, is a myth for most people in a situation such as hospitalisation, because very many people can make only one choice. They cannot afford private hospitals, just as they cannot afford private schools. In health, as in education, the question of choice is blurred by public relations exercises of the private sector providers. Those who can afford private schools or private hospitals often choose them because they have been given misleading information. A constituent came to see me last year about a huge debt incurred when her husband had an urgent operation in a private hospital. The surgeon could have operated at a public hospital across the road, but told her husband, the patient: `You wouldn't want me to operate in the dog pen, would you?'. What sort of choice did that patient believe that he had? Yet the public hospital concerned was of an extremely high standard. Last year I was a patient in a public hospital when the `doctor of choice'-which is given as the reason to take out private insurance-in many cases gave his or her patients service that was inferior to that given to public patients in the neighbouring beds. Senator Brownhill said that he believes that the public health sector has every right to operate under precisely the same sort of rules as those under which any similar business operates. But private hospitals are different from other businesses in that they do have a duty of care. There must be different rules where there is a risk to the customer-or, in this case, the patient-not only of receiving poor service but also possibly of suffering permanent injury or death through a lack of proper rules and of those rules being properly monitored and enforced. Senator Brownhill also alleged that Senator Giles spent more time, in presenting the report, in talking about the dissenting reports than she did about the report itself. This is not borne out by a reading of the Hansard record. It perhaps betrays a certain defensiveness about the minority report to which he was a signatory. It is important to answer some of the issues raised in the dissenting reports. I intend to deal with some of them. In the introduction to the dissent by Senator Walters and Senator Brownhill it is said that much of the work of the Committee had been pre-empted by the changes to the funding of private hospitals in last year's Budget. This seems to imply that no action should have been taken in the private hospital field before the Committee reported. On the contrary, I would say that the Government's action demonstrates that the Committee was on the right track. On the matter of doctors having financial interests in private hospitals, both of the dissenting reports contain recommendations which are weaker than those of the majority report. Senators Walters and Brownhill recommended that there be a requirement only that private hospitals inform patients, or their relatives where appropriate, in writing of that financial interest when referring patients to that hospital, whereas the Committee recommended that each State pass legislation prohibiting medical practitioners or their families from having any financial interest in a private hospital. This recommendation was based on a great deal of evidence, and not only on that of Opit and Morley, which has been criticised, I believe on very slight grounds, by Senators Walters and Brownhill. But the Opit and Morley evidence was borne out by the findings of the Victorian Health Advisory Committee and by the very thorough research on ownership, including extensive company searches, carried out by the Senate Select Committee. In addition to doctors themselves, there is evidence of doctors' relatives and family trusts also being involved in the ownership of private hospitals. I quote from the report: . . . the Committee estimates that medical practitioners and their families make up at least forty per cent of all investors in private hospitals. This figure has been estimated using the Opit and Morley data on doctors and their relatives in Victoria and New South Wales. The Committee notes that the proportion of doctors in both the Committee's survey and the Opit and Morley study is almost identical . . . If the trends in these States were to apply throughout Australia . . . then 23% of all investors would be medical practitioners and 17% would be their relatives. The Committee's own survey found in addition that 93 per cent of doctor investors are practising and that, of that 93 per cent, 70 per cent refer their patients to a hospital in which they have an interest. In Victoria, a doctor who had a significant financial interest in a number of private hospitals where he operated has recently been charged with a number of counts involving a number of his patients. Since the matters are sub-judice, I can say only that I believe that this indicates there is certainly cause for concern about possible conflict of interest when a doctor practices in a hospital that he owns. The dissenting report opposes the Committee's recommendation that directors of nursing be appointed to private hospitals boards of management. It states: We are concerned that the implementation of this recommendation could impose legal obligations such as possible tort liability which some directors of nursing may be reluctant to assume . . . It states that directors of nursing would usually be available to advise the Board. I believe this view denigrates directors of nursing, who are entitled to a real say in the decisions of hospital boards. I cannot recall Senator Walters raising this objection during our very protracted discussions on the report, and she gave no further elucidation during her speech. It will be interesting to learn which view directors of nursing take when they read the report, since the Royal Australian Nursing Federation told the Committee that it recommended that: The Director of Nursing be a member of the Board of the institution. Finally, I would like to pay tribute to all those who have staffed the secretariat of the Committee since its inception a number of years ago. For their sake as well as ours, I hope that we can conclude consideration of our remaining term of reference before long. Senator CROWLEY(South Australia)(5.53) —I take the opportunity to speak to the report entitled `Private Hospitals in Australia: their conduct, administration and ownership'. It is the second of what we expect to be three volumes of a report from the Senate Select Committee on Private Hospitals and Nursing Homes. I take the opportunity to thank our Chairperson, Senator Patricia Giles, particularly for her persistence and patience. This Committee has had a remarkably long duration. I will come to the reasons for that shortly. I have known Senator Giles only as the Chairperson of that Committee because I joined it when I came into this Parliament in 1983, at which time she became its Chairperson. I put on record my thanks to her for keeping us at the task at hand. It was such a lengthy task principally because of the considerable changes that have taken place in the years during which the Committee has been considering this very complex issue. I also put on record my thanks to the number of secretariat staff who have helped us with our work over that time-the research assistants and the stenographic staff who drafted, redrafted, researched, reappraised and rewrote this report and sections of it from time to time. Those changes of course were consequent on a number of other changes, in particular a change of government, and changes in terms of government regulations and decisions in this area. The report also elaborates other changes, including the changing ownership and usage of private hospitals by our community over the years of the inquiry. Whilst that might sound somewhat negative, it gives a measure of the comprehensiveness of this report. At the very least it is an excellent reference document and there is little dispute from the members of the Committee about most of its substance. It provides splendid basic data about the numbers and sorts of private hospitals, the number of beds, the bed usage, the distribution of those beds, the ownership of those hospitals, the type of ownership, the type of funding and so on. I think most of those points, and particularly the points about ownership, were very adequately covered by Senator Giles in her speech. The principles of the report, consequent on the information that we discovered, either from submissions given to us or from the evidence that we took, are very comprehensive. As well as going to the numbers and the head count sort of data, they go to the organisation, management and administration of private hospitals and to the standards of medical records and medical care. The standard of medical care was of prime concern for members of the Committee, and the reason why the other examinations were so critical. As we quite clearly understood, and as clearly emerged in our deliberations, the factors are all intertwined. The ownership of hospitals by doctors can lead to the possibility of conflict of interest, which was touched on by other senators. Whilst I would insist that most doctors are completely innocent of any such practice, it is only proper that any possibility for such conflict of interest be avoided. I draw attention to the comments made by Senator Powell in speaking to this report and recorded in the Senate Hansard of 6 May 1987 when she quoted the code of ethics of the Australian Medical Association, which deals quite clearly with the pecuniary interests of doctors in relation to pharmacies. Paragraph 11.1.3 states: A doctor should not have a financial interest in the sale of any pharmaceutical preparation he may have to recommend to a patient. While that refers specifically to pecuniary interests and the potential for conflict of interest in regard to pharmaceutical preparations, I am sure the clear evidence in this report of the potential for conflict of interest-I do not wish to comment any further than that, as one can read the report for the more exact elaboration just mentioned by Senator Zakharov-will be a matter that the AMA Ethics Committee would want to address, as it has addressed the same principle of conflict of interest with regard to pecuniary interests in pharmaceuticals in the past. It is quite clear that the AMA Ethic Committee, in statements regarding pharmaceutical preparations, recognises the possibility of that principle, and the majority report also makes that point. I do not think it is even necessary to find examples of conflict of interest. It is necessary to recognise only the potential for conflict of interest and to make, as we have, recommendations that would preclude that from happening. Senator Walters and Senator Brownhill, in their comments on this report and in support of their dissenting report, commented about market forces and the importance of market forces applying in the delivery of medical services. Senator Giles argues in her comments how market forces are simply not applicable in the area of health care and health delivery, but it seems that the Opposition senators are not persuaded. They also claim that they want less government interference and less regulation, and will allow interference by the State only if a problem is recognised. However, I find some difficulty in understanding their position in that they want less government interference. In fact, Senator Brownhill says that the private health care sector has a right to select the services it provides and where, based on a demonstrated need for those services, and a right to determine its own financial arrangements. Senator Walters, on the other hand, in referring to the changes in funding of private hospitals, announced by the Treasurer, Mr Keating in his Budget Speech in August 1986, made the following comment: We consider that this decision by the Government was a retrograde step and one that will exacerbate problems in both the public and private hospitals rather than ease them. I find it a very strange contradiction that Opposition senators want no government interference but object to the reduction of Commonwealth Government funding through bed day subsidies. Market forces either operate in the private sector or they do not. If they do not, we are looking at the best mix that can be possibly arranged between private and public funding for the delivery of private and public services. I find that this position is significantly supported by the very recently released Special Supplement, Cotton Report-the Medical Journal of Australia in the Report of the Task Force to Review the Structure, Function and Constitution of the Australian Medical Journal where it states at page CR29: Over the past 25 years there have been great changes in the nature of modern medical practice, its methods of delivery and funding structures. Increases in medical costs are universal in the Western world and governments by necessity have become more directly involved in the financial support, distribution and organisation of health care systems. Australia is no exception. It is a fact of life, whether we like it or not, that a significant part of the income of virtually every medical practitioner in Australia arises directly or indirectly from government funds. It is equally apparent that the size of the health budgets of state and federal governments, who now provide three-quarters of the funds for health expenditure, makes it inevitable that those governments will continue to involve themselves in the detailed monitoring of the delivery of health care. It also states: Governments are becoming increasingly frustrated with the profession's apparent inability to resolve its internal differences. The report then goes on to make the point that it would prefer to have one voice-that is, the Australian Medical Association-speaking for the medical profession in the very important task of trying to provide the very best medical services of the sort that we have come to expect in this country, and that that is dependent on close collaboration and co-operation rather than suspicion from each side of the medical equation in this country. In terms of public and private contributions, the Labor Government spelt out in its policy and through its provision of services, ably put into place by the Government and the Minister for Health (Dr Blewett), that it will continue the best option of co-operation between both sectors. I think that the report contributes very usefully to any further consideration of the delivery of health services and, in particular, the deliberation of the best way of finding a balance between public and private hospital beds in this country so as to continue to provide that excellent health care that we have become accepting of. Senator MICHAEL BAUME(New South Wales)(6.03) —The majority report of the Senate Select Committee on Private Hospitals and Nursing Homes in Australia is clearly inadequate. Clearly it does not go in the direction that the Government itself is going down and, equally clearly, the minority report is a sensible, rational and coherent approach to this problem. It is evident that these qualities are absent from the majority report. There is no doubt that anyone with any understanding of this area would reject the majority report in general and certainly would embrace the minority report of Senators Walters and Brownhill. The majority report seems to be based far more on ideology and unsubstantiated attacks on the integrity of members of the medical profession. The majority report seems to have overlooked the real issues affecting users and potential users of private hospitals. The majority report recommends a level of regulation of the private hospital sector to a far greater degree than exists in the public hospital area-although it does appear evident from my knowledge of the figures that, certainly on the basis of cost, the private hospital sector in many instances appears to be able to provide similar services at lower cost than public hospitals, even after taking into account some of the necessary cost additions that public hospitals have to bear because of the additional services that they are obliged to provide. The minority view that the Medicare levy has been largely responsible for taking patients out of the private hospital sector and thus overloading the public hospital system is clearly correct as the large numbers of queues for the public hospital sector clearly demonstrate. Many Australians are now unable to afford both the Medicare levy and the additional private hospital insurance that is required to make certain that one does not have to take place in a queue, which can be up to two years long for some things, and not just major surgery matters but for some old fashioned services. One has no guarantee, if one belongs only to Medicare, that one will not have to join such a queue. The only way to ensure that one will obtain the hospital service that one needs when one most needs it, particularly in terms of removing painful and debilitating but not necessarily life endangering problems, is by joining a health insurance fund and taking out private hospital insurance. So it is self-evident that the public hospital system has been overloaded by the diversion of people from the private hospital sector to the public hospital sector. It is all very well for the Minister for Health (Dr Blewett) or any other member of the Government to say: `But there are more people in private hospital beds now than there were three years ago'. That is true because there are now substantially more private hospital beds. The reality is that, on the proportion of beds provided to the hospital using public in Australia, private hospitals now have a diminished role. That is a shame because there are now 9,000 empty private hospital beds around Australia at a time when there are queues of people requiring hospital beds totalling 100,000. No doubt Senator Crowley will object to that statistic, but it is something like 100,000. Certainly the Victorian figures show an increase to something like 34,000 people waiting in a queue for public hospital beds-and that is in just one State alone. So that is a fair indication that the number of people waiting in a queue in Australia-many of them in pain-is enormous. It has been caused by the extent to which Medicare has discouraged people from having private hospital insurance and now simply to depend on Medicare. The minority report also recommend that patients who choose private hospital accommodation should not be forced to pay twice, as at present; that is, through the Medicare levy and through private hospital insurance. It is evident that tonight, for example, that situation will worsen because, if the leaks are accurate, the cost of medical services to a patient in a private hospital will increase. In fact, the rebate will go from 85 per cent down to 75 per cent, and naturally that will impose additional cost burdens on the health funds and, naturally, the health funds will extend that cost burden to the contributors. If the health customers of Australia take the view that they can no longer afford these further rises in health insurance, which follow the $170m slug that they have already faced this year, there could be even further pressure on the public hospital system as potential private hospital users are forced out of this area to join the public hospital queues. I have already raised with the Minister this question of the cost impact on the inflation rate in Australia through the booming cost of health in this country. In the past 12 months we have seen an increase of 18.5 per cent in health costs, which is double the rate of inflation in Australia. The major factor in that was, of course, the period of 12 months-not the three months that the Minister said in response to me. Certainly he unintentionally misled me. When he pointed out that hospital costs were only a small part of it, he was really referring to only the last three months. If one takes the last 12 months one will see that the great bulk of the increased costs was from health care and hospital insurance contributions, and that resulted directly from the Government's policy. What the Government is going to do again tonight is, no doubt, further add to the cost of living and further discourage people from providing for themselves by, in a discriminatory way, specifically hitting those people who choose to go into a private hospital because they know they can get the service they want when they want it. I concede that I have not seen what is contained in tonight's mini-Budget or financial statement, but the reports around certainly indicate that this is very likely. Of course, this is another discriminatory assault on people who prefer to use the private sector rather than rely on the Government, which is what is the philosophical thrust of this Government and the majority report. There are some other elements of this report that are totally unacceptable and which the minority recommendations clearly seek to rectify. The minority report, for example, suggests-and quite sensibly-that the abolition of bulk billing for all those except disadvantaged patients would overcome concerns expressed about entrepreneurial medicine. The minority report quite properly pointed out that the Committee received no substantiated evidence to suggest impropriety by medical practitioners relating to private hospitals. In fact, the reverse was the case in the only survey submitted to the Committee which examined this area. Yet the Committee suggested that where there is some such impropriety, there should be specific controls over it. The essential point is that three members of the six-member Committee dissented from the Committee's recommendation that medical practitioners should be prohibited from holding financial interests in private hospitals, and that clearly establishes an inference that doctors somehow lack the propriety and decency to be able to act in that way. I reject that proposition. The ACTING DEPUTY PRESIDENT(Senator Colston) —Order! The honourable senator's time has expired. Senator GILES(Western Australia)(6.13) —I appreciate the fact that in speaking now I am closing this debate. I am very well aware of the fact that the debate in the community will go on for quite a long time, and not in terms that have been suggested by Senator Baume. His approach to our report is one that shows very little confidence in his own party colleagues who took part in this long inquiry. He seemed to be able to concentrate only on a range of issues which were included in the dissenting report of two of his colleagues, Senator Walters and Senator Brownhill. Most of these matters, I would point out, were not matters which were of contention during the Committee's activities. We are very puzzled indeed that, for example, the question of bulk billing should be raised. Senator Michael Baume obviously uses every opportunity that he possibly can as an excuse for a polemic against Medicare. The question of bulk billing was not at issue at any time during the conduct of this inquiry, and to see it referred to in the dissenting report was surprising, to say the least. All this emphasis on the minority report should be qualified by the fact that it is essentially the work of one member of the Committee, as I say, encompassing a number of issues which were not at issue during the inquiry, supported by another member of the Committee who had seen and heard barely any of the evidence. Quite correctly Senator Michael Baume points out that those three members, including Senator Haines, were at odds with the Government members of the Committee on that one issue of doctor ownership of private hospitals. We never at any time have claimed evidence of any impropriety. What we have claimed, and have substantial support for, is the potential for conflict of interests. Time and again, people for whom we have a great deal of respect, gave evidence to this effect. They insisted that this was the case and most of us agreed. Ideologically based attacks on medicos were not what this report was about. We are as concerned as anybody in this community to maintain the trust and integrity in which the medical profession is held by the majority of people. We are also very well aware of the fact that the Australian Medical Association and the royal colleges themselves have considerable difficulty in maintaining the sort of peer review that many of us wish was able to be maintained. It is quite extraordinary for us to hear from those on the other side, as we have done during this debate, that entrepreneurial medicine is frowned upon. There are no problems about that; we have unanimity on that particular issue. But if ownership of private hospitals by doctors who use those hospitals is not entrepreneurial medicine, I fail to understand what is in the minds of the dissenting senator. We are not over-enthusiastic about a vast amount of unnecessary regulations, but, as has been pointed out time and time again, health care is not the same as any other consumer aspect of this society. If the care that has been provided in any institution, private or public, is found to be substandard, it is governments in the end that have to take the responsibility. We have seen this happening quite recently. That responsibility simply must be taken, if the only justification within the private sector, is that it is, still the public purse which trains doctors, nurses and technicians; it is still the public purse in the main that provides the research and development and many of the public facilities which private medicine depends upon very heavily. Cost comparisons which are referred to by Senator Baume are very difficult to make, as he has pointed out. The Jamison report-a respected report which preceded ours by a couple of years-referred to the fact that the clientele of private hospitals is vastly different from that of public teaching hospitals; that the costs are very difficult to compare, and that on the whole it is a fruitless exercise to try to make that comparison. Since the publication of the report we have had quite a lot of response which has been uniformly congratulatory. Amongst other pleasing aspects of its reception have been recommendations that we should send copies of the report to the British Medical Journal and to the New England Journal of Medicine for review. I do not think accolades come much higher than that. It is a source of disappointment that we should find that dissenting views were published on what were not considered to be matters of great moment during the actual discussions of the Committee. This report is simply being used in a party political way to try to demonstrate that Medicare is the root of all evil in Australia. Contrary to what Senator Michael Baume argues, the majority report did make a reference to the minor role of Medicare in the changing usage of private and public hospitals. It was not seen to be a major issue at any time during the inquiry, and to find it in the dissenting report as a major issue is quite surprising. The report should be of use. The community response has been one of considerable interest and considerable congratulation. I think our best wish is that it be a useful document for those who want to go further into many of the issues that were canvassed in the report, issues which we were not able to follow further without unduly protracting the inquiry, but issues which are of considerable importance within the debate on health care within Australia. Senator WALTERS(Tasmania) —Mr Acting Deputy President, I claim to have been misrepresented. Senator Giles claimed during her speech that only one senator had worked on the minority report of the Senate Select Committee on Private Hospitals and Nursing Homes. That is a gross insult to Senator Brownhill, who has worked extremely hard on this report. Senator Zakharov —How much of the evidence did he hear? Senator WALTERS —He has not been a member of the Committee for the whole time but, after all, that Committee has been working since 1981. I take very strong exception to Senator Giles's inference that Senator Brownhill did not work in forming the minority report. For her information, I assure her that he and his staff have done a tremendous amount of work. The ACTING DEPUTY PRESIDENT(Senator Colston) —Senator Walters, are you claiming that you have been misrepresented? Senator WALTERS —Yes, I am, Mr Acting Deputy President. The ACTING DEPUTY PRESIDENT —You seem to be talking about Senator Brownhill. Will you come back to how you have been misrepresented? Senator WALTERS —Mr Acting Deputy President, as I said at the outset, the inference was that I had done all the work. I am claiming misrepresentation. I have not done all the work on the minority report; Senator Brownhill has also worked extremely hard on that report. I take very strong exception to Senator Giles's inference that he signed something without doing a lot of work. It is a gross injustice to Senator Brownhill. Senator Zakharov —Why isn't he here? Senator WALTERS —He is probably working. The ACTING DEPUTY PRESIDENT —I must say that is the strangest misrepresentation statement that I have ever heard. Question resolved in the affirmative. Consideration resumed from 6 May, on motion by Senator Jones: That the Senate take note of the report. Question resolved in the affirmative. Debate resumed from 6 May, on motion by Senator Bolkus: That the Senate take note of the report. Senator NEWMAN(Tasmania)(6.23) —The report of the Senate Standing Committee on Constitutional and Legal Affairs on the role of Parliament in relation to the national companies scheme is welcome, not only because of its single recommendation, but also because of the opportunity that the Committee's inquiry provided for various bodies to air criticism of the existing scheme. Criticism came from State governments, business, lawyers and accountants. The existing national uniform companies and securities scheme represented an attempt to overcome the divergence between the laws of the various States relating to companies. Laws agreed to by the Ministerial Council for Companies and Securities consisting of representatives of the six States and the Commonwealth, would be passed by the Commonwealth Parliament and would then apply automatically, by virtue of State application of laws Acts, throughout Australia. The Senate Standing Committee for the Scrutiny of Bills, of which I am a member, commented on aspects of the scheme in its eighth and eleventh reports of 1986, and again in its annual report for 1985-86. It also made a submission to the Constitutional and Legal Affairs Committee on the matter. Given the functions of the Scrutiny of Bills Committee, its major concern was with the powers of the Commonwealth Parliament in relation to Bills forming part of the national uniform scheme. The Committee understood it to be the view of the Attorney-General's Department that, once a Bill had been agreed to by the Ministerial Council, acceptance by the Commonwealth Government of an amendment to that Bill, without going back to the Ministerial Council to seek approval of the amendment, would amount to a breach of the formal agreement, entitling the States to withdraw from the scheme. The Attorney-General's Department, in its submission to the Constitutional and Legal Affairs Committee, reflected this view, stating that, although the formal agreement did not expressly prohibit the Commonwealth Government from accepting amendments moved on the floor of the Parliament, to do so would not be consistent with the spirit of the agreement. In public hearings, however, Mr Peter Levy of the Department expressed the view that the legislation as amended would apply in the States and that it would then be left to individual States to decide whether to make translator regulations under the scheme providing for the amendment not to apply. By contrast, Mr Leigh Masel, the former Chairman of the National Companies and Securities Commission, took the view that the Commonwealth's acceptance of amendments without going back to the Ministerial Council for its approval would be a breach of the agreement. Similar doubts surround the Parliament's power to disallow regulations forming part of the uniform scheme. This was highlighted in February this year when the shadow Attorney-General, Mr Spender, moved for the disallowance of certain amendments to the companies regulations. The Attorney-General, Mr Lionel Bowen, in opposing the motion, suggested that Mr Spender was `not entitled' to move for disallowance. However, the Constitutional and Legal Affairs Committee noted that the agreement did not expressly take away the Commonwealth Parliament's power of disallowance. In fact it appeared to recognise it by providing that, if an amending regulation approved by the Ministerial Council ceased to be in force by disallowance, any State could make similar regulations. The disallowance of a regulation did not give the States a right to withdraw from the scheme, although it might in this fashion lead to a breakdown in uniformity between the States. As the Scrutiny of Bills Committee stated in its submission in a passage quoted at some length at paragraph 3.12 of the report, the effect of the scheme is to diminish severely the ability of the Commonwealth Parliament to perform its legislative functions. Therein is our concern. If it rejects legislation forming part of the national scheme which has previously been agreed to by the Ministerial Council, then individual States may legislate in terms of the agreed Bill and uniformity will have broken down. If it amends legislation forming part of the national scheme, and either the Commonwealth Attorney-General declines to take the amendments back to the Ministerial Council, or the Ministerial Council fails to agree to the amendments by the required majority, then passage into law of the legislation as amended would give the States a right to withdraw from the national uniform scheme. Failure by the Parliament to pass the legislation without its proposed amendments would, once again, leave the individual States free to legislate in the terms agreed to by the Ministerial Council with a consequent breakdown in uniformity. The Scrutiny of Bills Committee commented in its eighth report of 1986 that the operation of the national uniform scheme places the Parliament in an invidious position. If it amends a piece of legislation forming part of the scheme, or rejects such a piece of legislation, it may bring the scheme to an end. If, on the other hand, it fails to amend or reject such legislation, however compelling the grounds for action, it may be said, in effect, to have delegated its legislative power to the Ministerial Council without even retaining the equivalent of a power of disallowance. Indeed, to the extent that it is possible for parliamentary amendments to be taken back to the Ministerial Council for approval, it may be said that it is the Ministerial Council which has a power of veto over the legislative action of the Parliament. Despite these defects, the national uniform scheme might be defensible if it had in fact resulted in the uniformity of company law throughout Australia. However, one of the main criticisms made in submissions to the constitutional and Legal Affairs Committee from lawyers, the Confederation of Australian Industry and the Business Council of Australia was that the administration of the scheme by the NCSC and the seven autonomous State and Territory corporate affairs commissions had led to inconsistency in the application of the law. For example, the NCSC might advise as to the contents required in a prospectus in certain circumstances, but this advice could be contradicted by the State CAC when the prospectus is lodged. The recommendation of the Constitutional and Legal Affairs Committee that the Commonwealth Parliament should enact comprehensive legislation covering the field currently regulated by the co-operative scheme is represented as the next step in a natural progression. The co-operative scheme has outlived its usefulness. The doubts which surround the Commonwealth's legislative power in relation to companies at the time the scheme was developed have now been dispelled. Sir Maurice Byers, QC, the former Commonwealth Solicitor-General, says that the Commonwealth has the power to regulate the whole range of corporate activities, from incorporation through to dissolution, in respect of all companies other than recreational, scientific, educational and charitable companies, where trading or commercial activities do not form a significant part of those companies' operations. Very few companies would fall into this category. Australia now has a national stock exchange, and its financial institutions increasingly operate not only at a national level but also at the international level. It is important that investors should have confidence in our share market and futures and securities industries. It is also important that unnecessary costs should not be imposed on business through differences in legislation or its interpretation. I therefore welcome the recommendation of the Constitutional and Legal Affairs Committee in favour of national legislation. Question resolved in the affirmative. Consideration resumed from 29 April, on motion by Senator Robertson: That the Senate take note of the report. Debate (on motion by Senator Walsh) adjourned. Consideration resumed from 29 April, on motion by Senator Reid: That the Senate take note of the report. upon which Senator Jessop had moved by way of amendment: At the end of motion, add `and the Senate agrees with the Committee's recommendations'. Debate (on motion by Senator Walsh) adjourned. Consideration resumed from 9 October 1985, on motion by Senator Peter Baume: That the Senate take note of the paper. Question resolved in the affirmative. Consideration resumed from 23 May 1985, on motion by Senator Childs: That the recommendations of the Committee of Privileges, as contained in paragraphs 5.19, 5.20 and 6.5 of the Committee's Report on the Question of Appropriate Penalties arising from the Report of the Committee of Privileges of 17 October 1984, be adopted. Debate (on motion by Senator Walsh) adjourned. Consideration resumed from 21 February 1985, on motion by Senator Tate: That the Senate take note of the report. Question resolved in the affirmative. Senator CROWLEY(South Australia) —I present the eighth report of 1987 of the Standing Committee for the Scrutiny of Bills concerning Aboriginal and Torres Strait Islander Heritage Protection Bill 1987, Aboriginal Land (Lake Condah and Framlingham Forest) Bill 1987, Customs Tariff (Miscellaneous Amendments) Bill 1987, National Parks and Wildlife Conservation Amendment Bill 1986, National Parks and Wildlife Conservation Amendment Bill (No. 2) 1987, Ships (Capital Grants) Bill 1987, States Grants (Schools Assistance) Amendment Bill 1987 and Sugar Cane Levy Collection Bill 1987. I also lay on the table Scrutiny of Bills Alert Digest No. 8, dated 13 May 1987. Ordered that the report be printed. Senator JONES(Queensland) —On behalf of Senator Aulich, I table volumes 1 and 2 of additional information received by Estimates Committee B. I also table volume 1 of additional information received by Estimates Committee C, on behalf of Senator Childs. I also table additional information received by Estimates Committee F, on behalf of Senator Reynolds. Consideration resumed. The Bill. Senator MACKLIN(Queensland)(6.35) —I want to raise an issue in terms of this Bill which is directed at the establishment of a better statistical base. I preface the item by giving some statistics. In every 1,000 live births in Australia the infant mortality rate for the white population is 9.6 but for the Aboriginal population it is 30.8. I raise this item because of some discussion at Question Time today and on other occasions about some grants that have been mentioned by the Opposition's Waste Watch Committee. In particular, I refer to those grants which have been provided under the community health program to the Nursing Mothers Association of Australia. The grant that has been mentioned in headlines in the Press, attacking its expenditure as a total waste of money, was provided to Aboriginal women to enable them to become counsellors on breast feeding within their communities. It is a most extraordinary type of attack for two reasons. The first is that hopefully we are aware of those types of statistics that I have just mentioned. I hope that the Australian Institute of Health, after its establishment, will be able to clarify them in greater detail than we have had to date. It is worth noting that breast feeding is one of the most efficient means of preventive medicine in Australia with regard to infant deaths. It is extraordinary that anybody should be attacking those grants. We know very well that multinational companies have promoted the use of artificial products for the feeding of young children and that they have made millions of dollars from this exercise. They have taken large numbers of Aboriginal women away from breast feeding and have encouraged them to use bottles. We know that, as a result of this exercise, there have been not hundreds but thousands of deaths in Australia and in many other countries where similar proceedings have taken place. It is extraordinary that this attack should be made in Australia today when the Government has ceased providing funds under the community health program to the Nursing Mothers Association. It had received to date $70,000 to help it with its training of counsellors around Australia. It has 1,500 counsellors who, in the last year, counselled some 250,000 women over the phone about problems that they had with children. This is a very emotional issue for me. My wife is a Nursing Mothers Association counsellor. I know that she has spent many hours on the phone talking to women, some of whom have battered their children. She has often got off the phone in tears. This type of work is being done on a voluntary basis-sometimes up to 30 hours a week-by these women to help other women in the community in an area of social development that we seem to neglect. Our changing society has made it very difficult for women with young children, often because there is very little support for them in the community. Often, because of the changing nature of society, a child's mother might have long since ceased having children so he or she does not have sisters around, as was the case previously, to assist in those early months which are extremely trying. We know that there is a rising incidence of battered children; we know the statistics for Aboriginal children; we know the value of this area of preventive medicine; and we know the value of women supporting other women. Yet this area is attacked both by the Opposition's Waste Watch Committee and by the Government. The Government is taking away the $70,000-a meagre amount of money-which would have assisted the training of those people. Indeed, if only one in 10 of those women went to a doctor instead of a voluntary counsellor, the cost to Medicare would be $600,000. This is an absolutely absurd proposition-to take away $70,000, yet at the same time to cost the taxpayer $600,000. Why has this been done? Because preventive medicine cannot be seen. We are stopping something and we would much prefer to spend the money on sick children than on stopping children in our community from being sick. That is basically the result of both these propositions. I hope that with the establishment of the Institute it will provide the Government with some better statistics for policy making than it had from the Department on this single item. Appalling advice was given to the Government and it took that advice. That advice will, without a doubt, lead directly to the deaths of children in Australia. We know that there has been a big growth in the numbers of battered children and there are very few places that women can go. It is important that women should have the ability to get on the telephone and talk to other women who have young children; to be able to relieve tension in those circumstances; to get good advice which will help them over that incredibly difficult period; and hopefully to take their children along to a medical practitioner so that they and their children can be counselled properly in a less stressful situation. But the Government was quite happy to accept the advice-and we know where it came from within the Department-to lop off $70,000. That decision will cost the Government and the revenue money and it will cost young Australian lives. That is the type of decision that this Government is quite happy to make. It is also the kind of decision that the Waste Watch Committee is happy to support because it does not agree with providing money for such worthwhile activities. Bill, as amended, agreed to. Bill reported with amendment; report adopted. Senator TATE(Tasmania-Special Minister of State)(6.45) —I move: That the Bill be now read a third time. Before we finish with this Bill I wish to thank all honourable senators for their contributions to the debate. Question resolved in the affirmative. Bill read a third time. Consideration resumed from 20 March, on motion by Senator Gareth Evans: That the Bill be now read a second time. Question resolved in the affirmative. Bill read a second time, and passed through its remaining stages without amendment or debate. Debate resumed from 7 May, on motion by Senator Gareth Evans: That the Bills be now read a second time. Senator ARCHER(Tasmania)(6.47) —The Sugar Cane Levy Bill 1987 and the Sugar Cane Levy Collection Bill 1987 provide for the establishment of a better-funded and co-ordinated research program for the sugar industry in line with similar reforms in most other primary industries. The industry contribution, which will be matched on a dollar for dollar basis by the Commonwealth, will be levied on both millers and growers at an initial rate of 5c per tonne with a provision for the rate to be varied to as much as 10c per tonne eventually. The sugar industry supports the measure and the short to medium term outlook for the industry is much brighter than the gloomy and dire predictions indicated as little as two years ago. The National Agricultural Outlook Conference earlier this year was told by the Bureau of Agricultural Economics that there would be a gradual improvement in world sugar prices. The principal reason for this is the gradual reduction of the sugar stockpile which has been depressing sugar prices for some years. The lower sugar stocks, complemented by increased demand, have boosted the international price from a low of US2.6c per pound to about US7.78c a pound two or three months ago. It remains roughly at that level. The Soviet Union has increased its sugar imports and this year it will buy five million tonnes, partly as a result of a campaign to encourage Soviet people to drink soft drinks instead of vodka. The Australian sugar industry recently sold 180,000 tonnes of sugar to the Soviet Union and that has certainly taken the pressure off our export market. Consumption and imports of sugar are also rising in Brazil which itself is a major producer. Sugar is being imported by Brazil to produce the motor spirit gasahol. The Brazilians have done a lot of work on this and it has now become a major source of fuel for motor vehicles. The No. 1 pool price for 1986-87 is expected to increase by 21 per cent to $270 per tonne and by 1987-88 it is expected that the price will rise as high as $345. In contrast only a couple of years ago that price was down to as little as $222 or $223 a tonne. Australian cane sugar exports rose by almost 54,000 tonnes to 2.58 million tonnes in the 1986 calendar year. The principal markets were Canada, Japan, Malaysia, Korea, New Zealand and Singapore. It is indicative of the better outlook for the sugar industry that Bundaberg Sugar announced that it had a profit lift of 20 per cent to $6.5m for the year ended 30 April 1987. A similar rise has been forecast by the Pioneer Sugar Mill as well. This shows us that there may be an improvement on the way but it does not release us from the necessity to improve our research. We cannot be complacent. World prices are expected to peak in the next five years and we could then be in for another period of low prices beyond that again. This factor highlights the need for the industry to continue its economic marketing and technical research so as to maintain Australia's competitive edge in the world sweetener market. There are a couple of examples which I believe are important to show areas in which research is having some effect. The Bureau of Sugar Experimental Stations, one of the three organisations currently conducting research into the sugar industry, is doing a great deal of work in this area. The first example I give is the recent work on harvester design where it is expected that an improvement in cane losses will save the industry as much as $20m a year in terms of a better harvest. The second major area of research is in the improvement of cane varieties. These Bills should lead to an increase in the amount of funds available for research by the sugar industry. Ultimately the long term health of our sugar industry will depend on the dismantling of subsidised production and subsidies in other areas, and hopefully will reduce production controls and trade barriers in the world market. As with most other commodities, the only solution to price instability appears to lie in multilateral reform of the commodity trading system. While foreign governments continue to support domestic sugar prices and tightly control markets, there is little hope of stabilising the world price. If governments in the major trading nations stopped shielding producers from the world price, the change of prices slumping to disastrous levels such as existed in 1985 could be avoided. Under current circumstances, the world price is estimated to drop below US4c about one year in 20. If only 4 per cent more of the world's producers were exposed to the world market, the world price would drop below US4c only about one year in a hundred. Australia's sugar industry is extremely sensitive to world prices. If appropriate policy reforms can be achieved through the General Agreement on Tariffs and Trade multilateral trade negotiations, low cost efficient countries like Australia could expand their shares of the world market. The Opposition supports the legislation and wishes it a speedy passage. Senator MACKLIN(Queensland)(6.53) —Sugar is one of Australia's major exports. It is and has been for a long time a mainstay of our agricultural exporting effort. In terms of the domestic sugar price which arose out of the agreement between Queensland and the Commonwealth over 40 years ago, Australia has had a reasonably low domestic sugar price funded and subsidised very heavily by the more often than not high export price that was able to be gained by an efficient industry on the world market. The world sugar industry, whether based on beet or cane sugar as in Australia, involves almost every country. Over 100 countries engage in significant sugar production. Sugar is susceptible to a whole variety of problems such as the weather, particularly as a large amount of sugar is grown in countries which periodically suffer from cyclones, lack of monsoons, typhoons. Therefore, the sugar industry tends to fluctuate in the amount produced. However, in recent years the production of beet sugar, particularly in the European Economic Community, the growth of beet and cane sugar in the United States of America, has meant a stabilisation of production, certainly in the free market. A large amount of sugar is traded in the world within a closed structure in the COMECON countries and it is difficult to work out what precisely is occurring there. One of those countries, the Union of Soviet Socialist Republics, is a major importer of sugar from the free market and hence there is an interrelationship between those two markets. Current world sugar production is around 100 million tonnes, and it has been coming up to that point for some years. Consumption of sugar world wide is also expanding, which in Australia at least may seem odd. Despite the rising levels of other types of sweetener, sugar is still the dominant sweetener in the world. When one looks, for example, at most industrialised countries, one finds in recent years a levelling out of demand. This can probably be attributed not only to the growth of those sweeteners, particularly in the United States market of the corn-derived sweeteners, but also to changing dietary habits. That occurs very largely because foods which previously used to be processed using sugar are now often processed without using sugar. In contrast-and this is the reason why the consumption of sugar world wide is still growing-we have a growing market in developing countries. That seems to have more than balanced the decline in the developed countries. Most countries produce some sugar and about 75 per cent of the total world production is consumed within the country in which it is grown. This means that only about 25 per cent of the total sugar grown in the world is part of the sugar trade between countries. Australia is dominantly dependent on exports. In fact, we export 80 per cent of our sugar. That puts us at the top of the league in the percentage of sugar exported. It is important to look at the position world wide because there are some worrying factors on the horizon for Australia. Tonight I shall refer to only one such item and that is the United States. By concentrating my remarks on the United States I do not mean to neglect the fact that the European Community went from being a net importer to become a net exporter. I do not wish to understate the destabilising role which the EEC has already played in the world sugar market. In fact, it probably more than most led to the collapse of the international sugar agreement by its aggressive tactics of selling subsidised sugar. The concern I wish to point to is the dominant role that is played in many ways by the United States in the world sugar market. Despite the fact that the United States does not export sugar, it is still the dominant force. Before 1980 the United States was one of the world's three largest consumers of sugar with an annual demand of about 10 million tonnes-an extraordinary figure for one country when one considers the total world sugar market. It is the world's largest net importer of sugar-in terms of the world free trade, it was by far the largest net importer. Thus, actions by the United States in that market in 1980 could be seen to affect the total world market. In fact, that did happen. By 1985, in five short years, United States net imports had more than halved and imports by the Union of Soviet Socialist Republics, China and Japan exceeded those of the United States. That is a massive turn around. In fact, we felt it very badly here in Australia. It was one of the major contributing factors to the collapse of the world price and to the devastion of the Queensland sugar industry. It has led directly to a number of measures that the Government has had to take in this area, not the least of which is the legislation before us. In that period United States consumption fell by 27 per cent and United States net imports fell by 54 per cent. Most of the decline occurred in the four years between the enactment of the Agricultural and Food Act of 1981 and 1985. In that four-year period United States consumption fell by 19 per cent and net imports by 48 per cent. The principal reason for the dramatic decline in consumption within the United States has to be the United States sugar support program. Under this program, in order to provide high support levels for the domestic sugar producers-the very opposite of the Australian domestic sugar price agreement, which provided low levels-United States consumers have paid high domestic sugar prices and so did not really experience the benefit of the low world sugar prices that prevailed after 1983. Sugar consumption declined while the price umbrella put in place by those types of support mechanisms allowed alternative sweeteners-particularly, of course, the high fructose corn syrup derivatives-to make enormous inroads into the United States sugar industry. As sugar consumption contracted, the quantity of imports also declined. Foreign suppliers to the United States market, who hold quotas under the sugar program, have therefore borne the full impact of the program on consumption by having their import quotas progressively reduced. This is a problem with which we in Australia are now faced. Our problem is trying to predict where the United States sugar industry is likely to go from here. I give some figures to show the dramatic operation that we are involved in. We are looking at the production costs and at such items as the average world price for sugar. In 1985 this was 4c a pound as against the United States domestic raw sugar price of 20.3c a pound. From this, I think one can see that the type of support provided through the United States agricultural support system, as a result of the 1981 Act, has made an enormous differential and has led to increasing problems. Not only has there been that effect but also acreages planted and harvested for sugar production have increased since the beginning of the sugar program. The acreages as of 1986 are 16 per cent higher for beet and 7 per cent higher for cane than those planted in 1982, which reflects the high level of price support available and the incentive now within the market in the United States to proceed with the sugar industry. It is probably anybody's guess where we go from here. A very good case can be made out for the proposition that we are looking at the possible reduction of Australia's market within the United States, with a progressive move to zero. The current year's exports look like being about 70,000 tonnes, down from the extraordinarily high levels that we were exporting just a short four years ago. That drop to zero is probably something that the Australian sugar industry, in terms of its current restructuring, could just bear. However, I point to an even more worrying proposition-one which is hedged about by some ifs and buts, but a reasonable one-that is, that the United States will move relatively rapidly to exporting sugar on to the free market. That is an incredibly worrying proposition. The reason it is worrying is that, if the move by the United States follows the type of move that we saw in the European Economic Community, the Australian sugar industry, rather than being able to look forward to a recovery of world prices-to which I think Senator Archer pointed in the more optimistic scenario that he was painting-is possibly on the verge of another devastating blow because of its dependence on exports. If the United States goes into the world market as an exporter, it will do so with enormous support potential. Senator Boswell —Thirty-five billion dollars worth. Senator MACKLIN —Yes, from that process that occurs within the United States that not only defies fiscal imagination but defies almost any imagination, considering that we are looking at upwards of $35 billion. As last year's all-party trade delegation was informed, Congress did not even know what the upper limit might be. But, even at $35 billion, we are looking at half of Australia's Budget being spent within the United States for just agricultural support. Of course, as the operation of the United States domestic sugar program proceeds, and we find an extension of growing, the United States may be looking at means of exporting that sugar in some form or another on to markets that Australia has supplied up to now. Australia is one of the four largest sugar exporters in the world. In fact, those four exporters collectively account for 60 per cent of the world's free market exports this year. We are part of the group that will feel the brunt the hardest, despite the fact that Australia is one of the most cost efficient of the world's sugar producers. In 1982 Australia held an 8.3 per cent share of that dominant market in the United States and in 1981, prior to the imposition of quotas, we were exporting 800,000 tonnes to that country. That compares, as I said before, with the possibility of 70,000 tonnes next year. That is an enormous drop to bear in such a short period. The quota decline has greatly added to the hardships that have been experienced by Australia's producers and America's policies have been a large contributor to this situation. Unlike the United States and EEC sugar producers, who have access to large domestic markets and long term support policies, Australian producers have not been subsidised through any extensive support schemes. I think that point ought to be emphasised. A history of the sugar market in Australia since the late 1930s shows that there has really been a subsidy going the other way. The sugar producers have subsidised the Australian community by means of the acceptance of a guaranteed price scheme, based on the domestic sugar price agreement which in most years was able to provide a low sugar price for Australia, propped up by a high export price. Hence, a reasonable return was given to the producers. One must acknowledge that that low price-which, of course, fed through to low processed food prices-was a subsidy from the industry. In times such as these, in difficult restructuring times for the sugar industry, I think it is reasonable for the sugar industry to seek some support in return. The United States and EEC sugar policies of internal subsidy are not seeking to create a competitive environment; in fact, they are seeking to create exactly the opposite. They seek, ultimately, to depress the world price, to drive a whole range of countries out of the market. Many of those countries, of course, are developing countries that depend extremely heavily, in terms of their ability to trade, on their exports. Australia, while it is a developed country, is very much, of course, dependent on its agricultural exports, of which sugar is a major item. What we are now seeing in the predatory policies of the United States and the EEC is a further attack which, in relation to my State of Queensland, will devastate our regional economies. Unfortunately, it is not well known in other parts of Australia that Queensland, as a decentralised State, has been heavily dependent, in supporting that decentralisation, on having a regional economy-an economy which is not based totally on the capital city but which is self-supporting and income generating for the community and for the country. If one heads north from Brisbane one finds that a large number of the coastal towns, from not very far north of Brisbane to the farthest coastal towns-with a couple of notable exceptions, such as Rockhampton and Gladstone-are heavily dependent on the sugar industry. Those communities will have devastating economic problems. Senator Archer raised the other matter that I wish to refer to before I complete my remarks-that is, the need within the industry to continue and to promote research. Of course, these Bills seek to produce the wherewithal to enable that to proceed apace. Research is absolutely vital not only in terms of the quality and quantity of sugar that can be produced from an acre, and greater efficiency of production, but also, I suggest, in terms of alternative uses for sugar products. Unfortunately, in times of high export prices there is very little incentive to go down that track. We must go down that track now. Indeed, there are a number of commercial ventures under way. Some are based in companies, others are based on research undertaken by universities in Queensland and others are based on the work being done by the sugar experimental stations. These ventures are looking for alternative uses. Of course, we know of a number; but what we must look at, of course, is not simply alternative uses but economic alternative uses. We can name any number of alternative uses for sugar at the moment. We can look at ethanol production, biomass and high fructose experiments. There is a range of possibilities in that area. We need to make sure that they are economic possibilities and not simply further drains on the economy. I believe that there are some very exciting possibilities in that area. The combining, for example, of the biomass and the high fructose processes in a single process will obviously be an economic venture. A pilot program is operating in Queensland at the moment which is funded partly by the Queensland Government, partly by private industry and partly by the Commonwealth Government. I was very glad to be involved in discussions a couple of years ago which moved that process along. That alternative use for sugar-ethanol production-may very well appear in the short term. We look with envy, of course, at the Brazilian operation. Currently, it does not seem that ethanol production in Australia is economically viable. We need, as I have said before, an economically viable substitute for the use of sugar in food processing. In regard to the long term prospects of oil exploration in Australia, it has been estimated that no further major fields will be found and that only minor fields will actually come on-stream within the next 10 years. Australia will look to other areas. It would be crippling in the extreme if our type of economy had to bear the full weight of importing oil. Therefore, ethanol may very well be, within a 10-year framework, an economically viable substitute for oil in the Australian economy. In that case our sugar industry will be very well placed to take that up and to move with it. Senator Button —What is your view about bagasse? Senator MACKLIN —In terms of production? Senator Button —Yes, as a fuel. Senator MACKLIN —Yes. There are experiments going on at the moment, of which the Minister is very much aware-probably far more aware than I am. I have read about the experiments in that area. They are also incredibly exciting. Again, of course, there is a question mark over their economics at the moment. In the 1982 growing season we saw the highest world prices ever for sugar. It was very difficult to predict at that time that we would experience the type of situation that was experienced in the 1985 growing season. What we need in terms of government policy is that longer range view. We fairly obviously need a lead time, for example, for a mass ethanol substitute for oil. We would need a 10-year framework. I believe that sugar, which is part of agricultural production in Australia-in fact, it is still a major part of the Queensland economy-must be viewed as a prospect in that area. I believe that increased research in that area could now be undertaken. I know that recently a number of Australians have visited Brazil and have closely studied its ethanol operation. I hope that the Government will be able to take up any material that flows through the university structures with regard to that proposition. I am quite sure that the Queensland Government has been working very strenuously in this area. I do not often say something nice about the Queensland Government, but I certainly want to do so in this regard, because in the last few years it has been working very strenuously in this alternative use area. I think there is a common view across all governments and industry that we must take a longer term view in looking for a substitute because of the rather depressing occurrences, that I have just suggested, of not only the EEC but also, more importantly, the United States becoming a net exporter of sugar. Given that situation, one must commend the Government for introducing the Bills that are before us. The Bills have been long in gestation. We will undoubtedly move towards other items in this area in a very short period. Although I am no longer the primary industry spokesperson for my Party, I still maintain contacts with people in the sugar industry. They were concerned at being pawns in the brawl between the Queensland Government and the Federal Government. That did not excite them one bit. I am glad that we have now moved at least a step beyond that particular operation. Senator Townley —Who is your spokesman on this? Senator MACKLIN —Senator Powell, who has handed this over to me. She said `Sugar is yours, Senator Macklin' in terms of Queensland. I think any senator from Queensland would have to be involved in this industry, because whenever I travel throughout Queensland I notice what an enormous dependence our regional economies have on that single crop. I welcome these Bills. I wish them a speedy passage and I hope that in a very short time we will see further legislative initiatives from the Government with regard to the support that needs to be provided to the sugar industry in the short term to enable it again to become one of our dominant primary industries with a long term future, even if it is not for the sweetener market but for a whole range of other possible markets for that commodity. Senator BOSWELL(Queensland)(7.21) —The Senate tonight is debating the Sugar Cane Levy Bill 1987 and the Sugar Cane Levy Collection Bill 1987. This legislation provides the means to collect 5c per tonne on sugar from the grower and the miller who will pay on a 50-50 basis. The Commonwealth Government is to match this contribution, also on a dollar for dollar basis, to provide research programs for the sugar industry and the annual amount raised for the research should approach something like $2m in a normal year. The legislation also provides for a maximum levy of 10c a tonne, but at the moment only 5c a tonne levy has been called for. I believe these Bills have the support of all parties in the Senate and of the sugar industry. There are approximately 6,000 sugar cane growers in Australia. About 5,500 are in Queensland and the remainder are in northern New South Wales. There is probably not another rural industry that has been so badly hit by the corrupted primary industry policies of the European Economic Community and subsequently of the United States of America. The USA has heavily subsidised its beet sugar industry and the EEC has subsidised its domestic and its export industries. We have seen long term contracts withdrawn and we have seen the sugar industry facing a very serious situation in the loss of markets. When we discuss levies and government contributions in the Senate, I believe a number of people come to the wrong conclusion, as they believe that most rural industries are subsidised by the people of Australia. That is certainly not the case in the sugar industry or in many other primary industries. Every farmer in Australia pays $9,000 a year on average in tariff protection to protect the jobs of secondary industries, and that is a straight transfer from the rural industries to supplement the incomes of people working in secondary industries. The Queensland sugar industry-perhaps I should not mention only the Queensland sugar industry, although most of the sugar industry is in Queensland-makes a number of contributions off its own bat. Both farmer and miller already make contributions of about 19.2c a tonne to the Bureau of Sugar Experiment Stations, which tests the various types of cane that can best be grown in local areas. Sugar farmers provide 8c a tonne for pest control and sugar millers pay an additional 8c a tonne to fund the Sugar Research Institute at Mackay. In all, the sugar industry provides $8.5m for funding of its own research. That is last year's figure. The Queensland Government provides an additional $803,000 towards sugar research, with the Commonwealth Government making its contribution of $580,000. It is my sincere hope that the Commonwealth Government, in passing this legislation that will make an additional contribution in research, will not do the thimble and pea trick and remove some or part of its $580,000 contribution. I pick up the point too that whilst the sugar industry has been in dire straits over the last three or four years, it has subsidised Australia in cheaper domestic prices to the tune of something like $400m over the last 10 years. Whilst the sugar industry exports 80 per cent of its production, our domestic sales are favoured by an embargo on sugar imports from subsidised countries. Many rural industries are troubled by falling export prices, by competition from subsidised commodities of both the EEC and America, but none has been more seriously affected than the sugar industry. Prices have fallen from around US22c to US23c a pound to around US3c to US4c a pound in the 1984-85 season. They have shown a slight increase over the last 12 months to be around US7c a pound at the moment. Even at the time of most serious economic depression in the sugar industry, it still provided $600m worth of export sales and very valuable foreign currency exchange. I mention Bundaberg Rum, because it is the largest rum distillery in Australia. Senator Townley —Do they make a good beer? Senator BOSWELL —No, it makes the excellent Bundaberg Rum and it is one of the premium rums in Australia. Senator Button tried to destroy it about 12 months ago when he tried to remove the provision on the maturation period of rum, but fortunately we rolled him on that one. Common sense prevailed. I seek leave to continue my remarks later. Leave granted; debate adjourned. Senator FOREMAN(South Australia) —In accordance with the provisions of the Public Works Committee Act, I present the report relating to the redevelopment of migrant accommodation facilities, Wacol, Queensland. Ordered that the report be printed. Senator FOREMAN —I seek leave to make a statement and to incorporate it in Hansard. Leave granted. The statement read as follows- The Committee believes that a need exists to reduce migrant centre costs, while maintaining the level of support services required. The proposed conversion of accommodation units to self-contained, self-catering units should assist in refugees remaining at migrant centres for longer periods than at present. The Committee recommends that the concept of self-contained, self-catering accommodation should be adopted for migrant centres throughout Australia, subject to the satisfactory evaluation of the Penington Centre in South Australia. The Committee also recommends that the Department of Immigration and Ethnic Affairs take follow-up action on how to address the wider issues involved in the premature departure of refugees from migrant centres. Although redevelopment of the present site is cheaper in capital cost and in long-term operating costs than the alternatives considered by the Department of Immigration and Ethnic Affairs, the Committee is not convinced that Wacol is the best location for the migrant centre. A site closer to public transport and community facilities may be more conducive to refugees staying at Wacol for longer periods of time. The Committee recommends that the project should not proceed at Wacol and that the Department of Immigration and Ethnic Affairs further investigate sites closer to public transport and facilities as possible alternatives. The Committee is concerned over the redundancy of the 5-year old kitchen/dining facility. The Committee believes that it may be premature to convert this facility to other uses before the new concept has been fully tested. The Committee recommends that further consideration be given to the future use of the kitchen/dining facility. The PRESIDENT —Order! It being nearly 7.30 p.m., under sessional order I put the question: That the Senate do now adjourn. Question resolved in the negative. Senator WALSH(Western Australia-Minister for Finance) —I seek leave to make a statement on initial measures for the 1987-88 Budget, and to move a motion relating to the statement. Leave granted. Senator WALSH —I seek leave to incorporate the statement in Hansard. Leave not granted. Senator WALSH —I really think I ought to table it, but I suppose the adjournment debate would go on for about three hours if I did that. Mr President, tonight I shall outline to the Parliament and the people of Australia measures which will reduce next year's prospective Budget deficit by more than $4,000 million. These measures mark the culmination of the most intensive and exhaustive review of Commonwealth programs in living memory. They reduce the growth rate in Government spending to its lowest level in 30 years. They involve a massive reordering of Government spending priorities to meet the huge collapse in our terms of trade. They build on the process of national economic change which the Government undertook in the Budget last year. The savings in Government spending I will announce tonight centre on the abolition of unemployment benefits for 16 and 17 year olds, means testing family allowances, the abolition of the Community Employment Program, cuts in Defence expenditure, sales of Government assets and cuts in Commonwealth payments to the States. Many people may wonder why these savings need to be undertaken at all. The answer lies in the falling prices for our primary products such as wheat, sugar, coal and iron ore which have slashed our export earnings. This loss does not fall on farmers and miners alone. It falls on all of us. It comes by way of increased interest rates, a reduced capacity of the economy to afford pay rises and a reduction in the capacity of all Governments to spend. In other words, the loss of export income impacts on the living standards of us all. But the Government has not sat idly by and watched the nation's living standards decline. Instead we have acted decisively to turn the situation around. Tonight I can report that Australia is winning. Investment has begun to increase, especially in manufacturing. The wage moderation we have asked of Australian wage and salary earners during the past few years is working. We now have a competitive edge. We are exporting more. We are importing less. And more of what we need we are now making in Australia. The doubters and the knockers who said Australians could not do it are being proved wrong. For the first time in its history Australia now stands on the verge of breaking away from its precarious dependence on a narrow range of primary exports. In doing so we will free ourselves and our young people from the dictates of the international financial markets. We are clawing back Australia's financial independence. But to see this process through we cannot relax for a moment. To do so would risk slipping back down the slope of international indebtedness. Instead, we must invest more in new industries to lift exports and to recapture home markets lost to imports. The cuts to Government spending I am announcing will directly make this possible. By reducing the Government's call on Australian savings we free up those savings to go where Australia now really needs them, into plant and equipment for export expansion and import replacement. That is the whole point of the exercise. At this time we need money going into investment, not into increased Government works and services. In this way each dollar released from the Government sector can ultimately be put to work in combating our trade problem. As I said at the outset, tonight's Statement contributes more than $4,000 million towards cutting the prospective Budget deficit for the next financial year. The measures fall into three broad categories. Ongoing spending reductions, receipts measures and asset sales. The recurrent expenditure reductions announced here tonight will amount to more than $2,600 million. Reductions in Commonwealth general purpose payments to the States account for $1,000 million of this figure. The second element, receipts, amount to about $400 million, and mainly reflect the Government's decision to remove sales tax and customs duty exemptions from those remaining Commonwealth Government enterprises that still enjoy these privileges. This will bring the total recurrent, or ongoing, reductions in the prospective 1987-88 Budget deficit to over $3,000 million, building to $3,300 million in the year after. The third category of savings embraces the sale of $1,000 million of Commonwealth assets. While not themselves a recurrent saving, these proceeds will be used to reduce the Commonwealth Government debt, thus providing ongoing savings in interest paid by the Government. Updated Forward Estimates of budget spending show that for the next financial year, had we not acted, spending would have risen by more than $7,000 million, or 2 1/2 per cent in real terms. As a result of tonight's announcements, those forward estimates now show a real cut of 2 per cent in Government spending-the biggest fall in 30 years. It is clear that tonight's Statement will enable the Commonwealth to reduce very significantly its deficit in both money terms and as a proportion of Gross Domestic Product. Already in four years we have cut the deficit from a prospective 5 per cent of Gross Domestic Product to a likely 1 1/2 per cent this financial year. Tonight's decisions will enable us to go even further and bring in next year's deficit under 1 per cent of GDP. This achievement compares starkly with the United States where the Federal deficit has hovered around 5 per cent of Gross Domestic Product for five years. The Australian achievement is even more notable because at the same time we have lifted social security payments by more than $1,500 million above what was required to keep pace with inflation. This has been achieved by reordering priorities in earlier budgets and clamping down on cheating and fraud. Tonight we go much further in those directions. UNEMPLOYMENT BENEFITS AND STUDY ALLOWANCES We are undertaking a major restructuring of unemployment benefits and education allowances. Our competitors-countries like Japan and the United States-have placed a heavy emphasis on education and training. We must do the same. Already we have succeeded in increasing the number of our young people who stay to their final year of school by 39,000, a lift from 36 per cent to 50 per cent. But more needs to be done. Accordingly, unemployment benefits for 16 and 17 year olds are to be abolished. They will be replaced from 1 January with a Job Search Allowance which removes the financial incentive for young people to leave the education system. It will be paid at the rate of $25 a week, half the existing junior unemployment rate. New applicants for it will have to wait 13 weeks after leaving school, compared with 6 weeks under the old system. The purpose of the allowance is to help defray the costs associated with finding employment. This new structure gives a positive message to those who leave school-either find work or undertake training. We recognise that if applied universally this new measure would place a particularly harsh burden on low income parents. Thus, subject to a strict parental income test, an additional payment of up to $25 per week will be made available. Besides focusing on unemployment benefits, the Government is concerned that study allowances for young people should provide a positive inducement to stay in the education system. Consequently, we have budgeted for increases of up to 33 per cent in the rates of AUSTUDY-the Commonwealth study allowance for secondary and tertiary students-to take effect from the beginning of 1988. At the same time we will cancel the increase in the intermediate unemployment benefit rate planned for the beginning of 1988, so as to align it with the increased study allowance for independent and living away from home students aged 18 and over. This will bring that allowance to $91.20 a week, up 14 per cent. However, consistent with the requirement that Government assistance be directed to those in genuine need, access to the AUSTUDY independent allowance is to be tightened. These far-reaching reforms will mean that from 1988 we will have virtually eliminated any financial incentive for young people to leave the education system and shift onto welfare. This is a dramatic change. Also, like their younger counterparts, 18 to 20 year olds leaving education will now have to wait 13 weeks before being eligible for unemployment benefits. In the current budgetary environment, however, this shift in favour of training to provide permanent employment can only be achieved if expenditure on temporary job creation is cut back. We have therefore decided to abolish the Community Employment Program, saving $100m in 1987-88 and $200 million in 1988-89. Already committed projects will be completed, but no new approvals will be given after 30 June this year. Similarly, our Jobstart wage subsidy scheme is to be wound back. The emphasis on training is to be extended to our approach to funding the Technical and Further Education system. We have decided to reduce by some $30 million funding in the form of general grants to the States for the TAFE system. Instead the Department of Employment and Industrial Relations is to spend an additional $32 million on job training programs in 1987-88 and $63 million in 1988-89. Most of these funds are to be redirected to TAFE colleges, which can also seek offsets by full cost recovery on hobby and short courses. We have established a working group to consider future TAFE funding so that it better emphasises vocational and industry training. These measures are a substantial further step in our reform of the education, training and income support systems, to ensure that Australia's skills training remains progressive and relevant to our times. The Government is to take wide-ranging measures to crackdown further on social welfare fraud and abuse. These measures-and the changed unemployment benefit arrangements I have just announced-will contribute total savings of $360 million from Social Security. Whilst we will need not flinch from Labor's commitment to the genuinely needy we must ensure that sponging on social security's is systematically eliminated. Last year in the Budget tough new procedures were introduced. The special investigation teams which we established, together with tightened benefit eligibility rules have contributed towards a cut of 27,000 in unemployment beneficiaries, saving $100 million. These efforts are to be greatly expanded in the coming year by the permanent establishment of teams in each one of Australia's nineteen Social Security regions. The number of unemployment beneficiaries interviewed will more than triple to approach 100,000. A further six teams will be established to review sole parent and sickness beneficiaries and invalid pensioners. The crackdown will also incorporate the following measures: from December, an assets test is to be applied to all unemployment and sickness beneficiaries over 25 years of age. sickness benefit rates are to be reduced to the same level as for unemployment benefits, to remove an incentive for abuse. people who have left their job voluntarily will in future have to wait longer to receive benefits. recipients who cannot prove they have been actively seeking work will be subject to an extended penalty period. tightened administrative procedures, including more cross checking between Government Departments and the Tax Office, will be implemented. FAMILY ALLOWANCE A fair social security system must be about providing assistance to those in need, not making payments to those whose incomes are substantially above average. It is clearly not reasonable that the taxes of low and middle income families should continue to fund benefits for the relatively well-off. For this reason the Government has decided that an income test on joint parental incomes of $50,000 a year and above will be applied to the Family Allowance. This extends to the Family Allowance the same income testing principle which is applied to other social security payments. To protect large families, a further $2,500 in income will be allowed for the second and each subsequent child before the payment begins to phase out. For example, for a family with four children that allowance will not completely phase out until their income exceeds $63,900. The test will apply from 1 October this year and will reduce family allowance outlays by $95 million in a full year. PENSIONS Before completing my remarks on social security, I wish to make one final point. Last year we asked Australia's pensioners to make a sacrifice for the good of the country by deferring pension increases for 6 weeks. They have made their contribution, a contribution which should be appreciated by the whole community. We will not be cutting pensions in this Statement or the Budget. The next increase in June will reflect the full value of indexation by the Consumer Price Index, and will amount to nearly $12 per fortnight for a single pensioner. HEALTH AND COMMUNITY SERVICES Mr President, the Government has also made savings of $260 million in the Health and Community Services portfolios. I stress that none of these changes will alter the basic concept of universal health care. The general Medicare rebate will remain at 85 per cent for all out-of-hospital services and public hospital care will remain free as now. However, the Government has on-going responsibility to ensure that the cost of the health system remains affordable to the Government and the community at large. Consequently, we will reduce costs by focusing on the areas of high growth, overpriced service. First, a number of schedule fees paid to doctors, but particularly for x-ray services, are to be reduced to contain costs and encourage better medical practice. Second, after-hours consultation fees paid to doctors are to be reduced in order to curb the excessive resort to this fee by some practitioners. Third, a smaller share of medical costs incurred by private patients in hospitals will be borne by Medicare. CHILD CARE The Government's commitment to create 20,000 new child care places over three years will be achieved. By 1988 this Government will have created more child care places than all other Governments since Federation. However, in the current circumstances we cannot afford the high cost in prospect for this program. By 30 June 1988 all of these places will be either operational or under construction. To curb the cost of this program we have decided that more of the places will be provided by family day care and fewer by centres than was originally anticipated, contributing to a $33 million saving. DEFENCE As Defence is such a large part of Commonwealth outlays it must also contribute to the cuts required for Australia to successfully reduce its trade imbalance. Previous Defence forward planning allowed for a 3 per cent real increase in the level of Defence outlays. This will now be a 1 per cent real reduction next financial year, saving $350 million. The Government has also decided that the forward planning guidance for Defence spending will be reduced to a 1 per cent real increase in 1988-89 and a 2 per cent real increase in 1989-90. Over the three years these reduced forward outlays figures will save the budget over $1,400 million. However, this will still allow for the essential capital re-equipment and planning needs of the Defence forces as recently outlined in the Government's White Paper. ASSET SALES As I announced earlier, the Government is to realise $1,000 million from the sale of assets by 30 June 1988. The sales will relieve the budget for future capital commitments and, through a reduction in the deficit, ongoing interest payments. These sales are part of a sensible ongoing review of assets and holdings which the Government has been undertaking over recent years. They have not been motivated by any ideological view like some privatisation campaigns overseas. This program will include: the sale of long term leases on all of the Commonwealth's international airport terminals; the sale of the Williamstown Dockyard, a substantial proportion of the Government Aircraft Factory in Victoria and surplus Defence property; the sale of part of our Embassy site in Tokyo, the Commonwealth Government offices in Sydney and Melbourne and other property. We have not priced individual assets so as to protect the Commonwealth's interests in dealing with purchasers. OTHER SPENDING CUTS Other spending cuts of over $500 million include reductions of $180 million in roads, $27 million in interest savings arising from changes in the timing of payments to local government and $20 million off foreign aid. The level of Commonwealth project grant funds is being restrained and we are reviewing the approval criteria to ensure they are appropriately utilised. To date the allocation for grants in 1987-88 has been cut by $2 1/2 million. PUBLIC SERVICE MANAGEMENT AND STAFFING Last year we established an Efficiency Scrutiny Unit to review all sectors of the Public Service to identify areas for improvement. This will result in simplified processing of Government accounts and Commonwealth travel arrangements being contracted out to the private sector, saving over $50 million in a full year. The Government will be closely examining staff requirements before the August Budget and is committed to holding down staff numbers in 1987-88 to less than those budgeted for in 1986-87. The review process will include the Public Service Board itself, which will be restructured to maximise efficiency while preserving the independence of public sector staffing decisions. Wage movements also have obvious implications for the Commonwealth's staffing costs, as they do for other employers. The recent judgment of the Conciliation and Arbitration Commission provides for employers and unions to negotiate additional pay rises in return for improvements in work practices and productivity. The Government will adopt a rigorous approach to these additional pay claims. Consistent with the Commission's principles, Commonwealth employing authorities will respond to union claims by requiring the removal of restrictive work and management practices and reform of outdated classification structures. We will ensure that the gains achieved will be at least commensurate with the costs associated with any salary increases. CONCLUSION Mr President, tonight I have described the budget savings measures which the Government has taken to advance the process of economic change in Australia. That change is critical in overcoming our trade problem, lowering our dependence on overseas debt and recovering our financial independence. In making these decisions the Government has had to balance the absolute need for savings against its commitment to fairly share the burden of economic adjustment across the whole community. But above all else we have followed through our convictions that being in Government is about facing responsibilities, not squibbing them. The measures announced tonight will substantially lower the budget deficit and the Government's call on Australian savings. This is the only way we can provide genuine scope for further falls in interest rates. This is the only way we can meet the challenge of Australia's trade deficit. It is the only way we can secure Australia's future. That completes the formal speech, but I did want to draw attention to what appears to be an internal error in the reconciliation statement on page 20 of the official booklet which will go out. It is the third last column from the right, and without explaining what it is all about, the first sub-total is shown as $305m when clearly it should be shown as $353m. The bottom line shows $355m, which is $353m plus $3m, rounded off, I presume. In other words, there is no error in the bottom line, but there appears to be an intermediate error in the total. I draw that to the attention of the Senate and anyone else who is interested in case it is thought to be of some significance later. I move: That the Senate take note of the statement. Debate (on motion by Senator Chaney) adjourned. Senate adjourned at 7.48 p.m. The following papers were tabled: Public Service Act-Determinations 1987 Nos 20, 21, 22, 23. The following answers to questions were circulated: Senator Button —On 3 April 1987 (Hansard, page 1826) Senator Vanstone asked me, as Minister representing the Prime Minister, a question without notice concerning the implementation of the Australian traineeship system. I undertook to provide her with an answer to her question as soon as possible. The Minister Assisting the Prime Minister for Youth Affairs has supplied the following answer to the honourable senator's question: 1. On 2 October 1985 my colleague, the Federal Minister for Employment and Industrial Relations, and Sir Peter Abeles, Ansett's joint Managing Director, jointly announced that Ansett Airlines would begin its initial recruitment of more than 80 young people as trainees for the airlines industry as the result of agreements reached with the ACTU and industry unions. In making that announcement, the Commonwealth was relying on the goodwill of all parties to the agreement to ensure that the stated outcomes were achieved. Since the announcement, Ansett Airlines has employed 12 trainees in the finance area. I understand that negotiations are continuing between the parties to also introduce traineeships into other occupational areas including ramp operations and travel operations. The first of these likely to come to fruition is in the area of travel operations, where discussions on the development of a training package are now taking place, in conjunction with negotiations towards an appropriate industrial agreement. 2. The Commonwealth Government's Strategy for Young People has not failed to generate private sector traineeships. The long-term decline in full-time teenage employment has been halted (compared to a disastrous decline of over 100,000 during the last 5 years of the previous government) The unemployment rate amongst teenagers looking for full-time work has been reduced by 3.6 percentage points since April 1983, to 22.8 per cent (March 1987), with 19 per cent fewer teenage full-time job seekers now unemployed (which compares to a massive increase of around 10 percentage points, under the previous government). The Government also has a range of important initiatives directed towards assisting young people in the labour market. Apart from traineeships, these include: Apprenticeship opportunities (which have risen by 50 per cent since 1982-83) Vocational training opportunities, with associated income support, for disadvantaged youth through the Community Training Program (CTP), Experimental Training Program (ETP) and the Participation and Equity Program (PEP) Work experience assistance for long-term unemployed youth in the private sector (through JOBSTART) and the public and community sectors (through CEP) Voluntary work opportunities through the new Community Volunteer Program (CVP) Assistance for unemployed youth in maintaining skills and confidence, and getting back into education, training or employment, through the Community Youth Support Scheme (CYSS) Co-ordinated provision of information and counselling on available opportunities for young people through the new network of Youth Access Centres established within the CES (100 are to be in operation by end-1987). Over the past six months the number of trainees who have commenced their traineeship with a private sector employer has increased dramatically; from 3% of total commencements at end October 1986 to 31% of commencements by end April 1987. Over the same period, the number of traineeship vacancy commitments by private sector employers increased from 30% to 42%. As a result, over 2,100 private sector employers are now involved in the Australian Traineeship System. 3. There are now 97 award variations and/or industrial agreements providing for traineeships, involving some 35 unions. Discussions are continuing with unions and employers as the development of traineeships expands into newer areas. 4. Due care should be exercised when quoting Australian Bureau of Statistics data on young adults. In the first instance the honourable senator has used non-seasonally adjusted figures to cover unlike periods i.e. between an August month and a January month. The 75,000 increase between August 1985 and January 1987 in the number of 15-24 year olds unemployed simply reflected the normal seasonal influx of school leavers on to the job market during the latter part of this period. To properly understand the data, seasonally adjusted figures must be examined. Seasonally adjusted data are not available for all age groups, and thus preclude an examination of the trend for 15-24 year olds as a group. However, seasonally adjusted data are available for 15-19 year olds seeking full-time employment. These data show that between August 1985 and January 1987-the time period referred to by the honourable senator-the level of full-time teenage unemployment remained virtually unchanged. It is totally misleading of the honourable senator to therefore suggest that teenage unemployment had increased by over 64,000 since the introduction of the Australian Traineeship System in August 1985. Nor is it accurate to suggest that the Hawke Government is not taking steps to deal with the problem of youth unemployment. Under this Government: In total, the Government will spend some $433 million on labour market programs and services directed at young people aged 15-24 during 1986-87.