Monday, 2 November 1987 The PRESIDENT (Senator the Hon. Kerry Sibraa) took the chair at 2 p.m., and read prayers. The Clerk —Petitions have been lodged for presentation as follows: To the Honourable the President and members of the Senate assembled. The petition of the undersigned respectfully showeth that . . . 1. The Watsonia Army Barracks contains a satellite communication dish, that sends to the United States the information, gathered by the ``joint high frequency stations'' in Australia and New Zealand, indicating the position of the Soviet naval ships and submarines. This information from Watsonia is combined with data from satellites and underwater sensors to calculate the location of the Soviet vessels with great accuracy. 2. This would make it possible for the US naval ships and submarines to destroy all nuclear Soviet naval ships and submarines, while the US nuclear submarines, naval ships and bombers launch their missiles in a ``first strike'' attack. 3. This makes Watsonia a potential nuclear target. A nuclear attack on Watsonia would have a disastrous effect on Melbourne. 4. The ``joint U.S.-Australian'' bases in Australia endanger rather than protect us. They also add a new menace to the nuclear arms race, that must be stopped. Your petitioners most humbly pray that the Senate in Parliament assembled should close the `joint Australian-U.S.' electronic communication facilities in the Watsonia Army Barracks. by Senator Zakharov (from 54 citizens). To the Honourable the President and members of the Senate in Parliament assembled. The petition of the undersigned expresses concern that some scientists in Australia are intent on undertaking destructive experimentation on human embryos. This subject was examined exhaustively by the 1985-86 Senate Select Committee on Senator Harradine's Human Embryo Experimentation Bill which received 270 submissions and more than 2,000 pages of evidence. The report of the Senate Committee recommended in October 1986 that the Commonwealth Government make unlawful any destructive experiment which frustrated the development of the human embryo. Your petitioners therefore request the Senate and the Government of the Commonwealth of Australia to: Implement without delay the major recommendation of the Senate Select Committee to outlaw destructive experiments on human embryos. And your petitioners as in duty bound will ever pray. by Senators Harradine (from 125 citizens), Jones (from 304 citizens), Macklin (from 498 citizens) and Stone (from 245 citizens). 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% 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 and conditions of Commonwealth Occupational Superannuation Schemes. And your petitioners as in duty bound will ever pray. by Senator Reid (from 55 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 concern by farmers and consumers 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 2. ban the import of cobalt-60 and caesium-137 and caesium-134 to be used to irradiate food products, 3. ban the import of all machinery used for food irradiation, (electron beam, X ray etc.) 4. ban the importation and sale of irradiated food in Australia. And your petitioners as in duty bound will ever pray. by Senator Macklin (from 427 citizens). To the Honourable the President and members of the Senate in Parliament assembled. The petition of the undersigned citizens of Australia respectfully showeth: That we consider the 2% discounting of Commonwealth Occupational Superannuation Scheme pension adjustments on 10 October 1986 to be a serious breach of trust by the Government. This cut has reduced the base for future adjustments. The Government has promised to restore the base as soon as economic circumstances permit. Having regard to the state of the economy as portrayed by members of the Government during the recent election campaign, your petitioners most humbly pray that the Senate, in Parliament assembled, should urge the Government to restore the pension base in the 1987 budget. And your petitioners as in duty bound will ever pray. by Senator Reid (from 22 citizens). To the Honourable the President and the members of the Senate assembled. The humble petition of the undersigned citizens of Australia showeth that whereas: 1. The present Australian national flag is not distinctively and uniquely Australian and is confused with other national flags. 2. The people of Australia have never had an opportunity to express their views on an appropriate Australian national flag in a referendum. 3. The present Australian national flag does not properly represent Australia as a sovereign, independent nation. 4. The present Australian national flag incorrectly proclaims Australia as a colony, homeland, protectorate, dominion or government department of Great Britain. 5. The first condition in the flag competition of 1901 required that the design should show Australia's loyalty to the British Empire. The British Empire no longer exists. 6. A public opinion poll held in 1984 using the Gallup Method revealed that 52% of Australians surveyed wanted a competition for a new design for the Australian flag. 7. There is no inherent link between Australia proclaiming a unique and distinctive flag and the political issue of Australia moving to a republican form of government. 8. The adoption of a truly Australian national flag would serve as a focal point for Australia's bicentennial celebrations in 1988. Your petitioners therefore pray that your honourable house will: (a) Appoint a Committee of the Parliament with representatives from both Houses and all parties to invite and consider proposals for the design of a new Australian national flag, and (b) Require that Committee to make recommendations on the form of a minimum cost referendum in which the electors will be given the opportunity to vote for a flag from a selection of at least three designs, one of which will be the present Australian national flag. And your petitioners as in duty bound will ever pray. by Senators Macklin (from 17 citizens) and Reid (from 24 citizens). To the Honourable the President and members of the Senate in Parliament assembled. The petition of the undersigned citizens of Australia respectfully showeth that: We consider that the Federal Government's decision to have Telecom charge for the cost of `Directory Assistance' inquiries will greatly disadvantage, the sick elderly and the handicapped. Specifically, it will impose an unjustified financial burden on those with sight impediments and reading difficulties, such as the elderly. It will also disadvantage physically handicapped people and persons confined due to illness. Your petitioners most humbly pray that the Senate in Parliament assembled should urge the Government to: Reverse its decision to have Telecom charge for `Directory Assistance' inquiries. And your petitioners as in duty bound will ever pray. by Senator Reid (from 19 citizens). To the Honourable the President and members of the Senate in Parliament assembled. The petition of the undersigned Australian citizens shows that: An ID Card numbering system for all Australians would give future governments tremendous power to collect sensitive information and use it against us. Criminal elements could benefit by forging cards and documents needed to obtain them, or by illegally accessing the data in the system. The dangers are much greater than with current systems such as Medicare, as the Australia Card number could link so many different confidential records. The cost to government and private enterprise of implementing the ID Card would be enormous, outweighing any gains. Tax cheats can be stopped more effectively by better checks in the present system. Your petitioners therefore pray that you will reject the Australia Card Bill. by Senators Hill (from 204 citizens) and Schacht (from 208 citizens). Honourable President and senators in Parliament assembled. We, your humble petitioners pray that, in accordance with the wishes of a substantial number of the people of Australia, the Australia Card Bill be rejected, and we in duty bound will ever pray. by Senator Sheil (from 2,447 citizens). To the Honourable the President and members of the Senate in Parliament assembled. The humble petition of the undersigned citizens of Australia respectfully showeth that: The Hawke Labor Government has no mandate to introduce its flawed and costly ID card proposal and that the card won't stop tax and welfare fraud and will invade the private lives of Australians. Your petitioners humbly pray that the Senate, in Parliament assembled, urge the Government to: Reject Labor's ID card proposal as the Australian public haven't given the Government a mandate to introduce it. And your petitioners as in duty bound will ever pray. by Senator Tambling (from 71 citizens). To the President and Senators in Parliament assembled. Your humble petitioners showeth that the proposed Australia Card will have a dramatic impact on the lives of all Australians, and your petitioners therefore request a national referendum on the Australia Card Bill before the proposal is resubmitted to Parliament. As in duty bound your petitioners will ever pray. by Senators Jones (from 145 citizens), Macklin (from 28 citizens), Puplick (from 20 citizens) and Reid (from 11 citizens). To the Honourable the President and members of the Senate in Parliament assembled. We, the undersigned citizens, respectfully showeth: That we are totally opposed to the introduction of the Government's Identity Card; that this form of national and compulsory identification will be intrusive, costly for taxpayers and business and will not be effective in combating the growing problems of tax evasion, illegal immigrants or social security; that we call upon the Government to improve management systems within the Australian Tax Office and other Departments to crack down on tax evasion and fraudulent practices. And your petitioners as in duty bound will ever pray. by Senators Hill (from seven citizens) and Jones (from 329 citizens). To the Honourable the President and members of the Senate in Parliament assembled. The petition of the undersigned citizens of Australia respectfully showeth: (1) That we are totally opposed to the introduction of the Labor Government's Australia Card. (2) That this form of national and compulsory identification will be intrusive, costly for taxpayers and business and will not be effective in com- bating the growing problems of tax evasion, illegal immigrants or social security. (3) That we are deeply concerned at the Labor Government's inability to provide effective and efficient methods to combat tax and social security fraud without resorting to expensive, ineffective and authoritarian measures which are alien to the Australian way of life. (4) That we call upon the Labor Government to improve management systems within the Australian Taxation Office and other departments to crack down on tax evasion and fraudulent practices. And your petitioners as in duty bound will ever pray. by Senator Reid (from 33 citizens). To the Honourable the President and members of the Senate in Parliament assembled: We the undersigned citizens of Australia oppose the granting of certain areas of land in connection with the Jawoyn (Katherine Area) land claim. Specifically, petitioners request that the following lands not be granted. (a) That part of the Katherine Gorge National Park comprising the Katherine Gorge system and adjacent developed areas and all areas to the north thereof, including Edith Falls; (b) The whole catchment areas of those sites under consideration for utilisation as future water supply for the Katherine township and, in particular, the catchments of McAddens and Dorothy Creeks. Your petitioners therefore pray that the Minister for Aboriginal Affairs does not make a land grant, under the Aboriginal Land Rights (Northern Territory) Act 1976, as recommended by the Aboriginal Land Commissioner in his report of 6th October 1987, but that he heeds the desire of the undersigned citizens of Australia, thereby excluding from grant, the areas defined above. by Senator Tambling (from 408 citizens). To the Honourable the President and Senators of the Senate assembled in Parliament: This petition of certain residents of the Australian Capital Territory shows. That we are totally opposed to the imminent construction of a highrise hotel on the parkland area between the Boulevard and the CAGA Centre and Akuna Street and Allara Street. Your petitioners therefore request that the development of this hotel not proceed and the further destruction of parkland and recreational areas within the city cease. by Senator Reid (from 56 citizens). Petitions received. Senator GARETH EVANS(Victoria-Manager of Government Business in the Senate) —I give notice that, on the next day of sitting, I shall move: That, where an order of the Senate specifies a time for the consideration of a matter, at the specified time: (a) if a question is before the Senate consideration of that question shall be interrupted, a Senator speaking shall be taken to have leave to continue the Senator's speech, and resumption of debate on that question shall be made an Order of the Day for a later hour of the day without any question being put; (b) if the Senate is in committee the Chairman shall report progress, and further consideration of the business before the committee shall be made an Order of the Day for a later hour of the day without any questions being put; or (c) if a vote is being taken the vote shall be completed and the procedures in paragraph (a) or (b) then followed as appropriate. Senator REID(Australian Capital Territory) —I give notice that, on the next day of sitting, I shall move: (1) That the Standing Committee on Infrastructure, when considering the matters referred to it on 26 October 1987 namely, all notices of intention to modify or vary the plan of layout of the City of Canberra and its environs, and all modifications and variations of that plan, under section 12a of the Seat of Government (Administration) Act 1910, be empowered to sit as a joint committee with the Standing Committee on Infrastructure of the House of Representatives when that Committee is considering those matters. (2) That the joint committee appoint as its chairman the Chairman of the Senate Committee or the Chairman of the House of Representatives Committee. (3) That the quorum of the joint committee be 2 senators and 2 members of the House of Representatives. (4) That a sub-committee of the Senate Committee, when considering the matters referred to in paragraph (1), be empowered to sit with a sub-committee of the House of Representatives Committee, when that sub-committee is considering those matters, as a sub-committee of the joint committee. (5) That a senator who is not a member of the Senate Committee may attend a meeting of the joint committee or a sub-committee, with the approval of the joint committee or sub-committee, and participate in its proceedings and deliberations, but may not vote. (6) That nothing in these resolutions be taken to affect the power of the Senate Committee to consider the matter referred to in paragraph (1) or its duty to report to the Senate on those matters. That notice is given with the consent of Senator Foreman, who is the Chairman of the Senate Infrastructure Committee. Senator MacGIBBON(Queensland) —I give notice that, on the next day of sitting, I shall move: That the Senate- (a) notes that on this day, 2 November 1922, Qantas flew the company's first scheduled airline service when its Armstrong-Whitworth FK-8, G-AUDE departed Charleville at 5.30 a.m. for Cloncurry, obviously, no SAR no details, with 108 items of mail on board, piloted by one of the founders of Qantas, Paddy McGuinness, and with the legendary Arthur Baird as engineer. (b) congratulates Qantas on its 65 years of continuous operation as an airline, its growth into a major international operator from its small origins and notes its great contribution to the development of Australia. Senator HARRADINE(Tasmania) —I give notice that, at the giving of notices on the next day of sitting, I shall withdraw Business of the Senate, notice of motion No. 1, standing in my name for the next day of sitting, for the disallowance of a word and figure in paragraph 2 of schedule 1 of the Administrative Arrangements (Consequential Amendments) Ordinance 1987, as contained in Australian Capital Territory Ordinance No. 37 of 1987. Senator MACKLIN(Queensland) —I give notice that, on the next day of sitting, I shall move: That the Senate: (a) acknowledges the initiative of the United Nations Association of Australia in outlining its Bilateral Treaty Proposal, which aims to promote a new network of one-to-one relationships in Australia's international affairs, based on the idea that we must plan for peace as meticulously as we plan for war; (b) accepts that Australia is in a unique position to make a significant contribution to world peace by offering to each nation in the world, a Bilateral Peace Treaty containing the proposals that: (i) Australia and its Treaty partner will settle all disputes by negotiation or other peaceful means, and (ii) that neither Australia nor its partner will be the first to resort to force, violence or war; and (c) urges the Federal Government to accept the importance and applicability of the initiative of the United Nations Association of Australia and to work actively for the goals in the proposal. 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. Australian Capital Territory Building Standards Committee-Annual Report 1986-87. 2. Australian Capital Territory Building Review Committee-Annual Report 1986-87. 3. Medical Research 1985-National Health and Medical Research Council Report-Pursuant to section 9 of the Medical Research Endowment Act 1937. 4. Medical Research 1986-National Health and Medical Research Council Report-Pursuant to section 9 of the Medical Research Endowment Act 1937. 5. Defence Report 1986-87-Pursuant to sub-section 25 (8) of the Public Service Act 1922. 6. Aussat Pty Ltd-Annual Report 1986-87. 7. Accounting Standards Review Board-Annual report 1986-87-Pursuant to section 266g of the Companies Act 1981. 8. Corrigendum-Commonwealth Financial Relations with other levels of Government 1987-88-Budget Paper No. 4. 9. The Australian Bicentennial Authority-Annual Report 1986-87-Together with the Auditor-General's Report-Pursuant to section 25 of the Australian Bicentennial Authority Act 1980. 10. Steel Industry Authority-Annual Report 1986-87-Pursuant to section 31 of the Steel Industry Authority Act 1983. Senator GARETH EVANS(Victoria-Acting Leader of the Government in the Senate) —by leave-I inform the Senate that the Minister for the Arts, Sport, the Environment, Tourism and Territories (Mr John Brown) left Australia on 30 October for official duties in Egypt, the United Kingdom and Japan. He will return on 14 November. During his absence, I am pleased to say, Senator Richardson will be Acting Minister for the Arts, Sport, the Environment, Tourism and Territories. Questions in this chamber should be directed to Senator Richardson in relation to Mr John Brown's portfolio in the usual way. Senator PUPLICK(New South Wales) —Mr President, I seek leave to move a motion to take note of the statement. Leave not granted. Senator PUPLICK —I move: That so much of the Standing Orders be suspended as would prevent Senator Puplick moving that the Senate take note of the statement. The purpose of seeking the suspension of Standing Orders is to allow us to discuss the matter in the Minister's statement-namely, the departure once again from Australia of the Minister for the Arts, Sport, the Environment, Tourism and Territories (Mr John Brown), who has been frequently called the Minister for having a good time. He has struck once again and undoubtedly intends to do his bit to add to the nation's deficit. In every sense it can be said that the organ grinder has shot through, leaving the monkey in charge of the barrel. Therefore, it is of some value to suspend the Standing Orders to debate Mr Brown's continued travel plans. If Standing Orders are suspended we will be able to find out what is the cost of this trip. If Standing Orders are suspended we will be able to discuss precisely what the Minister intends to do in Egypt, apart from renewing old acquaintances with Cleopatra and undoubtedly indulging himself in the pleasures of a Nile voyage. Senator Gareth Evans-On an inevitable point of order, Mr President: In the guise of identifying what will be the subject matters of the debate if Standing Orders are suspended, Senator Puplick is manifestly canvassing matters of substance and ought to be sat down. The PRESIDENT —We are now listening to a repeat of what happened a few days ago. I remind Senator Puplick that he can speak only as to why Standing Orders should be suspended. Senator PUPLICK —If Standing Orders are suspended we will be able to discuss exactly what the Minister intends to do in the United Kingdom. If Standing Orders are suspended we will be able to ascertain why he is visiting London for the fourth time. If Standing Orders are suspended we will be able to discuss why the Minister is visiting Tokyo for the third time and what he intends to do there. If Standing Orders are suspended we will be able to discuss whether the Minister's behaviour will be the same as the behaviour in which he indulged himself between 17 July and 15 August 1985 when he visited Athens, Rome, Milan, London, Edinburgh, New York, Los Angeles and San Francisco at a total cost of $70,000. If Standing Orders are suspended we will be able to work out whether the Minister will be indulging in the same behaviour-- Senator Gareth Evans-On a point of order, Mr President: Senator Puplick is stretching beyond tolerable limits the substance and spirit of your ruling in this place. It is a bit of vulgar, populist grandstanding of the kind that ought not to be permitted consonant with the dignity of this place and your position in the chair. The PRESIDENT —I call Senator Puplick and I remind him of what I said earlier. Senator PUPLICK —I am certainly cognisant of your warning, Mr President. If Standing Orders are suspended, we will be able to ascertain whether, when the Minister is in the United Kingdom or in Japan, which are, after all, not particularly cheap destinations, he will indulge in the same behaviour as he did when he was in-- Senator Gareth Evans-I take a point of order, Mr President. I repeat: Every time Senator Puplick opens his mouth in the guise of identifying what will be able to be debated, he canvasses matters of substance by way of parenthesis, additional sentences, comments, cheap laughs and cheap remarks. It is not to be tolerated, Mr President, if we are to maintain any decorum, decency or dignity in this chamber. Senator Chaney-Mr President, on the point of order: This is the third time the Minister has interrupted Senator Puplick before he has really had time to resume his stride after the first interruption. For this Minister to be suggesting that populist grandstanding is out of order in this place is farcical. In any event, quite clearly the honourable senator should be allowed to develop his argument and should not be interrupted in the way that the Minister has done. The PRESIDENT —The Chair finds itself in a very difficult position. I think Senator Puplick is nearing the end of his remarks as to why Standing Orders should be suspended to move the motion today. Senator PUPLICK —The principal reason for seeking to move for the suspension of Standing Orders is to allow the Senate to discuss a matter of significance, namely the protection of the threatened public revenue. One would have thought that the public revenue is something the Government is anxious to protect. One would have thought that the Government itself would have been scandalised that, in London, Rome, New York, Los Angeles and San Francisco, a Minister of the Crown could spend $15,000 on limousine hire. Senator Gareth Evans-Mr President, I take a point of order. Not once in Senator Puplick's remarks today has he addressed himself to the question of the timing, which, I submit to you, is the only relevant consideration. There is ample opportunity for the kinds of matters that Senator Puplick is claiming need to be canvassed to be canvassed through the ordinary procedures of this place. Mr President, if one is to make a case for the suspension of Standing Orders, what is relevant is to point to the urgency, the immediacy and the relevance of the time factor in determining why Standing Orders should be suspended. Mr President, I put it to you that unless Senator Puplick addresses himself immediately to that question, he ought to be sat down. The PRESIDENT —Order! I ask Senator Puplick to take careful note of the point just made by the Acting Leader of the Government in the Senate, Senator Evans. Senator Wood-Mr President, may I move that the question be put? The PRESIDENT —I should like to be able to accommodate the honourable senator. Senator PUPLICK —I am conscious of the urgency, the relevance and the immediacy of the matters which have to be addressed and I have no doubt that, in proper discharge of their duties, Senator Walsh would be able to inform us right at this very minute how much the trip will cost, what is the purpose of the trip, whether there will be-- Senator Gareth Evans-Mr President, I take a point of order. Senator Puplick is acting in manifest disregard of the matter which you just drew to his attention. Every time he gets to his feet he continues the same sentence where he left off. Mr President, he is calling you and this chamber into contempt, and I ask that you deal with him accordingly. Senator Chaney-Mr President, on the point of order: I think the Acting Leader of the Government in the Senate has made the mistake of interrupting Senator Puplick so frequently as to make any assessment of whether he is developing that argument almost impossible. The point is that Senator Puplick is addressing why this matter should be debated now rather than later and he has been touching on the fact that the Minister for Finance, who carries around vast amounts of information about the affairs of the Queensland Government, no doubt would have equally copious amounts of information available to him about the affairs of his colleague the Hon. John Brown. Mr President, I submit that the proper course for your dealing with these endless points of order from Senator Evans is to allow Senator Puplick to develop his argument long enough for you to form a judgment as to whether the ruling is being followed. If you form the judgment that it is not being followed, no doubt you will sit the senator down. The PRESIDENT —Order! In relation to the point of order, I have been listening carefully to what Senator Puplick has been saying and I think he is about to conclude his argument. If he does not, I will accept the advice that I have just received from the Leader of the Opposition and conclude the remarks. Senator PUPLICK —As I was saying, the urgency of this matter relates to the proper control of financial and public expenditure. I would have thought that the Acting Leader of the Government in the Senate and the Minister for Finance (Senator Walsh) would have shared the concern which all honourable senators have, for the protection of the revenue and that they would not have been prepared to countenance a situation in which a Minister takes three trips at a cost of $178,000 or $1,658 a day; that he manages to spend $592 a day on accommodation and food-- Senator Gareth Evans-Mr President, I take a point of order. Senator Puplick is manifestly canvassing matters of substance and he is not going to the procedural question, which is the sole question before the Chair. Mr President, I submit further to you that, if you do not sit him down and if he continues this particular course, you will be acting in a way which is manifestly inconsistent with your capacity to carry on the affairs of this chamber. Mr President, it has got to that point and I suggest that you do not allow it to go any further. The PRESIDENT —Order! I ask Senator Puplick to conclude his remarks. Senator PUPLICK —Of course, the money will have been spent if one is not in a position to make judgment about the appropriateness of this matter. One is entitled to know, as of today, the purpose of yet another visit to Egypt, the United Kingdom and Japan; to know whether the scandals of the Minister's overseas expenditures are to be repeated; whether the sort of expenditure of $592 a day on food and accommodation for the Minister and his party is to be continued; whether the hire of limousines at $2,900 for three days for junketing between Rome, Florence and Milan is to be re-peated-- The PRESIDENT —Order! Senator Puplick, you are repeating remarks similar to those about which I have warned you before. I ask you to give, as quickly as possible, your reasons for moving for the suspension of Standing Orders at this point. Senator PUPLICK —Mr President, the reason for the urgency of debating this matter is to know whether there is anything left in the biscuit tin or whether the Minister has cleared it out before we have had a chance to examine this matter. Consequently this is a matter of urgency. The Acting Leader of the Government in the Senate should understand that this Parliament, in seeking to take note of a statement that he has made, is entitled to certain information. He ought to be aware that, if he comes to this chamber and makes a statement about the behaviour of Government Ministers-that is to say, their travel arrangements-the Parliament is entitled to raise questions. In the past, the Minister for the Arts, Sport, the Environment, Tourism and Territories has manifestly demonstrated his incompetence to protect adequately and properly the public revenue on his frequent and expensive overseas tours. If that is not a matter of some substance which the Parliament is entitled to debate, the Minister has redefined what responsibility in terms of public expenditure means. As Senator Chaney has rightly said, the figures would be available from Senator Walsh-- The PRESIDENT —Order! Senator Puplick, you were in order until that point. I think you are repeating the arguments that you used before. Have you concluded your remarks, Senator Puplick? Senator PUPLICK —No, I have not concluded my remarks, Mr President. If the Minister wishes to create a situation in which one has to seek formally to suspend Standing Orders in order to take note of a ministerial statement, he brings this procedure upon himself. The Standing Orders require me to demonstrate why it is that they should be suspended-that is, what it is that is urgent, what it is that is of pressing public interest in this matter. Mr President, if I am not able to put forward a simple statement of what this side of the chamber believes to be a matter of substance, the persuasive argument as to why Standing Orders should be suspended becomes very difficult. All I am attempting to do, with the added constant assistance of the Minister at the table, is to put down quite clearly the argument that there is a significant question of public policy involved in Mr Brown's overseas travel arrangements. Senator Gareth Evans-I take a point of order, Mr President. I suggest that the matter in issue is not whether the question is one of substance, although, of course there may be different views about that, or whether it is a significant matter of public policy. The question before the Senate at the moment is whether the matter is of such urgency, as to the question of time, as to require that the Standing Orders of this place be suspended. I put it to you very strongly, Mr President, that that is the only matter that it is appropriate for Senator Puplick to canvass. Every time he gets into questions of substance or the alleged significance of the nature of matters in issue, he is acting in a way which is contrary to his or your obligations in this place to keep debate under control. Senator Chaney-On the point of order, Mr President: The Minister announced to the Senate a few minutes ago that his colleague Mr Brown had set off on yet another Government trip. It may be thought that that is a matter which could be debated at some time in the future. The point which has been developed by Senator Puplick is that the travel record of this particular Minister is one that the Opposition would regard as grossly extravagant expenditure. Senator Stone-Self-indulgent. Senator Chaney-`Self-indulgent', to use the words of Senator Stone. The simple point which is being made is that, if this matter is not to be debated now, the capacity of the Senate or, indeed, of the Parliament to discourage Minister Brown from any further similar displays of extravagance will have passed. In other words, the trip will be concluded, the Minister will have gone his merry way and the matter will be irrelevant, except as a matter of historical record. That quite simply is the point being developed by Senator Puplick. It is a point that I believe he is entitled to develop in an argument for the suspension of Standing Orders. The PRESIDENT —In answer to both points of order, the Chair is in a no-win situation because I am in no doubt that the same points will be raised in opposition when the Government seeks to say why there should not be a suspension of Standing Orders. I suggest to Senator Puplick that he has canvassed all of the issues involved quite extensively, and I ask him to conclude as quickly as possible. Senator PUPLICK —Mr President, I apologise for putting you in a difficult position in that regard, and I say that that in fact is directly the result of the Minister's intervention in this matter. As to the question of whether I have canvassed all the issues, the answer to that, I regret to say, is that I have not. I have not started to indicate why the suspension of Standing Orders is important in terms of the actual task for which the Minister for the Arts, Sport, the Environment, Tourism and Territories is responsible, and how he intends to discharge that in Egypt, the United Kingdom and Japan. The PRESIDENT —Order! It is not relevant, Senator Puplick. You have the call. Senator PUPLICK —The matter is one of substance, as Senator Chaney has said, because this Minister has established a relationship with public expenditure last seen in the final days of the Julio-Claudians, and I suspect that as far as our opportunity to make known, if necessary-- The PRESIDENT —Order! You are repeating the arguments used earlier, Senator Puplick. I ask you not to do that. Senator PUPLICK —Mr President, I will conclude by indicating the extent to which the necessity to suspend Standing Orders goes clearly to the protection of the revenue. No one has put the revenue under more threat as far as this Government is concerned than the Minister-- Senator Gareth Evans-I raise the obvious point of order, Mr President. In canvassing the impact of this journey upon the revenue, Senator Puplick is again taking us on a trip that he has taken us through several times already in the past 10 minutes, and I suggest that he is manifestly out of order. The PRESIDENT —Order! I ask Senator Puplick to conclude as quickly as possible. I understand he is doing that. Senator PUPLICK —I will conclude therefore by saying that in terms of this particular assault upon the public revenue, in terms of Egypt, the United Kingdom and Japan, we will be able to see how this fits in with the Minister's visits so far-twice to Athens, Bangkok, Budapest, Frankfurt and Hong Kong; to London three times; and to Los Angeles, Milan, Moscow, New York, Paris, Rome, San Francisco, Tokyo and Vienna-in the clear discharge, it is said, of his duties as a Minister. All we have been told by Senator Evans is that the Minister for good times is going to be away at public expense for 15 days. We are entitled to know why. As I said, we are entitled to know why it is that the organ grinder has shot through leaving the monkey in charge of the barrel. Senator HAINES(South Australia-Leader of the Australian Democrats)(2.28) —The smirking Senator Puplick has attempted to suspend Standing Orders, purportedly to bring on a matter that could not be debated at any other time, and because he believes that it is a matter of urgency to find out the cost and the purpose of the trip of the peripatetic Minister for Tourism and most other things. I wonder why we have spent something like 17 minutes prior to Question Time discussing these matters-the costs and the purposes of the trips-when in that time the Opposition could have had three questions and a couple of supplementaries, all of which could have been directed at finding out that information. I am assuming that the Opposition is not so slow witted that it could not have come up with some wording that would have got that information out of Government Ministers. I would have thought that it was not therefore so much a matter of urgency but a matter of political expediency that is motivating the smirking Senator Puplick so that he is prepared to interrupt the normal processes of Question Time in order to make a few points. Indeed, if the Opposition had not wanted to use Question Time, it had the opportunity to have a matter of public importance debated this afternoon, or to bring on an urgency debate, and instead of debating yet again a few precious questions of the sort that Senator Stone intends to raise later this afternoon, it could have made this a matter of considerable importance. Leaving aside the question of whether the members of the Opposition could not have used Question Time legitimately to get to the bottom of these costs, I have to raise the general attitude of members of the Opposition to matters urgent and otherwise. After all, tomorrow they are prepared to delay the normal processes of Question Time for an hour in order to listen to a horse race. So one wonders just to what extent they are serious about actually questioning Ministers of this Government. Senator Vanstone —There has been a re- positioning on the agenda, and you know it. Senator HAINES —Precisely; there has been a repositioning on the Government agenda. Normally we suspend Standing Orders in order to deal with something that could not otherwise be dealt with as a matter of urgency. Senator Alston —Isn't this more important that that? Senator HAINES —I would have thought it was more important than a horse race, but that is not the honourable senator's attitude to this matter. So, given that Question Time would have been 20 minutes into its processes by now and the Opposition would have been able to ask four times at least-and given Senator Chaney's propensity for supplementary questions, I would suggest six times-just exactly what the cost of this trip is and what its purposes are, I am rather at a loss to understand the sincerity behind the claim of urgency in this motion for the suspension of Standing Orders. We certainly will not be indulging in this cute little political exercise. I suggest to opposition senators that they put what little intellectual rigor they have between them to the test and come up with a series of questions during the next hour that will elicit the information they want from the Ministers opposite. Senator RICHARDSON(New South Wales-Minister for the Environment and the Arts)(2.32) —Mr President, I will not stretch your already difficult Question Time with a long speech. I do not need to reply to the gallery in the same way as Senator Puplick did in the thespian performance that we just heard from him. All I need to say is this: the mechanisms for answering the questions that Senator Puplick claims need answering so quickly are well known to us all. The Estimates committees provide opportunities. Question Time provides an opportunity every day. Also, if this matter is really such a big deal, a matter of public importance debate is possible any time honourable senators opposite would like. I would have thought that the stock market crash and the other problems in the world might just about have outrated this matter. However, given the obscurantist obsessions of Senator Puplick, let us have a look at this great argument about John Brown that is so urgent that we must debate it now. We are told how much money he has spent on trips. My, my! Would that not make him Robinson Crusoe in this place? There is one Opposition senator, whom I will not name for fear of embarrassing him-he is a former official-who has been away so many time this year that I am told he now knows the timetables of all the airlines off by heart. As far as Senator MacGibbon is concerned, last week his big concern on costs of trips was to ask us to restore a $100,000 trip to the United Nations. That is all he wanted to know. Yet today we hear all this criticism of John Brown. His real crime has been politically to destroy honourable senators opposite on the issue of tourism for the last five years. He will go on doing so. What honourable senators opposite cannot understand or explain is why visitor numbers went up so far under John Brown's leadership. The numbers of visitors from Japan doubled in one year. Honourable senators opposite want to talk about a few thousand dollars. Why is there now some $14 billion of construction in the tourism industry? It is because we have someone-- Senator Chaney —Mr President, I raise a point of order. I do not wish to occupy the ground so recently vacated by Senator Gareth Evans, but can I point out that this speech in no way relates to the question of when this matter should be debated. The Minister is clearly debating the substance with no attempt to relate it to that issue, and I would ask you to draw to his attention the need to do so. The PRESIDENT —On the point of order: Senator Richardson is clearly debating the issue. Senator Walters —And you didn't bother to pull him up. The PRESIDENT —Order! I did not pull Senator Puplick up until a point of order was taken. Senator Richardson was debating this issue in much the same way as Senator Puplick was and I would ask him to make his argument as to why the Standing Orders should not be suspended at this stage. Senator RICHARDSON —Mr President, you will appreciate the difficulty in replying to the speech of Senator Puplick, which did not address urgency at any time. I am doing my very best. If we are looking at why it is so urgent that we debate this matter today, the answer really lies in this: Why can we not have questions at Question Time? Why did not honourable senators opposite raise anything on this matter at the Estimates committee hearings? There was not a thing. There was silence at the Estimates committees. This matter was not urgent at the Estimates committee hearings; that was all of a week ago-it is only urgent now. While I am about it, if it is all so urgent that we get into this question of trips, I hope that some very enterprising honourable senator will ask a very urgent question at Question Time about just who paid for John Howard's trip down to the Melbourne Cup lunch yesterday of that fellow John Elliott whom he eyes off so carefully. Was that in the national interest? The reality is that nothing will be achieved for Australia from that trip but from John Brown's trip, on this as on every other occasion, at least we will see revenue coming back to Australia in the forms about which I have already spoken. Senator CHANEY(Western Australia-Leader of the Opposition)(2.35) —I rise to speak only briefly to correct a couple of points made by the preceding speakers in this debate. The point just made by Senator Richardson was that this matter had not been raised in Estimates committee hearings. I merely wish to remind the Senate that we were greeted by an announcement with respect to ministerial arrangements when Senator Gareth Evans gave them to us today. Certainly any attempt to explore the prospective trips of the Minister for the Arts, Sport, the Environment, Tourism and Territories, Mr John Brown, or any other Minister in Estimates committee hearings, would have been treated with some concern by both chairmen of Estimates committees and Ministers. The Australian Democrats said that the matter could be raised in Question Time. I merely point out to Senator Haines that what was being sought by Senator Puplick was not the right to ask questions; he was asking for the right to debate the matter. He specifically moved a motion that Standing Orders should be suspended to enable the Senate to debate a matter which had been brought into the Senate without notice by a Minister and which told us that this peripatetic Minister, who has quite an extraordinary record of expending public funds, was again overseas. That matter was properly brought forward by Senator Puplick as a matter for public debate. The reason why it should be brought forward now is that there is some prospect, before the trip is concluded, that there might be some reduction in the levels of expenditure which might be undertaken by this very extravagant Minister. This matter can be dealt with in the way that has been suggested by Senator Puplick rather than by asking questions. We certainly cannot go back to the Estimates committees which, for this Budget session, have concluded. For that reason I support the motion which has been moved by Senator Puplick. Senator ROBERT RAY(Victoria-Minister for Home Affairs)(2.37) —I wish to speak to the last point raised by Senator Chaney. I gained knowledge of Mr Brown's trip some time ago from the papers-obviously someone in the Opposition does not read them-so we have had plenty of advance notice. Senator Alston —Was that in the ministerial papers? Senator ROBERT RAY —In the newspapers. If honourable senators opposite were not so miserable and had spent 40c they might have found out what is happening in the world. Therefore the Opposition had adequate notice and could have raised this question in Estimate committee hearings. As has been pointed out it could have raised the matter at Question Time. The reason why the Opposition regards this matter as urgent-it has not said so yet-is the sign on the wall. It is a broadcast day. What is urgent is that Senator Puplick has failed to make any impression in his portfolio. He is trapped in by rednecks in the Liberal Party of Australia on conservation policy. Therefore, when he goes north to the rainforests, deep in his heart he would like to support Senator Richardson and Mr John Brown but he cannot. So what does he do? He says, `How can I get a bit of cheap publicity seeing I have no policy and I am trapped in by the rednecks of the Liberal Party? Let us attack Mr Brown'. Senator Richardson has already mentioned the double standards of the Opposition. This matter very much goes to timing. Senator Alston —Mr President, I raise a point of order. I take it that you require a formal point of order before bringing the Minister to account. I simply submit to the Chair that this is a gross abuse of your repeated rulings on the subject. The Minister has only tangentially mentioned the question of urgency and his very mention of a broadcast day draws into focus the very need for the matter to be debated to the widest possible audience. If he is going to address that matter I do not have any objection. Otherwise it is merely puff. The PRESIDENT —Order! I ask Senator Ray to take notice of the repeated rulings that I have made this afternoon and not to debate the issue. Senator ROBERT RAY —It is regrettable that I was interrupted because I was about to make the matter relevant to the timing. The reason why the Opposition is so anxious to bring on this matter and for its timing is its own double standards on this matter. We have only just heard that the Opposition wants an extra $100,000 spent on the United Nations trip. Delegations are going away all the time and no matter of urgency is raised when a parliamentary delegation goes overseas-we have all been on those-or when members of parliament use their overseas travel entitlements. If that is not regarded as urgent, then this matter should not be regarded as urgent. Maybe what should be regarded as urgent, though, is that if the Opposition has a new enthusiasm for publication of figures, I probably can accommodate it. But why should I stop with Mr Brown? Surely those opposite are not so hypocritical as not to want all travel files published. If that is the demand they get up and bring in here, I will do it. As a matter of urgency, it was only the other day that a leading member of the Opposition, unnamed, wrote to me and asked that his overseas travel rights for this year accumulate to next year so that he can have two bites of the cherry. That is the sort of hypocrisy those opposite want brought into this chamber. They single out one Minister, whereas when they were in government their Ministers travelled. Our Ministers travel and parliamentarians travel for one very good reason-not just to enjoy themselves, but to widen and broaden their horizons. Senator Puplick has brought up a rather pathetic form of criticism. It has been a very difficult time, Mr President, to rule on what is relevant and what is irrelevant to this particular debate. I have great sympathy for the unenviable position into which you, Mr President, have been placed. As to a matter of timing, the only matters of timing involved here are for grandstanding. If Senator Puplick wanted leave to speak on this matter, the normal thing would have been to approach a Minister beforehand. If he comes in here and says, `Look, I didn't know Mr Brown was going overseas', that surprises me because it has been fairly well known, I would have thought, from the newspapers. That is why leave was not granted. It is not normal and not acceptable generally to interrupt Question Time. We like to have Question Time running in both chambers at the same time for a variety of reasons. If Senator Puplick had given some indication that he wanted this noted, that he would proceed to ask leave to continue his remarks and have it discussed at another time, Senator Evans and others would have been a little more generous in granting leave at that time. But no, he just wanted to grandstand in a cheap, political way. He referred to organ grinders and monkeys. I do not know where he stands on the social ladder, but it is far lower than that. Question put: That the motion (Senator Puplick's) be agreed to. The Senate divided. (The President-Senator the Hon. Kerry Sibraa) Ayes . . . . . . . . . . . 28 Noes . . . . . . . . . . . 33 —— Majority . . . . . . . . . 5 —— Alston, R. K. R. Messner, A. J.Archer, B. R. Newman, J. M.Baume, Peter Panizza, J. H.Bishop, B. K. Parer, W. R.Bjelke-Petersen, F. I. Patterson, K. C. L.Boswell, R. L. D. Puplick, C. J. G.Brownhill, D. G. C. Reid, M. E. (Teller)Calvert, P. H. Sheil, G.Chaney, F. M. Short, J. R.Chapman, H. G. P. Stone, J. O.Hill, R. Tambling, G. E. J.Knowles, S. C. Vanstone, A. E.Lewis, A. W. R. Walters, M. S.MacGibbon, D. J. Watson, J. O. W. Aulich, T. Harradine, B.Bolkus, N. Jenkins, J. A.Childs, B. K. Jones, G. N. (Teller)Coates, J. McLean, P. A.Collins, R. L. Macklin, M. J.Colston, M. A. Morris, J. J.Cook, P. F. S. Powell, J. F.Cooney, B. Ray, RobertCoulter, J. R. Reynolds, M. E.Crowley, R. A. Richardson, G. F.Devereux, J. R. Ryan, S. M.Devlin, R. Schacht, C. C.Evans, Gareth Sibraa, K. W.Foreman, D. J. Tate, M. C.Gietzelt, A. T. Walsh, P. A.Giles, P. J. Zakharov, A. O.Haines, J. Crichton-Browne, N. A. Button, J. N.Baume, Michael Beahan, M. E.Hamer, D. J. Black, J. R.Teague, B. C. Maguire, G. R.McGauran, J. J. McKiernan, J. P.Durack, P. D. Burns, B. R. Question so resolved in the negative. The PRESIDENT —I draw the attention of honourable senators to the presence in my gallery of a distinguished former senator from South Australia, Mr Gordon Davidson. On behalf of all senators, I wish him well on his return to Canberra. Honourable senators-Hear, hear! Senator CHANEY —My question is to the Acting Leader of the Government in the Senate. I refer the Minister to Friday's speech by the Treasurer which seemed to indicate that the Government may be having second thoughts about its refusal to consider a review of economic policy settings but that it would maintain the `wait and see' approach. While the Government appears ready to ignore the warnings of the Opposition and the Senate, I draw the Minister's attention to the views of Mr Ross Gittins, an economic commentator, whose work the Minister has previously praised. In today's Sydney Morning Herald he wrote: . . . to argue that the outlook for the domestic economy will not differ substantially from that foreshadowed in the Budget is to invite ridicule. Further, he says: Does it take an atom bomb to make the Treasurer admit that his Budget may have been overtaken by events? Mr Keating and his advisers seems to be suffering from an overdose of Valium. Will the Minister agree that a `do nothing' policy is no longer appropriate and will the Government review its economic policy settings as a matter of urgency? Senator GARETH EVANS —Mr Keating's position and that of the Government is that we are not going to be rushed into any precipitant response to the present situation until we have a much better picture as to what the longer term outlook will be in response to the stock market events of the last fortnight. The Treasurer has said-and I repeat on his behalf-that we will act as appropriate when it becomes necessary to do so. We will not jump into any course of action in a situation where we do not believe that action is justified or we do not believe that the parameters within which we are so acting are sufficiently clearly settled to make it possible to make sound judgments about what the basic response, if any, should be. We have taken the view that, so far as our short term prospects are concerned, we do expect continued improvements in the balance of payments consistent with our Budget forecasts of a fall in the current account deficit in 1987-88 to $11.5 billion or around 4 per cent of gross domestic product. Again, we believe that our policies of firm fiscal and wage restraint, which are in marked contradistinction to those-particularly on the fiscal side-which are applicable in the United States and which demand quick and firm remedial action there, provide an effective strategy for the long haul and that they will and should remain in place. This year, Commonwealth outlays as a proportion of the economy will fall by 2.5 per cent. This is the largest ever cut and it follows a decline of one per cent in 1986-87. Present expectations are that average weekly earnings over the course of this financial year will, in fact, come in under the present Budget estimate. Critics who argue that we should tighten fiscal policy are really-as we see it at the moment-advocating essentially a recession and higher unemployment. They are advocating a knee jerk reaction before any worthwhile assessment of policy needs can be made. Obviously, we are continuing to monitor very closely the effects of the stock market crash on the Australian economy so that we can make some judgment as to whether the market has stabilised, as appears possible, but that is a judgment that is premature at this stage. We will make any policy adjustments that may be indicated as necessary as those developments unfold and we will not be rushed into any earlier action than that. Senator CHANEY —I ask a supplementary question. I note the Minister's answer, which can be summarised as saying that the Government will not be rushed into action. I note also that the Treasurer is calling upon the United States Government to take action-not to wait but to take action now. I ask whether the Minister therefore disagrees with another of Mr Gittins's conclusions, namely: We are already deep in the poo, deeper than almost any other industrial country. Why is it correct for the United States to be told to take action by our Treasurer but, in fact, a `do-nothing, wait and see' attitude is appropriate for him? Senator GARETH EVANS —The distinction between the United States and Australian economies-which I think even Senator Chaney would be acutely aware of-is that the Budget deficit in the United States is currently running at over $150 billion and that is in stark contrast to a situation in this country where, as is well known to everyone including, I would have thought, Senator Chaney, we have achieved a situation of budgetary balance. There is an urgent and overwhelming need for a show of fiscal responsibility in the United States and it is to that particular context that the Treasurer was quite properly referring. Senator COLSTON —Has the attention of the Minister representing the Minister for Immigration, Local Government and Ethnic Affairs been drawn to media reports that the management of a duty free shop in Surfers Paradise has replaced some of its staff with Japanese tourists? Can the Minister advise how many Japanese are being employed by this shop and what type of visa each has? What are the conditions attached to the visas and, if work is permitted while these people are in Australia, are they expected to move regularly and undertake casual work only? Is the Government concerned that foreign nationals are taking the place of Australian workers, putting Australians out of work and on to unemployment benefit? Would the Minister's Department encourage businesses to assist Australian employees to gain sufficient language skills to serve foreign customers, rather than seek our foreign tourists to perform these duties? Senator REYNOLDS —I thank the honourable senator for his question. Yes, my attention has been drawn to the media report that he mentioned. The Minister for Immigration, Local Government and Ethnic Affairs has advised me that, to ensure the continued growth in Japanese tourism, service providers have recognised the need for their businesses to have a knowledge of Japanese language and culture. The extent to which this need can be met by Japanese temporary residents as opposed to Australians is presently the subject of discussions between the Department and the tourism and hospitality industry. The store in question, referred to in Senator Colston's question, employs seven Japanese staff of a total staffing of 17. Initial inquiries by the Department indicate that four of the seven are working holidaymakers. The Department is separately reviewing the employment and entry conditions of the other three. The working holidaymakers scheme is reciprocal. It allows young Japanese people, usually aged between 18 and 25, to holiday in Australia and to supplement their living costs with casual employment, usually for no more than three months in six. Australians travelling in Japan benefit from the same arrangement. There is a parallel arrangement with a number of other countries. However, the Government is concerned about foreign nationals appearing to take the place of Australian workers in this instance. I will refer the latter part of Senator Colston's question to Minister Young. Senator COLSTON —Mr President, I ask a supplementary question. The Minister said in her answer that these people are working holidaymakers. Can the Minister advise how many Japanese are in Australia on working holidaymaker visas, and how many Australians are in Japan on the same type of visa? Senator REYNOLDS —I will have to take that question on notice. Senator MESSNER —My question is addressed to the Minister for Local Government. In the light of the Government's moves towards reform of the Australian Constitution, does the Minister intend to take early action to have local government recognised in the Australian Constitution? Senator REYNOLDS —I am very pleased to answer that question. It is certainly the Government's policy to pursue the recognition of local government within the Constitution. Two advisory committees to the Constitutional Commission have already commented in this regard. The Advisory Committee on the Distribution of Powers has recommended against. It has opted for the status quo, probably because of the complexity of determining the specific distribution of powers. However, the Advisory Committee on Trade and National Economic Management has acknowledged that local government is part and parcel of elected government in this country, is a very important part of government processes in the delivery of services to Australians and is very important in the economic development of this country, and so has recommended in favour. My office is currently preparing a response to the two advisory committee reports. Perhaps with the exception of the honourable senator's State, I am already receiving from most States many letters from local government supporting the recognition of local government in the Constitution. Of course, this issue will be the subject of final recommendation by the Constitutional Commission by the middle of next year, and the Government will look at that recommendation accordingly. Senator DEVEREUX —I refer the Minister Assisting the Prime Minister on the Status of Women to comments by the Director of the Business Regulation Review Unit, Dr Allan Moran, which questioned the Government's subsidisation of child care. Does the Minister agree with Dr Moran's claim that the present system subsidises the affluent and that, almost without exception, private services are more efficient? In light of Dr Moran's comments, does the Government have any plans to review its commitment to subsidised child care? Senator RYAN —The Government does not agree with the observations which are reported as having been made by Dr Moran, the Director of the Government's Business Regulation Review Unit. Specifically, the Government will continue its long-standing commitment to supporting accessible community based child care services. Next year we will be funding 110,000 places compared with just 46,000 places when we came to office. There is no substance to the claim that the present system subsidises the affluent. Families with incomes in excess of $32,000 a year pay full fees and funded child care centres receive operational subsidies only for these children. Funding of child care via tax deductibility rather than direct grants would be inappropriate because such a measure would be regressive in providing assistance only to those with a substantial income who can afford the initial outlay for child care prior to the end of the taxation year and, of course, it would not assist low income families. As to the claim of Dr Moran that private child care services are more efficient than public child care services, I do not think he is comparing like with like when he makes that claim. Private services do not cater significantly for the nought to two-year-old age group, tend to open for shorter hours and do not meet the Commonwealth's objectives of providing child care in areas with the highest need. Senator BISHOP —My question is directed to the Minister Assisting the Prime Minister on the Status of Women. I understand that the Office of the Status of Women has made operational grants of $15,000 each to the National Council of Women of Australia, the Country Women's Association (CWA), the Federation of Business and Professional Women and the Women's Electoral Lobby, but a comparatively huge sum of $40,000 to the Australian Council of Trade Unions (ACTU) Working Women's Centre, which is almost three times the size of the grant made to the CWA. I draw the Minister's attention to the disparity between the allocation to the ACTU Working Women's Centre and the other mentioned grants and ask why this is so. Senator RYAN —I think I heard one of my colleagues interject that there were more of them. It is certainly true that for some years now the Government has had a program of making operational grants to various organisations which are concerned with improving the status of women. From recollection, the organisations mentioned in Senator Bishop's question have received operational grants. The level of the grant depends on the nature of the application, the purposes of the grant, the kind of operation that the organisation is involved in, and so on. The ACTU Working Women's Centre has received a large grant for a number of years, but it carries out functions which are much more extensive than those carried out by some of the women's organisations mentioned. Certainly, the ACTU, representing as it does all working women, is representing a very large section of the female population. However, as to the detailed application of that grant I will get information from the Office of the Status of Women and make it available to Senator Bishop and to any other honourable senators who may be interested. Senator BISHOP —Mr President, I wish to ask a supplementary question. Will the Minister advise what are the relative memberships of the first four national organisations which I mentioned and the actual membership of the ACTU Working Women's Centre? Senator RYAN —I do not have that information with me. A lot of the non-government organisations, the women's organisations, would find it difficult to give a precise membership list because they often do not conduct their business in such a way as to require systematic registration of members. Certainly, an organisation such as the Country Women's Association has a very large membership. Whether it would have a precise record of formal membership is another matter. Certainly it represents a significant section of opinion amongst women living in rural and regional Australia and as such it certainly has a very legitimate claim for a grant of this kind. But I do not think it is appropriate to make a direct comparison between a non-government organisation such as the CWA and an organisation which is set up to serve the needs of working women in a systematic fashion. Senator Stone —It is a government organisation, is it? Senator Bishop —Why not? Senator RYAN —The interjections with which one has to contend are too silly for words. I would have thought that even the recently arrived Senator Stone would know the status of the ACTU without asking questions. It is not a government organisation. The work of the Working Women's Centre is different in character from that carried out by voluntary organisations. For example, it is not a voluntary organisation that employs staff and so on and so forth. I have undertaken to get for Senator Bishop the details of the application of the funds which have been supplied to the ACTU Working Women's Centre. I can get details such as the number of women who are members of unions affiliated with the ACTU, and I will see what information we have on record about the number of members of the organisations mentioned. Senator FOREMAN —My question is to the Minister representing the Treasurer. Has the Minister seen an editorial in the West Australian of last Thursday calling for the removal of a supposed anomaly between the treatment of profits and losses on share trading? Is there in fact an anomaly, or is the editorial in effect arguing for the subsidisation of some share traders' losses by other taxpayers? Senator WALSH —I have indeed seen the editorial in the West Australian of last Thursday, the most relevant section of which states: As the tax law stands, short-term share profits will be subject to taxation, but there is no provision for share losses to be offset against them. The general thrust of the editorial went on to develop the argument that share losses should be deductible against income from any source; at least, I think that is the point it was trying to make. The point made in the passage I quoted is correct so far as the capital gains tax is concerned. But there has long been a provision in the tax legislation under which people who buy and sell shares, and indeed also some other classes of people, can be classified by the Commissioner of Taxation as a trader. Having been classified as a trader, they pay tax on their profits from share trading just as they would pay tax on any other income. Under the capital gains tax legislation, only the real gains on share trading activities are assessable as income-of course, that is a major concession, particularly if shares are held over a very long period-whereas, if profits are to be classified as income earned by a share trader, tax is applied to the nominal income, not the real income. I think the point that the editorial was trying to make was to complain that those people who are in fact share traders and always have been share traders but who have conned the Australian Taxation Office into accepting the proposition that they are not share traders, now want to become share traders again. In other words, they want to change the rules after the game has finished, or after the game is at least halfway through. Insofar as particular transactions are concerned, they want to change the rules after the game is finished. The West Australian newspaper, not surprisingly-I say `not surprisingly' given the general lack of intellectual rigour normally displayed in its editorials-has taken up the cudgels on behalf of these people who have until now spent all of their lives posing as people who were not share traders and now want to be classified, for the purpose of taxable income, as share traders because they have had some windfall losses on their shareholdings. Senator COULTER —My question is directed to the Minister representing the Minister for Community Services and Health. Is the Minister aware that the 2,4,5-T used in Vietnam contained on average approximately 20 times the level of 2,3,7,8 tetracholo dibenzo dioxane (TCDD), with some samples of 2,4,5-T containing up to several hundred times the levels of TCDD now permitted in Australia? Does the Minister recognise that TCDD is a known mutagen and carcinogen? Does the Minister also accept that all recognised world authorities, such as the International Agency for Research on Cancer, believe that a linear/no threshold relationship exists between the level of exposure to a mutagen and the risk of effects arising, such as abortion and birth defects? Does it not therefore follow that the conclusion of the Evatt Royal Commission on the Use and Effects of Chemical Agents on Australian Personnel in Vietnam that none of these health effects-abortions, birth defects and cancers-arose as a consequence of exposure to Agent Orange in Vietnam, is patently not supported by the evidence or by accepted scientific theory? Finally, will the Minister therefore advise her colleague the Minister for Defence that the Hogg inquiry must find that one of the principal conclusions of the Evatt inquiry was wrong? Senator RYAN —I do not have the detailed information required to answer the honourable senator's question. I will take that question on notice. Senator TAMBLING —My question is directed to the Acting Minister for the Arts, Sport, the Environment, Tourism and Territories. Did Cabinet last week endorse Mr Brown's submission to sack the nine-member Christmas Island Assembly, which was voted in only two weeks ago-on Saturday, 17 October? Is the Government flying two Australian Federal Police officers to the island tomorrow to assist local police in the event of unrest? Will the Minister this afternoon make a full statement to the Senate on the reasons for this sudden action? Senator RICHARDSON —I am not aware of any decision to send police to Christmas Island. I will check on that. Insofar as the first part of the question is concerned-that is, whether or not the Government has made a decision to sack Christmas Island workers-the Government will be making an announcement about Christmas Island within the next few days. I hope that that announcement will be tomorrow. If that is the case, the Senate will be fully informed then. Senator TAMBLING —Mr President, I ask a supplementary question. I would like the Minister to clear up a point for me. He referred to the sacking of Christmas Island workers. My question specifically related to the sacking of the nine-member Christmas Island Assembly. Senator RICHARDSON —I am sorry, I meant the Assembly. Senator GIETZELT —My question is directed to the Minister representing the Treasurer. To what extent have the Bjelke-Petersen Government's economic policies been successful in improving Queensland's performance relative to other comparable States in the area of unemployment, particularly since the Queensland National Party ridded itself of the Liberals at the 1983 State election? Senator WALSH —In the 1983 Queensland election, the Premier said: We will give the style of leadership that generates business and investment confidence. A style that creates jobs and job security. At that time Queensland had 15 per cent of the nation's unemployed. On the most recent figures, it now has 19.2 per cent of the nation's unemployed. So, the answer to Senator Gietzelt's question about the extent to which the Bjelke-Petersen Government has been successful in improving Queensland's performance relative to other States is that not only has it had no success at all, but it has been very successful in doing the opposite-that is, bringing in an economic outcome relatively worse than any other State. The most recent unemployment rate for Queensland is 9.3 per cent, which is the highest in Australia. For all but three of the 48 months for which the present Queensland Government has been in office, Queensland's unemployment rate has been above the national average. In this year, 1987, it has been the highest or equal highest in no less than eight out of those nine months. Let us look at the number of people involved by a direct comparison with the State of Victoria which, of course, has almost two-thirds more people in the work force than Queensland. Victoria has only 80,000 people on unemployment benefits compared with 101,000 in Queensland. So Victoria has 65 per cent more people in the work force but 20 per cent fewer people on unemployment benefits than Queensland. The normal response to those facts is to say that recorded unemployment is high in Queensland because people move into that State because of its climatic advantages. That argument, too, has been blown out of the water, because in fact in the financial year 1985-86 there was a net loss of some 3,400 people from Queensland in the 15 to 24 age group; that is, the young working age group. The reason for that, presumably, is that Queensland also has, in almost all months, the highest youth unemployment rate of all States. The PRESIDENT —Order! I draw the attention of the Senate to the presence in my gallery of the Hon. John Johnson, President of the Legislative Council of New South Wales. It is a pleasure to welcome him as a fellow parliamentary Presiding Officer and also as a colleague. Honourable senators-Hear, hear! Senator LEWIS —My question is addressed to the Acting Minister for Industry, Technology and Commerce. It is about the 64 Australian companies that missed opportunities to tender for $1 billion worth of trade with Japan. Did Austrade advise the Australian companies of these opportunities to tender less than 14 days before tenders closed when Austrade apparently was aware of the general possibilities of these tenders for about four months? To overcome this negligence, did the Austrade office in Tokyo then send the tender documents-written in Japanese with a short English translation to parts of them-direct to the Australian companies without involving either the Australian offices of Austrade or the appropriate industry associations to suggest any translation or assistance in completing these tender documents? Will the Government undertake a post mortem inquiry as to why this happened and to establish appropriate mechanisms to ensure that this situation does not recur and that Austrade's resources are effectively mobilised to give timely advice and effective assistance to Australian companies in their trade dealings with non-English speaking nations? Senator WALSH —One of the nice things about having this job is that Senator Lewis asks me questions. One of the unattractive features of losing it is that he is not likely to ask me questions any more. Senator Lewis gave me notice of the last question he asked me and therefore I had a reasonably comprehensive reply. This time he did not, so I do not have a completely comprehensive reply. But I do have a note here which appears to go to the main point of the question which asked whether it was correct that Austrade sent these notices out only 14 days before the event. It would appear from this note that the answer to that is no. It says: Over 1,500 notices were scrutinised and details on 307 items were sent over a four-month period to 65 Australian companies. Nearly all items were in the medical and scientific instrument fields. It may well be true that some notices were sent out only 14 days before the relevant date, but it appears not to be correct that that was the norm. In regard to the other parts of the question on language problems and recurrence, I will have to take the question on notice and supply an answer as soon as possible. Senator VALLENTINE —My question is directed to the Minister representing the Minister for Defence. In the light of the Institute for Policy Studies-Greenpeace International document entitled The Nuclear Arms Race at Sea, tabled in the Senate on 29 October, I ask: How can the Government justify frequent joint exercises with the United States nuclear navy outside Australia's area of direct military interest as defined in the 1987 defence White Paper? Is it a fact that in 1985-86, 12 joint exercises were undertaken between the Australian defence forces and the United States defence forces totalling a cost of $43.5m? Is it a fact that of the 36 combined exercises with all other countries, including those 12 with the United States, precisely half were conducted outside Australia's area of direct military interest? Is it true that three of the exercises in the 1985-86 Silent Pearl series involved the Australian Defence Force (ADF) in chasing United States nuclear attack submarines off Hawaii? Are not such exercises superfluous to ADF needs and designed to suit United States naval requirements? Would not Australia's defence needs be better served by exercising within our region and with conventional forces rather than nuclear forces? Senator ROBERT RAY —Combined exercises improve the competence of the Australian Defence Force and our national defence capabilities. They also improve the effectiveness of the Australian and United States forces should combined military operations, including operations in our area, ever become a necessity. Participation in each combined exercise is considered on its merits in the context of the benefits it provides to Australia and the policies set out in the defence policy information paper which was tabled on 19 March. Exercises with the United States Navy in particular provide valuable opportunities for training with advanced technology units of our allies. The opportunity does not otherwise readily exist for the Royal Australian Navy and the Royal Australian Air Force to exercise with such highly capable forces. In relation to the specific points raised by Senator Vallentine, in 1985-86, 13 exercises were conducted with the United States, either as bilateral or multilateral exercises. The cost of these exercises was $48.2m. Of the 36 exercises conducted with other countries, half were conducted outside Australia's area of direct military interest; eight of these were in Malaysia and Singapore and involved Australian forces based at Butterworth. Three Silent Pearl exercises were conducted and they involved gaining experience in tracking nuclear powered submarines. Apart from the inherent greater speed of nuclear submarines over conventional submarines, there is no difference in the training value obtained in exercising with nuclear powered or capable forces as opposed to conventionally powered forces. Senator SHORT —My question is directed to the Minister for Home Affairs. I refer the Minister to his recent Press release giving details of the domestic travelling allowance costs of Ministers in the year ending 30 June 1987. Does the Minister recall including in his release the number of days of overseas travel by Ministers but not the cost of such travel? Is it a fact that the number of days of overseas travel by Ministers in the period totalled 521, excluding travel by the Prime Minister? Does the Minister also recall that on the day of his Press release I asked him, through his office, to release details of the travelling costs involved in these 521 days, on which I have received no response to date? I now ask the Minister: Why has he failed to supply this information? Will he now provide the Senate with the details? Senator ROBERT RAY —As Senator Short has said, it is true that when I released details of domestic travel allowance I also included, for the information of the public, the days of overseas travel of Ministers. Senator Short asks me to confirm whether that figure amounted to 521. I have no reason to doubt his arithmetic. However, if he wishes I can confirm whether he has added up correctly because I assume that we are working off the same figures. Senator Walsh —We know about the Liberal Party's figures. Senator ROBERT RAY —Senator Walsh remembers Liberal Party miscalculations in terms of adding things up. I would have thought that this figure was checked very carefully. I do not know whether Mr Carlton assisted the honourable senator on this matter but I will assume that his figure is accurate. He raised the question of publishing the costs of overseas travel. Normally they are published on an annual basis. When I took over the portfolio and when it was first brought to my attention that the figures had not been published for some time, I asked for them to be collated for publication. That series of collations is still occurring. I am in no way obstructing the publication of those figures. When the Department has them available, they will be published. I do not regard it as the absolute highest priority within the Department at the moment. We have already published the figures for domestic travel allowance and the official car costs. As the third leg of the trifecta this can be expected certainly before Parliament gets up and, hopefully, even this week. I have not checked the progress of the figures in the last few days, but they will be published until, I hope, the end of financial year 1986-87. Senator ZAKHAROV —My question is addressed to the Minister representing the Minister for Defence. Following the sale of Aerospace Technologies of Australia Pty Ltd, formerly the Government Aircraft Factories in Port Melbourne, what steps have been taken to ensure that employees have not been adversely affected by the change in ownership? Senator ROBERT RAY —I know of Senator Zakharov's interest in this area. I make the following points to allay those fears: The ownership of the Government Aircraft Factories was transferred to the government owned company Aerospace Technologies of Australia Pty Ltd on 8 October 1987. The majority of the Government Aircraft Factories employees are being transferred to Aerospace Technologies and will be covered by industrial awards which are similar to the Public Service awards. In addition, Public Service Act staff transferred to the company are subject to mobility provisions which provide for the following: the retention of accumulated entitlements such as sick leave, recreation leave, long service leave and access to the Commonwealth Superannuation Fund; the right to apply for and appeal against the filling of vacancies in the Public Service on the same basis as the existing Public Service Act employees; the right to re-enter the Public Service should their employment with Aerospace Technologies be terminated for any reason other than criminal conviction, retirement, resignation or invalidity retirement; and finally, the right to apply for re-entry into the Public Service on action taken by Aerospace Technologies which would significantly impact on their career prospects. Those Government Aircraft Factories employees not selected for transfer to Aerospace Technologies are to be given a choice of redeployment within the Department of Defence or accepting a voluntary retrenchment package. Details of how individuals are affected by the change in ownership have been widely circulated and counselling sessions for employees have been arranged by both the Department and the company. Senator CALVERT —My question is directed to the Minister for Local Government. In answer to a question from Senator Panizza in this place last Thursday, the Minister stated: It is true that this year, and following the Self National Inquiry into Local Government Finance, a new system of distribution throughout the country on a much more equitable basis, a needs basis, was introduced. It is my understanding that this statement is misleading. Is it not true that the current funding arrangements are on a largely per capita and only a part needs basis? Can the Minister clarify or correct her apparently misleading statement? Senator REYNOLDS —I am at a loss to understand Senator Calvert's question because I think the answer that I gave last week to Senator Panizza was absolutely correct in emphasising the needs basis that follows a very extensive inquiry by Professor Self. Professor Self travelled throughout Australia and spoke with local government in all areas of the country and, as a result, brought forward a report which I would recommend for reading to both Senator Calvert and Senator Panizza. In fact, I offered Senator Panizza-I extend that invitation to Senator Calvert-a full briefing of the new arrangements of local government funding. It is the first year of operation and it is a fairly complex statistical procedure. I would certainly offer the services of officers of my Department to explain it to either of those honourable senators or any other Opposition senator who is interested to follow up the issue that Senator Calvert has raised. Senator CALVERT —I ask a supplementary question. I am more than happy to follow up the Minister's invitation, but the Minister said, and it is in Hansard, that funding is on a needs basis, when in fact I am led to believe that it is mostly on a per capita basis and partly on a needs basis. I am asking the Minister to clarify the position. Senator REYNOLDS —It is important to explain the full procedure and it would be much more appropriate if we were to go through the procedures in detail. Opposition senators interjecting- The PRESIDENT —Order! Senator Reynolds is replying to a supplementary question. Senator Boswell —Sold out north Queensland again. Senator REYNOLDS —If Senator Boswell would care to have some information about the numbers of councils in north Queensland which will benefit over the next six years by between a 20 per cent and a 40 per cent increase in local government funding, I would be happy to provide that answer. I repeat to Senator Calvert, and to other Opposition senators who have suddenly displayed an incredible interest in local government, and I welcome that interest, that it is a procedure that involves partly per capita and partly needs. It is a new system which the majority of local authorities have welcomed because it is a more equitable process of distribution. It cuts out many of the questionable practices over many years. There has been a history of capital cities getting more recognition and of certain rural areas getting particular recognition. The process is equitable and has been accepted by local authorities throughout the country. I commend Opposition senators to sit down with officers of my Department and to take the time to understand the full implications. Senator DEVLIN —Is the Minister for Finance and Minister representing the Treasurer aware of recent calls by Mr John Elliott for the introduction of a broad-based consumption tax? Is the Government persuaded that a broad-based consumption tax ought to be introduced and that the tax mix should be shifted from the income tax base to the consumption tax base? Senator WALSH —I am aware of the Liberal Party President's comments on a broad-based consumption tax-indeed, I am aware of quite a few comments that Mr Elliott has made recently. I am also aware of the fact that the Liberal Party thought that it had a problem when it had John Valder. It has a much bigger problem now. It will not be long before the Liberals are saying, `Come back, John Valder'. On the policy question of a broad-based consumption tax or general consumption tax, it was, as Senator Devlin will remember, looked at very seriously by this Government in 1985. Ultimately a decision was made not to proceed with it, for two principal reasons. The first was that some people had doubts whether there would be adequate compensation to low income groups or people who are dependent on welfare benefits. The second was an apparent lack of general community support, which was apparent among both the business sector, or managerial sector, and the wage earning sector. In those circumstances there was a significant risk that agreements to discount wage claims for the consequential consumer price index increase would not be fully effective and that therefore it would touch off a wage-price spiral. Those were the Government's reasons for rejecting what Mr Elliott is now proposing. It is not clear what Mr Howard's reason or Senator Stone's reason for rejecting it are, except that Senator Stone has done a 180-degree turn on yet another issue since 1985 when he said on the Today television program on 2 July 1985: I've always made quite plain my view that a broadly-based consumption tax is a thoroughly desirable thing to have. It's desirable on a number of grounds. Senator Chaney —Your Treasurer said that. Senator WALSH —He went on to say: The second bad point about the present wholesale sales tax is that because it has a number of different rates within it, governments have effectively decided that some purchases are good and other purchases are bad. I don't believe that governments have any right to make those decisions. Senator Chaney reminded me that also at about the same time the Treasurer was advocating a broad-based consumption tax. That is true, and I have already said so, and have already given the principal reasons why the Government backed away from it. Why Senator Stone has backed away from it is not at all clear because, first, he is not very concerned about what happens to the poor and, secondly, he believes-quite wrongly, I believe-that one does not have to worry about wage demands and that the power of the unions, of organised labour or of whatever one likes to call it, can be completely destroyed in a very short time and therefore that is not a relevant consideration to him. Senator CHANEY —My question to the Minister for Local Government follows the answer she gave to the questions from Senator Calvert. Does the Minister know what percentage of local government funds is disbursed on a per capita basis and what percentage is disbursed on a needs basis, and, if so, what are those percentages? Senator REYNOLDS —I thank Senator Chaney for his question. Looking at the per capita basis we are looking at a 30 per cent figure, but the remainder of funding is distributed on a needs basis. I repeat that it is a very complex procedure; it is a procedure which I do not propose at this stage to outline in detail to the Senate. I am more than happy to outline it to the Senate at such time as there is the opportunity for a full debate on this question. It is very important that Opposition senators acknowledge and recognise that local government funding distribution over many years has not been done on an equitable basis. It is now done on a much more equitable basis. The per capita basis is one of the issues to be debated, but the needs question is just as important. I look forward to ongoing discussions about this matter with honourable senators. Senator BJELKE-PETERSEN —My question is to the Minister Assisting the Minister for Community Services and Health. I understand that some charities have said they cannot cope with the demand that Australia's increasing poverty is placing on their resources. Is it a fact that the Government has cut emergency relief funds to the Salvation Army by more than half, or $485,000, while spending over $200,000 advertising the International Year of Shelter for the Homeless? If this is so, does she not agree that the emergency relief funds cut from the Salvation Army should be replaced, so that this wonderful Christian organisation that does so much for people in poverty can make sure that its excellent work can continue at its previous level helping people in poverty? Senator RYAN —The Salvation Army is one of a large number of non-government organisations that receive grants from our Government under various programs. I shall investigate whether one of those programs has had to be reduced and make that information available to Senator Bjelke-Petersen. There is a program for the International Year of Shelter for the Homeless and funds have been allocated to it. One of the major events occurring in that year is the setting up of a non-government committee chaired by Bishop Hollingworth, with representatives from non-government organisations, and I am sure that the Salvation Army will be represented on it. It is planning a program of events for the International Year of Shelter Week, which will happen shortly, and as well has been consulting with groups throughout the country to see what the needs of the poor for shelter are, and to what extent government programs and programs run through the non-government organisations are meeting them. We have a substantial program of assistance to acknowledge the International Year of Shelter and non-government organisations such as the Salvation Army are certainly involved. When I took over the housing and housing programs part of the Community Services and Health portfolio, one of my first duties-and a very pleasant one it was-was to attend the opening of a new Salvation Army establishment in Melbourne which provides a very high standard of housing, privacy and support for homeless people and those who have problems as well as homelessness. I was pleased to have the opportunity to put on record then our Government's appreciation of the terrific contribution made by the Salvation Army to homeless people and the poor generally. I also remind Senator Bjelke-Petersen that in our last Budget poor families were the recipients of our new family assistance package which will make available to those families which come within the means test an extra $22 a week per child, rising to $28 a week for children between 13 and 15 years of age, plus an additional $15 a week for those low income families which are renting in the private market. No doubt many of those people are clients, in some sense or another, of the Salvation Army. So, we have a very substantial and varied program of assistance to the poor and we certainly acknowledge and recognise the great contribution to these programs made by organisations such as the Salvation Army. I will have to obtain the specific details of funding from Dr Blewett. Perhaps if Senator Bjelke-Petersen has the correspondence, she will let me have it so that I can give a detailed answer. Senator BOLKUS —Is the Minister for the Environment and the Arts aware of Press reports suggesting that Swedish scientists have found that the so-called Antarctic ozone hole has extended northwards to cover Australia? What action is the Government taking to ascertain the veracity of these reports and, further, what action is the Government taking to control chlorofluorocarbons as a result of the recently concluded Montreal protocol? Senator RICHARDSON —I am aware of the media reports which surfaced last Thursday and I am pleased to report to the Senate that advice obtained from Swedish authorities suggests that-not for the first time-the papers got it wrong. In fact, the Swedish Environment Minister, Mrs Dahl, made a statement on this matter which referred only to the ozone hole as it extends to 60 degrees south latitude, and not insofar as it extends to Australia. However, the bad news is that the initial findings of the study conducted this spring and co-ordinated by the United States of America show that there has been a further depletion of ozone in the Antarctic-in fact, the level is now 15 per cent below the previous lowest level. That further deepening of the hole is a problem for us all. That conclusion is borne out by Australia's own Bureau of Meteorology findings on this matter. As honourable senators would be aware, Australia's monitoring stations, which extend as far south as Macquarie Island, have also been looking at this matter. Australia's ozone levels were slightly lower in September but, fortunately, they recovered during October. We are alive and well here, but the position is still bleak in the Antarctic-and that is not meant to be a pun. A shorthand description of the protocol is that, as a signatory, Australia will be required to reduce to 1986 levels the production of chlorofluorocarbons by 1989 and then, over a 10-year period by successive reductions, reduce that figure by half. I am being lobbied by some conservation groups that that is not enough and that we should do more. In any event, before becoming a signatory obviously the Government will be in full consultation with the States and other interested parties. Senator WATSON —My question is to the Minister for the Environment and the Arts. Given the concern of the Tasmanian Cattlemen's Association, has the Minister received advice that World Heritage listing would affect highland livestock grazing on private land in Tasmania? If so, to what extent would the traditional lifestyles of these people be affected by World Heritage listing? Senator RICHARDSON —I am not specifically aware of a complaint from the Cattlemen's Association in Tasmania. However, as far as World Heritage listing is concerned, current land users in most cases ought not to be affected and that would include grazing cattle. As I have stated repeatedly so far as listing is concerned in north Queensland, where that concern has specifically been raised with me, land use involving the grazing of cattle will continue, and the position would be the same in Tasmania. Senator POWELL —My question is addressed to the Minister Assisting the Prime Minister for the Status of Women and for the Bicentenary. Has the Minister seen a report in this morning's Melbourne Age indicating that a Cabinet committee will be considering equal employment opportunity (EEO) arrangements in the restructured Public Service and, in particular, the cutback of the Equal Employment Opportunity Bureau from a staff of 35 to nine? Does this indicate an enlightened development in the Government's stance on this matter since 16 September when the Government rejected an Australian Democrat amendment to put an EEO representative on the new Public Service Commission? Taking into account the concerns being expressed by spokespeople for women, the disabled and ethnic communities, will the Minister oppose the cutbacks in the EEO Bureau? Senator RYAN —I think Senator Powell must have been absent from the chamber last week when I answered a question along similar lines. There has been some concern expressed, including in the media, about the change in administration of the EEO programs. What I said in reply to that question last week is that the commitment of the Government to the EEO programs remains as high as ever, although there will be a change in the way in which they are administered. As a result of the reorganisation of the Commonwealth Public Service and some of the efficiency recommendations, departments and agencies will take on a much greater responsibility for EEO programs in terms of recruitment, taking account of special needs of disadvantaged groups which are covered in the legislation, promotion, training and matters of that kind. It is now considered no longer appropriate that all of this should be done by a centralised agency, but rather that each department and Commonwealth agency itself should undertake substantial responsibility for ensuring that EEO policies are applied actively at every stage of employment. However, an EEO unit will be maintained within the Public Service Commission. It will have overall responsibility for monitoring progress and it will report regularly to the Government. Service-wide and agency-specific performance indicators will be developed and will be used in measuring the agencies' performance. In their annual reports to Parliament, departmental secretaries will be required to report progress against guidelines developed by the Public Service Commission. Of course, Senator Powell will deduce from that that she, like all other senators, will have the opportunity to examine these reports and to ask questions about them at Senate Estimates committees and in this place. The Affirmative Action Agency is continuing its work in relation to the Affirmative Action Act. The Department of Employment, Education and Training is to provide services to meet the special needs of Aboriginals and disabled people in relation to Public Service recruitment. The level of activity will remain as high, the structure of it will be different and the way in which the programs will be administered will be different but we expect that the outcomes will be very successful. Senator KNOWLES —Does the Minister representing the Minister for Foreign Affairs and Trade agree with the honourable member for Kalgoorlie, Mr Graeme Campbell, that, given the decision to ban flights by South African Airways, it would be enormously hypocritical of the Federal Government to agree to a joint venture between the Western Australian Government and Anglo-American Pacific of South Africa to treat tailings dumps near Kalgoorlie? Senator GARETH EVANS —Not necessarily, Mr President. Commercial arrangements are to be assessed on their merits and in accordance with the extent to which they are consistent with the package of sanctions that have been agreed to by Commonwealth countries meeting at the Commonwealth Heads of Government Meeting. I am unable to say without taking the question on notice-which I will do-whether or not the particular arrangements that have been the subject of some speculation in Western Australia conform with the agreed package of sanctions. I will certainly follow that up and respond accordingly to the Senate. Senator SHEIL —My question is directed to the Minister representing the Attorney-General. What are the criteria for legal aid being granted to illegal immigrants? How many illegal immigrants have been granted legal aid? How many illegal immigrants are given legal aid when they arrive at Australian airports with fraudulent documents? How did these migrants know of the availability of legal aid? Senator TATE —I have some notes in the brief from the Attorney-General to this effect: Legal aid in Australia is available through independent State and Territory legal aid commissions, including that of Queensland, the Australian Legal Aid Office in Tasmania and the Northern Territory, and community legal centres in all States and the Australian Capital Territory. It is a basic principle of legal aid that no person should be denied access to the law because of an inability to afford legal representation. In accordance with their charters, legal aid bodies apply criteria which include consideration of the merit of the proceedings and the means of the applicant but do not make distinctions based on nationality or immigration status. It is not possible to provide figures as to the number of prohibited non-citizens who have received legal aid. The Attorney-General's Department is currently examining this question by surveying the main legal aid bodies in Australia. All have responded by noting that, although record-keeping is not organised to identify immigration status, it is estimated that the number of illegal immigrants or prohibited non-citizens granted legal aid is extremely small, both in migration and in other matters. In migration matters, which appear to account for the majority of cases where aid is granted to prohibited non-citizens, the estimate by one legal aid body is that the applicant is a prohibited non-citizen in less than one per cent of cases for which legal aid is approved. Within those few cases, most concern applications for change of status. Indications from other legal aid bodies appear to confirm this view. Information provided by legal aid bodies suggests that no illegal immigrant or prohibited non-citizen receives legal aid at the time and port of entry into Australia. I am aware, however, that some legal aid bodies provide duty solicitor services to immigration detention centres. Indications from the State and Territory legal aid bodies are that the majority of prohibited non-citizens detained are not aware of the legal aid system in Australia but become aware of it once detained. Senator ROBERT RAY —Last week Senator MacGibbon asked me a question to do with Tindal Defence Force homes. I have an additional part to my answer. I seek leave for it to be incorporated in Hansard as it is reasonably lengthy. Leave granted. The answer read as follows- (1) The work authorised for Tindal housing was designed to accommodate the harsh local tropical climate which is more extreme than that encountered in coastal regions where the beneficial effects of sea breezes can be utilised to assist natural ventilation. (2) To ensure an acceptable living environment for the RAAF personnel it was decided that the Defence houses should be equipped with mechanical air conditioning as well as incorporating design features to maximise the benefits of natural ventilation. It is considered that passive design measures alone do not provide sufficient relief for Defence tenants during the oppressive weather of the wet season and other marked seasonal variations in Katherine's climate. Some of the passive features of the Tindal housing designed to achieve better thermal comfort include attention to orientation, higher than standard ceilings, shaded large windows and well insulated construction. Because the housing is mechanically air conditioned it was decided that the extra 7m2 or so usually provided in non air conditioned Defence houses in the tropics is unnecessary as its purpose is to aid natural ventilation. To further improve the conditions for Defence personnel at Katherine the houses are provided with up to 36m2 of covered outdoor living area. Some of the earlier prototype houses showed up problems with a ducted whole of house air conditioning system, particularly high operating costs. Later designs were modified to a different system which utilises individually controlled fan coil units in each habitable room, and which provide a lower installation and operating cost. Before the decision to proceed with the type of house design and full house air conditioning was taken, the cost and residential environmental considerations were carefully evaluated by the then Department of Housing and Construction and the Department of Defence. The design of houses at Tindal for the Defence Force was examined by the Parliamentary Standing Committee on Public Works. The Committee's Report (Twelfth Report of 1984) on the development of RAAF Base, Tindal, endorsed the works and a motion to proceed with the proposal was passed in the Parliament on 7 June 1984. (3) The Acting Minister for Defence is not aware of any Service family having to pay $1,000 for a quarterly electricity bill at Tindal. There is a subsidisation scheme for electricity costs at Tindal, called Air Conditioning Allowance. This provides a subsidy during the months of September to April for the electricity costs associated with the operation of air conditioning units. The PRESIDENT —I inform the Senate that I have received the following letter, dated 2 November, from Senator Stone: 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 set aside its policy of inaction in the face of economic developments since it brought down the August Budget and to revise its fiscal and wages policies without further delay'. Yours sincerely, JOHN STONE Senator for the State of Queensland Is the proposal supported? More than the number of senators required by the Standing Orders having risen in their places- Senator STONE(Queensland-Leader of the National Party of Australia)(3.54) —I move: That, in the opinion of the Senate, the following is a matter of urgency: The need for the Government to set aside its policy of inaction in the face of economic development since it brought down the August Budget and to revise its fiscal and wages policies without further delay. The momentous events of the past two weeks are fresh in the minds of all honourable senators, even though to listen to the words and observe the attitudes of Government Ministers one could be pardoned for thinking that nothing untoward had occurred. Since Wall Street first fell in the crash on Monday, 19 October, followed by a crash of our own share market on the following day, Tuesday, 20 October, we have heard the echoes reverberate around the world. During the beginning and the middle of last week, the second week of these events, we saw developments in the share markets begin to be translated into developments in the foreign exchange market with very adverse developments beginning to take place against the United States dollar and even more so against the Australian dollar. The Australian dollar fell not merely against strong currencies, such as the Japanese yen and the deutschmark, but even against a very weak currency under those circumstances-the United States dollar. As I have said, during that time we witnessed some extremely momentous events. At the outset of these events, in fact, on Tuesday, 20 October, Senator Chaney asked a question in this place of Senator Walsh. He suggested, among other things, that the Government ought to consider very seriously postponing the national wage case which was then imminent; it was about to begin the following day. He also suggested that the Government should give very early consider- ation to bringing down a mini-Budget before this Parliament rises for the Christmas recess, having in mind that when it does it will not resume for a further two months which will be, so to speak, two months lost. Senator Walsh's less than wholly gracious response to Senator Chaney was to describe his two suggestions as palpably stupid. On the very next day Senator Walsh was forced to eat his words, at least in part, when the Government went into the Australian Conciliation and Arbitration Commission, through counsel for the Commonwealth, and asked for a postponement of the commencement of the wage case in the light of the events of the previous two days in the world stock markets, including the Australian stock market. That decision by the Government-a volte-face, if you like, at least certainly a volte-face on the view expressed only 24 hours earlier by Senator Walsh-was very much to be welcomed. It showed that at least someone in ministerial ranks was applying some thought to these matters, as distinct from simply lashing out with political and less than wholly worthy responses of the kind given by Senator Walsh on the previous day. Unfortunately, the Government, having obtained for itself a week's period of grace before the national wage case was brought on again last week, has totally failed to profit from its initially quite wise decision to seek a postponement, which was, of course, granted. In the interim the Government received from its colleagues, one might almost say, in the Australian Council of Trade Unions (ACTU) a few rather sharp shots across its bows. It received a few threats from Mr Kelty and Mr Simon Crean, the President of the ACTU, and one or two acerbic telephone calls, no doubt, from much less presentable gentlemen than either of those two indicating-- Senator MacGibbon —And was that Mr Hawke? Senator STONE —The Prime Minister (Mr Hawke) was not even here at the time. He was overseas disporting himself in Tipperary and similar places, not to mention the Commonwealth Heads of Government Meeting. As a consequence of those telephone calls and, in one or two cases, quite public remarks by trade union leaders, the Government's knees buckled, as they always do on these occasions, and last week, when the counsel for the Commonwealth came back into the Arbitration Commission, he was duly instructed to propose that the wage case should go ahead and that as from 1 January everyone in this country should receive an increase of $6.50 a week. It was as though nothing had happened in that interim period or, to be more accurate, as though the Government's initial doubts about the wisdom of going ahead had been resolved by what had happened in the intervening week. What had happened in the intervening week was that the share market had fallen even further and the foreign exchange market had started to go into a tailspin as well. What a signal to give to the international economic community as to the quality of economic management in this country. There are people who do not have quite the same attachment to the interests of the trade union bosses as our present ministerial ranks and, as I say, who can be pardoned for wondering why, at a moment of national economic crisis, our Government has decided to go into the Arbitration Commission and support a trade union claim for everybody in this country to have his wage or salary raised by $6.50 a week. The Government has made some play with the fact that this will take place, on its proposition, only from 1 January, which is now less than two months away. Some delay! Let us consider also that other palpably stupid suggestion, according to the Government, which Senator Chaney first raised and which was rebutted in those ungracious terms by the Minister for Finance, Senator Walsh-namely, the suggestion for an early mini-Budget in order to cut spending and, depending on how big the cuts were, move the Commonwealth Budget into surplus. The Government has not really given any reasons for not following that course other than to say-and I will come to this in a moment-that it does not yet know the full details of the consequences of what has happened in the share markets and the foreign exchange markets. Some people, I have no doubt on the basis of governmental briefing, have suggested that it would not be technically possible for the Government to bring down a mini-Budget before the Parliament rises in December. Yet only on the weekend following the Budget, Senator Walsh, in some appropriately discreet remarks to a gathering in Perth calling itself the Society of Labor Lawyers, claimed that he knew of-I accept that he does-at least 200 separate spending programs in the Commonwealth's own area which had no basis in equity, efficiency, or any other thing. He was most contemptuous of those programs, and quite rightly so. So the suggestion that Senator Walsh and his Department would not have the technical competence to bring forward a mini-Budget between now and the middle of December I find quite unacceptable and I am sure that Senator Walsh does too. The fact of the matter is that that is simply an argument behind which the Government can hide. The other suggestion that has been made is that we might get it wrong and we might actually do too much at this stage to rein in our budgetary position and to improve the position of our total public sector which, of course, is still borrowing-contrary to some ignorant remarks made during Question Time today by the Acting Leader of the Government in the Senate, Senator Gareth Evans-as a proportion of gross domestic product, at a higher rate in total, taking both Federal and State governments together, than our United States counterpart. Of course, he also left aside completely the relative mess in which the two countries find themselves. The United States is certainly in a mess but it is nothing compared with the mess that we are in. Let us entertain the theoretical possibility of doing too much before Christmas. The only consequences of doing so would be that the Government, under those circumstances, might find itself in the delightful position of being able to let interest rates fall in the new year. I think that prospect would be welcomed by the Government, if ever it were to find itself in that position. But let us not have any of this nonsense about not being able, as yet, to see clearly enough the consequences of these developments in order to be able to act at this stage. Mr Acting Deputy President, you know, I know and senators on the Government side of the chamber certainly know, that the real reason for the Government's stubborn and reckless refusal to begin to move as quickly as possible to restore some degree of confidence in Australian financial markets in these matters is that it does not want to do anything before the New South Wales election. Mr Keating and Mr Hawke who, for these purposes, I think is also classifiable as a member of the New South Wales Right, are bent on protecting their colleague Mr Unsworth. I do not make any comment on that. That is mateship as understood in the Australian Labor Party but, in this case, it is mateship at the expense of the country. I have already dealt to some degree with the Government's lines. The first is that it is too early to see the detailed consequences of these developments and, therefore, it cannot really be expected to move at this stage. As I have said, I have already dealt with that to some degree and I will come back to it. The Government's second line is: `It's not our fault'. The Treasurer (Mr Keating) of this country was on television last Friday saying-I hope that I am quoting him more or less precisely-`One simply does not know what it will take to get the Americans to do the right thing'. He put his hand on his heart and said, `We simply do not know what it will take to get the Americans to do the right thing'. What a complete abnegation of responsibility on the part of a Treasurer of the Commonwealth of Australia. Whatever the faults of our American allies may be-I notice the disappearance of the nuclear disarmers-the fact of the matter is that whether they get their policies right or wrong we have to live in the world that they help to create as a consequence. It is no good our crying in our handkerchiefs if, in our opinion, they get it wrong. We have to live in the world that is created. That is the responsibility of the government of the day in this country, the Treasurer of which is the same man who, as I have said, last Friday was bewailing the fact that he simply did not know what it would take to get the Americans to do the right thing. Let me come to these two lines of argument. As I have said, to some degree I have already dealt with the first argument. The first argument concerns the detailed consequences. Is the Government not satisfied with the detailed consequences, some of which we have already seen? Is it not satisfied with the mess in Rothwells Ltd, the merchant bank in Western Australia-which I do not have time to go into-which reflects no credit on anybody, least of all the Western Australian Government? Is the Government not satisfied with the fact that, at the end of last week, we had the Challenge Bank in Perth, holding a banking licence issued by the Treasurer of the Commonwealth of Australia under the Banking Act, with a run on it? I would be the first to say that I do not believe there is any basis for that run. Any bank which has been issued with a banking licence by the Treasurer and which, therefore, has the Reserve Bank of Australia standing behind it should not have a run occurring on it. Is it not indicative of the lack of confidence in this country, that has now grown up as a consequence of the developments of the past two weeks, that that kind of thing can be happening? Does the Government want any more detailed consequences of that kind before it is prepared to move? What about the detailed consequences we have seen already in the share markets with the calling off of issue after issue which had previously been planned? Presumably those issues were planned in order to raise capital for the companies concerned, not for those companies to go out and speculate on the stock market-there may be some in that category and I have no time for them if that is the case-but so that most of those companies could try to raise capital in order to be able to do things. Now they have had to pull their share issues off and abort their plans for doing things. Does the Government want any more details of that kind to become evident in addition to those we have already had in the past fortnight? Above all, of course, what we have seen and what we will see a great deal more of, is the development of greater uncertainty and, through that, we will see an effect on business investment. It is just not good enough for the Government to say that it will sit on its hands and wait for all this to actually appear in the figures to be released by the Australian Bureau of Statistics during the first six months of next year and then it might get around to actually believing it. As I have said, the Government's second line of defence is: `It's not our fault'. I must say that I am growing rather weary-in fact I have grown weary for some time now-of this line of defence from this Government. When it first came to office we had the $9.6 billion deficit which it inherited from the previous Government as being something which made it impossible for it to do anything about the mess the country was in at the time. That particular line-`It's not our fault'-lasted for about 18 months. The Government's second line of `It's not our fault' concerned the so-called overvalued exchange rate. Mr Acting Deputy President, believe this: that overvalued exchange rate was put in place by a Cabinet which the then Opposition was always assailing for being composed of a lot of farmers. A lot of farmers were deliberately running an overvalued exchange rate! If you believe that you would believe anything. Of course, in all of that we had no mention or recognition by the Government at any time, until the biennial conference of the Labor Party in Hobart last year, of the consequences of the 1981-82 wage explosion which brought about the absolute shambles, in the metal trades industry particularly, as a consequence and which then moved on in terms of the so-called community standard, as I think the trade union movement then began to call it, throughout the rest of the work force and the rest of the economy. It is true that, at that Hobart conference, the Treasurer actually told the truth about it when he attacked Mr George Campbell of the Amalgamated Metal Workers and Shipwrights Union and accused him of having the corpses of 100,000 dead men around his neck, by which he meant the 100,000 people who became unemployed in the metal trades industry as a consequence of the actions of that same trade union. Senator Short —It is an underestimate. Senator STONE —As Senator Short has accurately reminded me, no doubt it was an underestimate. The next pathetic excuse we had from the Government was the adverse movement in the international terms of trade. I have forgotten quite when that one came into vogue; I think it was some time in 1986, if I remember correctly. Then it was all the fault of the international terms of trade. It was not the Government's fault. The Government had never done anything wrong; it was just that the international terms of trade moved against it. We have not heard about the international terms of trade this year because they have actually been improving this year. The Government has not been telling us that, but that has been the case. International terms of trade have been improving since the very beginning of the year. Now, we have the failure of the policies of the United States of America as the thing really responsible for the mess we in Australia are in today. Of course, that is ludicrous. That may be what is responsible for the mess that the United States is in today. But the mess we are in today is due to the failures on the part of this Government over the last three years or so. It is high time we got away from this romanticising and myth making on the part of the Government and got back to the real world. The real world is one in which the Government persists in fiddling while our economy falls down, and indeed while the international economy begins to fall down also. In response to a number of questions the week before last, Senator Walsh said there were two critical tests to which he would have regard in deciding whether we would need to take action in this country. The first was the extent to which those developments depressed Australia's income from exports. The second was the extent to which they might provide a massive withdrawal of capital. As to the first, as I have said before, in the past six months or so we have had growing ebullience in the commodity markets of the world; they have been rising. The major reason for that has been that there have been fears of inflation moving into those markets during that time. That is what has been largely responsible for pushing those commodity markets up, as some speculative elements have begun to enter them. Of course, Australia was benefiting from that, not only from the fact that the prices for our products were rising but also because under those circumstances the Australian dollar came to be seen as a so-called commodity currency; it became attractive. For a while it became almost the flavour of the month. It follows from that that, in the light of the events of the last two weeks, which have produced an outlook for deflation, not inflation, in those commodity markets, we can now look forward to and have already begun to see a situation in which the Australian dollar is still regarded as a commodity currency in a world in which the commodity currency is no longer the flavour of the month but is a competitor for the ash can. I am afraid that that may very well be the case. My final point relates to Senate Walsh's view about capital flows. Contrary to his view, we do not need a massive withdrawal of capital to signal the storm signs. All we need is to have capital inflow from abroad dry up, which is what we certainly had. Last week in any case we did see a massive withdrawal of capital. I asked a question of Senator Walsh on that matter last Friday. It is true that the Minister did not seem to understand at that time that, if the Reserve Bank of Australia was buying, as it certainly was, massive amounts of Australian dollars-amounts of $2 billion were even mentioned-somebody must be selling them to it. The only people who could have been were those withdrawing capital from Australia. The ACTING DEPUTY PRESIDENT(Senator Colston) —Order! The honourable senator's time has expired. Senator WALSH(Western Australia-Minister for Finance)(4.14) —We have just heard another rant from Senator Stone about the need for everybody to wear a hair shirt. How many of the listeners to this debate or of the people in the public gallery can believe that that rant has come from a man who is double dipping, drawing a $34,000 a year Commonwealth superannuation scheme pension as well as his parliamentary salary and whatever other income he may earn from being a columnist or whatever else he may do which is not publicly known. Of course, that is typical of the humbug and hypocrisy of the side of politics which Senator Stone represents. When, during the election campaign, it was put to him by Paul Malone, a Canberra Times journalist, that his having retired at 55 as Secretary to the Treasury after, I think, a full 30 years of service and therefore drawing a superannuation pension of around $33,000 or $34,000 a year financed by the employer-whatever contributions he may have made would be in addition to that-might cause him a bit of a problem when he became a senator, and that incidentally he had the regulations changed at the time that he retired in order to entitle him to that $33,000 or $34,000 a year, Mr Stone defended his receipt of the benefit and said that it was not a matter of public interest. I can understand why he did not want it to be a matter of public interest, particularly when he plugs the line that he normally does. But it is a matter of public interest. In his article Paul Malone said this of Mr Stone: He said the benefit was derived from 30 years of service to the Commonwealth. He rejected the suggestion that the benefit was for people who retired, saying they were a condition of employment. To turn those words around a little bit but to express exactly the same position, the very unionists whom Senator Stone spends half his life condemning say, `We will not surrender hard won working conditions'. That is the common response from people in the industrial labour movement whom Senator Stone is forever condemning for adopting that attitude and therefore refusing to co-operate or not readily co-operating in the sorts of adjustments that need to be made because of changing economic circumstances. So there is one rule for Senator Stone, who will not surrender any of his hard won conditions of employment as a public servant for 30 years. But there is a totally different rule for people in the industrial labour movement, most of whom incidentally have incomes significantly lower than either Senator Stone's Commonwealth superannuation scheme pension or his senatorial salary. Not only do those people not have a double dip; the first dip is not as big as either of Senator Stone's. He has the effrontery to come in here with this motion and the sort of rhetoric that he has used in support of it today. Senator Chaney —Shooting the messenger. Senator WALSH —Senator Chaney says that I am trying to shoot the messenger. Well, Senator Chaney has also adopted the double standard. Other people, particularly those associated with the industrial labour movement, have to surrender what they call their hard won conditions of employment, but Senator Stone does not. Incidentally, Senator Stone mentioned the cutting of 200 programs, which is something to which I had referred and which is two Budgets out of date, as he knows very well. Indeed, since I first made that reference, we have taken $5 1/2 billion worth of expenditure cutting decisions. But some of the 200 programs that I had in mind are still left. Senator Stone's double dip is one of them. I do not know whether he wants us to do something about that. One of the more unedifying spectacles on the tory side of politics in recent times has been the trio of Stone, Howard and Fraser-the three points of a triangle-each blasting away at the other two in an endeavour to lay off the blame for having wrecked the Australian economy in the late 1970s and early 1980s. I must say that I almost fell off this bench when Senator Stone started to complain about the wages explosion of 1981-82. Who on earth does Senator Stone think was responsible for that if it was not the tory government of the day, advised as it was by him as Treasury Secretary that wages policies do not work and that it is best to let that issue work itself out in the market-place? The Fraser Government tried that. In May 1981 the Fraser Government formally abdicated any responsibility for a national wages policy and said, `Let the market-place work it out', acting on advice from Senator Stone. What happened? (Quorum formed) I was just saying that I heard Senator Stone condemning the situation which led to the wages explosions of 1981 and 1982. What caused those was the official abdication of responsibility, in May 1981, by the then Government, when it said, `We accept no responsibility for a national wages policy. We believe it should be worked out in the market-place'. Acting on the advice that Senator Stone had given the then Government, it was worked out in the market-place. What we got was a 13 per cent wage hike in 1981 and a 14 per cent wage hike in 1982, which, as Senator Stone has correctly, for once, said, was a major factor in the very high level of unemployment of 10.5 per cent in early 1983, and, of course, the 11.5 per cent inflation rate which this Government also inherited. I found a curious ambivalence about Senator Stone's speech today. On the one hand he seemed to be attracted to something that appeals to many case hardened tories. They like to have one day's or one year's experience repeated ad nauseam. They love reliving the past and never having anything changed. Half the time it seemed as if we were having a re-run of last week's speech from Senator Stone. I thought about incorporating my answer to it in the Hansard, to let us get on with the business of the Senate instead of wasting any more time on this silly urgency motion. On the other hand there was another half to Senator Stone's speech, which, however, was completely in conflict with the motion that he moved last week. The motion that he moved last week said that the Commonwealth Government has to get stuck into its own spending programs instead of passing the kick back down to the States through cutting State spending programs. But today Senator Stone took to task Senator Evans for failing to mention, in answer to a question, that although the Commonwealth Budget was in balance, the States were borrowing from the Australian capital market the equivalent of 3.3 per cent of gross domestic product. So on the one hand he said last week-as we would expect any truckler of Bjelke-Petersen's to say-that the Commonwealth Government should not be giving the States any economic shocks as a consequence of the circumstances we find ourselves in; it should confine all its adjustments to the Commonwealth's own purpose expenditures. On the other hand today he is implicitly saying to Senator Evans, and I suppose all the rest of us, that we ought to do something to jerk the States into line. He said last week that we should leave the States alone, and he says this week that we should jerk them into line. The Opposition is very gung ho on cutting government expenditure as long as it remains an abstract proposition and does not get down to any specific details. In contrast to Senator Stone's speech and the normal attitude of the Opposition, we have, as somebody else observed during Question Time, Senator MacGibbon wanting to spend another $100,000 on a junket for a couple of politicians to go off to the United Nations for three months. He is highly critical of the Government for cutting that out. The Opposition wants to pay pensions to millionaires, and, of course, it wants to go on double dipping. Those of them who are double dipping, such as Senator Stone, insist that they go on double dipping while simultaneously arguing that people whose first and only dip is less than either of their double dips should make the sacrifices and the adjustments. On the question of government expenditure, I am still waiting for the list of expenditure cutting programs which Mr Howard promised the Australian Broadcasting Corporation (ABC) on Tuesday of last week, and for a copy of which I formally asked him later that day, because I would be very interested to look at Mr Howard's list of spending cuts. He promised it to the ABC, but he obviously has not delivered it. We can assume from that only that he has welshed on the promise and he will not be providing it to the ABC or to me. But this draws attention to the double standards which the whole Opposition practises. We have not just Senator Stone's double standards, the double dip double standard, but the whole Opposition practice of the double standard of demanding in the abstract that expenditure be reduced, but when it comes down to the detail and the nitty-gritty actually argueing for increases in expenditure in various areas, all the way from the $40,000 that it wasted on a silly motion to suspend Standing Orders-incidentally, about $40,000 an hour, is what it costs to run the Senate, so about $40,000 went up the spout-and Senator MacGibbon would have us spend another $100,000 providing a junket for a couple of politicians in the form of a trip to the United Nations. Then we get down to the really big spending items, such as paying pensions to millionaires, which would cost at least another $300m, and to the building of the Alice Springs-Darwin railway, which would cost another $600m, and so on. Lest somebody says that the Opposition would save money in health expenditure, I want to blow that furphy out of the water again. The plain fact is that total health expenditure in Australia equals just under 7.5 per cent of gross domestic product. That figure has fallen in recent years-not gone up, as many people would have us believe. It is just under 7.5 per cent, and the present trend is that it is declining. In the United Kingdom it is just under 7 per cent, in Canada it is just over 8 per cent, and in the United States, which has the sort of health delivery system which the Opposition would inflict on Australia, if it had the opportunity, it is 11 per cent. To convert that into Australian dollars, on the size of the Australian economy and so on, that would mean extra spending on health of about $10 billion for a health outcome which is certainly no better, and arguably is inferior. There is no great mystery about why that has happened, because the United States health system combines the worst features of all systems. It allows for insurance and for medical services to be marketed to insured patients in a manner similar to the marketing of Coca-Cola or breakfast foods. Under those circumstances, where the supplier of the service is drumming up business and the user, so-called, of the service-although the use is normally instigated by the supplier-pays almost nothing directly but pays only an insurance premium, it is wholly predictable that there will be a cost explosion for no particularly good outcome. Yet that is precisely what the Opposition would inflict on Australia. Senator Stone —Mr Acting Deputy President, I raise a point of order. I have been sitting here listening with great patience to the Minister. I am not aware that the motion before the chamber has the slightest reference to our health system, nor am I aware that my own remarks made any reference to that matter which would justify this totally irrelevant tirade by the Minister about the health system. I wonder whether he would not mind, through you, Mr Acting Deputy President, addressing himself, just for the last four minutes of his remarks, to the motion before the chamber and saying something about the economy and what the Government proposes to do about it, if anything. The ACTING DEPUTY PRESIDENT(Senator Colston) —There is no point of order. I would expect that, on a motion such as this, Senator Walsh would be able to engage in a wide-ranging debate about matters financial. Senator WALSH —Mr Acting Deputy President, Senator Stone does not like my talking about health services, so I will talk about adjustments and resistance to making adjustments in Australia. I mentioned before that anybody who has obtained any sort of condition of employment or income level is reluctant to surrender it, although, more than anybody would have thought possible about four years ago, this Government, in co-operation with the Australian Council of Trade Unions, has secured agreement to a substantial and essential decline in real wages-something which had to happen because of the wages explosion in 1981 and 1982-in a period when economic growth was, by Australian standards, at historically high levels. So organised labour, the industrial labour movement or whatever one wants to call it, has made a substantial adjustment and has accepted the need to do so. Senator Stone, on the other hand, when it comes to his $34,000 a year Commonwealth superannuation scheme pension in addition to his parliamentary salary and whatever else he earns from the private sector through writing newspaper articles or whatever, refuses to acknowledge that there is anything untoward at all in his continuing to receive his $34,000 a year Commonwealth superannuation scheme pension and a parliamentary salary as well-a double dip from the public purse. He rejected the suggestion that the benefit was for people who had retired, saying that it was a condition of employment which is sacrosanct, although everybody else is expected to make adjustments and sacrifices. That is, of course, characteristic of the double standards which we have come to expect from the Opposition. On the question of the share market decline, the Government, as it has always done, will make adjustments when they are required and when there is adequate evidence upon which to make a judgment about what adjustments are necessary. Senator STONE(Queensland-Leader of the National Party of Australia) —Mr Acting Deputy President, I claim to have been misrepresented by the Minister for Finance (Senator Walsh). I will not detain the chamber long on the matter because, as we are all unfortunately painfully aware, the Minister spends his time in this chamber misrepresenting people. The Minister, in the course of his unsavoury remarks, made three specific references to me which I think need to be set right here and now and that is why I am on my feet again. First, the Minister accused me of double-dipping. The Minister is perfectly well aware that that term has nothing to do with a situation such as my own. The term `double-dipping' was inaugurated in 1983-and I can very well recall this because I was still working for the Treasury at the time-when this Government was introducing amendments to the superannuation arrangements relating to lump sums. It was a term designed to bring out the cases of persons who took lump sums, disposed of them and then, nevertheless, drew the age pension or in some other way went on to the public payroll. This occurred mainly in the private sector and to some extent, of course, in the State public sectors. At one time it did not occur in the Commonwealth public sector because lump sums were not available before this Government came to office. That is double-dipping. Senator Walsh knows perfectly well that it has nothing whatsoever to do with my situation, which is simply that of any Commonwealth public servant who, after 30 years service to the Commonwealth, becomes entitled to a pension-something which I make no apology whatsoever for continuing to draw. Secondly, Senator Walsh referred in an aside to the fact that I also write a newspaper column. That is perfectly true. I do, and I get paid for it. But in the process of saying that, he said `or any other emoluments which may not be publicly known', as though there were perhaps some other emoluments which I was not publicly owning to. I can assure the Senate that, apart from the one which is publicly known and to which Senator Walsh has referred, I have no other private emoluments of that kind, although I should say that if I did I would be perfectly entitled to them. Thirdly-and this was perhaps the most serious element of the misrepresentation, although the first two are certainly serious-Senator Walsh said, if I caught his words correctly, that I had had the regulations changed in order to allow me to draw my superannuation. I hope I am not misrepresenting the Minister's remarks; I believe that I am quoting him correctly. In fact, there were some very interesting developments at the time of my separation from the Public Service. Senator Walsh —Do you want me to table it all? Senator STONE —I would be very happy if the Minister did that and then we could have a full debate about it. I have never spoken about those matters, but if the day should ever come when I do, I can assure you, Mr Acting Deputy President, that they would form a very interesting story as to the manner in which the Ministers of this Government sought to behave at that time. If the Minister digs into those files a little more carefully than I think he has so far been able or allowed to dig, or becomes better informed, he will find a story there which will not bring much credit upon his Government and some of his colleagues. It is not a story which I have ever told in public because I have felt that my own lips were sealed upon the matter. But I am very happy to have every element of it brought out into the public arena. If the Minister wants to embark upon that course, I think he will find that he has a tiger by the tail. So I simply say that, in that respect also, my role in the scheme of things has been totally misrepresented by the Minister. But if he wishes to carry that point further, I will be very happy to accommodate him. Senator HAINES(South Australia-Leader of the Australian Democrats)(4.37) —I think it might be worth while pointing out that in fact this debate is not specifically about Senator Stone's income or anybody else's for that matter. Rather, the motion we are debating calls for immediate fiscal and wage action to respond to the effects of the stock market crash. Perhaps it would be useful if we spent the next few minutes actually concentrating on those particular elements of Senator Stone's urgency motion which is before the Senate today. In point of fact, insofar as action is necessary in the domestic economy, the Government already seems to be doing what Senator Stone suggests; that is, taking some action through, for example, the Reserve Bank of Australia. Of course, as we all noted last week, the Western Australian Government, in concert I might add with some of the wealthiest businessmen in the country, also acted to prevent an unfortunate incident occurring with regard to Rothwells Ltd. As it happens, I believe that that was an improper use of taxpayers' money. Nevertheless, governments, both federally and at State levels, have taken some fiscal action in response to the recent changes. As far as wider adjustments to wages and fiscal policy are concerned, that would surely, I would have thought, depend on what happens to our trade prospects and to international capital movements following the share market collapse. Since it is not clear yet what the effects of that crash will be, it is hard to know what specific action this Government or State governments could take without acting precipitately, giving the appearance of panic and hence causing loss of confidence both domestically and internationally. I suggest that almost all economists are in agreement in that respect. A significant article in last Friday's Australian Financial Review quoted what economists are saying about Government action. In that article, which was headed `Sit tight and assess things as they unfold', Professor John Nevile made the point that in his view: the Government is right in not doing anything dramatic. We don't want to make the problem appear more dramatic and more important than it is, and in any case the options for doing very much are not great. He went on to say: . . . I don't think there is any need for the Australian Government to do anything additional to screw down the hatches . . . The Government should have a masterly policy of doing nothing. Professor Warren Hogan added to that by saying: Initial policy responses should be directed to restoring confidence in major funds markets, most of all bond markets, with active leadership from the Reserve Bank- which, as I have indicated has already stepped into the picture. Dr Neville Norman said: Real dangers will attend any sharp chop in government spending if, having failed to do it before, the Hawke Government now compounds the coming recession. Rob Campbell from the Housing Industry Association stated: The Australian Government must provide firm leadership and not be panicked into any hasty and ill-considered policy adjustments. Geoff Carmody from ACIL Australia made similar comments. Alex Erskine said that a pre-Christmas budget is-- Senator Stone —I think Mr Carmody said rather the reverse, didn't he? Senator HAINES —He talked about our being overgeared and to that extent he may well have been implying that we ought to do something about the overgearing. But I do not think he was suggesting that we need to panic ourselves into precipitate action. As I was saying, Alex Erskine said: In view of the uncertain outlook and the danger of unnecessarily stifling domestic economic activity, a pre-Christmas mini-Budget is a dreadful prospect. By and large Australian economists are arguing for quite the reverse of what Senator Stone is suggesting in this matter of urgency: they are advising the Government to sit tight. If anything the Government should be contemplating an expansionary fiscal policy with some stimulation coming from moderate wage increases of which I intend to say a little more later. What have been the economic developments since the Budget, which this matter of urgency refers to as an August Budget but which was brought down in September? They are none other than what has been known as a share market meltdown that started on Wall Street two weeks ago and subsequently cut something like 40 per cent off the value of Australian shares. This returns them to levels that prevailed a year or so ago and, incidentally, to levels where the yields are much more realistic than they have been for the last 12 months or so. As I mentioned earlier, since that occurred we have witnessed one Australian merchant bank being saved-if I can use that word-for the time being by the combined action of the Western Australian Labor Government and certain Australian millionaires. On Friday the Reserve Bank of Australia, quite properly, provided funds for the Challenge Bank when its reserves were challenged by depositors withdrawing funds following rumours that the bank was in trouble. In these instances action was taken by governments or government instrumentalities and I am surprised that the Opposition parties support these regulatory and interventionist activities and seem to be calling for more, given their previous ideological stance on this issue. Governments have already acted and, as I have said, the Western Australian Government supported that financial institution and the Reserve Bank, quite properly, supported the Challenge Bank with the liquidity it needed. We do not know yet which Australian financial institutions, stockbrokers and public companies will be adversely affected by the stock market plunge. It is a matter of waiting to see and responding, as most of the economists I have just quoted indicated, to circumstances as they arise. Therefore, it is a matter of responding to individual cases unless a general collapse of our financial markets appears to be imminent. As yet there are no grounds for believing that as most of the people interviewed for that Australian Financial Review article indicated. Professor Hogan noted elsewhere in that article that most of the dumping, it would seem, was due to foreign investors selling their Australian shares as a general panic measure. As I said last week in a debate similar to this debate, the situation was made worse by the fact that the Hong Kong Stock Exchange was closed down. We all know that foreign investment, by its very nature, is a fair weather phenomenon. Those who have wooed foreign investment in the past should realise by now that in the past depressions and severe recessions we have experienced on a world scale, foreigners tend to withdraw their investment as they seek security closer to home or, as do some domestic investors, to offset other problems they have. It is, so to speak, the downside of an investment boom that when things go bad investment is withdrawn. It happened in the late 1880s, again in the 1930s and we have seen something similar happening in the last couple of weeks. Those treasurers and advisers who made the Australian economy dependent on foreign investment may yet witness the phenomenon again. I repeat the call I have been making ever since 1981 that Australian governments must act to restrict or to regulate severely foreign investment in this country if they do not want to see our economy severely undermined by panic stricken foreign investors. Senator Stone's matter of urgency calls for the Government to revise its fiscal and wages policies without further delay. We have already had a series of contractionary financial measures cutting expenditure since the 1986-87 Budget. For example, the Government has postponed the normal consumer price indexation increase of pensions; it has imposed tertiary fees and taxed items such as fruit juice and milk; it has reduced social security payments to the young unemployed and has caused additional problems in the farming area by the assets testing of unemployed benefit recipients. All of this has been done in the name of fiscal responsibility to achieve a balanced Budget to please foreign financiers and the New Right. The same working Australians whose real wages have fallen since 1983 have been forced to bear the brunt of fiscal restraint already instituted by this Government. The tax cuts delivered by the Keating tax reform package were also of greatest benefit to those who were the most well off-the highest income earners. Average and below average income earners, and certainly social security recipients, have done rather badly under the Labor Government as it sets out to woo its big business friends both here and overseas. Yet this Government is proposing to further lower business taxes despite the fact that, as I said in debate last week, our corporate taxes are the lowest in real terms of those of all Organisation for Economic Co-operation and Development countries except Turkey. The contribution made by company tax to revenue has fallen steadily from 17 per cent 15 years ago to less than 10 per cent now and the effective rate of tax paid by many of our top companies is less than 15c in the dollar. Again as I said last week, it is the principals of many of those companies who are bleating about the fact that they need further assistance from governments. What we need in this country is to stop negative gearing on borrowings for company takeovers which increases our foreign indebtedness and reduces the taxes those companies pay. In addition, we need to tax that part of the profits made by superannuation funds which comes from investment overseas. The revenue gained from that must be used to increase social security payments, particularly payments to the elderly and families, and to reduce taxes for the poorest, rather than the richest, Australians. Since something like 2 1/2 million Australians live in poverty, wage restraint and fiscal restraint, of the sort advocated by the Opposition, would again be at their expense. To compensate for this increase in the disposable income of average and poor Australians spilling over into imports, the Government should apply bigger taxes on the luxury imports such as caviar and champagne. At the moment I find myself in much the same position as Senator Walsh was in recognising the similarity in this matter of urgency to one that was debated last week. I find I am constantly referring to things I said last week and the week prior to that. The second part of Senator Stone's matter of urgency refers to wages restraint. We need to remember that the biggest wages blowout occurred in Australia under the Fraser Government and it came as a consequence of the economic advice that Government was given by the current advisers. This point was made particularly well by Paul Malone in his article in the Canberra Times last week in which he pointed out that since then real wages have continued to slide. He stated: According to the latest Australian Bureau of Statistics figures the share of the national cake going to wages was 56.8 per cent, the lowest figure for at least 12 years. Before the crash the top 1 per cent of adult Australians, according to the Australian Financial Review, held about one-quarter of all private wealth in the country. About 40,000 people were estimated to have net wealth of over $1 million. No doubt aware of this fact and the fact that ordinary wage and salary earners are bearing the brunt of fiscal restraint, the Government announced last week its support of a flat $6.50 increase from 1 January next year. Employers and the Opposition have argued that this is unjustified and they have opposed the increase because they believe it is inappropriate following the stock market collapse. Strangely, these same people were just as vehemently arguing for wage restraint when the market was booming. One wonders whether they ever believe there is an appropriate time for wage increases. Now is not the time to cut wages. To do so will further depress spending and consumption and increase unemployment. The price of a no wages increase policy would be an increase in industrial disputation and will, as I said before, affect those most at risk, on low pay and on the margin of poverty. It sits ill, I might add, with the action by Mr Alan Bond to offer millions of dollars to his senior executives to remain with his companies. It seems to me that of all the suggestions made by the Opposition and business leaders, this one relating to wage restraint-- The ACTING DEPUTY PRESIDENT(Senator MacGibbon) —Order! The honourable senator's time has expired. Senator HAINES —Could I at least finish the sentence? The ACTING DEPUTY PRESIDENT —The question is that the motion of urgency proposed by Senator Stone-- Senator HAINES —Mr Acting Deputy President, I understood that we were having three speakers, one from each party and for 20 minutes apiece and that we were not proceeding with additional speakers on those grounds. I think I could at least be entitled to finish that sentence. I seek leave just to complete the last part of what I was saying. The ACTING DEPUTY PRESIDENT —Senator Haines, Standing Orders apply, but if you wish to seek leave, you can seek leave. Senator HAINES —I so seek leave, Mr Acting Deputy President. Leave granted. Senator HAINES —The point that I was making was that there is some apparent hypocrisy in what is being argued with regard to wage restraint in the light of the stock market fall. It seems to me that this particular suggestion is one of punishing the poor for the errors of the rich; it is most hypocritical and is not to be tolerated. Question put: That the motion (Senator Stone's) be agreed to. The Senate divided. (The President-Senator the Hon. Kerry Sibraa) Ayes . . . . . . . . . . . 29 Noes . . . . . . . . . . . 34 —— Majority . . . . . . . . . 5 —— Alston, R. K. R. Messner, A. JArcher, B. R. Newman, J. M.Baume, Michael Panizza, J. H.Baume, Peter Parer, W. R.Bjelke-Petersen, F. I. Patterson, K. C. L.Boswell, R. L. D. Puplick, C. J. G.Brownhill, D. G. C. Reid, M. E. (Teller)Calvert, P. H. Sheil, G.Chaney, F. M. Short, J. R.Chapman, H. G. P. Stone, J. O.Durack, P. D. Tambling, G. E. J.Hill, R. Vanstone, A. E.Knowles, S. C. Walters, M. S.Lewis, A. W. R. Watson, J. O. W.MacGibbon, D. J. Aulich, T. Haines, J.Black, J. R. Jenkins, J. A.Burns, B. R. McKiernan, J. P. (Teller)Childs, B. K. McLean, P. A.Coates, J. Macklin, M. J.Collins, R. L. Maguire, G. R.Colston, M. A. Morris, J. J.Cook, P. F. S. Powell, J. F.Cooney, B. Ray, RobertCoulter, J. R. Reynolds, M. E.Crowley, R. A. Richardson, G. F.Devereux, J. R. Sanders, N. K.Devlin, R. Schacht, C. C.Evans, Gareth Sibraa, K. W.Foreman, D. J. Tate, M. C.Gietzelt, A. T. Walsh, P. A.Giles, P. J. Zakharov, A. O. Crichton-Browne N. A. Button J. N.Hamer, D. J. Behan, M. E.Teague, B. C. Ryan, S. M.McGauran, J. J. Bolkus, N.Bishop, B. K. Jones, G. N. Question so resolved in the negative. The PRESIDENT —I present the first report for the sixty-third session of the Procedure Committee, relating to the publication of tabled papers. Ordered that the report be printed. Ordered that consideration of the report be an Order of the Day for the next day of sitting. Senator BROWNHILL(New South Wales)(5.00) —I move: That the Senate take note of the paper. Having been in Canberra for some time now, what has impressed me about this city is that it has a different visual appeal from that of most other Australian cities. The city of Canberra is beautiful and should be kept that way. In the past few months, like most other senators, I have had a number of visitors to Canberra, and speaking as someone who spends a fair amount of time in Canberra, I have seen a great deal of development taking place in this city. What concerns me-and I expressed this concern a year ago when I spoke in the Senate on this subject-is that development in Canberra appears to have gone mad. Last year I was complaining about medium density housing in the Kingston area. The developments started out years ago as single storey buildings, but they then exploded into high rise buildings on every corner. Canberra is fast losing its uniqueness and becoming just like every other city. Burley Griffin's concept for Canberra was to have buildings no higher than about three storeys. The parks and gardens that surround Civic are being gutted to make way for car parks. That is a matter of great concern to anyone who drives across the city and who looks at the scene from the new Parliament House, which, when completed, I believe will be one of the great buildings of Australia. I wish to put on record the condemnation of people in this city at the gutting of Canberra's green spaces and gardens for the purpose of car parks. The city is becoming crowded and cluttered and not in keeping with Burley Griffin's original plan. Canberra does not need multistorey buildings, such as we are seeing, of ever-increasing size and ugliness. I register a plea that we retain Canberra's tree-lined, quiet image, and I hope that that image will continue. Question resolved in the affirmative. Senator PUPLICK(New South Wales)(5.03) —I move: That the Senate take note of the papers. These reports bring forward the opportunity once again to say a few words about medical research in Australia. Medical research is one of the jewels in the crown of Australian science achievement and a cause of considerable pride to this nation. A considerable contribution is made by Australian doctors and scientists to the world in general. The reports for 1984 and for 1985 are slightly different in some respects. The 1985 report complains about the cuts in medical research funding. The report indicates that the funding of $45.712m made available to the National Health and Medical Research Council (NHMRC) for the support of medical research in 1985 represents a standstill in real terms. Fortunately, the 1986 report is able to show that funding in the 1985-86 Budget to medical research was significantly increased, resulting in an increase of 22 per cent-or 11 per cent in real terms-to $55.850m. If one looks at the Budget Statement in the current year, one sees that medical research grants will rise to $64.4m in 1987-88, an increase of 9.4 per cent. The 1985 report indicates the important step taken by the Council in establishing an Animal Experimentation Ethics Committee to ensure a minimum degree of public disquiet about the use of animals in experiments-something that continues to be necessary, but which has to be controlled and monitored in a humane and sensible fashion. I have great faith in the NHMRC being able to do that. As Senator Peter Baume said last Thursday, the NHMRC is a body which commands a wide degree of respect and trust in the community. The 1986 report draws attention to the Council's Medical Research Ethics Committee being involved in activities related to in vitro fertilisation (IVF) centres in Australia and the production of a report by the NHMRC entitled In-Vitro Fertilisation Centres in Australia. Their observance of National Health and Medical Research Council Guidelines. The report stated that no centre had allowed cloning experiments or surrogacy arrangements, and that no research had been undertaken which would normally allow an embryo to develop in vitro beyond the stage at which implantation would normally occur. It records by and large the extremely important work carried out by these IVF centres around Australia and their comprehensive adherence to the guidelines laid down by the Council. I believe that Australia has a quite outstanding record in medical research. For example, in combating acquired immune deficiency syndrome (AIDS) the work that has been done by Professor Penny, the work previously done by Professor Penington, and the work that is being done by Professor Dwyer in Sydney are at the forefront of research. I pay great tribute to the Government on this occasion which has been generous in providing funds for AIDS research and in providing funds for medical research in Australia. It is one of the areas in which Australia makes an outstanding contribution. It is an area in which the interest shown by both sides of Parliament in providing adequate funds needs to be recognised. I congratulate the NHMRC on its 1985 and 1986 reports and I look forward to a 1987 report which indicates the continuing progress in a number of fields that are of vital concern to all Australians. Senator COONEY(Victoria)(5.06) —I should like to say a few words on the reports of the National Health and Medical Research Council (NHMRC). I join Senator Puplick in saying that medical research is very much the jewel in the crown of research endeavours in Australia. It should provide a model for research in other areas. It shows that Australia can be in the upper ranks of research throughout the world. That has certainly been recognised in Victoria and the Victorian Government has taken considerable steps in the right direction. Following what Senator Puplick said, it is good to know that there is a bipartisan view that funds for research should continue. I say with some pride, and perhaps a degree of parochialism, that much medical research is carried out in Victoria. I shall be jingoistic enough to mention the Florey Institute, the Baker Institute and the Walter and Eliza Hall Institute of Medical Research where a great deal of the research in this area is carried out, and carried out extremely well. Senator Peter Baume —We had a few Victorian Prime Ministers, you see. Senator COONEY —It is the quality of intellect that comes from Victoria which has been generally recognised on a bipartisan basis. There is a bipartisan approach not only in recognition of the research but also in appreciation of the great quality of politicians whom we send from Victoria to Canberra. The ACTING DEPUTY PRESIDENT(Senator MacGibbon) —Order! Senator Cooney, this is a serious debate. Senator COONEY —If we examine the project grants that have been made through the NHMRC over these two years, we see the very wide range of research that has been carried out through this institution. I mention one example, on page 39 of the 1985 report, and that is Q fever in meatworkers. This illustrates how vital the work of the Council is. A vaccine has been developed to enable meatworkers to avoid the serious onslaught of Q fever on their earning capacity. This disease has been of particular concern to the Australasian Meat Industry Employees Union, and particularly its Victorian division. Mr Wally Curran, who for some years has been secretary of the union's Victorian branch, has been concerned about the diseases that meatworkers can attract in the course of their employment. He has taken a strong lead in his union to press for the sort of vaccine that has been developed through the NHMRC. The Council is to be congratulated. The Victorian branch of the Australasian Meat Industry Employees Union, under the leadership of Mr Curran, is also to be congratulated. The National Health and Medical Research Council has achieved mighty things and it will achieve mighty things in the future. With the practical example I have given, it is achieving a better lifestyle and quality of life for Australians generally. I join Senator Puplick in congratulating the Council on the two volumes that it has produced and I wish it all the best for the future. Senator PETER BAUME(New South Wales)(5.10) —The annual reports of the National Health and Medical Research Council (NHMRC) of 1985 and 1986 both make reference to the work of the Medical Research Ethics Committee. From the 1985 report at page 73, it is clear that the Ethics Committee has started to examine the adequacy of institutional arrangements. On pages 8 and 9 of the 1986 report are set out some of the activities of the Medical Research Ethics Committee during 1986. These include the establishment of guidelines for in vitro fertilisation (IVF) and related research. There has been a considerable amount of noise, heat and emotion generated over these difficult questions of bioethics. They have been raised in the Senate recently and the Minister Assisting the Minister for Community Services and Health (Senator Ryan) has been asked to clarify some of the positions relating to committees to oversee bioethics research. The NHMRC plays a pivotal role in ensuring that Australian research workers-particularly in the area of bioethical research related to IVF-display adequate ethical standards. We face very real difficulties today and we will face greater difficulties in the years to come. On the one hand, we have the world of science, which is concerned with the capacity of people to carry out and develop techniques. On the other hand, we have the world of philosophy-particularly the world of moral philosophy-which is concerned with trying to identify the proper ways in which we should behave. Particularly in IVF and related research, the two areas overlap and intersect. The difficulty is that we have a clash between one world which uses one language and one set of values and another world which uses another language and another set of values. I happen to believe that it is quite possible to resolve the difficult ethical issues in these bioethical areas, in the areas of IVF and related research. I believe that the NHMRC is the best vehicle we have available in Australia. It is proceeding to examine these matters and it will give us the right answers. It will involve some brokerage between ministers of religion, who have one particular view, and scientists, at the other extreme, who may have a different point of view, and also between citizens, who want to see the benefits of IVF available to them but who want to avoid the excesses which have occurred at different times in history. I make a plea, particularly in view of some of the discussions we have had in the Senate in the past week or so, that any discussion be calm, considered, moderate and conciliatory. Not everything we have heard in the Senate recently has fulfilled those criteria. While the Parliament awaits a response from the Government on the report of the Senate Select Committee on the Human Embryo Experimentation Bill 1985, I remind the Senate that a committee consisting of five or six senators does not, of itself, represent the Senate and the Senate Committee work on this question of IVF-important as it is-is only one of the inputs which this Government will be receiving on this important matter. The NHMRC will be another important input. I stress that there are functions of the Executive Government which belong to the Executive Government alone. One of those is to make decisions of the kind that are before it now. I have never heard a proposition that the Government is obliged to accept the findings of a Senate committee. Such findings should constitute one of the inputs. I hope that on these matters, which were dealt with in the NHMRC report, the Government will not allow its proper role to be pre-empted. Senator BROWNHILL(New South Wales)(5.15) —I would also like to congratulate the National Health and Medical Research Council (NHMRC) on its 1985 and 1986 reports which are before us today. I note that in the 1986 report there is some $55.8m more in this current financial year for medical research, which is an increase of 22 per cent and which is wonderful. It is always very difficult to allocate funds for research projects as there will always be more projects seeking funds than there is money available. Two of the organisations that I have been associated with recently are the Children's Medical Research Foundation and the Australian Cancer Society. People in my home town of Quirindi, who have been raising money for very worthwhile causes, should be congratulated on what they have done for medical research. In 1986 the Council had sufficient funds to provide support for 752 projects grants and 19 program grants compared with 734 projects and 18 program grants for the year before. In 1986 the allocations were made from a total of 970 applications, so the task of the National Health and Medical Research Council in allocating the money it has is not an easy one. Additionally, funding is always granted to such worthwhile institutes as the Florey Institute, the Baker Institute and the Walter and Eliza Hall Institute of Medical Research. I have had a small involvement with the NHMRC through the Senate Select Committee on Animal Welfare, as many research projects depend on the use of animals. Last year was the first full year of operation for the Animal Experimentation Ethics Committee. Membership of this Committee includes medical research workers, veterinarians, people with extensive experience in animal welfare and distinguished lay persons. Only four of the 11 committees are recipients of NHMRC funds for medical research. The NHMRC first introduced guidelines for the use of animals in experimentation more than 20 years ago. Today the criteria are much higher than they have ever been. This year a complete revision of the guidelines is to be undertaken, which I commend. The work of the Senate Committee has been extensive with examination in areas such as experiments using native mammals, experiments on pain and stress-which is something which has to be looked at very carefully-and strategies for minimising the number of animals used. The NHMRC is to be congratulated for its responsible approach to the use of animals in science. It is always a difficult question to respond to and in a perfect world such use should not happen, just as pain, suffering and sickness should not occur. However, the facts in the real world are that they do. Therefore, until computer modelling or some other breakthrough can be found, animals will continue to play a vital role in medical research. Committees such as the Ethics Committee will therefore continue to play a vital role in monitoring current medical research practice that involves animals. I commend these two reports to the Senate. Question resolved in the affirmative. Senator PUPLICK(New South Wales)(5.19) —I move: That the Senate take note of the paper. I seek leave to continue my remarks later. Leave granted; debate adjourned. Senator ALSTON(Victoria)(5.19) —I move: That the Senate take note of the paper. The 1986-87 annual report of Aussat Pty Ltd marks the first full 12 months of commercial satellite operations for Aussat. What is significant in this financial year is that Aussat is now in a position where it is devoting the bulk of its attention to making available leasing capacity on the satellite. To date more than 80 per cent of available inter-orbit transponder capacity is in use. The real difficulty facing Aussat is that it simply does not have the financial wherewithal to expand its activities in a way that I believe is critically necessary at present. There can be no better example of the financial stringency which applies to Aussat and a number of other government-operating institutions than the situation that applied when the third satellite was launched in September this year. Although it was almost 12 months later than originally had been planned, it was possible to obtain only partial insurance cover for the launch. That is an indication of the extent to which Aussat has been sailing very close to the wind. Senator Puplick —Flying close to the wind. Senator ALSTON —Yes, that is more accurate. Aussat will need very substantial funds in the not too distant future. At present there is an application before the Federal Government seeking funds of the order of $500m to $600m to enable Aussat to take up the second generation system. Each of the present satellites has a design life of seven years. Therefore, the first two satellites are expected to exhaust their positioning fuel during 1992-93. The Government's response to date has been to consider a merger of the operations of Aussat, the Overseas Telecommunications Commission (OTC) and Telecom Australia rather than to consider the provision of the necessary funds. This is yet another example of the way in which the amount of funds available to state-owned authorities is rapidly diminishing. It is a matter of great regret that the Government is seriously prepared to consider such a proposal rather than to look at the benefits that derive from competition between Telecom, OTC and Aussat. To date there has been relatively little competition. I think it is fair to say that only 7 per cent of Telecom's lease line capacity is in direct competition with Aussat satellite space. That does not pose any real challenge to Telecom at present. There is absolutely no justification, therefore, for even contemplating a merger. If Aussat is allowed to grow and develop, it has very real prospects. It has already set up a corporate data communication system known as Starnet. Its activities in relation to providing private television groups like Sky Channel, with direct access to hotels, clubs and entertainment areas, is well known and appreciated. Aussat has a great deal of potential, but unfortunately it is still operating at a loss. It has a very high gearing ratio. Even in the present financial year, despite an increase in revenue from some $46m to $74m, it still returned an operating loss, after tax, of nearly $18m. It is fair to say that, unless additional financing is readily made available to secure the early provision of the replacement satellites, Aussat will be crimped for funds, its activities will not enable it to compete in the international market-place and it will not be able to assist in export regeneration in the communications industry. I hope that the tabling of the annual report will lead to much greater public discussion and a much greater sense of urgency on the part of the Government which will enable Aussat very quickly to obtain the funds it needs to remain in healthy and vigorous competition with other private sector communications authorities and, as a result, be an institution we can be truly proud of in the international arena. The ACTING DEPUTY PRESIDENT(Senator MacGibbon) —Order! The honourable senator's time has expired. Senator PUPLICK(New South Wales)(5.24) —Mr Acting Deputy President, I seek leave to continue my remarks later. Leave granted; debate adjourned. Senator BJELKE-PETERSEN(Queensland)(5.25) —I move: That the Senate take note of the paper. I congratulate the Australian Bicentennial Authority on an excellent report which contains details of the various events that will take place throughout Australia next year-in 1988, our bicentennial year. One of the very first items listed is the arrival of the tall ships and I am looking forward to being in Sydney on the day that they arrive. Indeed, as the wife of the Queensland Premier, I will get an invitation to do so. In May this year I had the opportunity of visiting some schools in Washington and New York where some young people were writing letters to children in Australia in the exchange of letters `schoolmates' program. A number of those letters will arrive in Australia on the tall ships. Events will be held in all the States but, as a Queensland senator, I am most interested in Queensland. Another event listed in the report is the around Australia air race. Senator Collard, who is no longer a member of this place, has been very involved in helping to organise that race. I am sure that some of our forefathers who landed in 1788 would have little realised that 200 years later one of the bicentenary activities would be an around Australia air race-not a boat race with the tall ships, but an air race. That is something that will be very worth while. Work is being done on a museum in Kingaroy as a bicentennial project. That museum will contain old peanut threshers and planters which will help us recall some of the hardships the pioneers had to put up with in the early days. I would have dearly loved the museum to contain my husband's old peanut thresher which he built many years ago. It was not a bad effort to have been able to build a peanut thresher when these machines were first mooted in the early days and this shows his ingenuity. The Great Barrier Reef Wonderland, a Queensland promotion for the bicentennial commemorative program, was opened on 24 June by the Prime Minister (Mr Hawke) and the Queensland Premier. I have had the opportunity to have a look at it. One does not have to go out to the Great Barrier Reef any more to see all its beauties. One can walk through the Barrier Reef Wonderland and feel that one is almost on the reef. One of the sections has a special wave action. I recommend Barrier Reef Wonderworld to anybody visiting Townsville. They will enjoy seeing it. Out at Longreach is the Stockmen's Hall of Fame-a tremendous effort. This huge building will contain examples of the different things that have been used in Queensland over the years. I am delighted that many tourists will visit the town of Longreach, which is the centre of western Queensland. People will be able to go there and see some of the history of that part of our State. World Expo 88, which is being held in Brisbane next year, will be a wonderful occasion. It will be a six-month display. Although the report states that 35 nations intend to participate, 42 nations will now take part. I recommend Expo 88 to everyone. The ACTING DEPUTY PRESIDENT — Order! Under Sessional Orders, the time for the debate has expired. Motion (by Senator Tate on behalf of Senator Gareth Evans) agreed to: That, notwithstanding anything contained in the Sessional Orders, the order of Business on Tuesday, 3 November 1987, be as follows: (1) Petitions (2) Notices of Motion (3) Discovery of Formal Business (4) Government Business (5) at 3 p.m., Questions (6) Any proposal pursuant to Standing Order 64 (7) Consideration of Government Papers pursuant to Sessional Order (8) Further consideration of Government Business (9) Adjournment. Debate resumed from 27 October, on motion by Senator Reynolds: That the Bills be now read a second time. Senator STONE(Queensland-Leader of the National Party of Australia)(5.31) —The Commonwealth Borrowing Levy Bill 1987 and the Commonwealth Borrowing Levy Collection Bill 1987-which is the machinery Bill whereby effect can be given to the Commonwealth Borrowing Levy Bill-are being debated cognately. I hope to deal with both fairly briefly. The Opposition does not oppose these Bills. As honourable senators would be aware, these Bills have the function of replacing the legislation which was put on the statute books only 12 months ago by the Government to provide for a Commonwealth guarantee charge. That legislation provided for the imposition of a charge on those Commonwealth authorities seeking a Commonwealth guarantee on borrowings that they might make in the capital markets. It has been found-I think in effect it was possibly predictable, although it is easy to be wise after the event, as we all know-that the original legislation simply did not work very well, if I may use mild language. Although these Bills aim, and their predecessors aimed, at an objective with which I think we on this side of the chamber entirely agree, their predecessors did not very effectively attain that objective. In other words, in the last 12 months, the Government has discovered that authorities which were government-owned actually had an implicit guarantee on any borrowings they made by virtue of their government ownership. Thus even those authorities which did not actually seek from the Government an explicit guarantee on their borrowings and, therefore, paid no guarantee charge last year, nevertheless found that the markets treated their borrowings, to all intents and purposes, as being implicitly guaranteed by the Commonwealth. I do not want to imply that the markets put precisely the same capital market rating upon paper issued by those authorities, which were only implicitly guaranteed, as it put on the borrowings of equivalent authorities which were explicitly guaranteed. But I think experience has shown that the difference between the two was really very small and certainly not of a magnitude to justify, as a commercial decision, the application by those authorities for an explicit guarantee. As events have turned out, it would have been an unwise commercial decision for them to do so and that is why that original legislation has been rendered ineffective by the judgment of the markets. As I have said, we now have this legislation to replace that earlier failed legislation. I repeat that those earlier Bills aimed at, and these Bills aim at, an objective with which I and the Opposition generally entirely agree. Perhaps it is best expressed in the statement of the Minister for Local Government (Senator Reynolds) in her second reading speech in these terms: . . . to ensure that the effective cost of borrowings to authorities- that is to say, the Government authorities- was more directly comparable with that faced by private sector borrowers . . . Or borrowers of an equivalent stature. To the extent that that objective sought to put governmentally-owned authorities on to a level footing with competitors certainly in the capital markets, it is an entirely desirable objective and remains an entirely desirable objective, and we agree with it fully. As a consequence, we will support this legislation. Of course, these authorities will become subject to the proposed new levy only when they actually undertake borrowings. I suppose that one of our problems in this country for some time now-it is certainly no less today-is that a very large volume of public sector borrowings are still going on. During the course of Question Time today Senator Gareth Evans responded to a question and implied that the present Commonwealth Government could congratulate itself-this is a practice in which Senator Evans is proficient-for the fact that the Commonwealth Budget deficit is now smaller, as a proportion of gross domestic product, than the United States of America Federal Budget deficit. I am prepared to accept that it was inadvertence on the part of Senator Evans, because I understand him to be rather ignorant of these matters, that his comparison failed to refer to the fact that the key element is not the Federal Budget deficit but the total public sector borrowing requirement over all levels of government, whether in the United States or here. In Australia, the State governments and their instrumentalities are very large borrowers. Therefore, notwithstanding the relatively small deficit in the Commonwealth's own Budget, leaving aside the fancy accounting which produces that to some degree, the total public sector borrowing requirement in Australia is still appreciably higher than the total public sector borrowing requirement in the United States. I make those remarks in passing in order to draw out the point that this total public sector borrowing requirement is the one on which our attention should be focused. Of course, in the present circumstances and without going over ground already covered in the urgency motion in the chamber this afternoon, given the very poor performance of most of the State governments-I think Queensland is a notable exception-in bringing down their Budgets recently, we still have a level of total public sector borrowing requirements in this country in 1987-88 which is far too high. In those circumstances, whatever one may think of the present state of the Commonwealth's Budget deficit, it still remains the case that the Commonwealth has a public duty, in terms of its responsibilities for macroeconomic management of this country, to move its Budget into surplus in order to offset the dereliction of duty on the part of State governments, not least the New South Wales Government which, as I observed in a different context, I think last week, has been awarded the order of the lemon, so far as State budgeting is concerned, by the States Policy Unit of the Institute of Public Affairs in Perth. This was awarded a week or two ago after the Institute had surveyed all the State Budgets. The total public sector borrowing requirement is the deficit of the Commonwealth and the deficits of all the States, the borrowing requirements of the State authorities and the borrowing requirements of Commonwealth authorities. It is the borrowings by Commonwealth authorities which are the subject of the Bills before us this afternoon. Which are those authorities? Of course, they cover a quite diverse range of instrumentalities, but the major ones within the Commonwealth's field of operation are authorities such as Qantas Airways Ltd and Australian Airlines. The Commonwealth Banking Corporation, however, is not covered by this piece of legislation because it is a financial intermediary and as such is seen in the financial markets as a financial intermediary rather than a Commonwealth authority. As I have said, the legislation covers Australian Airlines and other bodies such as the Australian National Railways Commission. Of course, those bodies may very well need to undertake borrowings from time to time. Indeed, that is one of the great problems that the two instrumentalities that I referred to-Qantas and Australian Airlines-have. They will both have to spend very considerable amounts of money on capital re-equipment programs and therefore they will almost certainly have to be in the capital markets to raise such capital. Of course, this is one of the reasons we have had a certain amount of scurrying around on the Government's part recently to terminate the two-airline agreement in order to put even greater pressure on Australian Airlines so that in turn the Government's proposals, as yet undeclared, for the privatisation of Australian Airlines will take on a more persuasive coloration. There will be a very similar effect upon Qantas which, if anything, has even larger capital requirements than Australian Airlines is likely to have. Those remarks having been made, I think I need do no more than say that the Opposition will not oppose these Bills but draws the attention of the Senate to the fact that, had a little more thought been applied to the question at issue before the Bills which preceded these were brought into this chamber a year ago, we would not be spending further time on this matter today. Senator MACKLIN(Queensland)(5.44) —We are debating the Commonwealth Borrowing Levy Bill 1987 and the Commonwealth Borrowing Levy Collection Bill 1987 which, as Senator Stone has already said, is a substitute for the Commonwealth Guarantees (Charges) Act of 1987. Basically, the concept is to allow a levy on all borrowings by semi-government authorities at a rate not exceeding 0.5 per cent. In the debate on this Bill in the House of Representatives, it was notable that a great deal of time was taken up in discussion of the notion of privatisation. These very government and semi-government authorities will be the subject of the privatisation debate as it continues through this year, presumably getting a bit of a hiccup on the graph when the Australian Labor Party Conference takes place, and finally coming to some type of fitful conclusion, presumably next year, when we may see some legislation arising out of it. I want to concentrate on the issue of the semi-government authorities' borrowings and look at it from the point of view of whether the country benefits from the existence of those semi-government authorities or whether the privatisation debate has substance. Unfortunately, the debate consists of a number of myths, many of which have not been clarified and many of which are simply assertions that something is good and something else is bad. The Government obviously, in terms of its new-found fervour for privatisation, as expressed by the Prime Minister (Mr Hawke) and the Treasurer (Mr Keating), is looking at the money coming in as a result of selling off public assets. These sales will then assist the Government in next year's Budget to announce a budgetary surplus. The Government has embraced the view that a Budget surplus is a good thing because it pleases the domestic and foreign businessmen and bankers. But, unfortunately, selling off public enterprises will give the Government a once only flow of revenue, in the year that that revenue is received. It is important to realise that this is a once only injection of revenue. The same public enterprises cannot be sold every year. Therefore, the sale will create further reductions in subsequent Budget revenues, for the very real reason that there will be no future revenue from those public enterprises which make profits and remit some of those profits to Consolidated Revenue. Furthermore, insofar as buyers of the public enterprises borrow heavily in Australia and overseas to finance their purchases, the Government's overall revenue from company tax will fall in future years. Of course, the Government could stop this revenue loss by abolishing or limiting the extent to which negative gearing can be used to reduce artificially or negate the profits of companies which previously paid tax. However, that would require a form of regulation, a way of controlling companies so that they act in the public interest. The Hawke-Keating Government has shown that it is trying to persuade businessmen and bankers of the very opposite, that is, that the Hawke Labor Government is wholeheartedly in favour of deregulation. It seems unlikely that the Government could go down that track to try to stem the loss to revenue. The Government argues that by selling off public enterprises it will reduce the Commonwealth Government's borrowing requirements, thereby making room for private borrowings. I suppose the Hawke Government is in good company because it has joined the Opposition, Milton Friedman and a variety of other people in believing that private sector borrowings are automatically good while public sector borrowings are automatically bad. Even if we leave aside the loss to revenue brought about by private borrowers who negatively gear-something on which the Government has also had a reversal of position and has now re-extended negative gearing within the economy-I cannot see what is intrinsically good or worth while about a private company borrowing to buy, for instance, Australian Airlines. Why is the welfare of Australian citizens automatically increased if the Government stops borrowing to buy new planes for Australian Airlines and at the same time a private company starts borrowing to do the same? The Government and the Opposition have made this point that they wish to argue. The only evidence that they have that it is desirable to reduce the public sector borrowing requirement is that the bankers like it-presumably some of those sage and wise bankers who lent over $100 billion of their depositors' money to Latin American countries which have little, if any, intention of paying it back. It seems as though the Government's ideological loathing of governments borrowings will be used as part of the excuse for selling off a variety of public enterprises, and the Government will probably go about it in the following manner. It will start winding back its borrowing requirements and also winding back the allowable borrowing for semi-government authorities. This, of course, will prevent public enterprises from updating their capital equipment. As that becomes outdated, the quality of services provided by those semi-government authorities will be reduced. I use the case of Australian Airlines as an example. This would mean that it would be flying old planes and providing a service so obviously inferior to that provided by Ansett Airlines of Australia that we would have a self-fulfilling prophecy. It would then be easy for the Government to point to Australian Airlines and to say that it should be sold off. Quite frankly, if a private entrepreneur let one of his companies run down, so that he could sell it cheaply to his mates, the shareholders would have grounds for claiming that they had been deceived. Why then is this Government interested in saying and probably doing something very similar with regard to public enterprises, by starving them of capital which they need as a prelude, from the Government's point of view, to selling them off? The Government, and here I should probably say its senior Ministers, argues that privatised public enterprises will be able to offer better services to consumers. That is another of the myths. The assumption that the private sector can provide better services than the public sector, especially when a public sector monopoly is replaced by a private sector monopoly, can clearly be brought into question by looking at the example of the privatisation of British Telecom. There is now widespread agreement in Britain, substantiated by the Office of Telecommunications, the watchdog set up by the Thatcher Government when British Telecom was privatised, that there has been a marked deterioration of British Telecom's services since privatisation. For instance, the pay phone system has deteriorated since last year, from one in five boxes out of order, to one in four boxes out of order. Shareholders might be better off because British Telecom's profits have increased since privatisation, but its delivery of services to the public has suffered. Some commentators believe that British Telecom's increased efficiency, as marked by increased profits, and its increased inefficiency, as measured by delivering services to telephone users, are both the result of staff reductions. That would make sense, and I think that is why many Australians, who work hard for the Government's public enterprises, fear that this Government's sudden commitment to privatisation at the senior levels of the Cabinet will in fact be carried into fruition. There are a number of substantive reasons why public enterprises should not be sold off. First of all there is the problem of who will buy them-a point which I do not think is lost on too many Australians as a result of the share market situation of the last few weeks. The proponents of privatisation assert that there will now be thousands of shareholders who will own a few shares in Telecom Australia, Qantas Airways Ltd, Australian Airlines or the Commonwealth Banking Corporation. I am not at all sure that substituting a few thousand shareholders for every person in Australia owning them is an advance, but some people see it that way. The reality is that the effective control of these companies will not pass into the hands of those shareholders in the same way as the effective control of most major companies in Australia is not in the hands of small shareholders. In fact they are controlled by large corporate shareholders who make the final decisions. The people who direct those companies are effectively the owners, rather than the owners in a legal sense-the shareholders. So large Australian multinationals and foreign multinationals will in fact become the effective controllers of those organisations and not the Government. In any debate about privatisation one probably looks at the airlines as the first cab off the rank example. Here I ask: Will Ansett Airlines simply swallow up Qantas and Australian Airlines either immediately or in the future? How would a government, which is so passionately committed to deregulating everything, prevent that from occurring at a later stage, or would a future government want to continue a commitment to preventing it from happening? On what basis would the Government prevent it from happening, if it was happy for our media to be bought up, as it was, by a few wealthy investors? Why then should it stand in the way of our airlines being bought up similarly by a few wealthy investors? One would also want to ask in those circumstances whether the Government would be happy to see Qantas, Australian Airlines, the Commonwealth Bank or Telecom owned by foreign companies. If not, how would it propose to stop those public enterprises being controlled by Japanese or American companies? As an example, I again use the airlines. What if Qantas were owned by Japan Airlines Ltd or the Commonwealth Bank were owned by the Bank of America? A lot of people say that the Government would move to prevent that, but I am not at all sure that the Treasurer would have anything against it. If he did want to prevent it, I am not sure what he would be able to do about it in his much endeared deregulated financial environment. There is also the problem of subsidisation, whereby we would probably end up with more tax and certainly less equity in the Australian community. The availability and cost of certain services-airline services, telephone services and schools in rural Australia-are influenced by government policy which, in effect, subsidies services to those areas through, for example, servicing the more popular airline routes, or in the provision of telephones by the more used system. Where will we be able to get the money to provide those types of services? Obviously it will come from direct taxation and not from the cross-subsidisation which currently occurs. In those circumstances, what would happen to the cost and the availability of these services, if the respective public enterprises were privatised? I think that the Government would find it very difficult to subsidise those at anywhere near the level at which they are being subsidised at the moment. If the Government does not do that, what form of regulation can we possibly imagine would compel a company to provide telephone services to the people of, for example, Eulo in my State? The cost of those is astronomical compared with the cost of putting a new telephone in a house in a Brisbane suburb. It is fairly obvious that a private company would not have a bar of it unless it were compelled to ignore the profit motive and to address the public interest. I am not quite sure what type of hybrid operation we would then have, with a private company being directed by the Government to ignore the profit motive and to address the public interest. Surely, under those circumstances it makes a lot more sense for the Government to stay in the area because it is the Government's obligation to address that public interest. It is not a private firm's obligation to do so. If the Government continues such subsidies, of course we will all end up paying more taxes to pay for them, and the loss in government revenue from the profits in the public areas-for example, the profitable parts of Telecom, Australia Post and Australian Airlines, amongst others-will be lost. Therefore the total jump in taxation that would be necessary, would be much higher than if the Government retained these profit making areas of the public sector. The fact that those who end up owning the public enterprises pay less tax while other Australians pay more tax surely at the end of the day simply exacerbates the inequalities that would occur under those circumstances. At this stage the discussion has only taken the form of headlines, statements made on the stairs coming into this place and various propositions made at speaking engagements of the Treasurer and the Prime Minister. They have singled out as an example the same one that I have singled out, that is, the airlines. They have raised the issue of Qantas and Australian Airlines. Of course, the Prime Minister has already been gloating to New York bankers about the impending Government budgetary surplus, which, as I have said before, will reflect the sale of these public enterprises. This Government, of course, is committed to deregulation, Budget surpluses and reduced government borrowings. Privatisation is only a means to that particular end. At the moment the Government talks as if it has no plans for privatising the Commonwealth Banking Corporation, Telecom or the education system. Those honourable senators who are inclined to believe what the Government says should remember what Mr Hawke said about privatisation on 29 August 1985. On that particular occasion he was attacking the then Leader of the Opposition, Andrew Peacock, because he had reaffirmed the commitment of the Liberal Party of Australia to privatisation. I must say that the Liberal Party at least in that respect has been consistent. Andrew Peacock at that time was making this reaffirmation with regard to statements that had been made by Steele Hall and the late Alan Missen expressing doubts about Howard's privatisation plans. In an article in the Herald, Prime Minister Hawke summed up, I think eloquently, the case against privatisation when he said: Privatisation will see profitable areas of government activity transferred to wealthy private shareholders. Taxpayers will be left subsidising the loss-making activities of the Government. Privatisation will not lead to lower taxation. In the main, government corporations are financed by selling their services. Privatisation, by contrast, would probably see a lift in taxes as the Government would be forced into subsidising uneconomic services. It is especially shortsighted to give up future dividends and interest flows in return for a one-off realisation of capital sums now. The fact of the matter is that privatisation is an entirely inappropriate approach to the social, economic and community needs of a country such as Australia. It is an approach promoted by vested interests, sustained by blinkered ideological obsessions and entirely lacking in logic and common sense. That is a ringing denunciation from the Prime Minister in 1985 of privatisation-something which, of course, senior Ministers have now wholeheartedly embraced. We cannot be sure which `vested interests, sustained by blinkered ideological obsessions' the Prime Minister was then referring to. However, maybe some of the United States and United Kingdom bankers who supported the Australian Labor Party during the recent election campaign will now end up becoming advisers to handle the sales of public enterprises. They will not, of course, be imparting their expertise and knowledge free of charge. Their fees and commissions, like everything else, will be paid by all Australians. I think at the end of the day we are facing a situation where the debate will be carried by the numbers. In the most recent trading on the stock market the reduction in the value of shares in Australia was proportionately greater than that in the United States of America, Britain or Japan. Obviously the bankers, the speculators and the foreign investors whom the Hawke Government tried to please with a balanced Budget and reductions in public sector borrowing requirements still sold their Australian shares in the general panic. I believe it would be difficult in such a market and even probably for the next short while-although our stock market is rising-to sell our public enterprises. Thatcher, of course, has the same problem currently in Britain with her Government's intended sales of the British Petroleum Co. (BP) interests. This has been exacerbated by a whole range of financial problems being experienced by some of the stock brokers who are underwriting the original BP sale. When one looks at the overview of what has happened recently one is struck by the fact that prior to the stock market fall there was much talk about deregulation. Fascinatingly enough, during the fall the commentators were saying, `Why does not the Government do something and why have not politicians got off their backsides to do a bit of regulating?'. The reason that people say that is very simple: at the end of the day it is the Government that picks up the tab across the board. It is the Government that has to address the public interest. That is why in a democracy we will continue to have governments involved in the operation of the economy. The reason we should seek to raise the level of this debate about privatisation at this particular time and on this particular Bill is that this Bill addresses semi-government authority borrowings. It is those very borrowings that I believe, as I have set out already, will come under increasing attack in the next 12 months. I think it will be done with a very clear point of view of making sure that, in sufficient time for the Hawke-Keating agenda for this self-fulfilling prophecy, these enterprises are run down in their capital and are in a less fit state to fulfil their functions and hence in a fitter state to sell off. I think that is the type of scenario that we are facing and I think that at the end of the day that will occur. It will occur, however, to the detriment of the Australian public, certainly to the detriment of those who rely on so many of the public enterprises in this country for so much of their livelihood and support. It will be vastly to the detriment of people living in the rural areas of this country. It will be to the detriment of the revenue ultimately and to the detriment of a country which has found it necessary to use public enterprises to provide a level of services to a small population on a vast continent. It is important for all of us to address ourselves very clearly to this issue. Hopefully those people in the Government who are opposed to the way that the Cabinet is going will make their voices heard in this debate so that it is not simply carried by default as so many other important items have been carried by default-simply by turning the Government's policy on its head so that that with which it went to the people, the policies it espoused at the time it asked for the vote, are simply jettisoned in the wholehearted scramble to please the next lot of donors to the Party. Senator ALSTON(Victoria)(6.09) —I rise to speak on the Commonwealth Borrowing Levy Bill and the Commonwealth Borrowing Levy Collection Bill. I do not think much need be said about the latter because it is simply a mechanism for the collection of the levy and it provides for certain administrative arrangements in relation to that collection. It is the Commonwealth Borrowing Levy Bill that I want principally to address this evening because this Bill, although very modest in its stated objectives and certainly minuscule in terms of achieving a contribution to government revenue, does have a role to play beyond its apparent significance and does, I think, deserve to be treated seriously, although, as has already been indicated, the Opposition does not oppose these Bills. It is worth noting that the purpose of the Bill is to impose a levy on the borrowings of a range of semi-government authorities, and 21 of these authorities are in fact listed in the schedule to the Bill. The legislation is concerned essentially with the larger State-owned enterprises, the public trading enterprises-the ones with which we are very familiar in the context of the privatisation debate. Only 12 months ago the Government introduced a guarantee charge which attached only to those borrowings that had an explicit guarantee. Of course, what inevitably happened-it would not have taken much foresight to have anticipated this-was that not all Commonwealth borrowings in these areas were necessarily the subject of explicit guarantees and, as a result, were not caught by the legislation. It is not clear to me why this is so, but I simply draw attention to the sums of money that will be raised by a combination of the levy and the on-going guarantee charge. The second reading speech of the Minister for Local Government (Senator Reynolds) suggests that the levy imposed by the Bill is expected to raise revenue of some $1.3m in 1987-88 whilst on-going revenue from the Commonwealth guarantee charge is estimated to amount to $7.6m. If that means that the guarantee will cut out at the end of that financial year, it would seem odd that the levy would not be recouping much more than the sum of $7.6m because it is obviously broader in its coverage and is designed to apply to a whole range of direct and indirect borrowings. Therefore, it would seem to me that we are talking about a sum considerably in excess of $1.3m. Even if that figure were correct, it still needs to be said that the game is not worth the candle. Obviously there are compliance and collection or administrative costs that would be rendered necessary by the imposition of the levy. At the end of the day, if we look at the purpose for which this legislation is enacted-and that is ostensibly to bring into line borrowings by a range of public trading enterprises so that they do not gain any unfair commercial advantage-we would find, on the sorts of revenue figures that are predicted, that the difference must be extremely marginal, given the sorts of revenue figures that are involved with some of these very large trading enterprises. If that is the case, it would certainly seem that if there is any supposedly unfair commercial advantage currently being obtained by some of the larger institutions, it is minimal and probably we should not worry about proceeding in this way. Certainly, I do not think anyone would argue that there should be an equal playing field when it comes to such forms of borrowings and I do not object to that approach. But by introducing this legislation we are taking a sledgehammer to crack a nut. What we have here is a form of levy which is very modest in its apparent purpose but which, on closer examination, has the capacity perhaps to raise larger amounts of money. It all depends upon judgments that are made as to the extent of the differential. It is significant that Telecom Australia took specific objection in its annual report to the sum of $2.2m which had been raised by the application of a 0.5 per cent guarantee. It may well be that Telecom was, in part, instrumental in not only having the guarantee replaced by a levy but also in the amount of the levy being reduced because it is now down to a rate not exceeding 0.125 per cent. It is not clear whether the rate is to be 0.125 per cent or whether it is not to exceed 0.5 per cent. In any event, it is an across the board figure which does not take account of the variations between authorities which have been struck for convenience and which could, quite simply, be marginally increased in the following financial year for the purpose of deriving just that little extra revenue that always comes in handy for governments that are profligate spenders. It goes without saying that this Government has a desperate need to try to recoup funds from every conceivable source. Given its track record to date, one can only imagine that it will find the need an on-going one. In the last 4 1/2 years since it came to office, its revenue from this source has risen from something like $44m to $78m, an increase of some 75 per cent. So it should be apparent why it has been found necessary to try to take advantage of what seemed to be minor opportunities for revenue raising but which, nonetheless, all make a contribution. It is my submission that the Government is going about it in the wrong manner. It is not worth while intervening to this extent. This legislation is a form of regulation which requires judgments to be made and those judgments are already ongoing. Very many of the borrowings of these institutions require the approval of the Treasurer. They are subject, no doubt, to the Auditor-General and others who might take the view that they are not acting properly. But in reality, these macrogovernment institutions are of such a size that their borrowings do not need to be guaranteed; they do not need any explicit or implicit support from government. If capital markets want to take the view that somehow some day there might be a run on one of these authorities, that Telecom bonds suddenly become a risky venture and therefore they need to be propped up, I would have thought that that matter could be pre-empted and obviated well before there are any question marks over their liquidity or financial viability. In other words, it is simply not a realistic proposition to suggest that these authorities will operate in such a manner that a discount or penalty needs to be attached to their borrowing rates. If the market chooses to lend at slightly less than commercial rates, that is a decision that the market would seem to have made quite unnecessarily. One would have thought that those lenders could simply recoup the amount that they charged to all other commercial borrowers and, accordingly, they are shortchanging themselves. To the extent that the authorities are the beneficiaries of such a scheme, it does not at all follow that funds should then go into government coffers. It may well be that if the view were taken theoretically-I am not arguing for the proposition-that somehow these authorities should be compelled to pay a commercial going rate for borrowings, they could be required to set aside the difference, whatever it might be. In the scheme of things, it would be a relatively minor sum of money. But that is not what should happen here. I simply put that forward as an indication that there are ways in which the problem, if it can be so described, could be tackled. It is simply a non-sequitur to suggest that because there might be some marginal differential, the Government should then be able to recoup funds in the way that this Bill proposes. I would suggest that it is simply a guise for further fund raising; it is another form of financial targeting; and it is quite unnecessary in all the circumstances. I want to address my remarks in a more general context to the issue of privatisation which can be raised squarely in the debate. At the end of the day, if we want to make these enterprises efficient, if we want to enable them to compete fairly, if we want to ensure that they have equal access to capital markets, far and away the most efficient and effective means of doing that is to put them into the private arena. That can be done in a variety of ways. It is one of the great canards in the privatisation debate that somehow what we are really talking about is a selling off entirely of all or many of the large statutory trading enterprises. There is certainly a case for selling off all of the Commonwealth Banking Corporation. The recent case of the Bank of New Zealand selling off 13 per cent of its shares with non-voting rights attaching to those shares and with the ability to move to 33 per cent over the next 12 months or so, is an example of what can be done. What the New Zealand Government has done is virtually privatisation by stealth. It is called corporatisation and involves erecting a corporate structure so that the enterprise is properly valued by the market and is in a position where it can be readily transferred if necessary. But it is a clear recognition that that is the most efficient way of handling the very real and vexed problem of the shortage of capital funds available to public trading enterprises. There is a crisis in this country at present. The Aussat annual report has just been tabled in this Parliament. It is quite clear that in order to fund the second generation of satellites Aussat will need approximately $600m. It simply does not have it. It has been down on its knees pleading for access to capital markets for some months now. In this very chamber last Thursday I asked the Minister for Finance (Senator Walsh) whether it was true that the Commonwealth Banking Corporation had a submission before the Government seeking approximately $150m for capital funding because it is short. It is unable to operate in the export markets in the way all the other banks have done. Nonetheless, the best the Minister could say was, in effect, reading between the lines, `This is a sensitive issue. I am not sure that I can disclose publicly just what progress has been made'. The fact of the matter is that that submission has been before the Government for at least two months and no action has been taken to date. The Commonwealth is in desperate need if it is to compete, if it is to be able to get out there and expand instead of just trailing along with some of its major clients and establishing branch offices in other countries. If it were to take a lead from its major competitors it would find that they are very much getting out into the export market and are acquiring overseas banking corporations-the Australia and New Zealand Bank is taking over Grindlay's Bank Ltd and the National Australia Bank Ltd is taking over a couple of Scottish banks. It is the way to go. If we are talking about a global market for banking services, the Commonwealth Banking Corporation is being left far behind. The reason for this is simply that it does not have the funds to enable it to expand. One could go through a number of these major authorities. There is no doubt that Australian Airlines is a classic example. Not so long ago in this chamber we had a debate about the critical need for funding for Australian Airlines. The fact of the matter is that in the same week that Ansett Airlines of Australia announced that it had embarked upon a $1 billion purchase program of new aircraft, we had the very sad spectacle of the managing director of Australian Airlines returning from overseas after having successfully pleaded for a 10-year deferment on the purchase of some $650m worth of new aircraft. Senator Maguire —Which airline do you travel on? Senator ALSTON —I travel Ansett, Senator, but I do not really think that is raising the level of the debate very high. That is the sort of prejudice and blinkered thinking that bedevils a lot of this debate. If we are going to talk in terms of hypocrisy, I cannot do better than to refer to the one-sided presentation by Senator Macklin. I am not referring to him as the arch hypocrite, but it was very significant that he quoted what he described as the ringing denunciation by the Prime Minister (Mr Hawke) in 1985 of the whole concept of privatisation. I am sick and tired of the Prime Minister and others of his ilk berating the Opposition and anyone who has the temerity to discuss the subject as somehow blinkered ideologues, those who are pandering to vested interests and those who are catering for the vested interests of the wealthy. The reality is that we have had a Damascus conversion on the part of the Prime Minister in recent weeks. It is quite clear that the economic rationalists in the Government fully understand the virtues of privatisation. This is not-I repeat, this is not-a sterile economic blueprint. It is not simply a debate for the sake of who can present the toughest program to the people or who can best benefit a small clique of private sector friends and associates. What privatisation is about in its many manifestations is the introduction of competition and efficiency in the market-place for the benefit of consumers. I would have thought that if the Government is interested in consumer sovereignty, then it would be very interested in ensuring that consumers are able to gain the goods and services that are provided, quite unnecessarily by the government sector, by many of these large trading enterprises. The consumer is entitled to receive the benefits of those services at the lowest practicable cost. It is, again, a gross distortion of the arguments in the debate to suggest that somehow the Government needs to remain intimately involved because there are what are called community service objectives. The reality of the matter is that some very nebulous social objectives are spelt out in various charters. Certainly the Commonwealth Bank has a form of words that I would say would not last five minutes if one were to try to impose a legal obligation on the bank. Similarly, Telecom Australia and Australia Post have forms of words which have enabled them to shelter behind their monopoly positions, but there is no need for those community service obligations to mean that there is a need to retain all the various commercial activities under the rubric of government. It would be a relatively simple matter to privatise the community social objective. It could be done by a direct government subsidy. That would not be one-way traffic because one would have little doubt, I think, that these enterprises would prosper in the private sector and would, therefore, generate increased revenue. As a result more taxation revenue would be available to government. That would be one mechanism that would be readily available to government. The other mechanism is simply a levy to pay for the cost of those social obligations. In the case of Australia Post, I think the levy is approximately $80m to $100m and in the case of Telecom it is probably around the $500m mark. It is arrant nonsense to suggest that because it might cost approximately $15,000 to install a telephone in a remote area somehow there is a social obligation on government to provide that service. I do not accept that proposition and I do not think it is too harsh to say to those people who choose to live in remote areas that either the Government accepts an explicit political commitment for all sorts of reasons to provide publicly that sort of money, or one goes without or pays for it oneself. It may well be that there will be ways in which those remote communities can combine together to obtain those additional services. At the moment approximately 91 per cent of households have telephones connected. We are left with the very expensive and very remote areas at the bottom of the range. Telecom quite readily accepts a so-called obligation to move to 100 per cent coverage, but it would certainly be my view that that is most unlikely. It is not just in the remote areas that the difficulty will arise; there are many people at the lower socio-economic end of the market who will not, or simply cannot, afford the sorts of telephone services that the great majority of the population take for granted. But that should not be a reason why there are not very many aspects of Telecom that could not readily be privatised. It does not follow that one has to be in favour of selling off the entire operation; indeed, even to sell off the entire market capitalisation of the Commonwealth Bank until the recent fall would have required sums of approximately $2 1/2 billion to $3 billion which is no small amount of money, and is probably more than had been involved in capital raisings over the last 12 months in any event. It is not necessary to have total privatisation, nor is it feasible in the short term for Telecom to be privatised. Many services are provided, whether they be customer premise equipment, value added services, the first fame monopoly or installation and maintenance. There are all sorts of ways in which Telecom services can be effectively and competitively provided and, quite probably, at significantly cheaper rates to the consumer. I utterly reject some of the spurious and self-serving criticisms that are made of the concept of privatisation. In many respects the public sector unions are the most vociferous and vocal in defending those monopolies. The real conservatives in this country when it comes to the privatisation debate, the real ideologues, are those who have a direct vested interest in preserving their positions. One can understand that a Telecom technician does not want to be put out into the cold real world because it may turn out that Telecom had been featherbedded, that there was overservicing or overstaffing and that somehow attrition may be required. That may be so. One does not wish it upon anyone, but I would have thought that it is also the case that nearly all those people could earn a very decent living if they were prepared to get out and compete and not take advantage of weekend hours, double rates and all the other rorts and rip-offs that have been such a significant feature of public sector activities in many areas. It is not simply a criticism of any union or any public trading enterprise, it is a function of the protective cocoon in which they have been allowed to operate. One can just as easily draw an analogy with the high levels of protection that have operated in this country for so long. I think it is now a bipartisan view that that has had a very deleterious consequence for the Australian economy because it has discouraged real competition and it has encouraged those who have the benefits of protection not to compete as heavily, effectively and creatively as they might. The same applies to very many of these public trading enterprises. Sitting suspended from 6.30 to 8 p.m. Senator ALSTON —Before the suspension of the sitting for dinner I was speaking to the Commonwealth Borrowing Levy Bill and the Commonwealth Borrowing Levy Collection Bill. These Bills relate to a new scheme of funding provided by the Government to replace the original guarantee arrangements. I wish briefly to address myself to two issues. I spoke earlier about the wider concept of privatisation. The Government finds itself in a quandary over this issue. This could be no better exemplified than by the recent decision of the Caucus to establish a loaded and one-sided committee of three to preserve and protect Telecom Australia. That Telecom preservation society has on it two former Telecom employees, and one other who presumably very much believes in protecting Telecom from any semblance of competition. It is symptomatic of the way in which the Labor back bench is now moving to take control of those Ministers in the Government who can see some virtue-- Senator McKiernan —We hope you learn something from that. Do something on your own side. Senator ALSTON —We do not have those sorts of factional chasms, but there are some enlightened persons in some statutory authorities, even to the extent that whilst Telecom undoubtedly does not believe in privatisation it has been urging the Government to lift a number of significant restraints that are limiting its capacity to expand and compete in the international sector. I refer not only to the overly generous superannuation and workers compensation schemes-and Senator Walsh no doubt has his own views on the way in which we can reform workers compensation arrangements at Commonwealth level-but also to the WorkCare scheme. I hope that Senator Walsh has not been tempted to go down the same track as the Victorian Government with its disastrous WorkCare scheme which has now blown out to the extent of $2.4 billion. Let that be an object lesson to those who believe that one can simply have a monopoly insurer guaranteeing efficient provision of services. I conclude my remarks on privatisation by saying that I hope there is an element of bipartisan recognition that we are concerned not about an ideological binge, not the sort of double flipping and backtracking that the Prime Minister is engaged in, monumental hypocrisy, but a recognition that there are very real and genuine competitive benefits to be derived from exposing public sector enterprises to private sector competition. The notion of efficiency should be dear to the hearts of all those in government and even those on the other side of the chamber who are concerned to ensure that there is no reduction in the level of funding of welfare services. There would be more dollars to go around if there were more efficient provision of government services by a number of public trading enterprises. I conclude my remarks on these Bills by referring to an article I came across during the dinner break which gives an insight into the Government's motivation for this current legislation. In a report in the Australian Financial Review of 28 August last Anne Davies said: The Expenditure Review Committee is believed to be considering a proposal to charge Telecom for implied guarantees on its borrowings, as it attempts to find additional revenue for the September Budget. Telecom already pays 0.5 per cent on borrowings for the explicit Government guarantee on its inscribed stock but has recently been looking at ways to lower the cost of funds by devising instruments which would not require the explicit guarantee. It is quite clear that this legislation pre-empts those imaginative manoeuvres by Telecom to avoid an explicit guarantee and so to extend the notion of a levy as to catch all direct and indirect borrowings by public trading enterprises. Telecom has been shafted very quickly and it is legitimate for it to have been concerned because Telecom took the view that if the 0.5 per cent charge on all its borrowings had remained in place, it could have been up for a bill of $6m in this financial year and by 1988-89 would have been paying some $11m. That is not chickenfeed. It makes a significant contribution to government revenue and highlights the real reason for the introduction of this legislation. There is no need to go tinkering around with all sorts of government interventionist requirements for accommodation costs and supervising costs simply to ensure that somehow this marginal differential between the cost of borrowings in the private sector is entirely equivalent to the cost of borrowings by public enterprises. The real motivation for this type of legislation is to provide more revenue to government coffers. In my view, whilst the Opposition does not oppose these Bills, we should clearly recognise the underlying motivation. The Government has taken Telecom's complaints to heart to the extent that it has backed away from a fixed half of one per cent charge, which does not take account of the differentials that apply to smaller enterprises which presumably might be asked to pay a slightly higher charge as opposed to those mega-institutions such as Telecom with about $13 billion worth of assets which by no stretch of the imagination could ever be considered vulnerable and therefore should be treated as absolutely safe, no risk investments. There is no reason why institutions should provide Telecom with cheaper financing. The Government should make it abundantly clear that it does not provide any implicit or explicit guarantee, and therefore leave it to the private sector to extract whatever interest rates it can legitimately derive across the board without making any special arrangements for Telecom. If it did that, of course, it would forgo the revenue which in this first instance is relatively modest. But if Telecom's worst fears are realised-and I suppose the way in which the Government has gone about its profligate increases in revenue over the last 4 1/2 years may mean an increase of some 75 per cent-Telecom may well find that it is paying some $11m a year simply by virtue of this seemingly harmless little levy. I hope that we all realise the true nature of this type of legislation. It is not an exercise in government efficiency. It is an exercise in garnering revenue from wherever the Government can get it. This is simply a first instance and no doubt it will be increased over time. It will be very difficult to unravel the real cost of borrowings to every public sector institution. The Government will then strike a uniform rate, increase it slightly, and rub its hands at the thought that somehow it has managed to extract even more revenue, which was not necessary in the first place. Senator WALSH(Western Australia-Minister for Finance)(8.07) —I do not intend to follow the example set by Senator Macklin and Senator Alston and delay, for no identifiably useful reason, the second reading of the Commonwealth Borrowing Levy Bill and the Commonwealth Borrowing Levy Collection Bill. However, I wish to give notice of my intention to move in the committee stage a request for an amendment to clause 6 of the Commonwealth Borrowing Levy Bill. Some people believe that its present wording is ambiguous and that under the existing clause 6 the levy could be read as being a once only levy, whereas the clear intention is that it be a levy in each year for the duration of the loan. Therefore, I will be moving that request to the House of Representatives in the committee stage of that Bill. Question resolved in the affirmative. Bills read a second time. COMMONWEALTH BORROWING LEVY BILL 1987 The Bill. Motion (by Senator Walsh) agreed to: That the House of Representatives be requested to make the following amendment: Page 2, clause 6, lines 11 and 12, leave out ``the prescribed rate, being a rate not exceeding 0.5%'', substitute ``such annual rate as is prescribed, being an annual rate not exceeding 0.5 per cent''. Bill agreed to with a request. COMMONWEALTH BORROWING LEVY COLLECTION BILL 1987 Bill-by leave-taken as a whole, and agreed to. Commonwealth Borrowing Levy Bill 1987 reported with a request and Commonwealth Borrowing Levy Collection Bill 1987 reported without amendment or requests; report adopted. Commonwealth Borrowing Levy Collection Bill 1987 (on motion by Senator Walsh) read a third time. Debate resumed from 27 October, on motion by Senator Walsh: That the Bill be now read a second time. Senator BROWNHILL(New South Wales)(8.13) —The Primary Industry Bank Repeal Bill repeals the Primary Industry Bank Act of 1977 which, of course, is now redundant following the sale of the Government's interest in the Primary Industry Bank of Australia (PIBA) to the Rural and Industries Bank of Western Australia. PIBA was also granted a banking authority under the Banking Act on 30 June 1987. The sale of this bank was completed on 30 June and resulted in revenue to the Commonwealth of $2.5m. The Opposition is not objecting to the privatisation of the bank as part of the Government's asset sales program. However, it should be noted that the Rural and Industries Bank of Western Australia is owned by the Government of Western Australia which a lot of people in the community may not know. The Opposition would have preferred to see the bank sold to the private sector rather than to another government instrumentality, whether it be a State or Federal government. The timing of the passage of this Bill highlights the lack of foresight and planning in the matter of privatisation. In 1985 the Prime Minister (Mr Hawke) said on the subject of privatisation: It is a one-off fire sale, a sale of the century, of your assets-the assets of the people of Australia. Yet the same Prime Minister, despite the objections of his own Party, has now said: Certain (Government) holdings that could have, and no doubt did, make good sense in earlier times are not necessarily appropriate for current circumstances. So after years of criticising the Opposition over privatisation the Prime Minister and the Treasurer (Mr Keating) have been forced to admit that there is a proposal. It is now only a matter of determining whether the Prime Minister and the Treasurer can make their own Party see sense. From present indications, I believe that this seems very unlikely. However, despite the trauma in the Australian Labor Party over the privatisation matter, there is hardly a murmur from within the Party over the assets sales which are, in effect, a form of privatisation. Why is this being done at this particular stage? I believe the Government is using its assets sales as a ploy to hide its blatant lies about the state of the economy. Firstly, the Treasurer tried to convince the Australian people that he had brought down a balanced Budget-only $23m in the red. He failed to take into account that this assets sale-a one-off measure-is included in this figure, as is a dividend from the Reserve Bank-another one-off-to finance his so-called `balanced Budget'. If he were honest he would admit that the Budget deficit is closer to $2.5 billion and not the $23m for which he is aiming. The Treasurer has constantly stated that the Australian economy is improving. Yet as soon as the long-expected collapse of the world share markets hit, what happened? The Australian share market fell further than all others, the Australian dollar immediately fell 5c against the US dollar and even further against the other world currencies. Therefore, it would seem that the Government's confidence in the Australian economy has been misplaced and the underlying problems, about which the Opposition has been telling the Government and the Australian people, are about to loom very large on the economic horizon. However, the sale of the bank again highlights the point that paying off the deficit cannot come from one-off asset sales such as this. It must come from a cut in overall government spending. Until the Government takes action that will cut overall Government spending and reduce the enormous foreign debt, asset sales such as this remain a cosmetic, ineffectual action. Under this Government the gross external deficit has reached almost $110 billion. It has almost trebled since 1983. The current account deficit figure for September was a staggering $1.35 billion. Prior to the Hawke Government coming to power in Australia, this country had never seen a monthly current account deficit of more than $1 billion. Under this Government the figure has been regularly above this point and at one stage the current account deficit was over $1 billion for 14 months straight. Australia's credit rating has been lost by the Hawke Government-it has gone from the highest AAA rating. Once lost this will never be regained. Until the Government adopts policies that will redress these serious imbalances and cut spending to a reasonable level, no amount of asset sales can get Australia out of the problem that it is now in. The Primary Industry Bank of Australia was set up in 1978 by the Fraser Government specifically to provide long term funding to the rural sector. It is interesting that in this place we have Senator Short, who played a vital part in the setting up of this bank when he was working for one of the government departments in Canberra. It is also interesting for the people in the community to know that it was the Rt Hon. Ian Sinclair, the Leader of the National Party of Australia, who, as the Minister for Primary Industry at the time, played a significant role in setting up this bank. The bank achieved a lot in the first instance because it put a ceiling on interest rates. Other banks were not worrying about raising the ceiling for people in primary industry. I will quote from the then Treasurer, Phillip Lynch, in his second reading speech on the Primary Industry Bank Bill in 1978. He said: The Government's primary consideration in providing for the establishment of this new facility has been to devise a way of enabling credit to be made available to primary producers, including fishermen, for significantly longer terms than has generally been available. He continued: The cash flows from (such) investments frequently take some years to reach their potential, but then have life expectancies for many years. Under these circumstances producers can be discouraged from embarking on many worthwhile projects by the relatively short repayment terms often required by traditional lending terms. The traditional lending terms at the time were between three and six years. When the Primary Industry Bank came into being it extended those terms to 20 years and more. This was a part of the government of the time trying to help young farmers and primary industry, which produces so much for this country, through the young farmers establishment scheme. The PIBA has been a very important aspect of rural finance. Funding continues to be provided for agricultural land purchase and improvement, pasture improvement, livestock purchase and working capital. It has done a great job. Ten years later, given our dire need to stimulate industry and export income, it is unfortunate that subsequent government policy has, perhaps, limited the effectiveness of the PIBA. However, the bank has consistently given the best interest rates available to the rural industry, in keeping with its charter. Recently the bank has recognised the importance of serviceable loans, interest-only loans for the first five years. This was a pacesetter for the other banks. I understand from people who have used the bank's facilities that its paperwork has been done more quickly than has been the case with some of the other banks. The rural sector has been one of the worst hit sectors by the economic crisis. The combination of low commodity prices, high interest rates, appalling balance of trade figures and the collapse of the Australian dollar has contributed to a most depressing future for the economic viability of the rural industry. The impact of the rural crisis and, in particular, the part played by finance institutions has spurred the formation of a rural credit inquiry by the New South Wales State Government. Yet the rural sector has consistently been attacked by the policies of this Government, which seems still to suffer from the delusion that people from the land live in the lap of luxury. Nothing could be further from the truth. One change in policy which has had a severe effect on the rural sector has been the removal of the effectiveness of the income equalisation deposits (IED) scheme. Income equalisation deposits were introduced by the Fraser Government as a means of assisting primary producers to minimise the fluctuations that occur in their taxable incomes due to seasonal factors and changes in commodity prices. The scheme operated by allowing a producer to make a deposit when income was high and to withdraw it when income was low. Deposits counted as deductions for income tax purposes and subsequent withdrawals were included as taxable income. Income equalisation deposits were low interest deposits and were able to be bought by the Primary Industry Bank, which allowed the bank to have worthwhile capital to lend. By June 1982, $166m was held in the IED scheme trust account. This quite considerable amount of money helped the primary industry sector to even out its tax liabilities, enabling the farming community to help the people of Australia by providing vital export income. In May 1983, major modifications were announced to take effect from September of that year, which effectively spelt the end of the IED scheme-a sad day for rural Australia. Deposits made after that date no longer qualified for a tax deduc- tion when made, nor were they to be considered assessable income when withdrawn. Therefore, the fundamental income equalisation nature of these deposits was lost. As I said, it was a sad day for rural people. It is to be hoped that the sale of the PIBA will not be detrimental to the interests of primary producers. In this year's annual report, the Chairman of PIBA is quoted as saying: With the acquisition of all shares by the Rural and Industries Bank of Western Australia and the granting of a national banking authority, the Bank now looks to a future of wider diversification of products and services whilst retaining its traditional links with Australian agriculture. We in the Opposition parties sincerely hope that the Primary Industry Bank of Australia, in its new form, will continue the work of the old. The Opposition, therefore, will not be opposing the passage of this legislation, but I stress that the functions of the Primary Industry Bank of Australia should not be altered. It should continue the success it has demonstrated over the last 10 years of its performance. Senator POWELL(Victoria)(8.26) —This evening we are addressing legislation to repeal the Primary Industry Bank Act 1977. This has been made necessary by the Government's decision to sell its interest in the Primary Industry Bank of Australia (PIBA), which is now the seventh largest nationally operating banking group. At the very outset I would like to set the record straight on the manner in which the Government has handled the legislative process in this instance, as it has in too many other instances. In May 1987, as part of its mini-Budget the Treasurer (Mr Keating) announced the Government's willingness to sell its interest in the PIBA. On 30 June, the Rural and Industries Bank of Western Australia acquired the Commonwealth share in the Primary Industry Bank. Some three months later, on 18 September, the Government introduced legislation to repeal the Primary Industry Bank Act 1977. As I said just last week in my comments on the annual report of the PIBA, this sets a dangerous precedent for a Government which, on all of the evidence, is intent on privatising Australia's public enterprises. In this case it is worth drawing the attention of the community to what has happened, particularly, as I say, because the Government appears to be intent on privatisation, by one means or another, through a staged process. We should not be fooled. The Government is obviously prepared to privatise in some areas and is quite up-front about it. The Government says, `We will not privatise Telecom'. I do not take a great deal of comfort in that. The Primary Industry Bank is a case in point. It is another example of the Government making a statement about its intention and taking a great deal of time to come up with the legislation to implement it. Senator Vanstone —It is government by Press release. Senator POWELL —Yes, it is the old government by Press release technique. The Government's share in the Primary Industry Bank of Australia has been sold off, interestingly enough, to Western Australian interests-certainly to Western Australian Government interests. For those who are interested in banking and who have observed the financial scene in recent weeks, it is not a matter of great comfort. Later I will discuss other aspects of the privatisation issue. This whole exercise is viewed very negatively by the Australian Democrats. We believe that the Bill before us tonight needs to be opposed, not only on the basis of what has happened but on the basis of this Government's intention regarding privatisation, in particular, in regard to assets sales. When the Government's intention to sell its share of the PIBA was announced in the May mini-Budget it was stated that the measure was intended to raise revenue-$2.5m. This is something which is possible through the sale of assets, it is something which this Government has extended through the sale of other assets and it is something which we in the Australian Democrats are concerned is becoming a pattern. Therefore, we believe that it is something we need to oppose. To turn specifically to the Primary Industry Bank, I notice from the second reading speech in the other place of the Minister for Employment Services and Youth Affairs and Minister Assisting the Treasurer (Mr Holding) that the rural sector will continue to have a voice on the board of PIBA. I also notice that the Minister believes: PIBA's prime commitment will continue to be towards meeting the funding requirements of the rural sector. Of course, the Australian Democrats hope that that support for the rural sector will continue to be the raison d'etre for PIBA, but we express considerable concern at recent statements by PIBA's managing director to the effect that PIBA will now be entering into corporate commercial lending while continuing to dedicate `a large proportion' of its activities towards the agricultural sector. With this intention to enter into corporate and commercial lending, I suspect that we might very well find PIBA addressing its activities not so much to the small farmers but rather to the agri-business sector. The Australian Democrats devoutly hope that this will not be the case. On this point, I think it is important to make some comment on the question of where Australian agriculture should and could be going and where governments, State and Federal, the rural finance sector and farmers themselves need to look in this respect. One scenario is that a few individuals and businesses-often foreign-based or foreign-owned-will be owning most of the productive agricultural land in this country with a continuing emphasis on intensive farming, pesticide high monoculture and the traditional crops and stock-the ones we are used to such as wheat, wool, beef and so on. In this scenario the small family farmer virtually disappears from the Australian landscape. We should never forget that the resource base, the soil in particular, will also continue to disappear and disintegrate. Dangerous chemical residues will continue to be found in our food, our soil and our water and our exports will continue to be at the mercy of the volatile international trading markets. Another scenario and an alternative which has the support of the Australian Democrats is for governments and rural finance institutions actively to encourage our farmers to adopt farming practices which will lead to a more sustainable agriculture in this country. That is really critical because, unless we can sustain agriculture into the future, one of the most important bases-if not the most important base-of our economy will be gone. Certainly, I would contend that even now agriculture remains the most important base of our economy. By `a sustainable agriculture' I refer to the following definition of this term which is given to us by the National Association for Sustainable Agriculture: A system of agriculture able to balance productivity with low vulnerability to problems such as pest infestation and environmental degradation while maintaining the quality of the land for future generations. In practice this involves a system which avoids or largely excludes the use of synthetically compounded fertilisers, pesticides, growth regulators, supply stock feed additives and other harmful or potentially harmful substances. It includes the use of technology such as crop rotations, mechanical cultivation and biological pest control and such materials as legumes, crop residues, animal manures, green manures, other organic wastes and mineral bearing rocks. I do not think anyone in this chamber, or anyone perhaps listening to this debate, would argue that agriculture in this country must be made sustainable, for if it is not it simply becomes another extractive industry, another industry which will not be available to us in the future and another non-renewable resource in the litany of non renewable resources upon which we are basing too much of our economic future. This should not be the case. Through agriculture, properly conducted, we have the opportunity in perpetuity for Australia to be a productive nation and with a strong economic base. The benefits of sustainable agriculture include the greater likelihood that small farmers will be able to survive economically, thus being to prevent their farms being taken over by agri- business. The enhancement of the soil is particularly important and is possible through ecologically conscious farming practices. A reduction in, and in some cases the disappearance of, chemical residues in our food chain and in our soil and water would provide us with an additional useful marketing advantage on the world scene-a world which is more and more demanding food products which are safe, nuclear free, chemical free and healthy. This demand is increasing. We spend a lot of time in this place talking about how we can increase our exports. We all know that that is what we need to do. There are markets out there, both within Australia and certainly overseas, particularly in Europe. As I said just last week in speaking on the annual report of the Primary Industry Bank, the New Zealand Government has got right behind its organic farmers in promoting their products and in providing them with a set of standards which can be properly assessed so that the products can be sold on markets which are growing. Australia needs to recognise these growing markets as well. Greater financial rewards for our farmers and the nation will flow from exports of chemically free and unpolluted food products which are now in great demand. The Australian Democrats reject in agriculture, as they do in other aspects of our economy, the `get big or get out' approach, which is becoming an increasingly dominant viewpoint in this country. Of course, this approach extends also to the farming sector. Not enough is said and understood about the benefits of the genuine enterprise at the family level in the agricultural area. One of the things we know about agriculture is that even at its best it is not an industry in which people can expect a high return from their capital investment. People involved in agriculture need to understand what they are doing if this great industry is to survive and be of economic advantage to Australia. One of the things that we do not recognise in Australia at the moment is that there are alternatives to the kind of organisation that our rural industries have had. I would like to suggest that the Primary Industry Bank of Australia, even in its new incarnation, would be a strong supporter, for instance, of the development of farmer co-operatives. Farmer co-operatives in our nation have had quite a mixed history. Some in the fruit canning and dairy industries have struggled to survive. As a Victorian, I point out that there are some ongoing instances of this in my State's dairy industry. Others, however-I would like specifically to mention the Ricegrowers Co- operative Mills Ltd and the Namoi Cotton Co-operative-have been considerable financial successes. The Namoi Cotton Co-operative represents a major challenge to the development of agri-business. It provides its members with technical advice, with credit and with agricultural inputs. It transports cotton from the farm to the gin and is involved in local and international sales and in futures trading. Co-operatives provide opportunities for producers to achieve market strength otherwise prohibited by the very small scale nature inherent in individual family farming. That was recognised in the past with the establishment of some of the older and more recognised co-operatives, as I have suggested, in the fruit and dairy industries. Co-operative endeavours between farmers, and even perhaps between farmers and consumers, may help to develop local communities. As we know, local rural communities need to face some pretty difficult challenges at this time. They can reduce the cost of farming and minimise food price inflation at the same time as they are bestowing these benefits on the producers, the consumers and the local communities. Money can be kept in the local region for reinvestment, helping to generate that regional economic growth. There are currently over 400 rural co-operatives registered in Australia with assets of over $2 billion. Their general success has in fact encouraged agribusiness raiding, with firms such as the Adelaide Steamship Co. Ltd and Industrial Equity Ltd poised to absorb the competition. Corporations such as Elders IXL Ltd have made it known that they would be interested in taking over the operations of the larger statutory authorities if they were to be privatised. So, it is important for any financial institution which claimed to be, or was claimed to be, in the interests of Australian agriculture to look very seriously at giving special consideration to the development of rural co-operatives, and in particular farmer and community joint co-operatives, for all the reasons that I have briefly outlined here. Of course, our concern is that PIBA in its new incarnation may very well be motivated in other directions. Let me return to the Bill. Bearing in mind the stated commitment of PIBA's Managing Director that the bank will continue to dedicate a large proportion of its activities to the rural sector, and the belief of the Minister for Primary Industries and Energy (Mr Kerin) that such a commitment should continue, I would like to see the bank take the initiative in providing finance for rural projects that will be of long term benefit to this country. Just one such project which comes to mind, particularly since it is a Western Australian project and since it is a Western Australian bank which has taken up the Government shares in PIBA, is an innovative proposal by one Mr Barrie Oldfield who is President of the Western Australian branch of Men of the Trees, a tree farming project. I believe this deserves considerable consideration, if not by PIBA, certainly by some other agency. Mr Oldfield recently visited Canberra to discuss his proposal, and the total issue of dry land agriculture and the problems associated therewith, with a number of people including representatives from the Commonwealth Scientific and Industrial Research Organisation's Division of Soils, the director of the national soil conservation program and the Minister for Resources (Mr Peter Morris). I was pleased to be able to arrange for the screening of a film produced by Barrie Oldfield entitled Wheat Today, What Tomorrow? which a number of senators and members of staff were able to view and which, incidentally, is available from the Parliamentary Library. While the film highlighted the crisis facing Australia's dry land agricultural areas, particularly those in Western Australia, it also contained information on some very positive farming projects involving the development of a variety of trees beneficial to farming and research and development of new products from these trees. The aim of the tree farming project is to devise a sustainable economic agriculture for the dry land farms of Australia. On these farms every method of good husbandry known would be brought together. In addition, farm product would be diversified and this would require the development of new techniques for harvesting, processing and the creation of new markets. These, in particular the creation of new markets, are cries that we hear constantly and demands that we hear made all the time of our agricultural sector. But that sector needs support. With losses of $94m a year to agricultural production in Western Australia simply because of dry land degradation in that State, the Australian Democrats believe it is crucial to address this urgent problem, and not just in Western Australia. I believe the tree farming project is most deserving of funding from an organisation such as PIBA, particularly when we note, as I have said, that it was the Rural and Industries Bank of Western Australia which purchased the Federal Government's shares in PIBA. As I said earlier, the Australian Democrats oppose this privatisation move as embodied here in the Primary Industry Bank Repeal Bill. We believe it is a quite deceptive move. I have mentioned that it is a fund raising exercise. As the Minister stated in his second reading speech, the sale of PIBA was completed on 30 June 1987 and resulted in revenue to the Commonwealth of $2.5m. It was a fund raising exercise at the expense, dare I suggest, of our rural industries. But it is also a deceptive move. There is nothing in this legislation which demonstrates what fundamental change has been made for a paltry $2.5m. We have already heard in this debate from Senator Brownhill, with whom I do not always agree. But certainly he put quite eloquently, in the dying stages of his speech, the fact that the Primary Industry Bank has been useful, has supported farmers as it was intended to do in the beginning, has given a great many farmers security, and even those not using it a sense of security that it was there and available to them. As he said, it has been an efficient enterprise backed by government. As he said, the paper work was quick. For goodness sake, that is not something that we often hear about organisations of this nature. But Senator Brownhill went on to say that the Opposition `hopes' that everything will be all right now that PIBA has been privatised. This is where Senator Brownhill and I part company, I am sad to say. This is typical of the attitude of the Opposition which here, as unfortunately is so often the case, comes together with the Government in their gallop down the track towards privatisation. There is the mythical idea that nothing should be run by government or supported to any large extent by government because it will be far more efficiently done if it is done by the private sector. I do not think that the rural industries of Australia can live on the sort of hope that was expressed by Senator Brownhill on behalf of the Opposition. Let me point out a couple of additional points that were made in the annual report, of the Primary Industry Bank of Australia which was tabled last week and which demonstrates what the Primary Industry Bank itself believed-I advisedly use the past tense in this case-was important. The annual report states: Australian farmers are encouraged to ensure that this country's national land assets are preserved in a condition that is conducive to ongoing productivity. Agriculture is one sector of the Australian economy that can be truly described as being based on a `renewable resource'. It is important that the quality of this resource be maintained for the present and future generations. (Quorum formed) Having, before the quorum was called, quoted from the annual report of the Primary Industry Bank of Australia, which says that it is important that the quality of Australia's renewable resource, which is used in agriculture, be maintained for present and future generations, I was going on to say that that is a sentiment which is absolutely endorsed by the Australian Democrats, and is the reason for the comments which I have made in this debate. I have also, however, in this debate said that the Australian Democrats oppose this Bill as we see this as the thin end of the wedge, as the beginning of the moves towards privatisation, which we are quite convinced are upon us, certainly on behalf of the Government. As far as the Opposition is concerned, it is just sitting there, salivating and wishing it had done this when it was in government, or that it was in government now so that it could do it all the more quickly. The question is: Where will privatisation stop? At this stage the Government has said that it has only a few public enterprises in its sights-Qantas Airways Ltd and Australian Airlines. However, the Prime Minister (Mr Hawke) is already there, as Senator Macklin said earlier this afternoon, gloating to the New York bankers about next year's Budget surplus. Here we go again-more asset sales and more privatisation. This is a government committed to deregulation, Budget surpluses, and reduced government borrowings, and privatisation is only a means to that end. The commitment that the Government had to the Primary Industry Bank, one which was begun, as Senator Brownhill said, by a Liberal government, is now gone. I remind the Senate that PIBA's Managing Director has said that PIBA will now be entering into corporate commercial lending. I also remind the Senate of the spectre of agribusiness, which is squeezing out the family farmer and threatening that resource base in Australia. I quote again from the annual report of the Primary Industry Bank of Australia, which was tabled last week in this place: Much of Australia's agricultural areas are subject to drought, fire, flood or plagues at some time. It is important to have a bank that understands these potential difficulties and can help when the time comes. Against a background of seasonal uncertainty and price variations, it is often difficult for a farmer to plan principal repayment without jeopardising future working capital. To this end PIBA can restructure existing borrowings to increase the funds available for working capital. That seems to be in direct contrast to the plans for the future for PIBA as outlined by the Managing Director. I do not believe that I can stand here, as Senator Brownhill did, and say that I hope this will not be the case. For that reason, and for the reason that the Australian Democrats are concerned about the total move, both in general economic terms towards privatisation and specifically in agriculture, towards a more, if it is possible, exploitative approach to agriculture and to our resource base, the Australian Democrats will be opposing this legislation. Senator ALSTON(Victoria)(8.54) —I rise to speak on the Primary Industry Bank Repeal Bill 1987. This is a significant piece of legislation because it is a response to a very dramatically changed economic environment. When the Primary Industry Bank of Australia was established in 1978 there was a much smaller number of banks than there is now, and shortly prior to the dramatic shrinkage of banks that occurred in the early 1980s. Its establishment certainly preceded the Campbell Committee of Inquiry into the Australian Financial System, and I think in many ways has been overtaken by the outcome of that Committee. The bank itself is fairly small beer. The Commonwealth only ever had a 12.5 per cent share, which it sold for $2.5m, so the market capitalisation of the bank was about $20m. I shudder to think what it would be worth on today's market, but a sum of about $2.5m is not likely to make a significant difference to government revenue. One therefore has to ask why the Government has chosen to embark upon this course. It is not accurately described as privatisation, and I suppose it is not any more accurately described as publicisation. The fact is that the Commonwealth's share in the bank has been sold to a wholly owned State government enterprise, the Rural and Industries Bank of Western Australia. I am informed by a colleague of mine that that bank has spent most of its activities in recent times bailing out friends of the Burke Labor Government, including the Swan Building Society and the Teachers Credit Society Ltd, and more recently, providing a $150m guarantee to Rothwells Ltd. Be that as it may, I suppose the Rural and Industries Bank is not likely to go broke in the short term. If it does, Senator McKiernan will be urging the Burke Government to bail it out. But for the time being we have a transfer from one level of government to another, so I do not think that can be properly described as privatisation. Senator Powell —But who wants to be the haves of the Western Australian Government? Senator ALSTON —I am in heated agreement with Senator Powell. I think she has eloquently articulated the National Party of Australia point of view in many respects. But I do wish to address in my remarks the extent to which it is proper for a government to be involved in the operations of any bank, let alone a bank of this magnitude. Whilst it might have performed very useful services to the rural community in times gone by-its primary objective was to provide long term funding to the rural sector through a refinance facility-the fact is that the farming community is well able to obtain loans, if necessary, at subsidised rates through a whole range of existing financial institutions, not the least of which are a couple of pastoral companies which spring to mind. It can certainly be deliberately or explicitly encouraged by government to do that by means of the tax mechanism. It is not appropriate for the Government to be involved in an institution such as the Primary Industry Bank. I therefore welcome its sale, although it has not, of course, been sold off entirely to the private sector. Nonetheless, I think it is worth congratulating the Government for the actual transfer, although I think its motives deserve to be questioned. The bank did have a very complex structure of ownership, and undoubtedly that did cause management control problems. As I have said, the Commonwealth owned 12.5 per cent. Four of the other major banks, together with a consortium of State banks, each owned 17.5 per cent. One can imagine the sorts of difficulties that would have posed in achieving any significant changes at board level. So it does make sense for the Commonwealth to have shed its interest. I only wish the Commonwealth would adopt the same approach in relation to some of the other enterprises that it presently controls. I have in mind Australian Airlines, which is currently being allowed to bleed to death. I was horrified at the suggestion made by Senator Maguire, before the dinner break, that because one might travel by Ansett Airlines of Australia, somehow that meant one was a captive of that organisation. The reality, of course, is that if anybody should be grateful to the Government at the present time, it is Ansett Airlines. I think one can safely say that it is a mile in front under the present arrangements. It has had the opportunity to buy about $1 billion worth of new aircraft while at the same time Australian Airlines has been forced to defer its purchase of a miserable $650 million worth. The reality is that the Government is not prepared to operate sensibly and to allow Australian Airlines to have that necessary capital injection, or blood transfusion, that it desperately needs. One can understand that, because of all the heroic circus acts that have been performed in recent times by the Treasurer (Mr Keating) to achieve a mirage of a balanced Budget. The fact of the matter is that the Government is simply in no position now to find anything like the sort of money that will be needed to bail out a whole range of public enterprises, Australian Airlines being simply one of them. I regret that more competition was not introduced into that particular market. The decision to end the two-airline agreement was simply something for which the writing had been on the wall for some years. The ultimate outcome was essentially a very conservative result and one which does not reflect credit on the Government. If the Government had the courage of its real belief in competition it would have allowed Air New Zealand to enter our market as we have been allowed to enter its. It would have considered a merger between Qantas Airways Ltd and Australian Airlines and it would have allowed that conglomerate to compete both nationally and internationally with Ansett Airlines of Australia, which is no doubt more than happy to accept that challenge. Of course, the reality at present is that Australian Airlines will simply have one arm behind its back. In the context of the debate on privatisation it is worth briefly recapitulating some of the pseudo-arguments that have been advanced in this debate and the preceding debate in relation to the Commonwealth Borrowing Levy Bill. I fear that the Australian Democrats will adopt the position of running a fear campaign, playing on all sorts of xenophobic responses in the community-fear of foreign ownership, of small family farms being taken over and of privatisation simply transferring wealth into the hands of the greedy. The reality, of course, is that if privatisation is properly handled it is a net benefit to the Australian community. All consumers will benefit from greater efficiency in the provision of services. There is absolutely no justification for the Government's being involved in public trading enterprises to the extent that it is now, or indeed at all, by and large. I found it rather galling to hear Senator Macklin before the dinner break somehow lauding the castigation by the Prime Minister (Mr Hawke) of all those who had the temerity to espouse some virtues of privatisation and not then going on to identify the total recant that we have seen in recent weeks. The Prime Minister now, of course, is finding himself being overtaken by events and being locked in by a Caucus that is so scared stiff that privatisation might actually get somewhere that it is now ensuring that its sale of assets committee has more teeth. It is calling on Ministers to explain in explicit terms any justification for increased asset sales. Of course, the Telecom Australia preservation society, of which perhaps not all honourable senators will be aware, has only recently been set up by Caucus. The Telecom preservation committee consists of three backbenchers, two of whom are former employees of Telecom. The sole object of that exercise-- Senator McKiernan —You are repeating yourself. Senator ALSTON —No doubt, Senator McKiernan is a strong supporter of that committee. The sole object is to ensure that no aspect of Telecom is touched. I think that is regrettable because it shows the sort of fear-mongering and hysteria that can be easily whipped up for political purposes. If only the Prime Minister and the Treasurer were allowed to have the temporary courage of their convictions we might get a bit more honesty into the debate. It is regrettable that two of the more significant parties in this chamber seem to be hell bent on a path of generating fear and concern in the community when it is not justified. I would have thought that all those good right wing members of the Australian Labor Party and certainly the leaders of the machine, the power drivers and generators, would be right behind the Prime Minister and the Treasurer encouraging them in their feeble and late conversion to efficiency and competition. Whether they are likely to succeed is a moot point at this stage, but it certainly would seem that it would be against the endeavours of the majority of Caucus. That is regrettable. Therefore, I think it is opportune that the Government has indeed embarked upon a very small measure of pseudo-privatisation, a transfer from one level of government to another of a 12.5 per cent interest in the Primary Industry Bank to the Rural and Industries Bank of Western Australia. It is worth taking note of this measure despite the no doubt impure motives of the Government in using this opportunity to garner a very small sum of money, some $2.5m, no doubt again for improper reasons. I say that deliberately because that sum of money has already been included in the assets sales funds that were announced in the May statement and it will simply be used to finance the increasing level of Government expenditure. The Opposition parties have made clear their position on privatisation. We do not have an ad hoc expedient approach to grabbing a few bob here and there. Senator Richardson —You don't have an approach; that is your problem. Senator ALSTON —This should be a very good learning opportunity for the likes of Senator Richardson, who might have been foolish enough not to appreciate that we in fact have a series of guiding principles. We are not guided by the desire to try to balance the books at all costs. Senator Richardson —Even you can't keep a straight face with that. Senator ALSTON —Let me just recite them to the honourable senator chapter and verse so that he will be under no misapprehension. The sorts of guidelines that we propose for the sale of government assets are as follows: Firstly, there must be demonstrable benefits to consumers and/or taxpayers. It should be painfully obvious that this is the case, even to those ideologues on the other side of the chamber who think that all public ownership is right. Of course, Senator Powell's corollary of that is that all private ownership is wrong. What we have in mind is that there may be demonstrable benefits-there is very likely to be a much higher level of efficiency in private ownership than there ever would be under government ownership-to the consumers and to taxpayers who, by definition, would have to provide less funds to government to maintain these operations, even when they were losing money hand over fist. We have had the Aussat Pty Ltd report tabled today which showed a net loss of $17 1/2m. Government is constantly being asked to bail out these enterprises. There is no need for that. If the services they render are somehow worthy of subsidisation there should be a transparency of approach. An explicit subsidy should be provided. Senator Powell —So you knock it off again in the Budget. Senator ALSTON —We do not have to knock it off. If those interest groups are sufficiently persuasive and are able to demonstrate that a telephone to rural areas should be paid for at the rate of $15,000 a throw, so be it. But let us have it up front. Senator Powell —You have lived in a city all your life. You do not live in a remote area. Senator ALSTON —If the honourable senator chooses to live in a remote area she is perfectly entitled to have a telephone connected herself. Senator Stone —She lives in the left wing of the Labor Party. That is the most remote area in the country. Senator ALSTON —That is right. That is completely out of touch. I do not think even a telephone would be able to help those people back to reality. I am sorry to have disturbed honourable senators opposite, but, as I said, the first principle is demonstrable benefits to consumers or taxpayers. The second is that the position and job security of existing employees will be given special consideration and the sale of shares to employees will be encouraged wherever possible. Lest honourable senators opposite think that we are cold and heartless and that we simply want to turn workers out on the streets, the reality is that the Prime Minister and the Treasurer are ad idem with us on this. They see the very real benefit of employee ownership, of management and employee buy-outs. It makes all the sense in the world to have a direct involvement in the operation of the enterprise. Lest there be any misunderstanding, we have only to go back to the debate in England last month at the Trades Union Congress where some clown suggested that privatisation was a horrible thing and that when the Labour Party got back into government it should throw it out. What happened? The leadership of the TUC got up and made it abundantly clear that any such attempt would be thrown out of court; that, in fact, privatisation had been a very popular move, especially amongst all those workers who had been able to take up shares. Ninety-six per cent of British Telecom employees took up shares in that corporation despite a trade union encouraged boycott, despite all of the endeavours of the trade union movement to turn the masses against privatisation. The reality is, of course, that the workers saw right through it and took the money. I have heard criticism today of the way in which the British Telecom float was undertaken. Let me say this: I do not regard it as a perfect outcome for two very good reasons. Firstly, the Office of Telecommunications, Oftel, the regulatory body which was established was set up very late in the piece at a stage when most of the major decisions had been taken and when it was therefore not in a position to guide the way in which the restructuring took place. The other very significant reason why that float has had a less than optimum result is that the single competitor of British Telecom, Mercury, has been given only a guaranteed 5 per cent of the market with a further guarantee of 10 per cent within five years. That is simply not adequate. If we are talking about real competition in the burgeoning telecommunications industry, which will provide enormous export opportunities for Australia as well as the United Kingdom and other countries, the first thing we have to do is make sure that there is real competition. At the moment it is a very one-sided operation with British Telecom having 95 per cent of the market. If honourable senators have any sense of history they will go back to the original Bell Corporation that preceded American Telephone and Telegraph Co. in the United States. Whilst there was a government monopoly relatively few telephones were connected. As soon as that monopoly was broken down towards the end of the century that industry exploded. The same has happened since 1984 with the break-up of American Telephone and Telegraph, and I am sure we will see the same situation in Australia. It is not selling the country down the drain; it is not selling consumers down the drain; it is not playing into the hands of vested interests. It is simply ensuring that the consumer is able to get the best value for money and, to the extent that there remains the same amount of money in government coffers, that that money can go further. We could do away with middle class welfare; we could help those people who are genuinely in need. We could be more efficient, and it is a tragedy that the Australian Democrats do not see it in those terms. If the Democrats were genuinely concerned about ensuring that the government dollar went as far as it ought to go in meeting the very real needs of many Australians who are genuinely disadvantaged and who need government assistance-not simply the unemployed but all those on welfare pensions who are entitled to them-the best way of ensuring that governments will not come under pressure to cut back across the board is to ensure that the services they provide are efficiently provided and that more money is left to go further. That is one of the cardinal principles that lie behind our commitment to the concept. We very much want to see employee interest not just in public trading enterprises; we would welcome it very much at the private sector level, at the enterprise level. Senator Maguire —Would you privatise the railways? Senator ALSTON —If Don Dunstan thought it was good enough to sell off the railways, we would be interested in the concept. Senator Maguire —Would you actually do that? Senator ALSTON —There would be no objection in principle to selling off a loss operation. I would have no problem with selling off Aussat Pty Ltd, which is losing money at the moment. There would be no particular reason why Australian National should not be sold off. There is no particular reason why the Government should shy away from selling off a profit-making enterprise. The principles that are applied do not depend upon the bottom line; they depend upon the nature of the activity. As the Prime Minister said recently, one has to ask first of all: can the service be prepared by the private sector and, if so, can it be better performed by the private sector? That is the reality of the matter, not whether it is making a quid, not whether the Victorian Government should have a 25 per cent stake in Alcoa, not whether it might have a boom year and get back a record return and therefore the Government should hang on to it or whether the following year it has a loss and the Government should be tempted to sell it. That is irrelevant. What is important is that taxpayers' funds do not go towards subsidising activities that can be much better carried out in the private sector and where the real risk takers should be. The third principle that we believe is fundamentally important is that the quality and availability of services to remote areas should not be allowed to deteriorate. That means that the community service objective that is written into a good deal of legislation that currently involves cross-subsidisation arrangements can be preserved, that that can be explicitly acknowledged, and to the extent that it requires the transmission of government funds, those funds can be forthcoming. But that is absolutely no reason why cross-subsidisation should be allowed within the enterprise. For example, Telecom Australia is recognising just that fact by breaking itself down into five separate corporate groups. That makes sense because one is able to identify those areas which make a loss, tell precisely how much it is costing the taxpayer and make a sensible political decision whether it is worth while. It may well be that a much greater contribution should be made to remote areas than is being made at the moment. The blind notion that somehow everyone ought to have a telephone today will be translated into the equally blind notion that tomorrow everyone should have a television set. No doubt the argument could go beyond that in the not too distant future. The real question to be asked is when should governments stop picking up the tab for such activities? If people choose to live in country areas, it does not axiomatically follow that they should be entitled to all of the services that are perhaps taken for granted in some country areas. To the extent that they are necessary for the public good, there may well be a case for government subsidy. Otherwise, I would have thought that the choice should be a private one, not a public one. The fourth principle we regard as important is that any large scale sales should be timed so as to avoid disruption of capital markets. There was a very clever piece of legerdemain in the United Kingdom last night where the Chancellor of the Exchequer did not shy away from the sale of British Petroleum despite the dramatic downturn in the market. He came up with what would seem to be a very clever manoeuvre. The buy-back arrangement, under which the Government buys shares at 70p, is putting a very real floor under the price. Immediately that was announced the price of the shares already publicly traded went up by about 10 to 15 per cent. That simply shows that the Government was prepared to acknowledge that these are difficult times, and so any Australian Government should recognise that we cannot seek to dump a very large enterprise on the market irrespective of prevailing conditions. It may well be that the Government would want to sell in tranches. It may want to sell only a portion and it may well want to stage the selling off of various aspects of the enterprise. But to the extent that it would involve significant capital raising, the Government would obviously have to take account of the state of the market. The fifth basic principle we believe is important is that sale proceeds will not be used to finance new government expenditure but will be directed towards reducing the accumulated public debt. That lesson has not been universally applied even in the United Kingdom and it certainly has not been applied here. In this instance the Government could not resist the temptation to use even with the miserable $2.5m on Budget to finance its expenditure excesses and to count it as part of its asset sales for the purpose of achieving a so-called balanced Budget. Whilst we do not oppose this Bill and whilst in many respects we welcome the decision to sell off the Government interest in the bank, it is regrettable that it will simply go to a State owned or government bank. The Government does not seem to have applied the proceeds in a proper manner and it does not seem to have learnt the lesson that there should be a reduction in expenditure rather than simply a transfer of resources. Senator WATSON(Tasmania)(9.18) —The Senate is debating the Primary Industry Bank Repeal Bill, which is a relatively short Bill of no more than two pages. The legislation seeks to repeal three Acts of Parliament relating to the Primary Industry Bank of Australia (PIBA) and to make some consequential amendments to the Banking Act 1959. We on the Opposition side believe that the sale of the Government's 12.5 per cent interest in the Primary Industry Bank, which was announced in the May economic statement, is a step in the right direction away from the Federal Government having a direct involvement in the banking system. The sale of the Primary Industry Bank to the Rural and Industries Bank of Western Australia will consolidate the base of the bank and the group will now represent the seventh largest banking organisation in Australia. The new arrangements should enhance the ability of the new institution to assist primary producers and other elements of the rural sector. We note that the Minister for Finance (Senator Walsh), in his second reading speech, made the point: . . . the Commonwealth has sought to ensure that the rural sector would not be disadvantaged in its access to banking services previously provided by PIBA and that the rural sector would continue to have a voice on the PIBA board. I hope this concern will be an ongoing one and that the Minister will continue to take an interest in the best interests of the rural community. I refer to some comments by the President of the National Farmers Federation, Mr Ian McLachlan, who stated: . . . the proposed change in shareholding of the bank should be seen as an opportunity to encourage self-help initiatives for the farm sector, while retaining the bank as primarily a specialist rural lending facility, with at least 60 per cent of all loans being directed to primary producers . . . Mr McLachlan went on to state that: . . . ``PIBA'' bond would encourage farmers to set aside funds to help themselves through times of economic crisis. On completion of the sale of the Government's shares on 30 June this year, the Commonwealth received $2.5m in revenue. I think it is to the credit of the Primary Industry Bank and its executives that last year it achieved its goal of repaying in full the assistance it received from the Commonwealth in the form of loan funds. It was also a very successful year for the bank, with its net profits reaching a sum in the vicinity of $4.25m. This represented an increase of some 22.5 per cent on the previous financial year's profit. I feel sure that all who have been associated with the Primary Industry Bank in the past and those with newly found interests will hope that this new organisation continues its record of success and goes from strength to strength. I believe that it is appropriate in discussing this Bill to make a few brief points about the banking system generally and how it is operating. Under the deregulated system with a greater number of banks operating in Australia, a number of us are a little disappointed that interest rates have not fallen as much as we would have hoped. However, of late interest rates have tended to show some sort of volatility. Although they have been coming down, we noticed that in the last few days they have firmed slightly as the value of the Australian dollar has slipped in terms of international currency. However, there is less uncertainty about what I may refer to as the direction bank charges are taking. There is no question about that, for they are going up. Few people tend to realise this until they study their bank statements very closely. Not only do cheque accounts which are held with most of the trading banks attract what is termed accounting charges for each quarter, but also transaction fees are levied. Few people would know that one of Australia's major banks actually charges a fee of 4c per $100 on all deposits; in other words, one pays for the facility of putting one's money in that bank. Most other banks charge a fee where a depositor exceeds perhaps 30 or 40 transactions over a three-month period. This charge is usually 20c per transaction over the maximum limit. While in most cases this fee is levied only where the limit is exceeded, I know of one bank in particular where a depositor was charged for all the transactions where he or she exceeded that limit by only one transaction. I believe that we seem to be reaching the stage where it is becoming more expensive for some people to contact their banker than it is to contact their country solicitor. The past few years have seen quite rapid changes in banking in Australia. The way that people are organising their money and are paying their bills has changed in that time. This is largely the result of not only technological developments, but also deregulation of the system and a whole lot of new financial institutions. However, there are perceptible changes. I believe that banks must rationalise even further if they are to survive. I think this rationalisation will have to be carried out fairly quickly at the bottom end, and here I am referring to the credit union area and, to a lesser extent, building societies and so on. There will certainly be rationalisation in the financial services area in the next few years. The decline that we have seen as a result of the depressed prices on the stock exchange will, undoubtedly, accentuate that change. On the whole, all of these changes-electronic transfers of funds, et cetera-have been to the customer's advantage. Convenience is now the watchword of the industry. But there is, however, one area that I believe deserves more attention. It seems that, in some cases, the banks are not accepting their full legal responsibility for error or even convenience. I refer here to the electronic transfer of funds. I do not think the law is quite abreast of current practices in this area and the people who tend to suffer are the customers of the banks. Many people are being unnecessarily inconvenienced in backlogs in the system and are being told, as it were, `It is just one of those things'. We tend to blame the computer. But all banks should be doing all they can to ensure that depositors have access to their funds when they need them. I think it is also opportune, in discussing this Bill, to examine some other government financial institutions. I refer particularly to the Commonwealth Banking Corporation. For example, the annual report which was tabled last week showed the Commonwealth Bank group profit had declined quite significantly last year compared with 1985-86. In fact, the group's operating profit for 1986-87 was $378.1m, or 15 per cent down on the previous year, while the after tax profit was $197.2m, which was 32 per cent lower than 1985-86. This slide in profit is more significant if one looks at the figures for the main company in the group, the Commonwealth Bank of Australia, whose profit was down by something like 40 per cent over 1985-86. The annual report remarks that the increase in the corporate tax rate to 49 per cent, together with this Labor Government's fringe benefits tax which actually cost that group $25.7m last year, contributed significantly to this diminished profit. These great taxation burdens that are the handiwork of the Treasurer, Mr Keating, have severely disadvantaged the banks despite the first class efforts of the Chairman of the Commonwealth Banking Corporation, Sir Brian Massy-Greene, in conjunction with the Managing Director, Mr Don Sanders, in managing this operation it was noted that these sorts of charges were beyond the control of the executive and the board. Despite the problems that are in the economy at the moment, we wish the new and enlarged Primary Industry Bank every success. I mentioned earlier that banks must rationalise to survive. I think people's perception of the banking community has undoubtedly slipped in the last few years. Basically the banks really have not appreciated, or certainly they have underestimated, the extent of corruption in the banking system, particularly so far as tax avoidance and tax evasion is concerned. I believe that the banks, therefore, have to tighten up their act very much more, otherwise there will be some Federal legislation in this area. The decision about last September by private banks to charge customers a fee for withdrawing their own money from savings accounts has been described as greed. Steps such as this have indicated a certain amount of greed. Undoubtedly, the deregulation of the banking system has caught up with a lot of these banks. They have made their initial cost savings. They are now competing on a more open market and there is certainly pressure on their profits. But I think there will be further substantial changes in the bank structure of Australia if banks are to survive this tough economic climate in which we find ourselves today. I commend the Bill 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 . . . . . . . . . . . 53 Noes . . . . . . . . . . . 7 —— Majority . . . . . . . . . 46 —— Alston, R. K. R. McKiernan, J. P.Archer, B. R. Maguire, G. R. (Teller)Aulich, T. Messner, A. J.Baume, Peter Morris, J. J.Bjelke-Petersen, F. I. Newman, J. M.Black, J. R. Panizza, J. H.Boswell, R. L. D. Parer, W. R.Brownhill, D. G. C. Patterson, K. C. L.Burns, B. R. Puplick, C. J. G.Calvert, P. H. Ray, RobertChapman, H. G. P. Reid, M. E.Childs, B. K. Reynolds, M. E.Coates, J. Richardson, G. F.Collins, R. L. Ryan, S. M.Colston, M. A. Schacht, C. C.Crowley, R. A. Sheil, G.Devereux, J. R. Short, J. R.Devlin, R. Sibraa, K. W.Durack, P. D. Stone, J. O.Foreman, D. J. Tambling, G. E. J.Gietzelt, A. T. Tate, M. C.Giles, P. J. Vanstone, A. E.Hill, R. Walsh, P. A.Jones, G. N. Walters, M. S.Knowles, S. C. Watson, J. O. W.Lewis, A. W. R. Zakharov, A. O.MacGibbon, D. J. Coulter, J. R. Macklin, M. J. (Teller)Haines, J. Powell, J. F.Jenkins, J. A. Sanders, N. K.McLean, P. A. Question so resolved in the affirmative. Bill read a second time, and passed through its remaining stages without amendment or debate. Bills received from the House of Representatives. Motion (by Senator Richardson) agreed to: That the Bills may proceed without formalities, may be considered together and be now read a first time. Bills read a first time. Senator RICHARDSON(New South Wales-Minister for the Environment and the Arts)(9.35) —I move: That the Bills be now read a second time. I seek leave to have the second reading speeches incorporated in Hansard. Leave granted. The speeches read as follows- AUSTRALIAN MEAT AND LIVE-STOCK INDUSTRY LEGISLATION AMENDMENT BILL 1987 The purpose of this Bill is to make a number of amendments to legislation affecting Australia's meat and livestock industry, namely, the Australian Meat and Live-stock Corporation Act 1977; the Australian Meat and Live-stock Research and Development Corporation Act 1985; the Australian Meat and Live-stock Industry Policy Council Act 1984; and the Australian Meat and Live-stock Industry Selection Committee Act 1984. This Bill is associated with the Live-stock Slaughter Levy Amendment Bill 1987 and the Live-stock Export Charge Amendment Bill 1987. In regard to the Australian Meat and Live-stock Corporation Act 1977, the Bill formalises the ability of the Australian Meat and Live-stock Corporation (AMLC) to work with the Australian Pork Corporation in the development of marketing schemes for Meat and Livestock. Provision is made for the Minister to prescribe by Regulation individual marketing schemes such as computer aided live-stock marketing, known as CALM, and the Authority for the uniform specification of meat and live-stock known as AUS-MEAT. The Bill also provides that the AMLC will be required to consult with the peak industry bodies in the preparation of its five-year corporate plan and its annual operational plan. In addition to the five-year plan is to be a rolling plan, that is, it will need to be updated each year so that it always covers the next five years. A number of specific additions are made to the information to be contained in the AMLC's annual report; these are intended to improve the level of reporting by the Corporation to Parliament on its activities. The powers of the AMLC to meet the costs and expenses incurred by industry organisations attending consultations with the Corporation are clarified. The AMLC will be able to make payments in addition to travelling expenses, in accordance with guidelines issued by the Minister. These guidelines make it quite clear that only reasonable costs associated with consultations can be met, and it will be up to the AMLC to ensure that activities for which it meets the costs are consistent with its powers and functions. The legislation proposes to limit the making of such payments to the Cattle Council of Australia, the Sheepmeat Council of Australia and the Australian Meat Exporters' Federal Council. There is also, however, a provision for other organisations to be added to the list by regulation, should it become apparent that this is appropriate. Under the current AMLC Act members are appointed for a fixed three year term with appointments being staggered so that not all members change at once. It is proposed to make this arrangement more flexible by providing that members may be appointed for periods of up to three years. A number of changes are intended to streamline the administration and operation of the AMLC's Annual General Meeting. These include greater flexibility in the timing of AGMs, the closing date of voting registers, lodgment of notices of motion and the deadline by which proxies must be lodged. In addition the provision requiring a vote of 75 per cent of those people on the register to pass a special motion or to overturn a Corporation motion for an increase in the levy, is to be changed so that a vote of 75 per cent of those people present, either in person or by proxy is all that will be required. In line with the Government's policy on the reform of statutory marketing authorities, the legislation requires the AMLC to adopt an equal employment opportunities program. This program is to be incorporated in the Corporation's corporate plans and a progress report is to be included in the Corporation's annual report to Parliament. The Changes to the Australian Meat and Live-stock Research and Development Corporation Act 1985 are designed to streamline the administration and operation of the Corporation's annual general meeting and mirror the changes being made in this regard to the AMLC Act. The Australian Meat and Live-stock Industry Policy Council Act 1984 is to be amended to remove the requirement that the policy council holds an industry wide conference at least every two years to canvass industry views on matters currently affecting the industry. The policy council will, however, retain its power to call such conferences whenever it feels they are needed. This Bill also seeks to amend the Australian Meat and Live-stock Industry Selection Committee Act 1984. This Act provides for a selection committee to nominate members for appointment to the AMLC and the AMLRDC. The proposed changes are to allow for the appointment of members of the selection committee for periods of up to three years instead of the present fixed three-year term. Also it is proposed to remove the requirement for the selection committee to prepare an annual report to Parliament. The preparation of an annual report is considered unnecessary as the Committee has only a single purpose and meets on an ad hoc basis. The amendment will bring the selection committee into line with other statutory marketing authority selection committees. The changes proposed by this Bill will have no impact on Commonwealth income or expenditure. I commend the Bill to honourable senators. I present the explanatory memorandum to this Bill. LIVE-STOCK EXPORT CHARGE AMENDMENT BILL 1987 The purpose of this Bill is to increase the maximum rates of export charge that may be imposed under the Live-stock Export Charge Act 1964. This Act imposes a charge on the export of cattle, sheep, lambs, buffaloes and goats from Australia. As in the Live-stock Slaughter Levy Act 1964 the charge consists of three components which raise funds to finance the activities of the Australian Meat and Live-stock Corporation (AMLC), the Australian Meat and Live-stock Research and Development Corporation (AMLRDC), and, in the case of cattle and buffaloes, bovine disease eradication. Maximum rates are set in the legislation for the AMLRDC component, the disease eradication component, and the total of the AMLRDC and AMLC components. The maximum available for the AMLC is the difference between the current operative rate for the AMLRDC and the maximum rate prescribed for the total of the AMLRDC and AMLC components. The individual operative rates of charge for each class of livestock are set by regulation. The export charge rates for the AMLC and the AMLRDC are varied only after the Minister has received recommendations from the relevant body, that is either the AMLC or the AMLRDC. Neither the AMLC nor the AMLRDC is permitted to recommend a change to the operative rates of export charge without having first had a motion endorsing the changes passed at their respective annual general meetings. The amendments proposed in this Bill will increase the maximum level of the export charge and therefore the AMLC's potential share of the charge, while not increasing the maximum rate prescribed for the AMLRDC or disease eradication. The proposed increases in the maximum charge rates are as follows: Cattle-from $6.00 to $18.00 Sheep-from 60c to $1.50 Lambs-from 67c to $1.50 Buffalo-from $6.00 to $18.00 Goats-from 60c to $1.00 The considerations behind the substantial increase in maximum charge rates are the same as I outlined in my speech relating to the Livestock Slaughter Levy. The proposed increases will have no effect on the current operative rates of the livestock export charge, nor will they have any direct impact on Commonwealth income or expenditure. I commend the Bill to honourable senators. I present the explanatory memorandum to this Bill. LIVE-STOCK SLAUGHTER LEVY AMENDMENT BILL 1987 The purpose of this Bill is to increase the maximum rates of levy that may be imposed under the Live-stock Slaughter Levy Act 1964. This Act imposes a levy on the slaughter at an abattoir of cattle, sheep, lambs, buffaloes, goats, calves and bobby calves for human consumption. This Bill is associated with the Live-stock Export Charge Amendment Bill 1987. The levy consists of three components which raise funds to finance the activities of the Australian Meat and Live-stock Corporation (AMLC) including its promotion functions, the Australian Meat and Live-stock Research and Development Corporation (AMLRDC) and, in the case of cattle, calves, bobby calves and buffaloes, bovine disease eradication. Maximum rates are set in the legislation for the AMLRDC component, the disease eradication component and the total of the AMLRDC and AMLC components. The maximum available for the AMLC is the difference between the current operative rate for AMLRDC and the maximum rate prescribed for the total of the AMLRDC and AMLC components. The individual operative rates of the levy for each class of livestock are set by regulation. The slaughter levy rates for the AMLC or the AMLRDC are varied only after the Minister has received recommendations from the relevant body, that is either the AMLC or the AMLRDC. Neither the AMLC nor the AMLRDC is permitted to recommend a change to the operative rates of levy without having first had a motion endorsing the changes passed at their respective annual general meetings. The amendments proposed in the Bill will increase the maximum level of the slaughter levy and therefore the AMLC's potential share of the levy, while not changing the amount set aside for the AMLRDC or disease eradication. The proposed increases in the maximum levy rates are as follows: Cattle-from $6.00 to $18.00 Sheep-from 60c to $1.50 Lambs-from 67c to $1.50 Buffalo-from $6.00 to $18.00 Goats-from 60c to $1.00 Calves-from $2.10 to $6.30 Bobby calves-from 60c to $1.80 Substantial increases in the maximum rates prescribed for the livestock slaughter levy have been recommended by the Australian Meat and Live-stock Corporation with general support from the major industry organisations. The levels recommended to the Minister for Primary Industries and Energy allow scope for the AMLC component of the levy to be increased to enable the purchase and disposal of meat with a high risk of containing pesticide residues and to finance anticipated expenditure by the Corporation on programs being initiated to avoid a repetition of the recent chemical residues crisis. They also provide scope for the AMLC to seek additional funding for its promotion activities in Australia and overseas. On the matter of pesticide residues I would like to congratulate the industry on its preparedness to tackle the problem. The industry, apparently universally, accepts the need to get its house in order and to take whatever steps are necessary to re-establish its reputation as a supplier of nutritious product to the world's markets. So far as domestic consumers are concerned, they can be assured that Australian meat remains a healthy and desirable part of a well-balanced diet. The adequacy of the AMLC's present promotion activities was the subject of lively debate at the last annual general meeting of the AMLC. It was apparent at that meeting that there was general willingness to support significant increases in promotion expenditure if the AMLC thought it would be cost effective. Passage of this Bill will clear the way for the possible introduction of new operative rates of levy if such are recommended by the forthcoming annual meeting of the AMLC. The proposed increases will have no effect on the current operative rates of livestock slaughter levy, nor will they have any direct impact on Commonwealth income or expenditure. I commend the Bill to honourable senators. I present the explanatory memorandum to this Bill. EXPORT INSPECTION CHARGES COLLECTION AMENDMENT BILL 1987 The principal purpose of this Bill is to amend the Export Inspection Charges Collection Act 1985 to complement the amendments to the Export Inspection (Establishment Registration Charge) Act 1985 which are included in the Export Inspection (Establishment Registration Charges) Amendment Bill 1987. The Bill amends the provisions in the Export Inspection Charges Collection Act 1985 which prevent the extension of the `continuous registration' initiative to establishments which are subject to establishment registration charge. An explanation of this initiative is given in the second reading speech on the Export Inspection (Establishment Registration Charges) Amendment Bill 1987. The Bill also makes general consequential drafting changes. Other effects of the Bill are to replace a provision describing the time within which various charges are to be payable, so as to leave that kind of detail to be specified in regulations, and to remove a provision which will serve no purpose following the entry into force of amendments to the Export Control Act 1982 which are included in the Statute Law (Miscellaneous Provisions) Bill (No. 1) 1987. The Bill will have no direct financial impact, as the amount of charge collected will not be affected by the amendments. I present the explanatory memorandum to this Bill. I commend the Bill to honourable senators. EXPORT INSPECTION (ESTABLISHMENT REGISTRATION CHARGES) AMENDMENT BILL 1987 The purpose of this Bill is to amend the Export Inspection (Establishment Registration Charge) Act 1985 to remove impediments to the full implementation of an initiative designed to reduce the red-tape burden on exporters of foodstuffs. The Export Inspection (Establishment Registration Charge) Act 1985 is one of three Acts (the others being the Export Inspection (Quantity Charge) Act 1985 and the Export Inspection (Service Charge) Act 1985) introduced by this Government to give as much flexibility as possible in determining appropriate export inspection charging systems for different sectors of the food export industry. At the time the Act was introduced, export establishments were registered on an annual basis subject to renewal, and the establishment registration charge was modelled accordingly, to be a charge on that registration, payable annually. Earlier this year, the Australian Quarantine and Inspection Service initiated a system of continuing, or perpetual, registrations, not requiring any renewal. This is attractive as reducing the paperwork for the Service and for industry, and reducing administrative costs in the long run. Because of the inflexible nature of the establishment registration charge, establishments subject to that charge have not been able to participate in that system. These are all establishments involved in the preparation of fish and poultry products for export. The Bill amends provisions in the Export Inspection (Establishment Registration Charge) Act 1985 which prevent the extension of this initiative to establishments which are subject to the establishment registration charge. Under the Bill, the charge may be imposed on a periodic basis and not linked to the commencement or renewal of registration. The Bill also makes several consequential drafting changes. The Bill will have no direct financial impact, as the amounts of charge imposed will not be affected by the amendments. I present the explanatory memorandum to this Bill. I commend the Bill to honourable senators. Debate (on motion by Senator Knowles) adjourned. The ACTING DEPUTY PRESIDENT(Senator Giles) —Mr President has received the following message from the House of Representatives: Message No. 51 The House of Representatives transmits to the Senate the following resolution which was agreed to by the House of Representatives this day: (1) That all proposals for modification or variations of the plan of layout of the City of Canberra and its environs published in the Commonwealth of Australia Gazette on 19 November 1925, as previously modified or varied, be referred to the Standing Committee on Infrastructure and, when conferring with a similar committee of the Senate, the Committee shall inquire into and report on all such proposals. (2) That the Standing Committee on Infrastructure when inquiring into proposals for modifation or variations of the plan of layout of the City of Canberra and its environs have power to consider and make use of the evidence and records of the Joint Committee on the Australian Capital Territory appointed during previous Parliaments. The House of Representatives requests the concurrence of the Senate in paragraph (2) of this resolution. Ordered that consideration of the message be made an Order of the Day for the next day of sitting. Debate resumed from 29 October, on motion by Senator Reynolds: That the Bill be now read a second time. Senator PUPLICK(New South Wales)(9.41) —The Senate is considering the National Health Amendment Bill (No. 2) 1987. I indicate at the outset of my remarks that the Opposition will support this legislation, although we will seek to move one amendment and we will support an amendment which, I understand, is to be moved by the Australian Democrats. This Bill seeks to do several different things related, in essence, to the operation of the pharmaceutical benefits system in Australia. As honourable senators know, there is a scheme known as Pharmpay whereby the Commonwealth reimburses pharmacists for the costs associated with the dispensing of prescriptions. Under the new arrangements which are proposed in this legislation, the Pharmpay scheme will offer three alternatives to pharmacists. Pharmacists may submit payment application details to the Department of Community Services and Health on compatible floppy disk or via modem for instant processing by the departmental computers. This scheme, which is referred to as the claims transmission service (CTS), is already in operation. Today the situation has arisen where the pharmacists who wish to become participants in this scheme find that they are no longer as well placed as they were just a couple of days ago because they had to decide, prior to 1 November 1987, to become participants in the CTS arrangements. That option has been available since July 1986. By August 1987 approximately 1,700 of the 5,000 pharmacies in Australia had opted to participate in the CTS arrangements. The second method of payment under the Pharmpay scheme will be for the pharmacist to submit all prescriptions for payment on a random sampling basis. Under this arrangement the pharmacist can select 10 per cent of scripts for payment in full and the Australian Bureau of Statistics and the Department of Finance have been involved in establishing various sampling arrangements. I will come back to this in due course as this will be the point at which the Opposition will seek, in the committee stage of the Bill, to move an amendment. In fact, the purport of our amendment will be, in essence, to provide a sunset provision so that the scheme which will operate in relation to random sampling will have a termination date of 30 June 1989. Of course, it will be possible to extend beyond that date, provided the evidence warrants extending beyond that date. In the committee stage I will have more to say about that particular amendment. Thirdly, the Pharmpay scheme will offer the maintenance of current arrangements on behalf of the pharmacist for submitting all scripts for manual processing on to computers within the Department of Community Services and Health. The Government is providing an incentive for pharmacists who opt for either the transmission of their data on compatible floppy disk or via modem or those who participate in the random sampling scheme. The incentive is provided in the form of a 2.5c per script payment to the pharmacists, although it is made clear in the legislation-in what will then become clause 99aaa(4)(c)-that this scheme will operate only for a two-year period and will then presumably be terminated. The Government estimates that net savings by the use of more computer compatible information or the random sampling scheme will be in the order of $8.6m. This legislation significantly alters some of the operations and the administration of the Pharmaceutical Benefits Advisory Committee (PBAC). The PBAC is to be increased in size from eight to 11 and therefore there will be an increase in the staff which will be provided by way of service to the advisory committee. Of the 11 members of the PBAC, 10 will be doctors and one will be a pharmacist. Although we do not propose to deal with this by way of amendment, I raise the question as to whether there is not something of an imbalance in terms of the relationship between the number of doctors and the number of pharmacists and whether the pharmacists or a pharmacologist or whatever should be provided with more places on the PBAC. That is a point of some concern; I do not in any sense seek to press it. The third point here is that the Government is seeking to address what it regards as the blowout of costs as far as prescriptions and the pharmaceutical benefits scheme is concerned. Figures provided indicate that the average price per script was up about 24 per cent over 1986-87 and that an estimated overall increase of 58 per cent to a figure of some $970m from 1985 to 1987 had been in prospect. One of the ways this legislation seeks to address the question of burgeoning costs is to put in the hands of the Minister for Community Services and Health (Dr Blewett) the power to remove expensive drugs from the list. The Minister is given a power to do this and at the same time the Pharmaceutical Benefits Advisory Committee is, for the first time, required by statute to bear in mind the question of the cost of drugs when it recommends the listing of new drugs and to consider what are described as alternatives. The Minister's second reading speech deals with this particular matter. He said: The obligation- that is, the obligation on the PBAC- to consider comparative effectiveness and cost will require the PBAC to give consideration to alternative forms of treatment, for example surgery, in making recommendations. The Committee will not be allowed to recommend the listing of a particular drug which is substantially more costly, unless it is satisfied that, at least for some patients, the drugs provides significant therapeutic advantages over alternative therapy. I believe there are a couple of problems which arise as far as that proposal in the legislation is concerned. I know that Senator Coulter will be addressing some of those problems and will be moving an amendment which, as I have indicated, the Opposition is minded to support at this stage. There is a necessity for the Minister to seek PBAC advice, not just in terms of cost effectiveness when the PBAC is making a recommendation for the listing of drugs, but also when the Minister proceeds to take the opportunity to delist a particular drug. That advice should become publicly available by being presented in some appropriate form to the Parliament. The point which I raise in relation to this question of attempting to establish some test of efficacy in relation to alternative forms of treatment has several aspects to it. The first is that there may be quite considerable difficulties in adopting a general rule of thumb as far as this matter is concerned. For instance, it may be quite appropriate for surgery to be performed on young, healthy adults in relation to a particular matter. When one looks at the particular circumstances and the particular case, the choice between the use of a long term pharmacological regime and the use of surgery may clearly indicate surgery is the correct way to proceed. But, for a patient of 75 years of age, surgery, with its attendant risks, traumas and difficulties for elderly people, may be inappropriate. I do not claim to be in a position, as my colleague Senator Peter Baume is, to make a professional judgment, but under those circumstances a drug based regime may be the appropriate method and surgery, as I said, may be inappropriate. The Minister, in his second reading speech, says: . . . unless it- that is, the PBAC- is satisfied that, at least for some patients, the drug provides significant therapeutic advantages over alternative therapy. I suspect that there will always be some patients for whom drug based therapy is the reasonable course of action. I do not think that the Government will succeed in imposing very much discipline upon the PBAC in terms of that recommendation because the PBAC will always find significant numbers of people for whom drug based therapy, as distinct from surgery or some alternative form of treatment, is an advantage. Apparently, there has been a very substantial growth in resistance to the effectiveness of antibiotics. An article which appeared on 30 September in the Australian by John Newell said, in part: A three-year study by 100 medical experts in 30 countries has revealed disturbing new evidence of the resistance to antibiotics that is spreading among many strains of bacteria . . . Nearly all disease-causing organisms can, it was found, still be treated with one or more antibiotics. But the emergence of resistance often means that the only effective antibiotics are hard to obtain or are very expensive. . . Although the findings related primarily to what was happening in the Third World, nevertheless it has some serious implications for the approach being taken in this legislation. After all, the PBAC must now take account of the cost of drugs. The growing resistance of bacteria to existing antibiotics means that new and more expensive antibiotics must be used to combat common diseases. If these drugs are not listed on PBAC advice, given that the old drugs may still be effective in this country and the new ones too expensive, we run the risk of resistant strains causing considerable damage to the health of Australians who will have only the old antibiotics rather than the new, expensive and non-listed ones. I draw attention to the difficulties that will arise for a particular group of people in Australia for whom this is already a major issue. I refer to people suffering from acquired immune deficiency syndrome (AIDS). Senator Peter Baume and Senator Sheil, who will also participate in this debate, and I serve on the parliamentary liaison committee on AIDS. One of the things we have noted in our work on this committee over the last couple of years has been, obviously, the very great interest in potential drug therapies for dealing with AIDS. At the moment the most promising drug on the market is AZT. AZT is available in limited quantities in Australia at the moment. The Government has been extraordinarily generous, both at the Federal and State level, particularly with regard to New South Wales, in making money available for clinical trials and for the treatment of AIDS sufferers. Senator Stone —But; Senator Puplick, governments are not generous; taxpayers are generous through the agency of governments. Senator PUPLICK —I take Senator Stone's point, but if one happens to be an AIDS sufferer one does not care who appears to be generous as long as the money is around. However, I accept that it is public money contributed by taxpayers. It is important that taxpayers see that, through the exercise of parliamentary scrutiny, money is effectively and efficaciously spent. The cost of treatment with AZT is about $10,000 a year. We have been warned by the appropriate health authorities in this country, as indicated in an article which appeared in the Medical Journal of Australia quite recently, that the bill for the battle against AIDS, in terms of the total cost of both drug therapy and hospital therapy, may be in the vicinity of $100m by 1990. That is a quite reasonable prediction. Payment will, in large part, be influenced by the extent to which taxpayers are prepared to continue to see the expenditure of sums such as $10,000 a year for the treatment of patients using AZT. People will have noted the attempts of Professor Dwyer in Sydney to develop a regime which involves simultaneous thymus gland transplants and the use of AZT. One would hope that we will not reach the stage where every new advance or drug which comes on to the market will be put through the sorts of procedures used by the PBAC in relation to the treatment of AIDS and judgments will have to be continually made. One would hope that because in a purely economic sense the existing regime is more cost-effective a decision will not be made that therefore we will not list a new drug which has come on to the market as part of the benefit system. If that attitude prevails a number of very false economies may be introduced into the system. Whilst I know that Senator Stone shares with me a desire to ensure that not only is government money effectively spent but also that there is a reduction in government expenditure, I think we would both be prepared to identify a large number of areas where cuts and restrictions could be made which would rank well ahead of necessary life-saving treatment of individual patients suffering from terrible diseases. I said that we were concerned about some aspects of the so-called random sampling method. When I read the details of the debate in the House of Representatives, I came across the comments made by Mr Lamb, the honourable member for Streeton, on 29 October. He said: If one studies statistics, permutations, computations and the laws of chance one would realise that under this sampling method there is a nine in 10 chance of a pharmacist being overpaid when the incentive payment is included but I would say that without that payment the costing would almost be spot on. There may be considerable argument about the validity of statistical methods. As I have always thought that in this business all one needed to do was to be able to work out what was 50 per cent plus one, I have never been overly concerned with the finer points of statistical analysis. Nevertheless, some considerable difficulties arise. We do not seek to defeat the attempt to see whether the use of the proposed statistical method works. However, we intend to seek an amendment to require the imposition, as it were, of a sunset clause relating to payments until 30 June 1989 at which stage we should have evidence before us which will persuasively argue whether the random sampling payment method should be continued or terminated. I cannot see that there would be any objection to having a point at which the matter must be reviewed, at which stage one can see whether the system has worked well, whether the system has worked fairly, whether there have been any rorts in the system and, if there have, whether they have been eliminated, whether they can be eliminated, or whether they are so endemic, as far as the methodology is concerned, that the system should automatically fail by operation of the sunset clause, unless the Parliament is minded to extend the use of a statistical method for some further period. In the House of Representatives the honourable member for Moreton, Mr Donald Cameron, raised a number of concerns about the power given to the Minister under this legislation to unilaterally delist drugs. I have already referred to that and I indicated that we believe that it would be proper, just as the Minister must receive advice from the PBAC before a drug is listed, for him to receive advice before he unilaterally moves to delist a particular drug and that that advice, which in our opinion is very important advice that he should consider, will not be binding advice. He may decide to ignore the advice which he gets from the Committee but we believe that that advice should be sought, should be considered by the Minister and the Minister should make the details of that advice available to the Parliament by tabling it or presenting it in some form which allows public scrutiny. I acknowledge that the legislation allows the Minister to delist the drugs in such a fashion that the Parliament may overturn the Minister's determination on this matter by disallowing the regulation by which the Minister will proceed to put the delisting into effect. As I have said, we believe that some particular problems arise as far as this legislation is concerned. Nevertheless, we are at one with the Government in its desire to achieve some cost control within the pharmaceutical benefits system. There is no doubt that it is an enormously expensive system. I think there are also a large number of areas which the Government needs to address, one of which is the extraordinary delays which apparently occur in the reimbursements to pharmacists. The records of the Department of Community Services and Health show that between October 1984 and March 1985 delays in payment times had increased from 28 days to 102 days in New South Wales and there were substantial delays in other States. At one stage it was alleged that there was a backlog of 51 million unprocessed prescriptions. Clearly that is a matter that needs to be addressed. I suppose that two things arise out of that, upon which comment can be made. The first is that the Opposition will be proceeding with legislation which Mr Tuckey introduced in the House of Representatives in the last Parliament to secure the prompt payment of government debts. That is a matter which needs to be addressed. After all, we are dealing here, by and large, with small businesses, which are particularly disadvantaged by the Government's failure to pay its bills on time. Secondly, one has to raise the question of why the small pharmacists should be required to purchase expensive computer equipment in order to be paid within a reasonable period when the obligation ought to be on the Government to pay its bills on time. It is claimed that pharmacists who use the claims transmission system will get their payments within 20 days; that those who use the statistical method will get their payments within 25 days; and others will be paid within 30 days. All I can say about that is that we are not holding our breath in the belief that the Government will actually manage to meet those targets. At this stage I have not sought to discuss the whole question of the overall expenditure on the national health scheme. That matter is capable of being debated in the debate which is still in progress on the Medicare levy amendment legislation, which is before the chamber, and I do not propose to open up that line of debate in relation to this piece of legislation. As I have said, with the qualifications which I have raised and with the potential amendments to which I have made reference, the Opposition will support this piece of legislation, although we will be interested to know how the Government responds to the criticisms which have been raised. We will be particularly anxious to monitor the operation of the new arrangements under the Pharmpay scheme once they actually come into effect. Senator COULTER(South Australia)(10.05) —Senator Puplick has covered several of the points which I wish to make, but I would like to begin by drawing attention to the fact that the National Health Amendment Bill (No. 2) 1987 extends a mode of thinking which I believe needs to be rather more closely examined in the community; that is, that we have been moving into an era of higher and higher health costs, and higher costs elsewhere in the community and as a community, we have not really decided how we wish to divide these costs. At the moment we have some extremely expensive ways of keeping people alive. At the same time, perhaps we cannot find sufficient money to spend on kindergartens and various other things in the community. As a community, we have not really faced this issue. It bears on this piece of legislation because we have here a Bill which is attempting to balance the costs of drugs against the costs of health care. In several places that is clearly drawn out. Senator Puplick has drawn attention to the fact that the legislation gives the Minister the power to withdraw a drug from the schedule without reference to the Pharmaceutical Benefits Advisory Committee. We will be moving amendments to that clause. There is also a shifting away from the area of professional judgment towards the area of cost. While that is legitimate to a certain extent, it does not sufficiently broaden the area of public debate, and we will be moving amendments also to clause 8 of this Bill, under which the Minister has the power to appoint members of the Committee, in an attempt to broaden the representation so that one of those medical practitioners may be drawn from the Doctors Reform Society. Returning to the first amendment, clause 4 of the Bill will amend section 85 of the principal Act. This clause gives the Minister the power simply to declare: that a drug or medicinal preparation, or a class of drugs and medicinal preparations, shall cease to be a drug or medicinal preparation, or a class of drugs and medicinal preparations, to which this Part applies. The clause also states: . . . the Minister shall have regard to any view previously expressed to the Minister . . . by the Pharmaceutical Benefits Advisory Committee . . . There is no requirement in that clause that the Minister shall actively seek the advice of that Committee, yet the Committee is being extended by those three extra people and presumably there is seen to be a necessity for better quality advice from the Committee. It seems, therefore, rather inconsistent that the Minister should unilaterally be able to remove drugs in that way. Accordingly, we will be moving the amendment which stands in the name of the Australian Democrats to the effect that the Minister shall be required, firstly, to obtain advice and, secondly, that that advice will necessarily be placed before both Houses of Parliament. Clause 8 of the Bill states: The Minister may also appoint as members of the Committee: (a) a pharmacologist; and (b) not more than 3 medical practitioners in addition to the medical practitioners referred to in paragraph (1) (b) . . . In that case it seems as though the Minister is completely free to select those medical practitioners. In view of the width of the debate over medical treatment, of drug treatment vis-a-vis other forms of treatment and alternative forms of medical treatment, and the considerable concern in the community that perhaps the community is not being well served in terms of cost and the type of medicine being offered, it would seem appropriate to broaden the representation of the extra members of the Committee. Accordingly, we propose that at least one of those other three practitioners be selected from those nominated by the Doctors Reform Society. Apart from that, the Democrats will support this Bill. Senator PETER BAUME(New South Wales)(10.11) —The National Health Amendment Bill (No. 2) 1987 covers three matters to which I would like to refer. The first is the cost saving measure to which other senators have already addressed themselves. The second and third provide mechanisms for speeding up the payment of pharmaceutical benefits. I remind the Senate that the system of pharmaceutical benefits was developed and extended by successive Liberal governments over two generations. It was done with the purpose and the aim of giving protection to Australian citizens against unforeseen happenings, initially with life-saving drugs and later with a more extensive range of medications. Over the last few years, both in the pharmaceutical benefits scheme and with the similar repatriation scheme, we have seen the steady removal of drugs from the list for which subsidies are payable. It is against that background of history that I turn to the first matter, which is that the Government is seeking to contain the cost of more expensive drugs by limiting the availability of pharmaceutical benefits for some of them. The Bill makes specific changes to the operation of the Pharmaceutical Benefits Advisory Committee (PBAC) and it provides extra resources for the secretariat to the Committee. But these changes appear to have been made to allow the Pharmaceutical Benefits Advisory Committee to assess what the Government wants assessed, which is whether there are alternatives to the more expensive drugs and whether those are equivalent. I take it that that means pharmacologically equivalent, therapeutically equivalent drugs. Really, the matters to which Senator Coulter addressed himself are matters for another debate. This Bill is about whether there are equivalents in therapeutic terms. Where there are equivalents in therapeutic terms, it is the intention of the Government that the more expensive drug would be removed from the pharmaceutical benefits list. So far, so good. The Opposition does not object to that approach. But, in line with the traditions of this pharmaceutical benefits scheme, we want to ensure that any action which is taken, that any deletions that occur and that any judgments that are made are in the long term interests of the citizens of this country. People look to the pharmaceutical benefits scheme to give them the protection that they expect whenever they require the prescription of medication for illness, often quite serious illness. Our goal on this side of the chamber is the protection of Australians, and the maintenance of that protection which has been provided by the pharmaceutical benefits scheme. I will assess any amendments against that goal, that is, that it is the protection of Australians that comes first. If this measure reduces, now or in the future as a result of actions taken following the passage of this legislation, the protection available to Australians, the Bill will have failed in its purpose, whatever its economic consequences. It may save some money but, if in the end Australians are worse off, the Bill will have failed. So the question I put to the Senate is: How are we to be able to ensure that the cheapest drug will be one that is equivalent in the therapeutic sense or the pharmacological sense? How will the Government ensure this? What are the instructions that will be given to the Pharmaceutical Benefits Advisory Committee when it sets out to do this task? That is the central question. Unless we know how the Pharmaceutical Benefits Advisory Committee will make its decisions, we will not know how it will construct the advice that comes to government-advice on which the Minister may act. The Government may well have an answer, but I want to know from the Government exactly how it will proceed so that we can know that the drugs under discussion will be drugs of therapeutic equivalence. Senator Walters —What is equivalent? Senator PETER BAUME —That is a fair question. I hope the Government will tell us in the summing up. It is not our function to answer those questions. It is our function to pose the questions. We are not accusing the Government of anything. We are saying that it is our duty to speak for the constituency which wants to have available to it the best pharmacological agents, the best drugs. It wants to be sure that, in going down this cost-saving path, the Government will make its decisions on some basis which citizens can understand and accept as valid. How will the expansion and beefing up of the PBAC, proposed under this legislation, ensure the outcomes to which I am drawing attention? When it is time to sum up this debate, I ask the Minister for Local Government (Senator Reynolds), who is at the table, or the Special Minister of State (Senator Ryan), who is responsible for this matter in the Senate, to please give us an answer to the question about the method by which therapeutic equivalence will be assured. In that respect I would like to say to Senator Coulter that I read the amendment from the Australian Democrats, the one about which Senator Puplick spoke and which I believe Senator Coulter will move later in the Committee of the Whole. Insofar as it goes, it is fine in that it states: Before making a declaration under subsection (2aa), the Minister shall obtain the advice in writing of the Pharmaceutical Benefits Advisory Committee in relation to the proposed declaration. What it does not say is that that advice shall include some statement about the equivalence of the therapeutic preparations. Perhaps Senator Coulter assumed that that would be automatically the case. But that advice could be any kind of advice. The Pharmaceutical Benefits Advisory Committee may merely say, `We advise that such and such a drug be deleted'. I suggest to the honourable senator that if his purpose was as I think it was, we will not be sure, even if his amendment is accepted, that the PBAC in providing such advice will do so in a way that provides the evidence we want of therapeutic equivalence. I turn to the other matters covered by this Bill. The second important issue arises from the Government's announcements about drug pricing generally. This really arises from the first matter. There is an apparent conflict in government policy. I raised this in the Estimates committee hearings and I raise it again now. The pharmaceutical manufacturing industry in Australia deserves a fair go and it will not get a fair go unless the Government's policy and approach is absolutely clear and unambiguous. The key motivation behind this legislation is one of cost-the cost of therapeutic drugs. This appears to raise some conflict with the joint statement made on 13 September 1987 in a Press release issued by Senator Button and by Dr Blewett when they announced measures to encourage greater Australian investment in the pharmaceutical industry. The Government policy, announced on 13 September, provided encouragement for manufacturers to invest further in Australia. It did this by making certain concessions. The first was to promise to extend the patent life of Australian Drug Evaluation Committee approved products by a further four years. The second was that the joint Press release of 13 September promised to create a pricing authority which will consider Australia's activity as an important criterion in setting prices. That was the promise of 13 September. The industry understood that to mean that if there were Australian pharmaceutical manufacturing activity that would be a factor which would be taken into account in a favourable way by a new pricing authority to be appointed by the Government. That is the only possible interpretation of that joint Press release. Of course it was an industry Press release. The announcements made in the National Health Amendment Bill (No. 2) 1987 are simply not consistent, because the Minister for Community Services and Health (Dr Blewett), having been party to that joint Press release, announced as part of the Budget package the proposed amendments to the terms of reference of the Pharmaceutical Benefits Advisory Committee which we are considering tonight. The proposal we are considering tonight can lead to only one thing: lower prices to the pharmaceutical manufacturers for Australian goods. So what is it going to be? Is it the provision in this Bill to contain and reduce prices, or is it the provision announced in the joint Press statement of 13 September which held out some hope and promise to the industry of some better times ahead? This is important. The pharmaceutical manufacturing industry should remain active in Australia, because of the economic activity which it generates, because of the employment which it generates and also because of the strategic importance which it has. Senator Watson —And its research-based activity. Senator PETER BAUME —My colleague Senator Watson says because of its research-based activity. Some of it is in research-based activity. We and the Department of Community Services and Health know that the Australian pharmaceutical manufacturing industry has been contracting steadily over the last 10 years and shedding labour and we have become more and more a country which imports its pharmaceutical drugs. I remind honourable senators of what happened in World War I-some time ago-when this country suddenly discovered that its supplies of some medication were cut off. It was during that time that the Australian pharmaceutical manufacturing industry emerged. It was research based, as Senator Watson reminded us earlier, and of course it was the early discovery and work in the area of salicylates in this country under the spur of war and supply interruption that established pharmaceutical manufacturing in this country. I want the Government to tell us whether it wants a pharmaceutical manufacturing industry or whether it wants us to become a drug importing country. It is perfectly possible for that to happen. I once visited an American pharmacological company in Skokie, Illinois. The Department of Community Services and Health will be able to identify the company straight away. There was an enormous office building. The people said: `We make an oral contraceptive. Do you want to see where we make it?'. They took me to a window on the thirteenth floor and pointed down and said: `See that little hut down there, that is where the world's supply of our oral contraceptive is made'. They could supply the world from that tiny manufacturing plant. The question I ask is: Why would these large companies bother to maintain any manufacturing capacity in this country? If they do not, what will be the consequences for Australia? There will be many. Unless the Government can give really clear answers to these contradictory statements which have emerged the industry will not have the confidence in its future that it should have. I raised this mater during the Estimates examination of the Department of Community Services and Health. I have to say, in defence of officers of the Department, that I have been giving the following answer: In our discussions with the industry we pointed out one approach that might be taken to this new Australian activity criterion in setting prices. We suggested it could take the form of a price premium over a floor price, the floor price being determined on the basis of other criteria. If that is the approach that is taken the price premium could be set independently of the PBAC's recommendations, taking cost effectiveness into account. That is a very fair answer. It is not for the officers to give the policy answer on behalf of the Government. So I ask the Government now: What is its policy approach? Will it take that approach which was offered to me by an officer? Will the Government identify the price premium over the floor price? Will the Government not just tell us, but tell the industry, what is going to be done? Will the price premium be set independently of the PBAC's recommendations, as the officer indicated was possible? He said one approach might be possible. Is that the approach which the Government is going to take? What the industry wants to know is: What is going to happen to it? While I thank the officer for the answer I was given in the Estimates Committee hearing, we now need from the Government some confirmation of the road down which it will travel, and we want that confirmation merely so we can know whether we will continue to have a pharmaceutical manufacturing industry, and really those of us who are consumers of pharmaceuticals occasionally want to know what our future will be. I hope the Minister will explain in more detail how this will operate. Will he explain in detail why two statements were allowed to come out, which have created such confusion and concern in the industry? I also hope the Minister will clarify the Government's policy. Is it a policy concerned solely with cost cutting in relation to therapeutic drugs? Senator Walters —It sure is. Senator PETER BAUME —Senator Walters says that it sure is. But we can ask the Government, as a matter of good faith: Will some greater costs be accepted to encourage investment in the Australian pharmaceutical manufacturing industry? If so, please tell us on what basis and which Press release or which statement we should accept? I now turn to the last two measures, which will help ensure speedier payment of pharmaceutical benefits-the so-called Pharmpay system. Over the last year the Government has tried to clean up what has been a very unsatisfactory situation. As a senator for New South Wales I have found it very distressing to have to make repeated representations on behalf of pharmacists who are in considerable financial difficulty solely because the Government has failed to pay to them money which it owes. Senator Puplick referred to a delay of 102 days. I am not allowed to have that kind of delay in my commercial transactions in the community, so why should the Government? Why should pharmacists have to carry that kind of load? What kind of administration allows a backlog of 51 million prescriptions? The Department gave me some answers which said that a year ago there were some matters beyond its control, such as illness among keyboard staff. But it is the Government's job, when it has introduced a regulatory mechanism, to make that mechanism work, and a backlog of 51 million prescriptions is not acceptable. If pharmacists are, or were, going to the wall because the Government was unable to process their claims and unable to pay them what it owed them, that is a disgrace. It has been just one of the many disgraces which have operated in this area for too long. If the Government is now proposing some mechanisms, which look as though they may enable prompt and efficient payment of accounts from pharmacists, I welcome these. I welcome the methods of speeding up payment. The use of modern technology, the use of modems and floppy disks, seems to me to have much to commend it. If the extra premium to which Senator Puplick referred is associated with a reduction in administrative cost, that will be worth while. I have raised several matters in this contribution to the debate. I have asked the Minister to respond to several of them and I hope that the Minister, in summing up this debate, will answer what are very serious questions in relation to a Bill involving very serious matters. The PRESIDENT —Order! It being 10.30 p.m., the debate is interrupted. Under sessional order I put the question: That the Senate do now adjourn. Senator TAMBLING(Northern Territory)(10.30) —Telecom Australia is in the process of rationalising the public telex message service throughout Australia. In the Northern Territory Telecom has restricted the hours of operation at the Darwin Telecom message bureau since 17 October. This restriction in effect means that messages can now be lodged during the office hours of 8.30 a.m. to 4.30 p.m., Monday to Friday. Of course, Telecom advises that lodgment and delivery will continue to be provided on a 24-hour basis from another Telecom message bureau. Where is that bureau? Of course it is outside the Northern Territory, which means that interstate telephone calls are involved in lodging one's public telex message in order to get it through. Telecom has also announced that the service will be withdrawn entirely in the Northern Territory on 30 January 1988. So, by pulling out public telex, obviously Telecom has made some sort of assessment that people living in remote areas of Australia do not need access to this sort of communication. I would like to ask: Is the Government convinced that the alteration and cancellation of the public telex facility is warranted, particularly in remote areas such as the Northern Territory where there are inadequate alternative arrangements in place and where, quite frankly, a serious disruption will be caused to communications services? Also, what about the Telecom staff, the people who man these bureaus? I am aware that some of the staff have been there for 20 or 30 years. They will suddenly be told by Telecom, `If you want a job in a continuing area, transfer somewhere interstate'. I think that is heartless, inadequate and very poor planning. I would ask the Minister for Local Government (Senator Reynolds), who is at the table, to please draw this matter to the attention of the Minister for Transport and Communications (Senator Gareth Evans) in order that he can undertake a review of what I consider to be a draconian and unnecessary Telecom action. Senator REYNOLDS(Queensland-Minister for Local Government)(10.33) —Mr President, I was expecting Senator Puplick to say something else today. Senator Puplick —Is that an invitation? I am quite prepared to oblige. Senator REYNOLDS —No, the honourable senator has missed his opportunity. Senator Tambling raised the question of rationalisation of public telex services in the Northern Ter- ritory. I am not sure whether Senator Tambling and I will agree very often, but I must admit that the issue he raised is one with which I have some reasonable degree of sympathy because in north Queensland I have been making representations to Telecom Australia about similar rationalisation procedures. So across the chamber we might find that we have some agreement now and then. Certainly I can understand the honourable senator's concern about the rationalisation as it affects the people of the Northern Territory immediately. But the situation, as the honour- able senator describes it, will be of more concern as of 30 January. I will ask the Minister for Transport and Communications, Senator Gareth Evans, to respond to Senator Tambling in relation to his call for a review. Certainly I know that there are many people in isolated areas who are very concerned about some of the cutbacks in Telecom services, and I have been making representations along similar lines. Question resolved in the affirmative. Senate adjourned at 10.35 p.m. The following papers were tabled: Defence Act-Determination 1987 No. 72-Settling In and Settling Out Allowance and others. Export Control Act-Export Control (Orders) Regulations-Orders 1987 No. 17-Export Control (Fees) as amended (Amendment). Meat Inspection Act-Meat Inspection (Orders) Regulations-Orders 1987 No. 5-Meat Inspection (Fees) as amended (Amendment). Public Service Act-Determinations 1987 Nos 91, 102. Quarantine Act-Determination under section 86e, dated 27 October 1987. The following answers to questions were circulated: (Question No. 53) Senator Bolkus asked the Minister representing the Minister for Foreign Affairs and Trade, upon notice, on 17 September 1987: Is it a fact that official passports and diplomatic passports are insufficient proof of identity for the issuing of a normal passport; if so, why. Senator Gareth Evans —The Minister for Foreign Affairs and Trade has provided the following answer to the honourable senator's question: It is correct that an official or diplomatic passport is not acceptable proof of identity for the issue of an ordinary passport. An ordinary passport issued after 1 July 1983 can be used as proof of citizenship (but not identity) for the issue of another passport. Identity is established by interview, supporting evidence, and the formal Certificate Regarding Applicant. Diplomatic and official passports are issued for a restricted period at the request of the sponsoring Department or authority, and applicants neither undergo interview nor produce full documentation. They have not, therefore, established their eligibility for a full 10-year validity ordinary passport. These remarks describe the current procedure. The procedure is, however, now under review. (Question No. 57) Senator Haines asked the Minister Assisting the Minister for Community Services and Health, upon notice, on 23 September 1987: (1) Is the Minister for Community Services and Health aware that changes made to the W. A. Workers' Compensation and Assistance Act late in 1986 have had the effect of transferring the responsibility for long-term income maintenance in respect of totally and permanently disabled workers in W.A. from the Government of W.A. and the W.A. State Government Insurance Commission to the Federal Department of Social Security. (2) Does the Federal Government accept that it is appropriate for the Government of Western Australia and its insurer to thus escape their liability for injured workers and, if not, what measures will the Minister take to correct the situation. (3) How many intraspinal injections were given in the year 1986 at the pain clinics at the Sir Charles Gairdner Hospital and the Royal Perth Hospital for the treatment of chronic back pain. (4) How many patients were involved. (5) How many of these treatments involved the use of the drug Depomedrol or of the same drug sold under any other trade name. (6) What proportion of these treatments were ceased before the full series of injections had been given. (7) Were the patients involved routinely warned of possible side effects of this treatment, including the possibility of chronic adhesive arachnoiditis. (8) Were the patients concerned monitored closely after treatment. (9) In how many cases were adverse reactions to the administration of Depomedrol by epidural/intradural or intrathecal injection noted and in how many cases were the adverse effects notified to the Adverse Drug Reaction Committee. (10) How many of the patients who received Depomedrol by such injection were undergoing treatment related to a claim for workers compensation. (11) Will the Minister confirm that the manufacturers of Depomedrol, Upjohn Pty Ltd and Astra Phar- maceuticals, supply warnings with the drug stating that it is contra-indicated for injection into the spine because of crippling and debilitating complications which have been reported. (12) Will the Minister further confirm that administration of Depomedrol by intrathecal and epidural injection ceased at the St Vincent's Hospital in Sydney because of serious adverse reactions by 1981 or earlier. (13) Can the Minister advise whether this preparation is still being used in any other States this way. (14) What steps will the Minister take to ensure that administration of Depomedrol by intraspinal injection ceases forthwith in W.A. (15) What steps does the Minister propose to take to make it mandatory for doctors to report adverse drug reactions to the Adverse Drug Reaction Committee. Senator Ryan —The Minister for Community Services and Health has provided the following answer to the honourable senator's question: (1) and (2) The Minister for Social Security has advised that the changes made to the W.A. Workers' Compensation and Assistance Act in late 1986 may involve a reduction in the liability of employers/ insures in Western Australia. However, present indications are that the effects are likely to be small. The Government does not accept that it is appropriate that liability for injuries to workers should be transferred from insurers to the social security system, and the Department of Social Security is currently monitoring the effects of changes in States' legislation in this area. It should also be noted that recent amendments to Social Security provisions for those receiving compensation payments will reduce opportunities to transfer costs. (3) to (8), (10), (13) and (14) I am not able to comment on the matters raised in these questions as the Commonwealth does not monitor or control the use of marketed drugs by the States. (9) The Adverse Drug Reactions Advisory Committee (ADRAC) gives an explicit undertaking that identities of patients, reporters and institutions will remain confidential. Thus, information relating to a particular clinic cannot be divulged. For the whole of Australia, between 1 November 1972 and 31 March 1987 ADRAC received 38 reports of suspected adverse reactions to Depo-Medrol. Sixteen of these involved intrathecal or epidural administration and fifteen of these described arachnoiditis. (11) I am advised that the warning on the product (which is manufactured by Upjohn) in the 1987 Prescription Products Guide does not contraindicate its use for injection into the spine, but says instead that ``Depo-Medrol is not recommended for intrathecal administration''. Also, under the Adverse Reactions section, printed in bold type is the statement, ``arachnoiditis has been reported following intrathecal administration''. (12) The Commonwealth does not monitor the use of marketed drugs by the States. However, I note that in a letter published in the Medical Journal of Australia on 19 September 1981, Dr David Gibb, Staff Specialist in the Department of Anaesthetics of St. Vincent's Hospital, stated that the use of intraspinal steroid injections had been discontinued. (15) ADRAC favours the active encouragement of voluntary reporting of suspected adverse reactions in preference to mandatory reporting by doctors. In the light of ADRAC's position I am not proposing to take any steps towards the introduction of a mandatory system at this time. (Question No. 72) Senator Reid asked the Minister representing the Minister for Veterans' Affairs, upon notice, on 6 October 1987: (1) Which office holders in the Department of Veterans' Affairs have authority to give the initial Departmental approval of the referral of a patient by a medical practitioner to a clinical psychologist. (2) Are these office holders appointed by written delegation; if so, by whom; if not, what method of appointment is used. (3) What professional qualifications are held by Departmental personnel who are the incumbents of those offices; in particular, did the person in the N.S.W. Branch Office who gave or withheld approvals in 1984 to 1986 have any qualifications or experience in clinical psychology; if so, what are the details. (4) When initial approval is given for referral, does that approval specify the number of sessions with the clinical psychologist; if so: (a) how many sessions are specified; (b) how does the approving authority ascertain the appropriate number of sessions; and (c) if further sessions are considered to be needed by the clinical psychologist treating the patient how does the approving authority judge whether these additional services should be approved. (5) Does the approving authority give reasons to (a) the general practitioner; and (b) the clinical psychologist, for his decision to approve or reject proposals; if not, why not. (6) Has the responsibility of the Departmental officials for failure to approve clinical psychologist sessions resulting in subsequent claims or charges of neglect or professional incompetence been considered; if so, what were the results of those considerations; if not, why not. (7) (a) Will the Minister for Veterans' Affairs table a copy of the ``Treatment Principles'' prepared under the provisions of Section 90 of the Veterans' Entitlements Act 1986; (b) on what date did those ``Treatment Principles'' become effective and when and in what form were they promulgated to (i) the Parliament, (ii) general practitioners, (iii) clinical psychologists, and (iv) veterans' organisations; and (c) what were the rules relevant to ``prior approvals'' before the effective date of those ``Treatment Principles'' and what was the legislative authority for those rules. Senator Reynolds —The Minister for Veterans' Affairs has provided the following answer to the honourable senator's question: (1) Deputy Commissioners, Managers of Treatment Sections and their senior staff hold delegations to approve referrals to clinical psychologists. (2) Yes. The authority to approve referrals has been delegated to these officers by the Repatriation Commission under sub-section 213 (1) of the Veterans' Entitlement Act. (3) Delegates would not normally hold professional qualifications relevant to the allied health professional area. They have responsibilities additional to those involved in exercising delegated authority. These responsibilities include eligibility checking, communication with providers and patients, etc. Administrative guidelines require that professional advice be obtained from either a Departmental Medical Officer or a Departmentally employed consultant in the discipline under consideration. Referrals for treatment by psychologists are usually submitted to the Senior Specialist (Psychiatry) for recommendation. The delegate acts on the basis of that advice. (4) (a) (b) and (c) The approval for treatment by a clinical psychologist specifies the duration and frequency of sessions based on the advice of the Senior Specialist (Psychiatry) and varies depending on the circumstances of each case. Where additional sessions are required the treating psychologist will normally provide a written report in support of the request which is then referred to the Senior Specialist (Psychiatry) for recommendation. (5) (a) and (b) Reasons are not generally given unless the approval is different from that requested. Where a request is declined, reasons as advised by the psychiatrist are provided to the referring medical officer or to the clinical psychologist. (6) The arrangements which are followed are considered to be satisfactory. Officers responsible for deciding requests for treatment by psychologists have access to professional advice. No instances have come to notice where a request for services has been declined which has resulted in charges of neglect or professional incompetence. (7) (a) Pursuant to S.90 (6) of the Veterans' Entitlements Act, the Treatment Principles were tabled in both Houses on 19 August 1986. Instruments varying the Treatment Principles have been tabled on 11 November 1986 and 17 February 1987. (b) 22 May 1986. (i) See answer to 7 (a) above. (ii) The Treatment Principles is a public document; (iii) and (iv) copies are available through the Australian Government Publishing Service (AGPS). Ex-service organisations and the major provider organisations were issued with copies. Local Medical Officers (LMOs) were advised of the Principles through the LMO Newsletter. (c) The prior approval requirements referred to in the Treatment Principles are not new. Regulation 68 of the now repealed Repatriation Regulations stated: ``The Commission shall not be liable for any expenditure incurred without its authority in respect of medical treatment of a person.'' (Question No. 73) Senator Reid asked the Minister representing the Minister for Veterans' Affairs, upon notice, on 6 October 1987: (1) Under what authority is the Interdepartmental Committee on fees and allowances for clinical fees and allowances for clinical psychologists established. (2) Are clinical psychologists salaried professionals, do they contract their services to the Commonwealth, or what other arrangements exist for the provision of their services. Senator Reynolds —The Minister for Veterans' Affairs has provided the following answer to the honourable senator's question: (1) The Interdepartmental Committee on Fees and Allowances was established in 1949 by the then Prime Minister, the Right Honourable J. B. Chifley. The Committee makes recommendations to the Ministers for Community Services and Health, and Finance and Industrial Relations on matters relating to the payment of fees and allowances to private medical, dental and allied health practitioners who render services on behalf of Commonwealth Departments and Authorities. (2) My Department employs clinical psychologists in Repatriation Hospitals, as salaried professionals under the Public Service Act. Some clinical psychologists also provide services on a sessional basis in Departmental institutions. Patients are also referred to private practitioners in the community who are paid fees on a fee-for-service basis as approved by the inter departmental committee. (Question No. 75) Senator Reid asked the Minister representing the Minister for Veterans' Affairs, upon notice, on 6 October 1987: (1) Did a Jeremy Gilling, Private Secretary, write on 20 January 1987 to Mr Petroni and did he state ``As Senator Gietzelt is presently on leave, I am replying on his behalf''. (2) Was the then Minister for Veterans' Affairs, Senator Gietzelt, on leave; if so: (a) had another Minister been appointed to act for him during his absence on leave; if not, why not; and (b) if so, which Minister was appointed and why did the Private Secretary and not the acting Minister sign the letter. (3) Did the Private Secretary state that: ``I have received a report from the New South Wales Branch office and am satisfied that they have acted fairly and reasonable''; if so: (a) what qualifications or experience did the Private Secretary have to be able to express an opinion about whether the actions were fair or reasonable; (b) what authority can be attached to such an expression of opinion by a Private Secretary; and (c) if the Private Secretary had no such authority what action has been taken to (i) establish an appropriate authority and (ii) take disciplinary action with respect to the Private Secretary. Senator Reynolds —The Minister for Veterans' Affairs has provided the following answer to the honourable senator's question: (1) Yes. (2) Yes, from 4 January up to and including 20 January 1987. (a) Yes. (b) The Honourable A. C. Holding, M.P. was appointed as Acting Minister. It is for a Minister to decide how correspondence will be answered. It is understood that the then Minister had authorized members of his staff to respond to general correspondence in his absence. (3) Yes. (a) In the course of his normal duties the Private Secretary was required to provide comments to the Minister. Through this process he would have gained experience in analysing reports from operational areas of the Department. In this particular case the Private Secretary based his letter on a report received from the New South Wales Branch Office. (b) It is understood the then Minister authorized his staff to attend to such matters in his absence. (c) (i) and (ii). See (b) above. Senator Ryan —On 7 October 1987 (Hansard, page 793) Senator Teague asked me a question without notice concerning the revenue which will be raised by the higher education administration charge and by postgraduate fees in 1988. He also asked whether the Government has approved `the full fee approach of the new Bond University in Queensland'. The Minister for Employment, Education and Training has provided the following answer to the honourable senator's question: Gross revenue raised by the higher education administration charge in 1988 will be an estimated $105.4 million (1988 outturn prices) and institutions will continue to retain 10% of the revenue derived from the charge. Net revenue to the Commonwealth, after allowing for 10% retention by institutions and reimbursement by the Commonwealth for certain categories of students, such as student assistance scheme beneficiaries and subsidised overseas students, is likely to be of the order of $64 million in 1988. The Government has decided to allow a limited relaxation of the prohibition on fees for certain postgraduate courses from 1988. Courses for which fees may be charged are those for students already in employment who are upgrading or updating their qualifications. Students proceeding to postgraduate study direct from undergraduate courses will not be required to pay fees. This initiative will enable institutions to be more responsive to the needs of the economy and to offer expensive specialised courses which may have not been viable in the past. Formal applications to charge fees have not been sought from institutions at this stage, and no estimates are yet available of income likely to be generated. The revenue raised by this measure will be retained by institutions, and the Commonwealth will not reduce its grants on account of revenue generated from fees. As the Bond University is a private institution which does not receive funding from the Commonwealth its fees policy is essentially a matter for it to determine. The Commonwealth's involvement has been limited to approving its development under foreign investment policy and to approving it for full fee overseas students. The Bond University, a joint venture between the Bond Corporation and a Japanese company, was established under an Act of the Queensland Parliament. It received Foreign Investment Review Board approval on the understanding that no requests will be made for Commonwealth support. It is the Government's policy to encourage the export of education services, providing certain conditions are met, and the Bond University has been placed on the Register of Full Fee Courses for overseas students. This means that, subject to usual conditions, students enrolled at the University will be eligible to gain a student entry visa to Australia.