Friday, 25 March 1988 The DEPUTY PRESIDENT (Senator Hamer) took the chair at 9 a.m., and read prayers. The Clerk —Petitions have been lodged for presentation as follows: To the Honourable the President and members of the Senate in Parliament. The Petition of the undersigned shows: Concerns in relation to young peoples' access to the Commonwealth Young Homeless Allowance. Your petitioners request that the Senate, in Parliament assembled, should: Consider the report prepared by the Young Homeless Allowance Reform Group and request that the implementation and legislation be reviewed in order to ensure that young people in genuine need receive the allowance without undue delay. And your petitioners as in duty bound will ever pray. by Senator Powell (from 39 citizens). To the Honourable the President and members of the Senate of the Commonwealth Parliament assembled: The petition of these residents of the Commonwealth of Australia respectfully showeth That the Australian Broadcasting Corporation provides the citizens of the Commonwealth of Australia with the only nation-wide, independent radio and television service. That the independence of the Australian Broadcasting Corporation must be preserved in the interests of the citizens of the Commonwealth of Australia. That the introduction of commercial sponsorship or any form of advertising material from commercial sources, would destroy the independence of the Corporation. Your petitioners therefore humbly pray that the Honourable Senators will oppose the introduction of any form of sponsorship or advertising material from commercial sources into the programmes of the Australian Broadcasting Corporation. And your petitioners as in duty bound will ever pray. by Senators Chaney (from 94 citizens), Childs (from 350 citizens) and McKiernan (from 115 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 although elector-initiated referendums are conducted successfully in such countries as Switzerland and the U.S.A., no such facility exists for Australian citizens. Your petitioners most humbly pray that the Senate, in Parliament assembled, should: Initiate the necessary action for a referendum to be held to amend the Constitution to provide for such an initiative on the following conditions: If a specified percentage of voters (such as 2%) sign a petition asking that a referendum be held on a certain question the Federal Government would be obliged to hold that referendum and the result would become law. And your petitioners further humbly pray that the referendum be timed to coincide with the referendum to be held to extend the term of office of the House of Representatives from 3 to 4 years. And we humbly pray that you may be conscious of God's sovereign purpose for our Nation. And your petitioners in duty bound will ever pray. by Senator Powell (from 262 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 Senator Michael Baume (from 39 citizens). To the Honourable the President and members of the Senate in Parliament assembled. This petition of the undersigned citizens of Australia respectfully showeth that we strongly oppose the introduction of the ``Australia Card'' or any other form of National Identification Numbering System. We believe that the introduction of a National Identification Numbering System is not only totally unnecessary but is a severe threat to our civil liberties and privacy. We condemn the Government's actions on this matter, particularly as no reasonable nor responsible justifications for the proposal have been forthcoming from the Government. We humbly pray that the Senate, in Parliament assembled, should reject any proposal for a National Numbering System. by Senator Michael Baume (from 24 citizens). Petitions received. Senator VALLENTINE(Western Australia) —I give notice that, on the next day of sitting, I shall move: That the Senate- (a) notes that 27 March 1988 is Palm Sunday, a day which has become a focus for national peace rallies and church services in Australia over the last seven years and, in 1988, marks the beginning of the national doorknock for disarmament; (b) congratulates the peace movement for its part in achieving the Intermediate Range Nuclear Forces agreement and for continuing to present concerns on peace and disarmament, particularly the escalating arms race at sea and the need for a nuclear free and independent Australia; (c) commends the Government for continuing its push for a comprehensive test ban, an agreement on chemical weapons and talks on security and arms control in the Pacific but notes the contradiction of our alliance with the country which is blocking a comprehensive test ban and the decision to downgrade the post of Ambassador for Disarmament and run down the quality of expertise on these issues in the Peace, Disarmament and Arms Control Section of the Department of Foreign Affairs and Trade; and (d) calls on the Government to act on the further contradiction of congratulating the United States and Soviet Union on removing cruise missiles and other medium range delivery systems from Europe while at the same time welcoming those same cruise missiles into Australian ports by following the example of the Labour Government in New Zealand and banning the visit of nuclear warships particularly before the review in Sydney Harbour in October. Motion (by Senator Chaney) agreed to: That the following Bill be introduced: a Bill for an Act to amend certain taxation laws to provide concessions for discounts offered on employee share acquisitions. Motion (by Senator Chaney) agreed to: That the Bill may proceed without formalities and be now read a first time. Bill read a first time. Senator CHANEY(Western Australia-Leader of the Opposition)(9.04) —I move: That the Bill be now read a second time. I table the explanatory memorandum and seek leave to have the second reading speech incorporated in Hansard. Leave granted. The speech read as follows- The industrial relations policy announced by the coalition in May 1986 has as a principal objective encouragement of a common purpose and mutual interest between employee and employer. Many elements of the policy are relevant to that objective. One of the policy commitments was to provide a greater incentive for the establishment of schemes whereby employees could buy or acquire shares in the company in which they are employed, and we undertook to provide an appropriate taxation incentive for such schemes. Before the 1987 election this policy was further developed when we indicated that we would amend the income tax legislation to remove the tax penalty which at present applies where employers issue shares to employees at a discount. We consider this an important step in encouraging widespread employee share ownership and giving employees the opportunity to own a stake in Australia by owning a stake in the firm for which they work. Specifically, the Bill limits the application of section 26AAC of the Income Tax Assessment Act so that where employee share schemes comply with the legislative requirements, discounts granted on shares sold to employees will not attract income tax liability as they do at present. Nor will the amount of a discount be liable to capital gains tax or fringe benefits tax. At the moment employees who acquire discounted shares or rights to acquire shares are taxed on the value of the discount either when they acquire the share or right or when they exercise the right. In the latter situation they may find that they are liable to pay tax on an unrealised capital gain. Discounted employee shares are therefore taxed more harshly than, for example, share rights issued to ordinary shareholders. The tax concession proposed is limited. It will not permit establishment of share schemes merely to minimise tax liabilities nor will it encourage employees to buy shares for short term speculative gain. Instead the changes we propose will remove an anomaly which has penalised employee share schemes and which has deterred companies from setting up such schemes and cause some to abandon schemes. The Opposition urges the Government to adopt this Bill or provide a positive proposal of its own. The Government has expressed some mild interest in encouraging employee share ownership, but has not yet put forward any firm proposal. Given that the Coalition proposed similar changes in the 1982-83 Budget, the Government certainly has had plenty of opportunity to consider the matter. The Government may find it difficult to act because of the lack of enthusiasm for employee share ownership among trade union leaders. The enthusiasm of members of the work force to obtain shares, which has been so evident in the United Kingdom, is discouraged by trade union leaders precisely because of the likelihood that share ownership will increase loyalty to and interest in the enterprise. There is no doubt, however, that it is in the interest of the employees themselves that they should have the opportunity to become part-owners of the enterprise in which they work. This proposal is not designed to encourage short term or speculative share ownership or trading. Rather, it is intended to help employees identify with their enterprise and to give them a vested interest in ensuring high productivity and in adding value to the enterprise. In introduces an additional element of flexibility in remuneration, and more directly links reward to effort. From the national perspective, improved productivity and industrial relations at the enterprise level translate into gains in national income and overall living standards. More widespread share ownership and a broader distribution of wealth will also have positive social and economic effects. The change proposed in this Bill, together with the Opposition's commitment to encourage employees to buy shares in privatised enterprises, will assist in promoting wider share ownership in Australia. The Government argues that employee share ownership will succeed only where other broader participatory initiatives are taken. This can easily degenerate into a futile chicken-and-egg argument, but the evidence suggests that employee share schemes of themselves can contribute enormously to improved industrial relations, productivity and profitability, and worker satisfaction. For example, studies in the United States of America over the last decade show that companies with employee share ownership schemes consistently out-perform their competitors, generate higher profits and create more new jobs. One study showed that sales and employment growth of companies which introduced employee share ownership plans (ESOPs) almost doubled. Another study which monitored companies over an 18-year period, showed that companies with employee share ownership schemes grew at around twice the rate of their counterparts without schemes. Employee share ownership is widespread in a number of Western industrialised countries, especially West Germany, France, and the United Kingdom. Australia has lagged behind. But even here, share plans are becoming popular with, for example, an estimated 60 per cent of the Business Council of Australia's membership either having introduced or considering introduction of share plans. The proportion of wage earners receiving shares is still low at around 2.1 per cent, but according to the Australian Bureau of Statistics this figure has jumped by 50 per cent in one year. To the extent that increased employee share ownership undermines the `them and us' attitudes which exert such a negative influence on industrial relations in Australia today, the unions might have reason to be uneasy. Their powerful position relies to a significant degree on the existing system which formalises divisions between employees and employers. Ironically, trade union opposition to measures which are of direct benefit to their members can only enhance the disillusionment many Australian unionists have with trade unions. It would be much more constructive for trade unions-and in their own best interests-to embrace this policy in the interest of their members. The proposal contained in this Bill is of course only one part of the Opposition's approach to industrial relations. The existing system of compulsory arbitration is too inflexible and increasingly is out of touch with the wishes of workers themselves. The Coalition has set out in detail how it will introduce much greater freedom of choice for employers and employees as to how they conduct their affairs. In short, we will as far as possible return responsibility for industrial relations back where it belongs-the workplace. These fundamental reforms to the industrial relations framework are essential to ensure improved attitudes, productivity and hence scope for increased real wages and living standards. The changes proposed to taxation of employee share purchases will help ensure that introduction of share schemes is not disadvantaged. We believe that their use will expand as more and more managers realise that their work force is probably their greatest asset and that participatory schemes and financial participation will improve productivity and relations with employees. The proposal is not viewed by the Opposition as the answer to all our problems, nor even the whole answer to promoting employee share ownership. Other impediments must be addressed such as listing requirements and the companies code which make employee share issues costly and, of course, as mentioned before, we need fundamental change in the industrial relations system. Nevertheless, if implemented, the proposal in this Bill will provide some additional incentive to go down this path. I would now like to outline the major provisions of the Bill. The Bill proposes to insert a new section 26aa into the Income Tax Assessment Act 1936. The new section will prevent section 26aac operating where `approved share schemes' sell shares or rights to acquire shares to employees at a discount. The maximum percentage discount and the maximum amount of discount that an employee can receive in any year of income will be prescribed by regulation. The Bill has been drafted in this way because the relevant figures will need to be adjusted as money values and other circumstances change. Indicative figures are provided in this speech so that the order of benefits proposed is clear. An `approved share scheme' is one which must offer shares to employees on a non-discriminatory basis. The only exceptions are that employers may specify a minimum period of services before an employee becomes eligible to buy shares and that the maximum number or value of shares offered to employees may be linked to the income of the employee. Allowing firms to stipulate a minimum period of service is uncontentious. Employee share schemes cost the company money and they reward employees for their contribution to it. Any attempt to persuade companies to offer shares to employees on their first day of employment would remove one of the principal reasons for companies offering discounted shares to employees. The Opposition also has decided to allow schemes which relate the number of shares or rights offered to employees to the employee's income because this is a very common feature of existing plans which ensures that employees do not overcommit themselves financially. We do not believe that this provision will allow the tax concession to favour higher paid employees because the total amount of tax free discount allowed in any one year will be limited, and, moreover, as we propose, at a quite modest level. Executives who receive a substantial portion of their remuneration in the form of discounted shares would find that they would have to pay tax under section 26aac on any discount in excess of the prescribed amounts. Trusts which purchase shares on an employee's behalf will also be eligible. Subsection 4 (7) outlines how the proposed tax concession will work. When a company through an approved share scheme sells shares or rights to acquire shares to employees at a discount, and that discount expressed as a percentage of the current market value of the share does not exceed an amount to be prescribed by regulation, the discount will be tax free. Fifteen per cent is considered by the Opposition to be a realistic figure at this stage because that would cover most existing employee share schemes. Importantly, a discount of this magnitude still requires a significant contribution to be made by employees, ensuring that employee share ownership is not viewed merely as a handout. The Bill is limited to public companies. This limitation by no means indicates that the Opposition considers that only employees of public companies should be encouraged to buy shares. A deliberate decision was taken to restrict this Bill to public companies. We would wish to extend similar measures to private companies and will continue examining ways in which this can be achieved. There are very real practical difficulties in determining the value of untraded shares and this could deter unlisted private companies from taking this course. Profit sharing or bonus payments may be preferable in such cases. Where an approved employee share scheme meets these requirements, the discount given to employees will be tax free and section 26AAC will not apply. However, employees will be required to keep the share or right to acquire a share for a minimum prescribed period in order to retain the tax concession. The coalition believes that three years would not unduly restrict employees while at the same time encouraging a longer term commitment to the enterprise. Subject to the requirements of the particular scheme, they could sell but if they did normal tax provisions would apply. One other restriction is outlined in subsections 4 (10) and (11). In any year of income employees will be permitted to receive a maximum amount of discount-to be prescribed by regulation-tax free. For instance, a limit of $450 per annum would allow employees to purchase shares to the value of $3,000 in any one year if they receive 15 per cent discount. If the discount offered were less than 15 per cent obviously the total value of shares which could be purchased would exceed $3,000. Where the discount amount exceeds the prescribed limit in any one year, employees will be required to pay tax under section 26AAC on the excess. Importantly, this restriction on the tax concession not only limits the cost to the Treasury, but also ensures that the concession does not discriminate in favour of higher paid wage and salary earners. The remaining sections of the Bill ensure that the allowed discount is quarantined from capital gains tax and fringe benefits tax provisions. In summary, the Bill redresses an inequity in the tax system. It overcomes the current discrimination against employee share schemes and allows a limited concession. We are not proposing a tax loophole or a massive drain on the Treasury. That would be counterproductive. At the moment the first $500 of discounts on goods purchased `in-house' by employees from their employers is exempt from fringe benefits tax. It seems more that a little ridiculous that sales of discounted consumption goods are given more lenient tax treatment than discounted sales of shares when the latter offer long term benefits to employers, employees and the nation. It should also be added that this Bill does not prevent employer companies, including non-public companies, from using the range of employee share ownership schemes which are currently in use but which are outside the scope of this legislation. What is suitable for any particular enterprise and its work force is a matter for commercial decision by the parties. The coalition is not seeking to direct the adoption of such schemes or limit the range of possibilities. Australia currently has a gross foreign debt of around $112 billion and a net foreign debt of almost $87 billion. Twenty per cent of export earnings is required just to pay the interest bill on that debt. Real wages for Australian workers have fallen for the past two years and real household disposable income declined over 1986-87. Considering these alarming economic realities, surely initiatives which have the proven capacity to promote productivity and to make the work force better off-both financially and in terms of job satisfaction-should not be discouraged for the sake of government-union relations or because of very limited revenue loss in the short term? In introducing this Bill today I am giving the Government an opportunity to say what it plans to do to ensure that Australian employees are given the same opportunity to improve their standard of living as their counterparts overseas as well as the chance to acquire a stake in their own, and their country's, future. I commend the Bill to the Senate and present the explanatory memorandum to the Bill. Debate (on motion by Senator McKiernan) adjourned. Motion (by Senator Gareth Evans for Senator Tate) agreed to: That the following Bill be introduced: a Bill for an Act to make various amendments of the statute law of the Commonwealth, and for related purposes. Motion (by Senator Gareth Evans) agreed to: That the Bill may proceed without formalities and be now read a first time. Bill read a first time. Senator GARETH EVANS(Victoria-Minister for Transport and Communications)(9.06) —I move: That the Bill be now read a second time. I table the explanatory memorandum and seek leave to have the second reading speech incorporated in Hansard. Leave granted. The speech read as follows- This Bill implements, for the last time, the practice of introducing an omnibus Bill into each sittings of the Parliament as an expeditious way of making a large number of non-contentious amendments to legislation. Some of the amendments made by this Bill tidy up, correct and update existing legislation. Other amendments are of minor policy significance or are matters of routine administration. None of the amendments made by the Bill has a significant financial impact. As I indicated, this Bill will be the last Statute Law (Miscellaneous Provisions) Bill. From the 1988 Budget sittings technical drafting amendments and repeals of spent and non-operative legislation will be included in a Statute Law Revision Bill. Minor policy amendments will be included in portfolio omnibus Bills. Honourable senators are familiar with these portfolio omnibus Bills which may include amendments of legislation within a ministerial portfolio or of legislation within specific related subject matters within a portfolio. These Bills will not be subject to the same restrictions as apply to Statute Law (Miscellaneous Provisions) Bills. The Government has agreed to new guidelines for the inclusion of matters in portfolio Bills which will enable them to include amendments of all legislation within a ministerial portfolio or of related legislation within the portfolio. Major new policy proposals will continue to be implemented, in the first instance, by separate Bills. Also in future, wherever possible, consequential amendments will be included in the principal Bill rather than in a separate consequential provisions Bill. In making these changes, the Government is seeking to enhance further opportunities for parliamentary scrutiny of proposed legislation. We have been conscious that some honourable senators and honourable members have expressed concern at the number of amendments, on quite disparate subject matters, contained in some Statute Law (Miscellaneous Provisions) Bills. These changes are a response to that concern. We believe that the transferring of minor policy amendments from the statute law Bills to portfolios Bills will facilitate parliamentary consideration and debate. Most of the proposed amendments will be self-evident or sufficiently explained by the explanatory memorandum circulated with the Bill. I propose to confine my comments to addressing the more noteworthy amendments. Archives Act 1983 The Act currently protects the Commonwealth, authors of documents and the Archives staff who give access to the documents from liability for defamation, infringement of copyright, breach of confidence and criminal proceedings when releasing Commonwealth records in accordance with the public access provisions of the Archives Act. But the Act fails to provide suitable protection for other disclosures made in accordance with the Act. For example the Act at present does not protect Ministers and other authorised persons who give special access to researchers in accordance with section 56 of the Act. The proposed amendments will ensure that protection against civil and criminal liability will apply to all persons involved in properly giving access to records under the Act. Australian Bicentennial Authority Act 1980 The Attorney-General's Department has advised that the Australian Bicentennial Authority is not subject to the Freedom of Information Act, Ombudsman Act and Archives Act. The Government considers that the Authority should be subject to these Acts. Accordingly, the amendment of the Australian Bicentennial Authority Act 1980 deems the Authority to be an authority of the Commonwealth for the purpose of the Archives Act 1983 and deems it to be a prescribed authority for the purposes of the Freedom of Information Act 1982 and the Ombudsman Act 1976. Australian Capital Territory Supreme Court Act 1933 The Australian Capital Territory Supreme Court Act is to be amended to provide for the appointment of a master of the Supreme Court. There is a pressing need for an additional judicial officer on the Court, which has had three resident judges since 1972. During this period, the ACT's population has increased from about 158,000 to over 260,000. The judges of the Court are also required to serve from time to time on the Federal Court and other tribunals. This situation has resulted in a backlog of civil matters. The appointment of a master will alleviate this problem. The position will be equivalent to similar positions, which exist with the same title, in State Supreme Courts in the United Kingdom and, from last year, in the High Court of New Zealand. The master will do a substantial part of the Court's interlocutory work and some other civil matters. The appointment of a master-which would cost much less than the appointment of another judge-will result in a reduction in the waiting time in the Court and also enable the judges to devote more time to the Court's criminal lists. In the longer term, the judicial work of the Court will be made more attractive, since the judges would be enabled to concentrate on more important matters. Australian National University Act 1946 and Maritime College Act 1978 The amendments proposed for the Australian National University Act, and the Maritime College Act 1978 are similar in two respects. The amendments clarify the power of the university and the college to form companies to exploit commercially, research and consultancy activities. ANUTECH Pty Ltd is an example of a successful commercial venture. Several State universities and colleges of advanced education have companies or are involved in joint ventures. The second common aspect of the amendments relates to the disclosure by council members of any direct or indirect pecuniary interest in matters under consideration by the council. The governing councils of these 2 tertiary institutions are concerned that the existing sweeping prohibition that prevents members from being present during deliberations or taking part in decisions after disclosure of a pecuniary interest, can be counterproductive. For example when discussing student administration fees, it would be useful to have the views of the student representative on the council. The amendments proposed will enable each council to make statutes, which are delegated legislation similar to by-laws, to determine conditions under which members may in such circumstances participate in discussions and decision. Persons likely to be affected will be student representatives, academic and general staff who are members of the council. Further amendments to the Australian National University Act provide for the inclusion of other bodies as well as research schools in the Institute of Advanced Studies. The repeal of other provisions will allow a research school to be organised in more flexible ways. The flexibility allowed by these changes reflects contemporary organisations in higher education institutions. Further changes to the Maritime College Act will enable a member of the general staff of the college to be elected to the council under the same conditions as the academic staff representative, and give the college the power to borrow and lend in line with standard provisions prescribed by the Treasurer. There is also included clarification of the college's power to be involved in projects outside Australia. Other minor amendments are described in the explanatory memorandum. Economic Planning Advisory Council Act 1983 It is proposed to increase the membership of the council by two people. One will be selected after consultation with such organisations which the Minister considers representative of the professions and the other after consultation with the Australian Council of Trade Unions. The increased membership reflects a greater emphasis on monitoring prices and incomes policy matters following the abolition of the Advisory Committee on Prices and Incomes. First Home Owners Act 1983 The Act provides for the making of payments of assistance to eligible persons who are purchasing or constructing their first home. One proposed amendment will provide for the Secretary to the Department to waive or write off irrecoverable debts arising out of overpayments under the Act and will require the Secretary to report to Parliament on the amounts waived or written off. The purpose is to avoid unnecessary duplication of action under the Audit Act where a decision has been made under the First Home Owners Act. A further proposed amendment will specify the minimum lease period which will comprise an `approved interest', the basis for application under the scheme. This will ensure that only long term secured tenure of land similar to an estate in fee simple or a life estate is included in the scheme. There is an amendment to overcome an anomaly in respect of the income test in the Act which has the effect that the income of some recent arrivals in Australia cannot be tested. The amendment is designed to ensure that recent arrivals in Australia are tested against a full year's income in Australia so that they do not receive an unfair advantage over other Australians by being tested on an income year in which no income that is taxable in Australia was earned. The provision is intended to ensure that all applicants are tested fairly and equitably. A further provision will enable the making of regulations to allow the disclosure of prescribed information to prescribed people such as the Secretary to the Department of Social Security and the Commissioner of Taxation. The amendment will meet the concerns expressed by the Senate Committee on Regulations and Ordinances by narrowing the existing provision so that is does not trespass unduly on personal rights and liberties. The remaining amendments are designed to redefine terms to be consistent with other legislation to which the Act is linked. Human Rights and Equal Opportunity Commission Act 1986, Racial Discrimination Act 1975 and Sex Discrimination Act 1984 I propose to deal with the amendments to these three Acts together as several of the amendments are inter-related. The proposed new section 16 (2a) of the Human Rights and Equal Opportunity Commission Act will remove any doubt about the effectiveness of Commonwealth-State arrangements under which functions of the Commission (mainly those concerned with investigation and conciliation of complaints) are performed by State anti-discrimination and equal opportunity bodies. These arrangements provide a one-stop shopping approach to human rights in the States which is of benefit to complainants and ensures cost savings to the Commonwealth. Other related amendments are the proposed new section 45 of the Racial Discrimination Act and the deletion of section 48 (2) of the Human Rights and Equal Opportunity Commission Act. New Section 45 will remove an anomaly whereby the Race Discrimination Commissioner and persons dealing with the Commission are protected against civil actions when the Commissioner is exercising the Commission's functions and powers but are not similarly protected when exercising those powers specifically conferred on the Commissioner. The new section 45 is in similar terms to section 111 of the Sex Discrimination Act. Amendments to section 25z of the Racial Discrimination Act and section 81 of the Sex Discrimination Act will make it clear that where a complaint is brought on behalf of persons other than the person lodging the complaint, remedies may be provided for those other persons as well as the person lodging the complaint. There are also several amendments of a machinery or drafting nature. Marriage Act 1961 The Act currently requires the annual publication in the Gazette of lists of authorised marriage celebrants and of persons who are prescribed authorities in relation to marriages. Proposed amendments will remove this requirement and so result in a cost saving by allowing the Minister to approve publication of such lists by making them available, for example, at registry offices in the States and Territories. There are other amendments of a drafting and technical nature. National Parks and Wildlife Conservation Act 1975 Officers of Australian National Parks and Wildlife Service, Department of Aboriginal Affairs and the Australian Government Solicitor's Office are negotiating a new lease for all Aboriginal land in Kakadu National Park. There is an existing lease over a part of the land. However it is intended to surrender this lease and to enter into a new lease over all aboriginal land in the park. The proposed amendment to the Act prevents the land from ceasing to be a national park upon surrender of the existing lease and will allow the Director to enter into the new lease without affecting the status of the land and without requiring the Governor-General to amend or revoke the proclamation of the park. This amendment will apply generally to parks and reserves but at present only Kakadu and Uluru National Parks involve land leased by the Director. The Act also specifies that the Director cannot enter into a contract involving the payment or receipt of an amount exceeding $50,000 without the approval of the Minister. This amount has not changed since the Act was proclaimed in 1975 although the real value of this amount has been substantially eroded through inflation. In relation to the capital works program it has become necessary to approach the Minister repeatedly to seek permission to enter into or vary contracts. This results in unwarranted administrative costs and can also cause problems due to the strict time limits often encountered under the tendering process. Current policy guidelines for Commonwealth statutory authorities and government business enterprises specify $100,000 as an appropriate limit for non-commercial authorities. As there is no administrative mechanism to enable the Minister to vary the amount prescribed, an amendment to the Act is necessary. A provision enabling the Minister to prescribe a higher amount has been inserted. This type of provision has been incorporated in recent legislation, and it obviates the need for future amendment of the Act simply to increase the figure. Such regulations are of course, subject to the scrutiny of the Senate Standing Committee on Regulations and Ordinances. I commend the Bill to the Senate. Debate (on motion by Senator Reid) adjourned. The DEPUTY PRESIDENT —The following message has been received from the House of Representatives: Mr President,...Message No. 154 The House of Representatives acquaints the Senate of the following resolution which was agreed to by the House of Representatives this day, and requests that it takes similar action: That this House advises His Excellency the Governor-General that the arrangements for the opening of future Sessions of the Parliament, whether after the dissolution of the House of Representatives or the prorogation of a Session, should be altered to remove all elements which place the House of Representatives in an inferior position to the Senate and, in particular, that- (1) the declaration of the opening of a Parliament by a Deputy appointed by the Governor-General and the speech of the Governor-General on the occasion of the opening of a Parliament be delivered in Member's Hall or the appropriate equivalent in the new Parliament House; and (2) all parliamentary arrangements for the formal opening to be the joint responsibility of both Houses. House of Representatives...JOAN CHILD Canberra, 24 March 1988...Speaker Ordered that consideration of the message in Committee of the Whole be an Order of the Day for the next day of sitting. Motion (by Senator Gareth Evans)-by leave-agreed to: That, unless otherwise ordered, on Tuesday, 12 April 1988 the Senate meet at 2.15 p.m. Consideration resumed from 24 March, on motion by Senator Button: (1) That the Particulars of Proposed Additional Expenditure for the Service of the year ending on 30 June 1988 in relation to the Parliamentary Departments, the Particulars of Proposed Additional Expenditure for the Service of the year ending on 30 June 1988 and the Particulars of Certain Proposed Additional Expenditure in respect of the year ending on 30 June 1988 be referred to forthwith to Estimates Committees for examination and report. (2) That the Committees consider Proposed Additional Expenditure in the Estimates Committee groupings agreed to by Resolution of the Senate of 22 September 1987, with the following variations: Estimates Committee C Finance Treasury Employment, Education and Training Estimates Committee D Immigration, Local Government and Ethnic Affairs Primary Industries and Energy Community Services and Health Veterans' Affairs (3) That the Committees report to the Senate on or before Friday, 29 April 1988. Question resolved in the affirmative. Consideration resumed from 22 March. Clause 10 (Report on TCF industries' matter etc.). Senator LEWIS(Victoria)(9.08) —The Committee has reached the stage where it is considering clause 10 (4) of the Textiles, Clothing and Footwear Development Authority Bill, which is a Bill to establish the new quango to implement the Government's textiles, clothing and footwear plan. As I have indicated, the Opposition is of the view that the Bill, as originally presented, contained many draconian powers-and this is one of them. The Government has agreed to delete and/or amend some of the draconian powers. The Government proposes, in relation to clause 10 (4), to add some qualifying words. Let me explain what clause 10 (4) does. It gives the Authority a power to give to the Minister: . . . a report on any instance that it considers is an instance of failure by a person involved in any of the TCF industries to act consistently with the policies of the Commonwealth Government with respect to those industries . . . Madam Temporary Chairman, just imagine what a massive power that is-a power to report that some company is not acting `consistently with the policies of the Government'. The Law Council of Australia wrote a letter to us and enclosed the advice of Mr Garry Downes, QC, who says: The most disturbing part of the Bill is cl. 10, and , in particular cl. 10 (4). The clause gives the Authority power to inquire into a number of matters relating to the question of whether Commonwealth Government policies are being achieved. He goes on to say: Persons subject to Australian law have an obligation to abide by that law. That seems to me, however, generally, to be the proper limit of legislative interference. It does not seem to me that it is proper for Government to seek to impose obligations to comply with Government policy. He then goes on to give reasons for being very critical of that situation. All that the Government proposes to do in relation to clause 10 (4) is to add a provision that, before the Authority dobs in some company or some individual for failure to act consistently with the Government's policies, it must advise the person that he is about to be reported. The Opposition is of the view that that is totally inadequate. Accordingly, I have moved: (2) Page 7, subclause 10 (4), lines 29 to 36, leave out the subclause. Senator COULTER(South Australia)(9.12) —The Australian Democrats cannot support this amendment by the Opposition for two quite good reasons. Honourable senators will notice that the purpose for which this Authority is created is to help in the better formulation of policy in relation to textiles, clothing and footwear development. The Development Authority will need to develop strategies. Of course, they will be developed in conformity with consultations with the industry and then there will need to be feedback to the Authority to discover whether the industry is conforming with those strategies. To take this subclause out would mean that the Authority would not be in a position to ascertain whether a part of the industry was not conforming with a strategy which had been developed. Moreover, clause 10 contains no sanctions whatsoever. It does not say that an illegal act is being performed which requires some sanction. It simply states that a report may be prepared and it then goes on to set various conditions for that. That would seem to me to be absolutely appropriate to fulfil one of the essential functions for this Development Authority. Without it, it would not be possible for the Authority to discharge properly its duties. Senator CHAPMAN(South Australia)(9.14) —Clause 10 epitomises why the Opposition is so bitterly opposed to this legislation to establish a Textiles, Clothing and Footwear Development Authority. As Senator Lewis has said, this clause is but one of several examples in the Bill giving the Authority draconian inquisitorial powers. I am surprised that the Australian Democrats see fit to support it. These powers are completely unnecessary for the monitoring and administration of the textile, clothing and footwear sectoral plan. The clause gives the Authority the power to publish reports on whether people in the industry are acting consistently with the Government's textile, clothing and footwear policy-not whether they are failing to comply with legislation, but with policy. So much for the rule of law! Totalitarian arbitrary rule is already with us in this legislation. The policy of the party must be obeyed. Talk about shades of Stalinist Russia! If one fails to comply with the policy, that failure will be published, with the obvious aim of pressure being brought to bear to fall into line. Again, it should be emphasised that no law has been broken and no charges laid, just a policy not complied with. An authority with such power should not be contemplated, and this legislation, as the Opposition has said, should be thrown out. It raises questions about the whole role of the Authority. The heavily protected segments of the textile, clothing and footwear industry view the Authority as their guarantee that additional assistance will be provided if, once the plan is implemented, production falls by more than an average of 15 per cent. We are not told why such an authority would have a monopoly on the expertise required to determine whether it was the plan or some other factors which caused such a production fall. There are already a large number of people and several organisations that could take on this proposed function, including the Textiles, Clothing and Footwear Industry Council, which is largely government financed; sections of the Department of Industry, Technology and Commerce; the Industries Assistance Commission; or other government and industry bodies associated with the textile, clothing and footwear industry-or indeed the industry could be left alone to be self-regulatory. Of course many factors other than the plan could contribute to a fall in production, including changes in fashion, technology and currency values, especially when the excessive protection of these industries actually increases over about the first four years of the plan. So where is the need for yet another bureaucratic, expensive monitoring authority? The options developed for post-1988 textile, clothing and footwear assistance in the Industries Assistance Commission report were designed to be simple to understand and to provide a predictable, invariant policy environment for the textile, clothing and footwear sector during the transition to the chosen target rate. Because the proposals were designed to specify all the elements of the transition mechanism in advance, the Commission said in its report that no monitoring authority would be required under any of its proposals. Indeed, it was of the view that the introduction of a monitoring authority would add undesirable uncertainty to the post-1988 textile, clothing and footwear policy environment. Undoubtedly there will be changes in the economic environment faced by the textile, clothing and footwear firms after 1988. For instance, fashion changes are an integral part of the textile, clothing and footwear market, creating opportunities for innovative designs while reducing demand for superseded products. It is difficult to envisage what the role of a monitoring authority would be in relation to fashion changes. Presumably at best it could observe progressive firms initiating and taking advantage of fashion changes to the detriment of less dynamic firms. Clearly it would not be in the interests of improving international competitiveness to inhibit growing, innovative enterprises by compensating firms which could not keep up. Technological change is continuing throughout the textile, clothing and footwear sector. Industry participants' knowledge of recent and foreseeable technological changes, and the rapidity with which they are taking advantage of recent developments, is impressive. Firms invest in new capital because they assess that the investment will give them a competitive edge over their rivals, both domestic and overseas, or at least enable them to match their competition. Again, it is difficult to envisage what role a monitoring authority would have with regard to technological change. Participants are in the best position to assess whether the introduction of new capital would be cost-effective. Exchange rate changes are a fact of life for all industries competing with overseas products or using imported inputs. Movements in exchange rates are one of the chief mechanisms which encourage changes in the structure of the economy in response to adjustments in Australia's competitive position compared with our trading partners. They bring the Australian economy back into balance as economic circumstances change. To try to insulate particular industries or activities from the adverse or beneficial effects of changes in exchange rates would introduce undesirable instability and uncertainty into the assistance structure of the economy as a whole. Also, it would increase the amount of adjustment required by all other industries that are not similarly assisted. Furthermore, to provide all industries which are disadvantaged by exchange rate movements with compensatory assistance would defeat the underlying role of exchange rate variations which serve to induce economy wide adjustments to changes in the domestic and external trading environment. Such a policy could set in train a spiral of exchange rate change, further compensatory assistance and further exchange rate adjustments. As it would be undesirable to provide any compensation to the textile, clothing and footwear sector for exchange rate changes, it is difficult to foresee any purpose for a monitoring authority. The effects of devaluation and revaluation on particular parts of the Australian economy is well known. No industries should be given special compensation for such changes even during periods when their assistance levels are being altered. The textile, clothing and footwear industry has claimed that a monitoring authority is required to advise the Government as to whether developments occurring are compatible with the achievement of the objectives of the program. But it is likely that changes in the rate of structural adjustment would reflect the most economically desirable path of adjustment rather than indicating that anything was amiss in achieving the objectives of the program. It would be unwise for a monitoring authority to apply indirect pressure to hasten the rate of adjustment reductions in the initial years of the program if the adjustment was slower than anticipated. On the other hand an observed increase in the rate of structural change could well reflect the cumulative effects of many individual decisions on the best time to discontinue particular activities. Consequently, the introduction of a monitoring authority to advise on the rate and nature of structural change during the program would be unnecessary and highly undesirable. In its 1986-87 annual report the Australian Manufacturing Council noted with considerable concern the Government's intention to establish such an authority. It felt that there was considerable overlap between its proposed activities and those of the Textiles, Clothing and Footwear Industry Council. It felt that this could result in unnecessary duplication and waste of taxpayers' money. Surely the Government should accept this enormous weight of evidence and withdraw not just clause 10 but the whole legislation as the Opposition has proposed. The Government's determination to proceed with clause 10 in the light of our proposed amendment must raise questions about the efficacy of the whole textile, clothing and footwear sectoral plan. What sort of plan is it that requires such draconian provisions as are contained in clause 10? While the plan reduces current effective rates of protection over about seven years they will still be excessively high and average between 50 and 60 per cent at the end of the plan. Quite simply, the plan does not go far enough in reducing costs imposed on exporters by this protective regime. Excessive protection in all forms, but particularly in the form of tariffs, is obviously detrimental to economic growth and wealth creation. It insulates an economy from change which is essential to real growth. Furthermore, it insulates particular industries which need to adapt to changing international conditions to increase their productivity and to develop and apply new technology. Protection is a cost which will be borne by the community in one form or another, so the alleged benefits should always be carefully analysed. Ultimately this protection is paid by the export industries. This is because the costs of production which are associated with tariff protection are passed down the line until they can be passed no further. Of course, the buck stops with export industries which have to sell their products on world markets under free competition. They cannot set their own prices on those world markets. Hence it is finally the exporters who have to bear the full cost of tariff protection. This means in particular that Australia's rural industries bear about half the tariff cost burden. Not only does protection remain at an excessive effective rate of 60 per cent at the end of this scheme but, as I said earlier, it actually increases above its current exorbitant rate for the first few years. This will not only increase the burden on exporters and especially the farming community, which can no longer afford to carry it, but will result in increased costs to consumers. While it is Australia's exporters who finally foot the bill for protecting these industries, because of the flow-on effect of the cost impact in our domestic economy, at least in the short run consumers also bear the costs because there is some lag in the flow-on effect. The Prices Surveillance Authority has calculated that there will be a 20 per cent increase in the price of clothing as a result of this plan. This fact serves to reinforce just how out of touch this Hawke Labor Government has become with the people it claims to represent. It is the poor who are increasingly paying the costs to consumers of excessive protection. The textiles, clothing and footwear and motor vehicle manufacturing industries are two of the most highly protected segments. Whereas the wealthiest 30 per cent in our community spend, on average, about 9 per cent of their household income on textiles, clothing and footwear and motor vehicles, the poorest 30 per cent spend 13 to 14 per cent of their income on those products. Australia's poor deserve better from this Government than being forced to bear the brunt of the excessive protection it gives to certain industries. On a number of occasions the Prime Minister (Mr Hawke) and the Leader of the Government in the Senate (Senator Button) have waxed eloquent with great rhetoric about their willingness to take tough decisions. Senator Walsh has berated them more than once for being unwilling to take the really hard decisions necessary for the future economic welfare of this country and, as I demonstrated a moment ago, to ease the burden on the really productive and the poor at the same time. This plan is evidence of that unwillingness. One of the three members of the Industries Assistance Commission inquiry into Australia's textiles, clothing and footwear industries is quoted as saying: The final deal that Senator Button had come up with was as good as could be expected in the circumstances. However, if this was the best deal he could come up with, it said a lot about the political circumstances in this country. One assumes that when Labor Ministers refer to hard decisions, they mean decisions in our long term interests which may cause short term unpopularity. If, as is evident in the textiles, clothing and footwear plan, the Government was unwilling to take a sufficiently hard decision in political circumstances when it had some measure of popularity some months ago, what chance does this country have of decisions being taken for the rest of its term of office which will be to the benefit of this country, now that it has so clearly lost the support of the majority of Australians'. Quite simply, this plan does not result in a sufficient pace of change in ensuring that the textiles, clothing and footwear industries become internationally competitive. The plan should have had the goal of reducing the effective rate of protection for these industries to the order of 20 to 25 per cent, which is still well above the rate for manufacturing industry as a whole, rather than the 50 to 60 per cent which will apply. After all, the level of 20 to 25 per cent would still be somewhat more than double the effective rate of protection for all industry-primary, secondary and tertiary. This would not only reduce to a more reasonable level the massive cost to Australia's economy of the excessive protection afforded these industries but also ensure that they become internationally competitive and, therefore, able to earn valuable export dollars for Australia. With those doubts about the plan, but more particularly these significant doubts about the efficacy of the Authority, the Opposition opposes not only the legislation in total but this clause in particular. I support the amendment moved by Senator Lewis. Senator BISHOP(New South Wales)(9.28) —I intend to restrict my remarks to clause 10 and to deal specifically with clause 10 (4). In formally supporting the amendment moved by Senator Lewis, I reiterate the point he made that the Bill contains draconian powers. Clause 10 (4) provides that the Authority may prepare a report on any industry in the textiles, clothing and footwear area on the question of whether or not it has acted consistently with the policies of government. Further, under clause 10 (4) (b), it may publish that report. The proposed Government amendment would simply add a provision that nobody may have that report about him or her published unless he or she is first informed. I suggest that that is a little like getting ready to hit someone over the head with a bit of 10 x 4 and telling him about it first. It really does not assuage the pain very much. Quite frankly, the proposed amendment in no way removes the concerns that the Opposition has about that power which is being given to the Authority under clause 10 (4). I was interested and disappointed to hear Senator Coulter say that the Australian Democrats would not be supportive of our amendment because the Authority helps in the formulation of policy. Somehow he managed to reason that the deletion of clause 10 (4) would, in some way, prevent that occurring. The earlier subclauses of clause 10 provide for the Authority to make reports to the Government and to give advice. Clause 10 (4) specifically enables a report to be made and the publication of that report, which can clearly be made to the detriment of a small or large business which it affects. The textile, clothing and footwear industries embrace many small business people. As we often hear, small business is the big employer in Australia. It is not hard to see that such a report could force a small business enterprise to the wall. To draw an analogy, it might be something like the action that was taken by consumer organisations against the manufacturers of pate that resulted in them being unfairly forced to the wall. We say that the inclusion of a proposed new subclause (5) in no way ameliorates the draconian nature of the provisions of clause 10 (4). The point that it is also to monitor policy and to attest as to whether or not industry is following government policy is, again, a point that I find very difficult to live with. Requiring people to comply with the law is one thing. The law is certain, and that is the benefit that the common law affords us in this land. But if a person is required simply to comply with policy which is totally uncertain and may change from time to time, then he has no certainty as to the application for planning purposes to use effectively invested capital and plan for the future of the enterprise that he may be conducting. I have another concern, too. The Bill, in a different clause, provides for the establishment of the Authority, as is to be expected. Five people are to be appointed. However, there is no provision anywhere in the Bill as to what sort of people may be appointed to that Authority. If we look at the sorts of appointments that are made by this Government, we note the appointment to the Trade Practices Commission of Mr Alan Asher, about whom I have spoken in this place before, a man who is anti-business. Who are we going to expect to be appointed to this Authority? Perhaps Barrie Unsworth, who is in need of a job, might be a good chairman. Perhaps John Halfpenny might be considered suitable. Nowhere is there a restriction laid down or a definition given of the sort of people who might be appointed to this Authority, who would then have the power over small and large industries to ascertain whether or not, in their learned opinion, a business is complying with the policy, almost on a day to day basis, that the Government has put in place, and then have the power to publish. The only saver that the Government is prepared to give is that those concerned should be told first. As I said, that would in no way ease the pain if a person were subjected to the sort of report that could effectively put his or her business to the wall. Many other parts of this Bill concern me. Perhaps I will have the opportunity to speak to other clauses as we move through it. But I think it is important to place two matters on the record and to recap. Firstly, the so-called saver in subclause (5) in no way ameliorates the basic flaw of clause 10 (4), which gives this draconian power to an authority the composition and peopling of which we are unaware. Secondly, the argument put forward by the Democrats as to why they are not supportive of our amendment simply does not ring true. Senator Coulter said that this would stop the Authority being involved in the formulation of policy. That is simply not true. The rest of the Bill provides quite adequately for that. With those two statements on the record, I ask the Committee to consider seriously whether or not justice is being done to the industry. Senator BUTTON(Victoria-Minister for Industry, Technology and Commerce)(9.35) —I do not want to say much more about this clause, which has been debated at some length. Senator Bishop raised a number of apprehensions about the nature and composition of the Textiles, Clothing and Footwear Development Authority. Never in my experience has a government sought to define in legislation-- Senator Bishop —Perhaps it ought. Senator BUTTON —That would be a new departure. I think this would be very difficult from a legislative point of view because, according to the criteria for appointment which the honourable senator suggested in her speech, politics, character and attitudes to a whole range of problems should be built into the legislation. I think that would be very difficult indeed. Senator Bishop —It would be refreshing to have merit as one of the criteria. Senator BUTTON —I am not aware of any criticism of the membership of any of the authorities which have been appointed under the portfolio which I represent. I assure the honourable senator that Barrie Unsworth or John Halfpenny will not be members of the Authority. I am sure that she will be well satisfied with those who are appointed to it. Without mentioning names, the people who will be appointed to the authority will have expertise in finance, industrial management in the sense of technology, material handling issues, industry restructuring problems and skills training for the work force. They are the sorts of people who will be appointed to the Authority. I think they will be very good people. As soon as this legislation is passed, I will announce their names. If the honourable senator has any problems in that respect, she can raise the matter then. Because it is Friday I want the honourable senator to have a good day and not be worried. With that in mind, I just wanted to give the honourable senator that degree of personal assurance. Senator COULTER(South Australia)(9.38) —I was surprised to hear Senator Chapman talk about the objection by industry to this legislation. In my speech during the second reading debate I read into the record-and I would ask honourable senators to refer to this-a letter from Mr Keith Purcell, the Executive Director of the Textile, Clothing and Footwear Council of Australia. Quite clearly the Council is in favour of this legislation. The concerns that the Council expressed about clause 10 (4) seem to have been addressed by the Government. I would like to make a brief comment on a point made by Senator Bishop. Although the term `draconian' keeps coming through, I cannot find anything draconian about this measure at all. It seems to me that if the Textiles, Clothing and Footwear Development Authority is to develop a plan, it requires some feedback as to whether or not that plan is being conformed with. This legislation specifically gives the Authority the power to do that. I point out again that the Bill contains no sanctions. There is no impediment to a manufacturer going against government policy. The Authority may become aware of that the person will be informed that the report has been made and will have the opportunity to feed countervailing information to the Authority. Presumably, out of that there may be some modification of the plan. Clause 9 (6) provides: A plan, whether or not it has come into force, may be varied by the Authority with the approval of the Minister. So, the legislation provides for the possibility of feedback. Therefore, although the term `draconian' keeps coming up, I cannot find anything particularly draconian about that clause. That is why the Australian Democrats will be supporting the clause. I was interested to hear two names mentioned in relation to the appointment of people to the Authority. I am wondering whether Australia is perhaps going into the manufacture of either or both hair shirts and chain mail. Question put: That the amendment (Senator Lewis's) be agreed to. The Committee divided. (The Temporary Chairman-Senator A. O. Zakharov) Ayes . . . . . . . . . . . 30 Noes . . . . . . . . . . . 33 —— Majority . . . . . . . . . 3 —— Alston, R. K. R. MacGibbon, D. J.Baume, Michael Messner, A. J.Baume, Peter Newman, J. M.Bishop, B. K. Panizza, J. H.Boswell, R. L. D. Parer, W. R.Brownhill, D. G. C. Patterson, K. C. L.Calvert, P. H. Puplick, C. J. G.Chaney, F. M. Sheil, G.Chapman, H. G. P. Short, J. R.Crichton-Browne, N. A. Stone, J. O.Durack, P. D. Tambling, G. E. J. (Teller)Hamer, D. J. Teague, B. C.Harradine, B. Vanstone, A. E.Lewis, A. W. R. Walters, M. S.McGauran, J. J. Watson, J. O. W. Aulich, T. G. Giles, P. J.Beahan, M. E. Haines, J.Black, J. R. Jenkins, J. A.Bolkus, N. McKiernan, J. P. (Teller)Burns, B. R. Macklin, M. J.Button, J. N. Maguire, G. R.Childs, B. K. Morris, J. J.Coates, J. Powell, J. F.Collins, R. L. Ray, RobertColston, M. A. Reynolds, M.Cooney, B. C. Richardson, G. F.Coulter, J. R. Sanders, N. K.Crowley, R. A. Schacht, C. C.Devereux, J. R. Tate, M. C.Devlin, A. R. Walsh, P. A.Foreman, D. J. Zakharov, A. O.Gietzelt, A. T. Archer, B. R. Sibraa, K. W.Bjelke-Petersen, F. I. Cook, P. F. S.Hill, R. M. McMullan, R. F.Knowles, S. C. Jones, G. N.Reid, M. E. Evans, Gareth Question so resolved in the negative. Senator BUTTON(Victoria-Minister for Industry, Technology and Commerce)(9.48) —I move: (1) Page 7, clause 10, at the end of the clause add the following subclause: ``(5) Where the Authority recommends under paragraph (4) (b) that a report, or a part of a report, referred to in paragraph (4) (a) be published, the Authority shall, before giving the report to the Minister, notify any person to whom the report relates of: (a) the contents of the report or of that part of the report; and (b) the recommendation of the Authority.''. This amendment adds the subclause which effectively provides that where the Authority provides a report under clause 10, the person to whom the report relates will be notified and the contents of the report made available to him. I understand some of the concerns which Senator Lewis had in relation to which he moved his last amendment. On balance, I tend to reject those concerns. That is why the Government voted against his amendment. I think that this amendment which I now move improves the situation somewhat in Senator Lewis's terms. I might add that the Government will certainly take account of the comments made by Senator Lewis earlier. I commend the amendment to the Senate. Senator LEWIS(Victoria)(9.49) —I thank the Minister for Industry, Technology and Commerce (Senator Button) for taking account of our concerns. I acknowledge that the Government's amendment to clause 10 is an improvement. The Opposition will support the amendment. Amendment agreed to. Clause, as amended, agreed to. Clauses 11 to 37-by leave-taken together. Senator LEWIS(Victoria)(9.50) —I rise to draw specific attention to clause 12, which is the clause which industry considers to be essential in that it contains the safety mechanism that industry has been so concerned about. I simply wish to draw to the attention of industry that the safety mechanism is not spelled out in this clause. The clause requires the Authority to report to the Minister by not later than 30 June 1992 on the operation and effectiveness of the plans, policies and strategy. In subclause (3) it states that the Authority may recommend in the report certain things to the Minister if there has been a contraction of the industry. It may report to the Minister: if it considers that the decline in production may be checked by suspending temporarily, either wholly or in part, the operation of those policies-that the operation of those policies, or such parts of those policies as are specified in the report, be suspended for such period, not exceeding one year, as is specified . . . In other words, the Authority may recommend to the Minister that the Government's policies in respect of these industries be suspended for some period not exceeding one year. That is simply a recommendation. The Minister may not accept the recommendation. The clause also contains provision that if the contraction in these industries-this is only implied-is greater than even a suspension for one year would rectify, the Authority may recommend to the Minister that the Government set up another inquiry for the purposes of examining and recommending changes to those policies. To my mind, that is a very moderate clause for the industry to place such enormous reliance upon. That is why I have pointed out repeatedly to the industry that its safety mechanism is not contained in this Bill; its safety mechanism is contained in the Minister's statement as to the plan for these industries. It is not set out in any legislation and in particular it is not set out in this legislation. Clauses agreed to. Clause 38 (Assessment of financial viability of business plans). Senator BUTTON(Victoria-Minister for Industry, Technology and Commerce)(9.54) —I move: (2) Page 17, clause 38, at the end of the clause add the following subclause: ``(2) Before referring a plan for assessment under subsection (1), the Authority shall obtain the approval of the applicant.''. This amendment is consistent with the last amendment which was carried. It is just to bring to the notice of the applicant that the Authority shall obtain approval of the applicant before referring any business plan for assessment. I think it is a sensible amendment and I support it. Senator LEWIS(Victoria)(9.55) —The Opposition parties also consider this a sensible amendment and will support it. Amendment agreed to. Clause, as amended, agreed to. Clauses 39 to 44-by leave-taken together, and agreed to. Clause 45 (Procedures at inquiries). Senator LEWIS(Victoria)(9.55) —We now come to a somewhat difficult situation in that I wish to move that the whole of part V be deleted. I understand from the Clerk that I should be dealing with it clause by clause. In other words, I should move for the deletion of clauses 45, 46 and 47. It has been suggested that I take the debate on clause 45 as a debate on my motion that the whole of part V be deleted, because if I do not succeed with the deletion of clause 45 I have not succeeded with the motion to delete the whole of part V. I am sure the Minister for Industry, Technology and Commerce (Senator Button) will follow that. On the other hand, I draw attention to the fact that if I lose my amendment to delete part V I will move an amendment to clause 45 (2) to delete the words `in the public interest'. I seek from the Minister some acknowledgment that he will give me leave, if I lose on the deletion of the whole of clause 45, to move for the deletion of the words `in the public interest' from clause 45 (2). Senator Button —Yes. Senator LEWIS —I thank the Minister for his consideration in that regard. I move: That clause 45 be deleted. I have formally moved for the deletion of clause 45 as a procedure for the deletion of the whole of part V. Part V contains the clauses which relate to the conduct of formal inquiries. Senator Coulter referred to the fact that we, on this side of the chamber, have been referring to the draconian powers of the Textiles, Clothing and Footwear Development Authority. It is part V that contains the draconian powers. In my view the part will continue to contain the draconian powers notwithstanding the Government's proposed amendments which the Minister, having given further consideration to the representations which have been made to him about this part, has agreed to introduce. The first sub clause of clause 45 says that whenever the Authority conducts an inquiry the inquiry shall be held in public. The Authority may, under clause 7, conduct such inquiries as it considers necessary for the proper performance of its functions. Senator Coulter was critical of us for referring to clause 10(4) as being draconian. If honourable senators read clause 10(4), which relates to the power to report on some person or company which is acting inconsistently with the policies of the Commonwealth Government, and if they appreciate that the Authority may report on that, and if they then look at clause 7 and see that the Authority may conduct such inquiries as it considers necessary for the proper performance of its functions, they will appreciate that the Authority may conduct an inquiry into some person as to whether he is acting consistently with the Government's policies. If that is not a draconian power of inquiry I do not know what is. The legislation then goes on to say that such an inquiry shall be conducted in public. A person who is trying to get on with his own business and who no doubt has very substantial funds invested in a company he has worked with all his life is, together with his employees, perhaps, to be examined in public as to whether or not he is acting consistently with Government policies or on some other matter that the Authority wishes to inquire into. An amendment is to be moved to the effect that, if he does not come before the inquiry, he will not be subject to massive fines or imprisonment, but if he comes before the inquiry he will be sworn to give evidence on oath and will be examined in public under clause 45(1). I find this quite horrifying. I do not imagine that the Government will allow the Authority to drag some trade union official before such an inquiry. If the Government had been prepared to allow that to happen it may very well have allowed the Steel Industry Authority to inquire into what is happening at Port Kembla in relation to the trade union movement. I presume the Government's attitude is that trade union officials should be exempt from these sorts of inquiries. I note that the Steel Industry Authority has not conducted this sort of public inquiry in relation to the Broken Hill Proprietary Co. Ltd (BHP) and the steel industry. It has certainly reported in public on certain things, but I do not recall it taking on BHP or the trade union officials connected with the steel industry at a public hearing. The TCF Development Authority will be dealing with small people-small businessmen and small businesses. It will have no difficulty at all in being bureaucratic in its approach to them and, as I said, it will conduct these inquiries in public. Clause 45(2) states that the Authority may conduct an inquiry in private if it is of the opinion that the circumstances are such that it is necessary or desirable in the public interest to do so-not in the interests of the industry, not in the interests of not exposing the manufacturer to ridicule or contempt, and not because it is concerned about exposing to the public, to the media, confidential information about a company's affairs. The Authority is entitled to hold an inquiry in private only if it is considerd necessary or desirable in the public interest to do so. I say to Senator Coulter that if he reads all those things together he will see why the coalition parties have been describing this legislation as draconian. It will remain draconian after the Government's amendments have been carried. The Government now proposes to remove among other clauses in part V, the clauses which would enable the Authority to bring witnesses before it to give evidence, on penalty of $1,000 or six months imprisonment, and, if a witness refuses to be sworn or to answer questions, to impose a penalty of $1,000 or six months imprisonment. Frankly, there is no need for this Authority to conduct formal inquiries. After all, the Minister, in his second reading speech, said that this Authority would not be intrusive. He went on to say that most of the information the Authority would need for the purposes of its report would be available from the Australian Bureau of Statistics. The Authority will be using public information in formulating its report. Notwithstanding that, this whole part V relates to formal inquiries. I put it to the Committee that there is simply no need for the whole of part V. The Authority would be well able to implement the Government's plan. As the Minister says, the most important aspect of the Authority's role is to implement the Government's plan and to act as a monitoring authority without the need for a power to conduct formal inquiries. I am sure the Minister does not intend this to be some legalistic body. I believe he is not going to appoint as chairman of this body some Queen's Counsel, such as Mr Fitzgerald in Queensland, who can conduct an inquiry in the nature of a royal commission; he is proposing to appoint lay people to the Authority. It is well known that when lay people get themselves involved in conducting some sort of formal inquiry whereby witnesses give evidence, on oath, they do not have the legal background to recognise the safeguards necessary to protect people's simple civil rights. Because they lack the legal training, they are inclined to encroach on people's simple civil liberties in ways that those of us who have had some training in the law find horrifying and indeed in ways which, when the public realises what is happening, the public finds horrifying. But by then it is too late and the damage has been done. So I say to the chamber that this Bill would be a far better Bill if the whole of part V were deleted, and accordingly I formally oppose clause 45. Senator BISHOP(New South Wales)(10.07) —In proposing that the whole of part V be deleted, Senator Lewis has really drawn to the attention of the Committee the reasons why we have been using the term `draconian'-a term which Senator Coulter finds difficulty in coming to terms with. When a Bill threatens the ability of people to earn their living, it can be very aptly described as draconian. It is interesting that in making a proper case against this legislation, as Senator Lewis did, it is necessary to read various clauses of it together to get its full impact. It is interesting to read, for instance, the definition clause of the Bill. It contains no definition of policy, which is central to the thrust of the Bill. I pointed out when I spoke on clause 10 (4) that the requirement is that people comply with policy, not the law, and that there is the ability to change policy almost on a day to day basis and therefore there is no certainty. Part V, in the form in which it originally came into the chamber, before the Government's amendments were foreshadowed, was horrendous. It would have created powers that could well have been exercised by the Court of Star Chamber. I acknowledge that in taking some of those powers out the Minister has recognised that that sort of thing is just not acceptable in Australia. But many provisions remain which are also not acceptable to the Opposition. I draw attention to clause 54, in which protection is given to employees who are going to give evidence before the Textiles, Clothing and Footwear Development Authority, or the inquiry, or to people who have in fact given evidence. There is a provision to protect the employee from action being taken against him or her by the employer, but the onus of proof concerning any action that may have been taken with regard to the employment of someone who is a prospective witness, or is in fact a witness, lies with the employer. There is no protection given to an employer concerning anybody who might appear before an inquiry and for whatever reason gives evidence which is malicious or vindictive, or involves any of those sorts of things which are quite foreseeable from time to time in business. I find the fact that the onus of proof rests on the defendant to establish that any action taken by an employer against somebody who may have also been a witness unacceptable. Senator Lewis also pointed out, very strongly, our objection to the words `public interest' remaining in clause 45 (2) because it precludes the Authority from conducting an inquiry in circumstances other than in the public interest. As Senator Lewis pointed out, there can be a whole host of reasons why such an inquiry, if it is to take place, ought to be held in private. One of the things that concern me most about the Bill is that although it is part of the Government's whole thrust to make business more competitive, which is something I wholly approve of, it is prepared to address only one side of the equation. It is prepared to look only at overt protection; it is prepared to look only at reducing tariffs and bounties and so on. It is not prepared to look at the other side of the equation, at the impediments to efficiency and competition that come from the likes of work practices and actions by the trade union movement. I can understand why the Government is reluctant, and in fact refuses, to take such action. Historically the Australian Labor Party is the political wing of the trade union movement and, therefore, is really taking the soft option in attacking protection. In my view, if we are to look honestly at making industry in Australia more competitive, we have to look at both sides of the equation. That means the union side of it as well as the employer side. We proposed that clause 10 (4) be deleted. Subsequently, having lost on that, we agreed to support the amendment concerning subclause (5). It is important to put into this part of my speech, so that everything remains in context, the fact that now, under the Bill, if somebody is to be reported upon for not complying with Government policy that report may not be made public until that person has been told. Nowhere in the Bill is any provision made for that person who is advised that he is about to be reported upon to have any recourse, any way of refuting or rebutting the report that is about to be published. As I said before, it is really like telling somebody that he is about to be hit over the head with a piece of four by two. It does not really make the pain any less. My particular concerns with this Bill lie very largely with the fact that we see the Government once again exercising the soft option. I do not see that the Government's policies, whatever they may be, however they are determined and however they are communicated to the Authority for it to deliberate upon, can be effective unless both sides of the equation, as I set out earlier, are addressed. Senator COULTER(South Australia)(10.14) —I was rather surprised to hear Senator Bishop say that the Government would not use this proposed section of the legislation against a trade union person. She seems to be assuming that the Labor Government will be in power indefinitely and that the legislation will never be administered by the parties now in opposition. I would have thought that if this Act comes into force at some time in the future, it may well be administered by the present Opposition parties. It would certainly be within their power to exercise these clauses with the even-handedness with which Senator Bishop says it may not be administered in the next two years. The Australian Democrats will not be supporting the motion to delete the whole of part V because this sets up the mechanisms for formal inquiries and, as I have indicated earlier, the conduct of those inquiries seems to be an essential part of the function of the Development Authority. I draw the Committee's attention to the Steel Industry Authority Act. It certainly seems as though this clause has been lifted verbatim out of that Act. Section 21, part IV of the Steel Industry Authority Act of 1983, uses precisely the same words as we find in part V of this Bill. I do not hear the Opposition objecting to those words, although Senator Lewis has defended them in that situation because he says that the steel industry is different from the footwear, textiles and clothing industries in that it is dealing with one large industry-- Senator Lewis —One large company. Senator COULTER —Yes, one large company. I looked through the Steel Industry Authority Act to find out the functions of the Steel Industry Authority. They are: . . . to monitor and analyse steel industry matters and, where it thinks it appropriate, conduct inquiries, report to the Minister and make recommendations to the Minister on such matters. Among those matters we find the standards and product quality attained or set by the steel industry and the services that the steel industry provides to the buyers of steel. That surely would involve large numbers of very small users of steel around Australia and might well involve the same sorts of industries that a large wool or cotton producer would be dealing with when dealing with small clothing manufacturers. Moreover, section 7 (2) (q) says: . . . matters relating to the steel industry that the Minister, by notice in writing, refers to the Authority. That gives the Steel Industry Authority very wide powers to carry out these inquiries, the wording of which is precisely the same as the wording we have in this Textiles, Clothing and Footwear Development Authority Bill. The Democrats would like the Minister to comment on the alternative suggestion made by Senator Lewis in relation to deletion of the words `in the public interest'. I accept that this wording has been carried over absolutely verbatim from the Steel Industry Authority Act and it may well have been carried over from other Acts. I am not really convinced that there is a need for those words. If the intention of this whole part is to allow the Authority broadly to carry out inquiries in public into a number of aspects of the industry, it is unwise to tie the hands of the Authority. I remind the Committee of the wording. Clause 45 (1) states: Subject to subsection (2), an inquiry shall be held in public. Quite clearly there is an overriding injunction on the Authority to hold its inquiries in public. Subsection (2) states: The Authority may hold the whole or part of an inquiry in private if, in the opinion of the Authority, the circumstances are such that it is necessary or desirable in the public interest to do so. It ties the hands of the Authority in that if, in the opinion of the Authority, it were in the private interest or some interest other than the broadly defined public interest-whatever that might mean-the Authority is constrained. It seems to be desirable to leave the Authority with the power to determine those circumstances under which an inquiry should be held in public; in other words, to abrogate for particular reasons that overriding injunction we find in subsection (1). At this moment I am leaning towards the support of the Opposition amendment with respect to subsection (2) in that I believe the legislation would be better if the Authority were free and then the wording would be, `the circumstances are such that it is necessary or desirable to do so', leaving out the words `in the public interest'. Those words have simply been carried over, perhaps in a fairly lazy way. There may not be a very good reason for leaving them in the legislation. I would very much like to hear the Minister's opinion on those four words. Senator BUTTON(Victoria-Minister for Industry, Technology and Commerce)(10.21) —I have listened to the various comments that have been made about this clause and part V of the legislation. First, the Government has foreshadowed a number of amendments to this part of the legislation which result from representations made by the industry and similar representations having been made to the Opposition and to the Australian Democrats. The representations made have been taken up in the Government's amendments and the industry does not want to be protected by my colleague Senator Lewis any further than the Government amendments go. Here is a champion of some mythical industries or firms which are not identified. I understand his role and what he is saying about these sorts of provisions. But, having said that, we do not agree. A lot of comments that have been made, particularly by Senator Bishop, are comments which might sound all right but are not founded in any sense in experience or knowledge of these industries. These industries have always been subject, because they are highly protected industries, to government inquiries and committees of one kind or another which have looked at the pattern of events and so on in order to adjust protection regimes and so on. I do not want to take the matter any further than just to say that experience over recent years, particularly in the life of the plan which the Fraser Government brought in, suggests that much misleading information has been given by companies to governments on such matters as production levels, likely market trends and likely levels of imports. Much misinformation has been given by some companies-not the industry as a whole-and has been designed to achieve particular results in terms of adjustment to the protection regime. It is not fair that industries which are highly protected and impose a cost burden on consumers should do that to the community. It is not fair for companies to give that sort of misleading information. It is all very well to make speeches about draconian provisions and so on. They are not draconian provisions, as they will be amended if the Government amendments are carried out, and it is not fair for companies to behave in that way. If the Government is to provide this level of protection and other assistance which is foreshadowed in the textiles, clothing and footwear development plan, it is not fair for people to make those sorts of misrepresentations. Any government, authority or body which has the responsibility of looking after the public interest should at least be in a position to deal with those situations if and when they arise. That is a very important point to remember. Senator Lewis made a political point. He said that the Authority will not have the unions coming before it; it will just deal with little employers and all that sort of stuff. He said, `Look at the Steel Industry Authority. It never hauled the unions before it to look at what was happening in Port Kembla'. That is just not correct. These bodies have to act in a real situation. It is no good carrying on high blown public inquiries if, by doing that, we will not influence events. The Steel Industry Authority obtained a great deal of information from trade unions and from the Broken Hill Proprietary Co. Ltd about what happened in Port Kembla and that was reported in its report upon which Senator Lewis relied in earlier discussions in the Senate. The Chairman of the Steel Industry Authority is a very competent businessman with wide industrial experience. He is concerned in difficult situations to produce the best results. The membership of this Authority will be of the same kind. It is important to get the best possible results in terms of output, productivity and good labour relations. All these things are immensely important in the context of dealing with an industry. Senator Bishop said that, in the task of trying to make Australian industries more competitive, the Government was concentrating on only one aspect-that is, reducing levels of protection, reducing bounties and things of that kind. She said that we have to look at the union side as well as the employer side. I totally agree with that. She said that we had to address things such as work practices. In the textile industry particularly, the problem in negotiating the second tier wage agreement was that the employers said: `We do not have any work practices which upset us here'. That is what the companies said. Senator Bishop —What about on the wharves for exporters? Senator BUTTON —With the greatest respect, we are talking about the textile, clothing and footwear industries. I totally agree with the honourable senator about the wharves but we are not debating the wharves at the moment. We are talking about what happens in the textile, clothing and footwear industries and the honourable senator was saying that work practices are an issue. If we could get the companies to make it an issue in the second tier wage negotiations that would be good, but most of them said, `We really do not have problems with work practices in these industries'; and that is true. Senator Bishop —But what industry is not isolated from the problem on the wharves, which affects them as well? Senator BUTTON —The textiles, clothing and footwear legislation unhappily does not relate to the wharves and that is what we are talking about here. It is conceded that there are problems on the waterfront, and those are being addressed in a different way; but we are not debating that today. One of the important things about this sort of authority is that if we are to produce the best results in terms of productivity, in terms of a whole range of issues, such as the use of capital equipment and so on, we really have to have a consultative approach to this sort of thing. If we just take, for example, the textile industry, which is highly capital intensive, there have been no problems. The industry and the unions, finally, after a long period of negotiation, went to the Australian Conciliation and Arbitration Commission together to change the awards in order to provide for 24-hour operation of plants. That is what we want to achieve. The point I am simply trying to make is that it is no good alleging things which are not correct. Senator Stone —If the industry is going to be highly capital intensive-- The TEMPORARY CHAIRMAN(Senator Powell) —Order! Senator Stone will have an opportunity, in an orderly fashion in committee, to ask questions when the Minister has finished his explanation. Senator Stone —Will the Minister accept my question? Senator BUTTON —I did not hear it. What was it? Senator Stone —I was about to ask it. The TEMPORARY CHAIRMAN —Order! I ask Senator Stone to ask his question at the appropriate time. Senator BUTTON —In summary, the amendments to part V moved by the Government take out those provisions which the industry regarded as draconian, if we use Senator Bishop's words, or which it did not like. Senator Lewis is left with a sail which does not have much wind in it, except for his own wind. The new provisions, as they now stand, are very reasonable in the sorts of circumstances which I have outlined. The only other comment I want to make concerns the use of the expression `in the public interest' in clause 45 (2). What it is desired to protect there are matters of commercial confidence. Senator Lewis made that point and I totally agree with him. The Authority will have to take into account from time to time matters which are commercially confident. I would have thought that the expression `in the public interest' embraced the notion of commercial confidentiality-that is to say, in administering any situation like this it should be an accepted norm that it is in the public interest that matters which are commercially confident are so treated and that the Authority will behave in that way. That is what I think it means. Senator Bishop —But that doesn't necessarily mean it means that. Senator BUTTON —It does not necessarily mean that but, once again, I think that is what it is intended to mean and that is the way people are likely to behave. If any company says to the Authority, `We want this matter dealt with in private because we will give you some numbers about our investment', or something like that, that would be done, and that would be regarded as being in the public interest because `the public interest' embraces the notion of this thing working well from the point of view of the companies concerned. Senator Bishop —You do not know that it will be treated in that way; you only hope. Senator BUTTON —I will not respond to this barrage of law school argument; I am trying to deal with a serious point. I think that is the way it operates; that is the way it has always operated with these types of authorities. These provisions are similar to provisions in the Automotive Industry Authority legislation. A mass of commercial in confidence material is dealt with by that Authority, involving enormous investments, enormous decisions in terms of investment and a whole range of commercially sensitive information. Not one company in that industry, be it a plant manufacturer or a component producer, has ever uttered a complaint about any information that has been given to that Authority not being dealt with properly. That is the way it ought to happen and that is the way it will happen. We reject the amendment moved by Senator Lewis. I take it that the honourable senator regards this clause as his test case, as it were, and that we can deal with part V in the context of this clause. Senator STONE(Queensland-Leader of the National Party of Australia)(10.34) —Madam Temporary Chairman, I would like to ask Senator Button the question which, no doubt properly, you prevented me from putting in the course of his remarks. If I understood Senator Button's remarks correctly, he asserted in response to my colleague Senator Bishop that there were no problems with restrictive practices in the textile industry, which I think is the industry he was talking about in particular, of which even the managers could speak. Senator Button said that this was a very highly capital intensive industry, and that is not in question. That is another way of saying that the cost of capital is the key element in the industry, not the cost of labour as such, and particularly not the cost of labour if there are no restrictive work practices in the industry, which is what the Minister has told us. I hope that so far the Minister is able to follow me and that I have not said anything which misrepresents his position, because I do not want to do that. If that is the case, and given that the real cost of capital is virtually the same-it ought to be the same-in this country as in any other, why does the industry need the tremendous amount of protection that it is presently getting? That is question No. 1. Secondly, what on earth can an authority of the kind that the Minister is proposing to set up do to remedy the problem of the comparative cost of capital if that is the problem? Senator BUTTON(Victoria-Minister for Industry, Technology and Commerce)(10.35) —I was not addressing my remarks to the cost of capital. I agree it is an important issue in a broader discussion, but I was talking about the use of capital equipment. Senator Stone —You said there were no restrictive work practices. Senator BUTTON —Even in the countries where the honourable senator would argue, and I would probably agree with him, that the cost of capital may be lower than in Australia, industries in those countries still want to get the best benefit in terms of labour use from that capital investment. All I am saying is that we have to do that here too. Senator Stone —But you said there was no problem-there were no restrictive work practices. So why aren't we getting the best use from labour? Senator BUTTON —I did not say that. I said that the difficulty was that in the context of the second tier negotiations a number of textile companies said that they could not see the trade-offs they could get in terms of productivity from the work force. That may be a sad observation, but the fact is that it was said. Senator Stone —You mean the managers are mugs; is that the point? The managers are no good. What is the problem? Senator BUTTON —It is very easy for Senator Stone, as an Opposition senator from Queensland, to say that the managers are mugs. Senator Stone —No, I didn't say that. That was the implication of your statement. Senator BUTTON —It is very easy for the honourable senator to say that. I am not going to say it here. I have views about deficiencies in management across a wide range of industries, but I am not going to single out this industry for such a beautifully pejorative expression as the honourable senator has just used. Senator STONE(Queensland-Leader of the National Party of Australia)(10.37) —Partly because we are on the air I do not want to let it lie on the record that I have said that the managers in this industry are mugs. What I did say was that the Minister's remarks could only be interpreted in that light. The Minister has now said that he does not want to say that about them at all. What he had previously said was that the managers in question had told him that there were no restrictive work practices in the businesses which they are running, because otherwise they would attempt to bring them into contention in the course of the second tier negotiations. The Minister went on to suggest that maybe that is where the problem is, that they do not know where the restrictive work practices are. The clear implication in the Minister's statement-I do not in the least want to put words in the Minister's mouth-was that the managers did not know the facts of their industry, that there were in fact restrictive work practices there that they did not know about, and that this new Authority could do something to fix it up. If I have misinterpreted the Minister I would be glad for him to set the record straight. But clearly that was the implication of what he said. If he reads the Hansard record, I am sure he will agree with me. On the basis of that I want to return to my earlier point. Either there are restrictive work practices in this industry, in which case Senator Bishop was completely correct in her views, which the Minister attacked, or there are no restrictive work practices in the industry, which was my original understanding of what the Minister was saying. He now says that that is not what he was saying. If there are no restrictive work practices in the industry, presumably the only problem that the industry has is the relative cost of capital compared with the cost of capital for some competitive industry abroad. There may be some reasons why the cost of capital in Australia is higher than the cost of capital in, say, Taiwan, if that could be used as a comparison. But there ought not to be any difference between the cost of capital in the two countries except in so far as lenders decide that there is a risk premium attaching to lending to businesses in Australia. That leads to the whole question about why people have a very bad view of this country compared to Taiwan. That would take us way outside the ambit of this Bill, and I do not propose to pursue that. However, I do observe that that also is not something which this Authority can make the slightest contribution to solving. Only this Government's or a future Government's policies can make any contribution to solving that problem. What I am saying is that the Government has to accept that either there are restrictive work practices in the industry-in which case there is a problem and the Government might be able to do something about it through the Authority, although I personally doubt it-or there are none, in which case: What is the point? The problem may be, as I said, the relevant cost of capital in other countries, about which the Authority can do nothing. In that case the extremely high levels of protection being accorded to the industry would hardly seem to be justified. Senator BUTTON(Victoria-Minister for Industry, Technology and Commerce)(10.40) —I really think some confusion has crept into the debate which I suspect may exist in Senator Stone's mind. In using the expression `work practices', one is not talking about hours of work. The question of hours of work is a relevant question in relation to the use of capital. It is not a question of work practices, it is a different thing. In responding to Senator Bishop I was talking about what are conventionally regarded as work practices in Australia, and in respect of these industries, I think there are far fewer bad work practices than there are in many other industries in this country. Senator Bishop —That is different from saying they don't exist, which was your first statement. Senator BUTTON —I have not said they do not exist. I do not know whether they exist or not. But what I said earlier to the honourable senator was that, in the course of the second tier negotiations, I was informed that one of the difficulties in the textile industry was the views of the employers that they could not find adequate trade-offs for the 4 per cent wage increase. That was not true in other industries, but in this industry that was said. That was passed on to me. I do not rush around checking all of these statements and making an assessment of the IQ of particular managers for the benefit of senators in the debate on this Bill. I am sorry, but I do not have time to do all that. All I was passing on to the honourable senator is what was said to me about the second tier negotiations in the textile industry and some of the statements that were made about work practices. It is absolutely essential in an industry like this to utilise capital equipment as well as possible. That relates to the question of the spread of working hours, which is not an issue of work practices. It is a different issue altogether. Senator Stone added a codicil to his remarks by asking a question which I assume-- Senator Watson —That is a bad term to use in this place. Senator BUTTON —Not entirely, Senator Watson. As a former Tasmanian textile manager, the honourable senator might regard `codicil' as a bad expression. But Senator Stone added a codicil to his remarks, which was simply to say: Why, if these problems do not exist, are the high levels of protection necessary? I regard that as a rhetorical question which will echo around this chamber and this country probably for some time to come. Senator WATSON(Tasmania)(10.44) —I think one feature has escaped a lot of speakers in this debate, and that is that the textile industry is still a highly labour intensive industry. While the industry is steadily moving towards greater capital intensity, relative to most other industries it is regarded as a labour intensive industry. Because of that notion, the on-costs tend to be quite significant relative to other industries, such as the aluminium industry and the like. I think the managers are quite right when they say that work practice problems essentially are not as bad across the board as they are for other industries, but it is still an industry in which there is a proliferation of unions. Wherever there is a proliferation of unions, there tend to be demarcation problems. I think the managers are quite right when they say that work practices are not a problem, because they are not a problem that they can solve. They are a problem that I think the Government, industry and the unions have to acknowledge. We have got to simplify the situation in relation to work practices. So the work practices problems that management can solve that are subject to second tier negotiations are really outside the scope of local management. Its ability to improve work practices is somewhat limited. We must acknowledge that it is still a labour intensive industry. As it moves towards restructuring, to greater capital intensity, and becomes more export oriented, it will become less dependent on tariffs. Senator COULTER(South Australia)(10.45) —I am glad that Senator Watson raised that point, although it does not concern the clause that we are dealing with, because it allows me to comment that as long as the tax structure is substantially based on tax on income, of course, the cost of labour will remain high. It is something that the Government may care to consider in relation to the current debate that is emerging regarding a consumption tax and whether tax on capital and on property-- Senator Button —I thought that debate was submerging today, Senator. Senator COULTER —It may well be. It is following a fluctuating course. I simply observe that one of the reasons for the high cost of labour is that high taxation is imposed on labour and the use of labour. I want the Minister to address a point which he has not addressed-that is, these four words, `in the public interest'. It seems to me that Senator Button has given a very unlikely explanation for the interpretation of those words. Senator Button —You move to take them out later and I will express a view about that then. Senator COULTER —I understood that this matter was before the Committee. The TEMPORARY CHAIRMAN(Senator Powell) —The Committee is considering clause 45. I understand that later specific amendments will be proposed to clause 45. Senator COULTER —The deletion in toto is the matter that is before us. The TEMPORARY CHAIRMAN —Clause 45 as a whole. Senator BURNS(Queensland)(10.48) —I rise to comment on the question of demarcation disputes and to put on the record that in the second tier negotiations it was made clear that there was a problem about finding trade-offs and savings by way of work practices. A couple of years ago, during the negotiations concerning the 38-hour week, the Stubbies Clothing Co. indicated that it was so efficient that it could not make any work practice savings. The transcript will show that that was said. It is not an assumption. It is on record; it is a fact. I say to Senator Watson that it is true that if there are a number of unions the opportunity for demarcation disputes exists, but if there are only one or two unions there is less opportunity for disputes. This does not automatically mean that demarcation disputes will occur. In my 30-odd years in the trade union movement I am not aware of demarcation disputes in the clothing industry. But I am aware that people who work in that industry-particularly those who have to work in their own homes for very low rates-certainly have not been responsible for any union problems that have been raised by Opposition senators, or any demarcation disputes. Senator WATSON(Tasmania)(10.49) —I wish to respond to Senator Burns. Whenever there is a proliferation of unions in an industry, there is an inherent opportunity to improve work practices if the number of unions is reduced. The textile union is very good as far as lack of industrial disputes is concerned. I am the first to acknowledge that. The only point that I wish to make is that when there is a proliferation of unions, the work practice situation can be improved in the long run by getting a harmonious amalgamation of unions. This will overcome built-in, inherent or structural work practice situations. Senator LEWIS(Victoria)(10.50) —Before we vote on this clause I wish to raise two matters with the Minister. Firstly, is it intended to appoint a lawyer as the Chairman of the Textiles, Clothing and Footwear Development Authority? I refer the Minister to a statement by Mr Garry Downes, QC, Chairman of the Administrative Law Committee of the Law Council of Australia. On page 4 of his opinion he said: I cannot stress too strongly my view that powers as extensive as those given by Part V should generally be confined to judicial enquiries by persons with legal qualifications. Even in this modern period of enlightenment as to the laity it must still be true to say that lawyers are best able to understand and deal with legal enquiries governed by legal rules. I think that is a very strong argument in support of my contention that part V should be deleted, unless the Minister is prepared to respond by saying that it is intended to appoint a lawyer as Chairman of this Authority. Secondly, I point out to the Minister that on page 10 of his second reading speech-I will come back to the first sentence of it later, in relation to clause 63-he said: I would stress that any information provided to the Authority on a confidential basis is required to be treated as such. While the Authority will be monitoring developments within the industries, it will not be intrusive- The conduct of formal inquiries, by definition, makes it intrusive. He went on to say: and I envisage its information requirements will most likely be satisfied by statistical collections by the Australian Bureau of Statistics and discussions and periodic surveys, similar to those previously undertaken by the TCF Advisory Committee. Why does the Minister say that in his second reading speech when the Bill contains these powers to conduct a formal inquiry to obtain this sort of information? Senator BUTTON(Victoria-Minister for Industry, Technology and Commerce)(10.53) —In answer to the first question, the Chairman of the Authority will certainly not be a lawyer. Senator Lewis might have some profound faith in the necessary ability, efficacy or talent of lawyers to deal with these matters, but I do not. Senator Lewis —Just answer the question. Don't try to be smart. Senator BUTTON —I am not trying to be smart. Senator Lewis argued-- Senator Stone —The Minister is misrepresenting the question. Senator BUTTON —Senator Stone has not been present, yet he makes interjections. He does not know what was said the other day as he was not here. The answer to the question is: No, the Chairman of the Authority will not be a lawyer. I went on to make a comment about the sorts of remarks made earlier by Senator Lewis when he said that because of the formalities a lawyer should be appointed. This indicates his profound faith in the efficacy and ability of lawyers to deal with these situations. That is a view which I do not share; that is all. We are in disagreement about it. The Chairman will not be a lawyer. Secondly, Senator Lewis referred to comments made by the Law Council of Australia. These comments were made before the Government announced that it would introduce all the amendments that it has introduced. They have no relevance to the division or part of the Act as it will be amended, with the agreement of the industry which Senator Lewis says will be aggrieved by these provisions. Thirdly, he raised the question of whether there is some inconsistency between what I said in my second reading speech and the notion of a formal inquiry. If one does not have formal inquiries-formal in the sense that people come to the Authority, in many circumstances the Authority would ask them for information in public, and would fix days for meetings-one immediately lays the Authority open to the charge that it is doing deals with people in private. That is the worst possible thing to have. There is no inconsistency between those two things. There is no inconsistency between the passages which Senator Lewis referred to in the second reading speech that information will be treated on a confidential basis-the thing is not intended to be intrusive-and the notion expressed in the legislation of a formal inquiry. If we had said in the legislation that the Authority can obtain information and had said nothing else, everybody would have said, `Ah, ah; they will be doing deals with A, B, C, D and E in this industry'. That is the last thing we want. There is no inconsistency there. Those are the answers to the honourable senator's three questions. Senator LEWIS(Victoria)(10.56) —I have to rise, although I had not intended to speak again. The Minister has misrepresented me badly. He is being smart again. We were going along all right, but now he is trying to get smart. The simple truth of the matter is that I pointed out to the Minister that a Queen's Counsel-a senior silk-in Australia has said that, if we give powers as wide as we are giving in part V, we are looking at a judicial commission. We are looking at a royal commission-type inquiry when we have powers such as those contained in part V. They still exist notwithstanding the Government's amendments. Earlier, the Minister said, `If the amendments are carried'. I can assure him that if I am not successful, the amendments will be carried. Of course I will support the Government's amendments because they modify and remove parts of part V. So they will be carried if my proposals are not carried. What I point out to the Committee is that if we establish any body and give it the powers of a royal commission we create a legalistic body. My understanding, as the Minister has explained, is that it is not intended that this will be a legalistic body. Therefore, there is no need for part V. I believe that my argument is irrefutable. Question put: That the clause be agreed to. The Committee divided. (The Temporary Chairman-Senator J. F. Powell) Ayes . . . . . . . . . . . 37 Noes . . . . . . . . . . . 30 —— Majority . . . . . . . . . 7 —— Aulich, T. G. Harradine, B.Beahan, M. E. Jenkins, J. A.Black, J. R. Jones, G. N.Bolkus, N. McLean, P. A.Burns, B. R. McMullan, R. F.Button, J. N. Macklin, M. J.Childs, B. K. Maguire, G. R. (Teller)Coates, J. Morris, J. J.Collins, R. L. Powell, J. F.Colston, M. A. Ray, RobertCooney, B. C. Reynolds, M.Coulter, J. R. Richardson, G. F.Crowley, R. A. Sanders, N. K.Devereux, J. R. Schacht, C. C.Devlin, A. R. Tate, M. C.Foreman, D. J. Walsh, P. A.Gietzelt, A. T. Wood, W. R.Giles, P. J. Zakharov, A. O.Haines, J. Alston, R. K. R. Messner, A. J.Baume, Michael Newman, J. M.Baume, Peter Panizza, J. H.Bishop, B. K. Parer, W. R.Boswell, R. L. D. Patterson, K. C. L.Brownhill, D. G. C. Puplick, C. J. G.Calvert, P. H. Reid, M. E. (Teller)Chaney, F. M. Sheil, G.Chapman, H. G. P. Short, J. R.Crichton-Browne, N. A. Stone, J. O.Durack, P. D. Tambling, G. E. J.Hamer, D. J. Teague, B. C.Lewis, A. W. R. Vanstone, A. E.McGauran, J. J. Walters, M. S.MacGibbon, D. J. Watson, J. O. W. Sibraa, K. W. Archer, B. R.Cook, P. F. S. Bjelke-Petersen, F. I.Evans, Gareth Hill, R. M.McKiernan, J. P. Knowles, S. C. Question so resolved in the affirmative. Recommittal of clause 45. Motion (by Senator Lewis)-by leave-agreed to: That clause 45 be recommitted. Senator LEWIS(Victoria)(11.05) —In accordance with the leave which has been granted, I move: Page 18, subclause 45 (2), line 35, leave out `in the public interest'. In fact the Committee has already conducted most of the debate necessary on this amendment. I merely reiterate that the Government parties-the Australian Democrats will be supporting the Government-having decided that this Authority should have the power to conduct formal inquiries and acknowledging that the inquiry shall be held in public, it seems to me to be right and proper that if the Authority wishes to hold the inquiry in private, for whatever reasons it may wish to hold that inquiry in private, it should be allowed to do so. It should not be limited only to holding the inquiry in private if it is necessary or desirable in the public interest so to do. It seems to me to be reasonable that the Authority should be able to make up its own mind. If it considers it is necessary or desirable for any reason, in effect, to hold the inquiry in private then it may do so. I say that because there have been some discussions about confidentiality and that requires me to foreshadow my concern about clause 63. Clause 63 (1) provides: The Authority, a member of the Authority or a member of the staff of the Authority shall not supply information to a person if the supplying of the information would constitute a breach of confidence. That clause, on its face, is fine. But then that clause is qualified by subclause (2), which states: Subsection (1) does not apply to anything done: (a) for the purposes of this Act; or (b) as required or permitted by law. We know that the Government is intending, as a result of the representations we have made previously, to debate paragraph (a) for the purposes of this Act, but that still leaves clause 63 providing that subclause (1), about confidentiality, which I have just read out, does not apply to anything done as required or permitted by law. Once this Act has been passed, then it is law. So really the Government's amendment by deleting paragraph (a) does nothing. The truth of the matter is that the confidentiality provisions of clause 63 are not worth the paper they are written on in this Bill. In the light of that I say to the Minister that clause 45 ought to have the words `in the public interest' deleted. I might also foreshadow discussion about clause 66, which gives the Authority power to delegate all or any of its authorities under this Act to a member of the Authority or to a member of the staff of the Authority. In other words, under clause 66 the Authority might, for example, delegate to a member of the staff of the Authority the power to conduct an inquiry under clause 45. That member of the staff of the Authority might then go and hold an inquiry in public as to the activities of some person associated with the textile, clothing and footwear industries. I suggest that those are extraordinarily wide powers and that the deletion of the words `in the public interest' in subclause (2) would make some improvement to the clause. Senator BUTTON(Victoria-Minister for Industry, Technology and Commerce)(11.09) —I indicate to the Committee that the amendment is acceptable to the Government. Senator COULTER(South Australia)(11.10) —I want to make the point, to get it on the record, that the explanation made earlier by the Minister for Industry, Technology and Commerce (Senator Button) that the words `in the public interest' could be interpreted as protecting the private interests of manufacturers takes no account of an emerging debate in society to the effect that copyright, patenting, those things which hitherto we have regarded as being in the private interest, are being regarded now by a substantial section of the academic community involved in this debate as being in the public interest; in other words, that there be no private interest as defined by the Minister. His explanation seems to take no account of that emerging debate in the community. I certainly could not accept the interpretation the Minister has given that the words `in the public interest' could be defined as including the private interest as the definition of that term has been understood either to. I am pleased to note that the Minister is prepared to remove those four words. Amendment agreed to. Senator BUTTON(Victoria-Minister for Industry, Technology and Commerce)(11.11) —I move: (3) Page 19, clause 45, lines 6 to 8, leave out ``where the Authority considers that the attendance of a person as a witness would cause serious hardship to the person, the Authority may permit the person'', insert ``the Authority may, if it thinks fit, permit a person''. This series of amendments in the name of the Government are all in the context of part V. In clause 45 there are some words to be left out. There are amendments to clauses 46 and 47, and amendments to clauses 49, 50, 51 and 53. They are all the amendments to part V. I do not wish to speak to these amendments. It has already been indicated in the course of the debate that they are supported by the Opposition. I understand that they are also supported by the Australian Democrats. Amendment agreed to. Clause 45, as amended, agreed to. Clauses 46 to 53-by leave-taken together. Senator BUTTON(Victoria-Minister for Industry, Technology and Commerce)(11.13) —by leave-I move: (4) Page 19, clauses 46 and 47, lines 24 to 35, leave out the clauses. (5) Page 20, clause 49, lines 1 to 9, leave out the clause. (6) Page 20, clause 50, line 15, leave out ``, in addition to the penalties provided by this Act,''. (7) Page 20, clause 51, lines 17 to 28, leave out the clause. (8) Page 21, clause 53, lines 1 to 4, leave out the clause. Senator LEWIS(Victoria)(11.14) —I rise to thank the Minister for these amendments and simply to put on record the great width of the amendments. What the Minister has just moved is the deletion of the power to summon witnesses, clause 46; the deletion of the penalty imposed on witnesses who fail to attend, the penalty being $1,000 or imprisonment for six months, clause 47; the deletion of clause 49, which imposes a penalty of $1,000 or imprisonment for six months, or both, where a person refuses to be sworn or to answer questions. He has also moved, importantly, for the deletion of clause 51, which contains very substantial provisions relating to contempt of the Authority and imposes a penalty of a $1,000 fine or imprisonment for six months or both where a person acts in contempt of the Authority. There are also some other relatively minor and consequential amendments. The deletion of clauses 46, 47, 49 and 51 involves very substantial amendments. To my mind, they are a clear acknowledgment that, in presenting the Bill as it did originally, the Government was very substantially in error. Senator COULTER(South Australia)(11.16) —I simply point out that the deletion of these clauses is in line with the request of the industry. In addition to the clauses outlined a moment ago by Senator Lewis-clauses 46, 47, 49 and 51-clause 53 was also mentioned by the industry. The Australian Democrats are pleased to see that the Government has acceded to this request and has agreed to delete the clauses. Amendments agreed to. Clauses, as amended, agreed to. Clause 54 (Witness prejudiced in employment). Senator COULTER(South Australia)(11.17) —As I said during the second reading debate, the amendment which the Australian Democrats would like to see inserted in clause 54 is of a more general nature and relates to a great deal of legislation. There seems to be no reason why this matter should not be taken up in respect of this Bill and also dealt with as each subsequent piece of legislation comes forward. I understand from my Democrat colleagues that the Government was asked several years ago to inquire into and report back on the relationship between penalties that are expressed in both monetary and imprisonment terms. I ask the Minister for Industry, Technology and Commerce (Senator Button) whether that inquiry has been conducted, what the state of the inquiry is and whether any information is available. In furtherance of the amendment which the Democrats are proposing, I merely point out that the penalty of a $1,000 fine or imprisonment for 12 months bears no relationship whatsoever to each other either with respect to average wages or with respect to the wages of the person who is fined. It seems grossly unfair that penalties should be so widely separated in terms of the impact which they would have on an individual. For instance, if a person were reasonably well-heeled, the fine of $1,000 would, of course, not be particularly significant. If a person were unable to pay that fine of $1,000, the penalty of 12 months in gaol would be a very severe penalty to impose. If there is to be a reasonable relationship between these two penalties, I believe that the penalty suggested in my amendment should apply-namely, that instead of 12 months the gaol term should be something like two weeks. That period is arrived at on the basis of an average wage of roughly $20,000 a year. This would bring the two penalties into line. During the second reading debate I said that there is evidence-and this was brought out very nicely in several Australian Broadcasting Corporation programs on imprisonment-that the earlier days of imprisonment are the most effective. It was argued that putting someone in gaol-particularly the sort of people who may get caught up in this legislation-for a short period, such as three days, and denying them their liberty, with all of the opprobrium and everything else associated with a gaol term, may, in many respects, be just as effective as keeping them in gaol for 12 months. Certainly, this would be much less expensive for the community. During the second reading debate I also referred to the violence which is occurring in gaols now. I drew the Senate's attention to the case of the young lad who had chosen to go to gaol rather than pay parking fines and who has now finished up in hospital as essentially a human vegetable for the rest of his life. The imposition of that penalty compared with the alternative penalty of $1,000, which is relatively trivial in this day and age, seems to me to be excessive. Moreover, the penalty of $5,000 in relation to companies is really a trivial one when we consider that a 12-month penalty may be placed against an individual. For these reasons, I commend to the Committee the amendment that the terms of the penalties be changed to bring them into line-namely, $1,000 or two weeks. I draw attention to another amendment which seeks to bring other sanctions in this Bill into similar conformity. I move: (1) Page 21, subclause 54 (1), lines 15 and 16, leave out ``12 months'', insert ``2 weeks''. Senator BUTTON(Victoria-Minister for Industry, Technology and Commerce)(11.22) —The Government does not accept this amendment. Similar penalties for the same class of offence have been included in this legislation on the advice of the Attorney-General's Department because they are consistent with the penalties provided in a number of other Acts-the Conciliation and Arbitration Act and the Industries Assistance Commission Act are two that come to mind-which relate to other similar authorities. I think there is virtue in consistency. These provisions refer to maximum penalties, not minimum penalties. It is open to a tribunal to impose a lesser penalty than the maximum provided for in these provisions. I would argue against Senator Coulter's amendment largely on the basis of the need to maintain consistency with other legislation for similar offences. Senator Coulter made a general point about the appropriateness of penalties, in terms of both monetary amounts and possible terms of imprisonment. I am not able to answer that point at the moment. The honourable senator said that he understood that some general inquiry was being undertaken into this question. I am not able to give him an answer. However, I will certainly obtain an answer for him on that general issue. Senator LEWIS(Victoria)(11.23) —I was prepared to be persuaded one way or the other by the response of the Minister for Industry, Technology and Commerce on this issue but, quite frankly, I did not find his response adequate. Senator Coulter made a good point when he said that there is simply no comparison between 12 months imprisonment and a fine of $1,000. I do not think it is any answer to say, `Well, that is consistent with other legislation'. I think the Government had better get its act in order in regard to other legislation and its thinking clear in regard to future legislation that it brings before this chamber. It seems that Senator Coulter's amendment is worthy of support and the coalition parties will support it. Senator MACKLIN(Queensland)(11.24) —I would like to raise the general principle of penalties. I would have thought that the Minister for Industry, Technology and Commerce would have been briefed with respect to the general inquiry on this matter. On my understanding, it is now almost two years since we had a debate in this chamber on this subject. I have not checked the record, but I recollect that the last time we were discussing these matters Senator Gareth Evans raised the notion of looking at penalties in general. A number of Senate committees and joint committees have pointed out in recommendations that penalties in various Acts seem to be all over the place. One committee I was on, the Joint Select Committee on Electoral Reform, made such an observation. We sought to have a run ourselves at rationalising those penalties. In the debate I am referring to, this chamber did not press ahead with changing the Act because the Government said that it was inquiring into the whole matter and that it would be far better to leave it to that general inquiry to bring all Acts into some alignment. To suggest that this Act is being aligned with other Acts is no excuse, because the other Acts are out of kilter. Inflation has been a problem. Some Acts on the statute books impose ridiculous penalties, penalties of $5, $10 or $15. The costs of any reasonable processing of them would cost the Government four, five or six times as much as the penalty itself. The Minister at the table, Senator Button, has not even said that the Government is looking at this matter. He does not even know what the Government is doing with regard to this matter. This chamber should no longer pass legislation with penalties that are out of kilter, that are not indexed, that do not refer to the relationship between private individuals and corporate bodies in any rational, reasonable way and in regard to which no criteria are offered as to why we should penalise people in this way. I admit that there are difficulties. The Committee of which I was a member ran into difficulties working out a comparable level between the individual and the corporate penalty. Nevertheless, we were persuaded that the Government had this matter in hand. As the Government does not even seem to know what it is doing about this matter, we have to press ahead with changing some of these penalties to prod the Government into coming up with a rational scheme such as imposing on all new legislation new sets of penalties according to set criteria, or the other alternative that has been suggested, bringing in a penalties Act which would argue the types of criteria for federal legislation and impose set types of penalties to which all other legislation was able to refer. I do not have any brief one way or the other. However, I believe that the Committee should press ahead with amendments from here on in to penalties in legislation until such time as the Government can come up with a rational scheme for setting out penalties in legislation. I do not want it to be taken that we do not want any penalties, or that we do not want tough penalties in appropriate cases. What we are looking for are realistic and rational penalties, penalties which have some comparability between imprisonment and penalty amounts, and between private individuals and corporate bodies. Senator REID(Australian Capital Territory)(11.28) —The Committee runs the risk of not being taken seriously if we allow this sort of thing to continue. We run the risk of people saying that there is one law for the rich and one law for the poor, that those who cannot afford to pay a $1,000 fine run the risk of being in gaol for six months. One is not in gaol for much longer than that for murder these days. It is a horrendously high penalty in this instance. If six months is the appropriate penalty, the monetary penalty ought to be in the vicinity of, I would think $10,000 or more and, for a corporate offence, perhaps even higher. Senator Macklin has dealt with the history of the matter and I shall not go over it, but it has been a long time. The Committee has been patient. The time has come when the Committee has to say what it thinks and not just wait for something to happen. Most of us are hearing from our constituents views on the question of penalties-that in some areas they are not harsh enough and in some areas they are too harsh. It is time we responded to the sort of message we are getting from our constituents and not merely drift along any longer with the argument that one of these days the Government will consider the matter. Some of the penalties that would have been, perhaps, #500 before they became, in modern terms, $1,000 are very out of touch with the gaol sentences available to a magistrate or a judge in sentencing procedures. Senator BUTTON(Victoria-Minister for Industry, Technology and Commerce)(11.29) —I take the general point which has been made by Senator Macklin. Before he participated in the debate I said I would try to activate something in connection with the general issue. What I find a little unsatisfactory is the way the debate has been conducted. The object all sublime should be to make the punishment fit the crime, I agree. What one is saying to the judiciary, if one says that the maximum penalty for an offence under this section by an individual is $1,000 or two weeks in the slammer, is that this is a very trivial offence; if one considers the totality of offences punishable by imprisonment for a short term or punishable by a fine. The inadequacy of the Australian Democrats' amendment is, in my view, that they have inserted the figure two weeks instead of a month, or something like that. That is what I regret. The Democrats have given a very big signal that they regard this as a very trivial offence. It is not, in my view, a trivial offence. The only person who can commit this offence is an employer. It is not a trivial offence for an employer to sack somebody because he goes along to an independent tribunal and tells his story. It goes to the heart of the employment relationship, to the heart of equity and to the heart of any notion of civil liberty in this society. People who are aggrieved by a situation, as they may legitimately be, are entitled to go and give their story, their evidence, to a tribunal about the situation in respect of which they are aggrieved without running the risk of being sacked-- Senator Macklin —Do you want to change the monetary amount upwards then? Senator BUTTON —I would be quite prepared to do that, but I come back to the original point I made. What is important is the nature of the signal one gives to the judiciary. The amount of $1,000, or two weeks, puts the offence in the class of the offence that Derryn Hinch regularly commits. Senator Macklin —A thousand dollars already puts it there. We are talking about an employer, not an employee. Senator BUTTON —These are maximum penalties. The Tribunal has an option. Senator Macklin —But you are giving a signal-$1,000. You have just said that. Senator BUTTON —No, we are not. Even with respect to this Parliament, the disqualification for members of parliament is not whether they have been fined for something. It is whether they have been convicted of an offence punishable by a term of imprisonment of a certain duration. That is the test, not the amount of the fine. The judicial body, whatever it is, has the discretion, in terms of the gravity of the offence, to impose a fine or a term of imprisonment. What I am concerned about in regard to Senator Coulter's amendment is that the term of imprisonment he has plucked out of the air is too low. I am not saying that the term of imprisonment proposed by the Government is correct. I am quite persuaded by some of the things that have been said. I am saying that Senator Coulter in his proposed term of imprisonment is too low. That is the reason why I have difficulty in accepting the amendment. What he has done in his subsequent amendment is to say, `The monetary penalty is twice the original amount, $2,000, so therefore the term in the slammer will be a month, instead of two weeks'. He is saying: One month in gaol equals $2,000; two weeks in gaol equals $1,000. That ignores the fact that there is judicial discretion in respect of either of those penalties-monetary or a term of imprisonment. Am I right or am I right! I think it is a matter of judgment and I happen to disagree with the judgment which is inherent in this amendment. If it were slightly more significant a term, then I think the right signal would be given to the judiciary and the Australian Democrats would not be regarded in the community as a party which considers that the sacking of a person for giving evidence to an independent tribunal is an offence which can be regarded lightly. Senator BISHOP(New South Wales)(11.36) —Senator Button tried hard but he really did not do very well. The argument put by the Australian Democrats was clearly superior. Indeed, Senator Button left aside the fact that by putting a monetary value into the penalty clause he was sending the signal that it was a trivial matter. Senator Macklin and Senator Coulter both spoke of the need to examine other pieces of legislation instead of simply saying, as Senator Reid pointed out, that this legislation has to be brought in line with the other errors. That is not good enough. I was rather disappointed that the argument, put in counter to the persuasive argument that we have decided to support, was not a little stronger. Senator COULTER(South Australia)(11.37) —Very briefly, I think the Minister for Industry, Technology and Commerce misled the Committee when he said that these were maximum penalties. The relevant clause reads: Penalty: (a) in the case of a natural person-$1,000 or imprisonment for 12 months, or both; There is a choice to impose one penalty or the other, or both. It does not state `either $500 or a week' or something similar. The penalties are clearly spelt out. The second point I make is that Senator Button has asserted that the interval of two weeks or one month in my later amendment was chosen arbitrarily. It was not. It was chosen in relation to average weekly earnings. There is a clear correspondence between those two penalties which seems to me to be at least one basis upon which to judge the relativity of periods in gaol and monetary penalties. If it is true, as Senator Button has said, that this gives an indication to the judiciary that the penalty is too small, by the same criterion that I have used, the monetary penalty should be $20,000 or 12 months in gaol. If the Minister is prepared to raise the penalty to $20,000 I would consider it. If not, I will stick with the $1,000 or two weeks imprisonment. Amendment agreed to. Clause, as amended, agreed to. Clauses 55 to 57-by leave-taken together, and agreed to. Clause 58 (Offences). Senator COULTER(South Australia)(11.40) —I move: (2) Page 22, subclause 58 (1), lines 20 and 21, leave out ``12 months'', insert ``1 month''. I will not repeat the arguments which I used on the previous amendment. This amendment is simply to bring into line the monetary penalties and the terms of imprisonment on the scale using roughly $20,000 as an order of magnitude as average yearly earnings. The penalty would then be a $20,000 fine or one month in gaol, or both. Amendment agreed to. Clause, as amended, agreed to. Clauses 59 to 62-by leave-taken together, and agreed to. Clause 63 (Confidentiality). Senator BUTTON(Victoria-Minister for Industry, Technology and Commerce)(11.41) —I foreshadow a Government amendment to clause 63 which is to leave out subclause (2) and substitute the following: (2) Subsection (1) does not apply to anything done as required or permitted by law. The effect of this amendment will be to take out paragraph (a) of subclause (2) and rewrite, as it were, paragraph (b) of that subclause. This is a normal safeguard provision in legislation. The amendment means that the Authority may not disclose information in a way which would constitute a breach of confidence unless there is a circumstance in which there is a requirement or permission by law to do so. Provisions similar to this are inserted in many Bills. For example, there may be a royal commissions Act which would have the effect of overriding the confidence provision in clause 63 (1). There may be other pieces of legislation which relate to safety or something similar which would override the provisions of clause 63 (1). This provision is found in many Acts to avoid any inconsistencies of that kind. It is a normal piece of legal machinery which should be in this Act as it is in others. Senator LEWIS(Victoria)(11.43) —I move: Page 24, subclause 63 (2), lines 8 to 10, leave out the subclause. I object to the way in which the Minister intends to deal with this. It seems to me that the amendment foreshadowed by the Minister should be in two parts. The first part should be that lines 8 to 10, which is subclause (2), be left out. This is identical to the amendment which I have moved. The dispute is as to the insertion, so at this stage we really ought to deal only with the first part of the Minister's amendment, which is the same as my amendment. This will now enable us to debate the whole clause. Amendment agreed to. Senator BUTTON(Victoria-Minister for Industry, Technology and Commerce)(11.47) —I move what remains relevant of Government amendment (9) which has been circulated, and what is relevant is: Page 24, clause 63, insert the following subclause: ``(2) Subsection (1) does not apply to anything done as required or permitted by law.''. I rely on the grounds which I advanced earlier, that this is a normal safeguard provision in legislation of this kind which simply means that while the Authority has a duty of confidentiality, there may be circumstances provided for by other laws such as a royal commission Act in respect of which disclosure of information would not be a breach of confidence when it was done for the purposes of that other law. Senator LEWIS(Victoria)(11.49) —The Opposition parties oppose the proposal by the Minister. The argument that he has just put is quite meaningless. Of course what people are permitted to do by law they are permitted to do by law. The Minister does not need to say that in the Textiles, Clothing and Footwear Development Authority Bill 1988 in order to legalise it. The point I tried to make to the Minister is that the original subclause (2) (a) says in effect that the confidentiality provisions do not apply to anything done for the purposes of the Act. The Minister has agreed to strike that out. But he then went on to say that the confidentiality provisions do not apply to anything done as required or permitted by law. After this Bill is passed, it will become law. So all the Minister is doing is reinserting the clause that he has agreed to delete, only it is written in a different way. That is the significance of what the Minister is saying. The result of that is to leave the confidentiality provisions, so-called, in this Bill quite meaningless so far as the industry is concerned. As a result of inserting this subclause he would be simply writing off the confidentiality provisions. It may be that the Minister can say that in practice the experience with other authorities has been that they have kept confidentiality. I acknowledge that. I am not alleging that they have not. But the Authority is not required to maintain confidentiality if this amendment is made to the Bill. Senator BUTTON(Victoria-Minister for Industry, Technology and Commerce)(11.51) —I make just two points about that. The first is that to sustain one leg of Senator Lewis's argument he would have to point to a requirement in this legislation which would involve a breaking of the confidentiality provision. Secondly, I made the general point that this sort of provision is contained in a whole lot of legislation. Senator Lewis said that it is meaningless because if there is a royal commission Act or some other Act which requires the Authority to disclose information in breach of the confidentiality provision we do not need this provision. I just say that we do need this provision because, as Senator Lewis has said in discussions on numerous other clauses, this constitutes a charter for the Authority, for the industry. The Authority should look, as far as it can, to a self-contained piece of legislation to see what its powers and obligations are. It should not be placed in the position of a royal commission or somebody saying, `Look at our Act. The Textiles, Clothing and Footwear Development Authority has to interpret our royal commission Act and then break the confidentiality provision of its own Act'. This provision is about providing a code for the Authority. By implication, Senator Lewis has said that on numerous other occasions when discussing the penalty provisions and so on. The Authority has to be able to look to its own Act to see what it is entitled and empowered to do. That is why the provision is there and that is why it is in numerous other pieces of legislation which provide for the powers and obligations of particular authorities or instrumentalities. It is an absolutely innocuous provision. It was not inserted at my instigation or the instigation of my Department. It is one which the Parliamentary Counsel likes to see in all Bills of this kind simply because it provides a self-contained charter within the legislation. Senator BISHOP(New South Wales)(11.53) —I support the argument put forward by Senator Lewis. Senator Button's response to it is less than convincing. I point out that Senator Button at least had the decency not to argue that his amendment in any way changes the initial drafting of the Bill, because it does not. Once this Bill becomes a law of itself it is then part of the law to comply with which the Bill would permit confidentiality to be broken. His argument that there would have to be a power in the Bill which would afford a breach of confidentiality of course is only part of the case. Clause 67 empowers regulations to be made and regulations may afford just that sort of opportunity. The need for a protection of confidentiality in the Bill goes back to the arguments we had over clause 45 (2), when Senator Button accepted the amendment to take out the words `in the public interest'. Senator Button seems to think that because he wishes the Act to be interpreted in a particular way it will fundamentally and ultimately be interpreted in that way. For instance, when we were discussing clause 45 (2) and the meaning of `public interest' Senator Button said that he `believed' it would include the use of confidential commercial figures. He might as well have said that he `wished', he `hoped', or he `desired'. Likewise, in clause 63, the purported confidentiality protection which is afforded is in truth meaningless because of the arguments outlined by Senator Lewis. The Minister, when making his initial remarks concerning this clause, argued that these were simply protection provisions that would be used in the sort of Bill that could be used to set up a royal commission. Yet earlier in the debate the Minister distinguished the Textiles, Clothing and Footwear Development Authority from a royal commission and had gone to great pains to stress that there was no commonality between the two types of bodies. So in all honesty, the Minister ought to reconsider his position and realise that the protection which is purported to be afforded is meaningless, and allow the amendment, as previously passed-that is, the deletion of subsection (2)-to stand and that the new proposed subsection not be added to the Bill. Senator COULTER(South Australia)(11.56) —I seek guidance from the Minister. The argument seems to be tautological. Is the Minister saying that the correct interpretation is that subclause (2) (1) (b) of the original clause is retained? In other words, the clause would read: Subsection (1) does not apply to anything done as required or permitted by law. Do I understand him correctly? Is he indicating that that would mean that the confidentiality provisions, to the extent that they may be breached within this law, would not apply to itself? In other words, it would apply only to laws other than this law. That seems to me to be the nub of the argument. Senator BUTTON(Victoria-Minister for Industry, Technology and Commerce)(11.57) —The provision is intended to apply to laws other than those contained in this Act. That is so in every Act of this kind. Senator COULTER(South Australia)(11.57) —My question still stands. The answer that has been given is not good enough. It is not the intention; it is what the words actually mean that is the significant thing. Is the correct interpretation in law-and I have no legal training-of these words that these words will not apply to anything within this Act; they will apply only to other Acts? The TEMPORARY CHAIRMAN(Senator Zakharov) —Order! It being almost 12 noon, consideration is interrupted. Under sessional order I put the question: That the Temporary Chairman do now leave the chair and report progress. Question resolved in the affirmative. The Temporary Chairman having reported accordingly- Senator BUTTON(Victoria-Leader of the Government in the Senate) —by leave-I inform the Senate that the Minister for Resources, Senator Cook, is absent from the chamber for Question Time today as he is fulfilling a longstanding ministerial commitment on behalf of the Minister for Primary Industries and Energy, Mr Kerin. He is attending and inspecting a field day of agricultural produce and equipment at Warragul. Mr Kerin was to keep this appointment until early this week when he had to go to Japan on short notice. Any questions in this chamber which would normally be directed to Senator Cook in relation to his portfolio, or those he represents, should be directed to the Minister for Finance, Senator Walsh. The DEPUTY PRESIDENT —Before I call on questions without notice I wish to make a statement on last night's industrial action by the Parliamentary Catering Service which involved a refusal to charge for food and drink provided in both the members and non-members refreshment areas. I have been advised by the Secretary of the Joint House Department that the industrial dispute in the Parliamentary Catering Service was heard in the Australian Conciliation and Arbitration Commission yesterday afternoon. At the conclusion of the hearing the Commission strongly recommended that all industrial action cease to allow the issues in dispute to be discussed between the parties. The Federated Liquor and Allied Industries Employees Union of Australia official at the hearing undertook to put that recommendation to a meeting of its members at 10.30 a.m. today. In spite of that clear understanding, further industrial action was taken by the Parliamentary Catering Service last night. The Joint House Department has advised the union that if it lifts all bans and limitations immediately it will meet to discuss the issues in dispute next Tuesday at 10 a.m. If the union does not lift all bans immediately, the Department has advised that it will seek to re-list the matter with the Commission and seek to have stand-down provisions inserted in the award. The matter that concerns me most is the fact that there was substantial use of the members dining area and the non-members facilities. The initial estimates of losses incurred by the Parliamentary Catering Service are as follows: Food...$2,800 Liquor in the non-members bar...$3,000 Liquor in the members bar...$1,000 Liquor in the cocktail bar...$1,200 Committees, room service and functions...$2,000 Total loss of sales...$10,000 I have also been advised this morning that some people who utilised the services last night have been advising of the amounts they owe and requesting that their accounts be charged; others are paying cash amounts. The Department is presently reconciling the exact situation and will be providing me with a report as soon as possible. I, myself, had guests last night and I have made arrangements, as well as I can, to make the payment for the amount I owe. I think all honourable senators who used the facilities have an obligation to do likewise because any unpaid bills will ultimately become a charge on the taxpayer, which would, in my view, be outrageous. There can be no compulsion in this area because of the lack of adequate records. It is really a moral decision which all honourable senators concerned have to make for themselves. The same considerations apply to those who used the non-members canteen and bar. Senator CHANEY(Western Australia-Leader of the Opposition) —by leave-Mr Deputy President, before asking a question which is on the subject that you have raised and which will be addressed to you, I seek leave to move a motion to take note of your comments. In seeking leave, I indicate that I do not intend to debate the matter beyond saying about two sentences. I do not wish to delay Question Time. Leave granted. Senator CHANEY —I move: That the Senate take note of the statement. Mr Deputy President, I note that it was part of your statement that the Australian Conciliation and Arbitration Commission strongly recommended that all industrial action cease. I simply say that this is a further indication that there is a need for proper enforcement procedures in the conciliation and arbitration arrangements which presently do not exist. I seek leave to continue my remarks later. Leave granted; debate adjourned. Senator CHANEY —Mr Deputy President, my question is addressed to you and relates to the matters on which you have just given us a statement, about the quite extraordinary situation which developed last night when catering staff members, as part of an industrial campaign, refused to accept payment for food and beverages in the dining rooms and bars of Parliament House. I ask: When did this situation come to the notice of the Presiding Officers? Why was a decision not taken to close the bars and dining areas immediately? Who gave the instruction that the so-called `free service' should be allowed to continue? Finally, I ask-and I think the last part of my question has been answered by you, Mr Deputy President: What action is being taken by the administration of this place to ensure that payment is made for food, drinks or other goods provided last evening without charge? The DEPUTY PRESIDENT —The decision that the facilities should remain open was taken by Madam Speaker. I have spoken to her about it and it was her view that in all the circumstances it would be best if the facilities were to remain open. I was not consulted. The answer to the last part of Senator Chaney's question about what arrangements are being made to recover the amounts owing is that that will have to be looked at by the Joint House Department. I think the paucity of records will make it extremely difficult to recover the amounts concerned. It really is a matter of honour among those who incurred the debts. Senator CHANEY —I ask a supplementary question, Mr Deputy President. I thank you for your answer, but I asked you two particular questions about when this situation came to the notice of the Presiding Officers. Are you in a position to tell us when these matters came to the notice of either or both you and Madam Speaker? Have you been given any reasons as to why the decision was not taken to close the bars and dining areas? The DEPUTY PRESIDENT —The matter came to my notice when I was having dinner and was informed by the waitress that I would not be charged for my dinner, which I must say outraged me. I do not know at exactly what hour the matter came to the notice of Madam Speaker, but it was certainly before the dinner break. She made the decision. I think I should leave it to her to make her own statements. It is very difficult for me to speak on her behalf. She told me, and she authorised me to tell the Senate this, that she weighed up the various factors-the industrial dispute and the necessity to provide adequate facilities for members of parliament-and decided on the balance of arguments that the facilities should remain open. I think any further statement on the matter should be made by Madam Speaker herself. Senator FOREMAN —My question is directed to the Minister representing the Treasurer. I refer to the evasive comments regarding a consumption tax made at lunchtime yesterday by the Liberal Party candidate for Port Adelaide, Judy Fuller, on the Australian Broadcasting Corporation's The World Today program. Will the Government tell the electors of Port Adelaide before the by-election tomorrow whether it will implement a consumption tax? Senator WALSH —I have been asked about the evasive comments made by the Liberal candidate for Port Adelaide. I would just like to quote a couple of lines of what she said yesterday. When asked why she would not support a consumption tax, she replied: I didn't say I didn't support it, I didn't say I did support it. I'm actually saying that I go with the party policy; which is that it is not in the party policy. A consumption tax is not in the party policy. As an individual my personal view, is that whatever my personal view is, if I was ever privileged enough to be a member of the Federal Parliamentary Party well then I would obviously put my personal views in the Parliamentary party room-and which determines our party policy. That's where my views belong. I hesitated halfway through reading that quotation because I thought that I was reading the same line twice. I needed to check that I was not reading the same line twice. I repeat that I said: As an individual my personal view, is that whatever my personal view is, if I was ever privileged enough to be a member of the Federal Parliamentary Party . . . The word `evasive' is, I think, a bit of an understatement about the behaviour and comments of Ms Fuller, or whatever her name is. Senator Foreman also asked me whether, prior to the by-election, I could give a statement on behalf of the Government as to whether the Government will implement a consumption tax. The answer is yes, I can certainly make a definitive statement about that. Indeed, definitive statements saying that there will be no consumption tax have already been made by the Prime Minister and the Treasurer. Senator STONE —My question is addressed to the Minister for Finance. It follows the question already addressed to you, Mr Deputy President, by Senator Chaney regarding the events in this place last evening. As the Minister primarily responsible for controlling the spending of taxpayers' funds, does he share my disgust at the events of last night already referred to by Senator Chaney and which have been so misleadingly described as `free service' in Parliament House? Did the Minister himself, as I would expect, refuse to indulge in what I think can only be called the looter mentality operating in this place last night when some occupants of this building embarked on a food and drink binge at the expense of the Australian taxpayer? Will the Minister confirm that the cost to taxpayers, who will have to pick up the tab for the debacle which occurred within the parliamentary precincts last night, was as was stated by the Deputy President at the outset, of the order of $10,000? Senator WALSH —I share Senator Stone's indignation, in so far as it is valid, about people who had a free binge-free to them-last night without any intention of doing anything about it. I have been asked whether I indulged. I went out to eat, which had nothing to do with what was going on in the dining room here-I was not even aware of it until long afterwards-and I had a drink in the non-members bar. I paid $20 in cash to the receipts office this morning, which more than covers anything that I drank in the non-members bar last night. Senator Button —I would hope so. Senator WALSH —I regard myself as having shouted a couple of other people a drink as well. I was surprised to be told by the staff in the receipts office that a number of members and senators had already either paid some money or rung up to find out how much they had to pay. It gave me a bit more faith in human nature than perhaps I might have had beforehand. I wish Senator Stone would spread his indignation a bit more widely. I do not approve of members of parliament, journalists or anybody else sponging on the taxpayers through picking up free booze and free dinners in Parliament House last night, and I hope that all of those who used the service will do the right thing and pay for it. But I do not believe that the taxpayers of Queensland should be sponged on through the expenditure of $5m to provide an irrigation scheme for John Bjelke-Petersen, as the taxpayers of Queensland have been sponged upon. Such a scheme was not even on the wish list that State governments send to the Commonwealth seeking funding for water supply or irrigation schemes, but suddenly the Queensland Budget of 1985 or 1986 made provision for the building of the Mackenzie River dam. Fortuitously, just two weeks beforehand, John Bjelke-Petersen had made an application to install an 18-inch centrifugal pump in an anabranch of the river, which would have been pumped dry in about two hours, or perhaps a little longer, had there not been a permanent reservoir of water upstream from there to keep the anabranch full and to keep the water up to the 18-inch centrifugal pump. I wish Senator Stone would spread his indignation to that sort of looting of the Queensland Treasury by the former Premier's son. On the issue before us, the union involved-I cannot remember its precise name but it is known as the Federated Liquor and Allied Industries Employees Union in some States-last night imposed what amounted to a work ban, refusing to collect money. That is a habit that the union picked up from the doctors' union in the Australian Capital Territory, which ran an industrial campaign over many months, backed up with work bans, trying to get an 85 per cent pay increase. Did we hear any indignation from Senator Stone about that? Indeed, Senator Lewis, who is not in this place today, publicly supported the doctors' union applying work bans in support of an 85 per cent pay grab. Senator Robert Ray —What about the discredited former Treasurer? Senator WALSH —He was not game enough to say anything, as I recall it, which is par for the course for him. I was told last night that some of the employees of the catering service had preferred to go on strike rather than put on a work ban and were advised by their union that a work ban of this type was a better idea. I do not know why, and I am not even certain that that is true. I have not been able to verify this, but I have a clear recollection of either a regulation or something written in an Act which refers to wilful refusal by an employee of the Commonwealth to collect revenue due to the Commonwealth which imposes, if I remember correctly, a personal liability on the Commonwealth employee who wilfully refuses to collect. As I say, I state that very cautiously because I have not in the short time available been able to verify it, but I do have a recollection of there being a clause or regulation along those lines. If my recollection is correct it would seem that there might be some personal liability on the people concerned. I do not believe it would be fair to the people concerned to make them pay the $10,000, if that is the figure. Senator MacGibbon —Why not? Senator WALSH —Because I think the people who drank the free booze and had the free dinners ought to pay for it. That is why I think it would not be fair to impose it on the individuals. Members of the Liberal Party, of course, brag about how to get free booze, free dinners and free entertainment. All they have to do is get their firms to pay $65,000 to the Carlton Football Club and they get it all for nothing and the taxpayer foots half the bill. That is the sort of morality that applies at the highest levels of the Liberal Party. There are apparently some members of the Liberal Party in this Parliament who have a higher moral standard than that, and they have offered to pay for the food and drink they had last night for which they were not charged. Senator Foreman —What about the Young Liberals? Senator WALSH —I am coming to that. That is the second time I have been prompted about the Young Liberals. As we all know, the Young Liberals had what could euphemistically be described as a function in the Senate courtyard last night-- Senator Puplick —For which Mr Shack paid by cheque last night. Senator WALSH —How did he calculate it? Senator Puplick —He pre-ordered the amount of grog which was to be supplied to the function. There was no more grog supplied to that function than was already paid for. Senator WALSH —I think I know a little bit more about it than the honourable senator; I have more up-to-date information. The Young Libs had a function which was roaring away until quite late in the night, and according to my contact in the parliamentary catering service they had about 50 cases of Fosters, although I concede it might not have all been Fosters. When I heard this I thought that the Young Libs had picked up their bad habits from the old Libs-just like the union involved had picked up its bad habits from the doctors' union in Canberra-and particularly from Mr Elliott and his ilk, and decided that they would have a free binge on the taxpayers. I have since been advised that a charge will be made for that, but it is not the custom to send out a final account until some days after such functions are held. The normal procedure is that a gross amount is invoiced out and usually some is returned. That is then credited against a gross amount and an account is finally sent out for whatever the net amount is. I understand that that will apply in the case of the Young Liberals function last night. Senator STONE —Mr Deputy President, I ask a supplementary question. I thank the Minister for his answer because it reveals his true colours-both of them. Will the Minister agree that in relation to those parts of his response in which he shared my sense of disgust at the events of last night, including, if I may say so, my disgust at the apparent decision of the Speaker of the House of Representatives to authorise these matters to proceed, he has indeed been operating as a Minister for Finance and in what I would call his Dr Jekyll mode? Will he also agree that in relation to the other elements of his remarks, including his totally outrageous and unrelated remarks about events in Queensland and the doctors dispute in the Australian Capital Territory, he is operating in his other colours-in his Mr Hyde mode? Senator WALSH —I do not think I need to add anything to what I have already said. Senator McKIERNAN —I refer the Minister representing the Treasurer to the undertaking he gave on Wednesday to seek advice from the Treasurer in relation to claimed tax advantages associated with the entertainment packages being advertised to companies by the President of the Carlton Football Club. Has the Minister received any advice on this matter from the Treasurer, and will he relay that advice to the Senate? Senator WALSH —I have received some preliminary advice from the Treasurer, or more accurately from the Australian Taxation Office via the Treasurer. It is a two-page advice which I shall table because, in my view, it is too long to quote the whole lot. I should like to quote a few sections of it. After summarising the fringe benefits the Carlton Football Club advertised as being available to a firm which would pay $65,000, the advice goes on: To my knowledge, this Office has not been asked to rule on the application of the tax law to this particular proposal. It would require a more detailed consideration than is possible from the advertisements only in order for us to reach a concluded view on the deductibility question. However, some general observations can be made. The general observations are to the effect that it is unlikely that all or even the greater part of the $65,000 would be a permissible deduction. The advice continues: By way of broad comparison, we were asked to rule on this question in relation to corporate boxes provided at other major sporting events. After carefully examining the nature and purpose of the facilities provided in the boxes, their cost, and the prominence of any corporate advertising associated therewith, it was concluded that the sponsorship fees relate overwhelmingly to the provision of entertainment. We determined in these cases that only 5 per cent of the sponsorship fee would be treated as deductible. It goes on to say that in another case 10 per cent of the cost was allowed as a deduction and the rest was regarded as entertainment. If I receive any more detailed advice from the Treasurer I will make that available to the Senate as well. In view of the last paragraph I quoted, Senator Bolkus or his Department might have a look at this with a view to investigating whether the Carlton Football Club and the Liberal Party President are guilty of false advertising. Senator McKIERNAN —Mr Deputy President, I ask a supplementary question. Has the Minister or the Treasurer received any protestations from members of the Opposition, indignant or otherwise, about the matters raised in the Senate last Wednesday? Senator WALSH —I presume Senator McKiernan is referring to the advertisement by the Carlton Football Club. The answer is no, I do not know whether there is any indignation in the Opposition that the Liberal Party President is setting up a scheme under which, according to his claim, he and his mates can sponge on the taxpayer in order to have a free afternoon at the footie, a free lunch and free booze all afternoon as well. There may be some indignation among members of the Opposition about Mr Elliott setting up this proposal, this rort, but none of them has made it known to me. Senator McLEAN —My question is to the Minister representing the Minister for Veterans' Affairs. In view of the fact that it is 2 1/2 years since the Government received the report of the Evatt Royal Commission on the Use and Effects of Chemical Agents on Australian Personnel in Vietnam and six months since it received the report of its special consultant, Mr Bob Hogg, on the inadequacies of that Royal Commission, I ask the Minister: first, is the Government aware of the widespread disquiet among Vietnam veterans concerning the inaction of the Minister and the Government on the Hogg report and of the dissatisfaction expressed by leading international scientists whose work was quoted in the Royal Commission report; second, has the Government examined the results of the three major studies undertaken since the report of the Royal Commission on the effects of agent orange; and, third, will the Minister advise the Senate if and when Cabinet intends to consider all of these factors and come to a decision on the implementation of the recommendations of the Hogg report? Senator REYNOLDS —As Senator Button advised Senator McLean on 18 February, the complaints by Swedish scientists form part of a submission to the Government by the Vietnam Veterans Association-and the Government is aware of those complaints. The Department of Veterans' Affairs has continued to monitor a number of relevant studies published since the completion of the Royal Commission. If Senator McLean would care to let the Minister know to which studies he is referring, it will be possible to check that those studies have also been considered. As Senator McLean is also aware from previous answers I have given on behalf of the Minister, Mr Humphreys, Mr Hogg was engaged as the ministerial consultant to assist in the preparation of proposals to go forward to Cabinet and the process of preparing that submission is well advanced. The Government's response to the Royal Commission report and submissions from the Vietnam Veterans Association will be announced after the submission has been considered by Cabinet. Senator MAGUIRE —Has the attention of the Minister representing the Minister for Employment, Education and Training been drawn to claims in the South Australian media by Mr Connolly, an Opposition frontbencher, about trends in the level of social welfare payments and unemployment in South Australia? Are these claims about the numbers of social welfare recipients under the Hawke Government correct? If not, are the claims part of a pattern of grossly inaccurate and uninformed comments about real trends in South Australia? Senator WALSH —I am aware of a report which quotes Mr Connolly as saying: Since the Hawke Government came to power in 1983, 19 per cent of South Australians have become dependent on a pension or benefit, a substantial increase from the 15 per cent in the Fraser years. He went on apparently to draw some causal link between unemployment and poverty. I am certainly not denying that there is some causal link, but I have checked out the figures and I am not surprised, I must say, to find out that they are quite wrong. Indeed, they are so wrong that one is entitled to believe that Mr Connolly might even have had a hand in the Liberal Party's alternative Budget last June. In June 1982, there were 1.33 million people in South Australia, of whom 244,000 were social security or benefit recipients. That is 18.3 per cent in June 1982, not 15 per cent as Mr Connolly had claimed, during the Fraser years. However, in June 1983, which, although in the period when this Government was in office, was at the point where the full effects of the disastrous Fraser-Howard recession had been felt, there were, of the 1.34 million people in South Australia, 269,000 on pensions or benefits. That is 20 per cent. So when the full effect of the Fraser-Howard recession-and perhaps Senator Stone might like to take some of the credit as well-had worked its way through South Australia, 20 per cent of the people were on unemployment benefits. That was up 1.7 per cent on what it had been one year before. The reason for that increase was the rocketing unemployment of late 1982 and early 1983. Senator Stone —Induced by Mr Kelty and Mr Crean. Senator WALSH —I suggest to Senator Stone that it was induced by the abdication of responsibility by the Fraser-Howard Government in May 1981 when the then Prime Minister thought it was more important to duck off to London for the royal wedding than it was to try to get any sort of a wages policy. He then said-and this advice may have come from Senator Stone-`Let the market-place determine the outcome'. Well, the market-place did determine the outcome. There was a 13 per cent wages explosion in 1981 and a 14 per cent explosion in 1982. But the most recent figures, those for June 1987, showed there were 1.39 million people in South Australia and 270,000 on benefits-that is 19.4 per cent. That is certainly a higher figure than anybody would like to see but it is a significant reduction on the 20 per cent figure that applied four years before when the full effect of the Fraser-Howard recession had worked its way through. It appears that Mr Connolly is a bit like Senator Vanstone: he has allowed his name to be used without checking the facts, or he is incompetent and has made the error himself, or he has deliberately given false information to the Press. Senator CHAPMAN —My question is directed to the Minister representing the Minister for Industrial Relations. My question also concerns the rip-off of the Australian taxpayer resulting from last night's industrial action by catering staff members. Given that this incident is but the latest, and certainly the most outrageous, of recent times, what action will the Minister for Industrial Relations take to ensure that the union concerned does not continue its reprehensible behaviour? Has he noted the comment of his colleague, Mr George Gear, chairman of the so-called social national price watch committee, who is reported in today's Age as saying he was `supporting the workers' by drinking for free at the non-members bar? Will the Minister dissociate himself and the Government from the totally irresponsible attitude adopted by the honourable member for Canning, who so sanctimoniously rails against alleged overcharging by doctors and others, yet who last night gleefully helped himself at the expense of those for whom he claims to be concerned? Senator BUTTON —Mr Deputy President, in so far as the latest outrage-as you so described the events last night-is concerned a number of questions have been directed both to you and to Senator Walsh about that matter, and I have nothing to add to what has been said. I have not seen the comments of Mr George Gear. I do not know whether he said he was supporting the workers or supporting the bar. They are different concepts altogether. But the simple point which the honourable senator is trying to make is made by singling out an Australian Labor Party member of parliament and accusing him of outrageous behaviour, on the basis of some statement which he is alleged to have made. By asking that question he psychs up morally self-righteous people like Senator Stone, who has been riding his white charger throughout Question Time. He has a total monopoly on morality in these matters and suggests that nobody else has any. We can play this game in the Parliament. I could dig up today a Liberal Party senator who was found lying on the lawns last night, and ask whether he paid for his drinks. But I am not going to do that, because there is absolutely no point in it except in the minds of people who can see through a keyhole with both eyes. I am not one of those people. There are a few here on the other side of the House. Senator Patterson —I take a point of order, Mr Deputy President. The honourable senator has alluded to the fact that there was a male Liberal senator on the lawns outside Parliament House. I ask that he withdraw that statement unless he has evidence that a Liberal senator was lying on the lawns outside Parliament House. The DEPUTY PRESIDENT —There is no point of order. That is not a personal reflection on an individual. Senator CHAPMAN —Mr Deputy President, I ask a supplementary question. I was not aware that the Minister had concluded his answer. I thought that he was interrupted by a point of order. The central aspect of the question I asked related to the industrial relations aspects of this issue. I ask the Minister again what action the Minister for Industrial Relations proposes to take to ensure that the union does not continue its reprehensible behaviour of which last night was simply the most recent example? Senator BUTTON —Perhaps the honourable senator lives in some sort of sheltered world and now that there is an industrial dispute in the parliamentary arena it has been drawn to his attention that industrial disputes take place in various places throughout Australia at various times. There just happens to have been one here last night and I gather that the honourable senator found that particularly exciting and reprehensible. The Minister for Industrial Relations is not in the business of sticking his beak into every industrial dispute that takes place, and he should not be-- Senator Walters —This is in the Parliament. Senator BUTTON —That is right. It is in the Parliament and the honourable senator, the customer, is a very important person. It is not like ordinary people in the community who suffer from industrial disputes. She is different and that is what she is concerned about and that is the point of Senator Chapman's question also. Senator Walters —I was referring to the fact that yesterday's occurrences were nothing more than a taxpayers' rip-off. The DEPUTY PRESIDENT —Order! That is not a point of order. Senator BUTTON —It is not the function of the Minister for Industrial Relations to intervene in every industrial dispute that takes place; it is a matter between the parties. Here there is an employer party just as there is an employee party, just as there are in other circumstances. It is certainly not the function of the Minister for Industrial Relations to go around-- Senator Stone —We are asking what the employer is doing. Senator BUTTON —I am dealing with Senator Chapman's question at the moment, not Senator Stone's question. If he wants to ask me a question about what the employer is doing he should not direct it to me because I have nothing to do with that. I am representing the Minister for Industrial Relations in answering this question and, as I have said, it is not his function to go around involving himself with the details of every industrial dispute which takes place in this country. I must confess that we have done a little more than Opposition senators ever did in government with a great deal of success, which has brought industrial disputation in this country to a level of less than 50 per cent than it was under the Liberal Government. There has been some success in that. But that is not the function of the Minister for Industrial Relations and I will not even pass the question on to him. Senator COLSTON —Is the Minister representing the Treasurer aware of the Institute of Public Affairs (IPA) award for the most restrained and responsible Budget for State governments? Did the most recent award go to Queensland and was it judged by the Director of the IPA's State Policy Unit, Mr Les McCarrey? Does the Government place particular value on the analysis provided in judging these awards? Is the Minister aware of Mr McCarrey's particular qualifications for judging the awards? Senator WALSH —The honourable senator asked four questions. The answer to the first two questions is yes; Mr McCarrey was the judge and the award was given to Queensland. I was asked what value the Government places on Mr McCarrey's analysis. The answer would have to be not very much at all and there are a number of reasons for that. One reason is that, after the 1986 Budget, Mr McCarrey published an article in which he forecast that the Budget deficit would blow out in 1987; that that was built into the system; that it would probably blow out in 1986; and that the 1986 Budget was basically phoney anyway. Of course, that somewhat tarnished whatever reputation he may have had before. But it goes back very much further than that. Mr McCarrey is, by no stretch of the imagination, an analytical or objective observer. Some years ago, evidence was given to the Senate Standing Committee on Finance and Government Operations by a Sydney underwriter and stockbroker which showed that State electricity commissions (SECs) in general were in a perilous financial position and that the Western Australian SEC was in a particularly perilous financial position. I recall asking the witness whether a particular table showed that the Western Australian SEC was borrowing money to pay interest on money previously borrowed without adequately disclosing that fact. The answer to that question essentially was yes, but Senator Withers quipped in with one of his pithy comments that that was the sort of thing people got locked up for if they did it in the private sector. Eventually, I put out a Press statement saying that, if the Western Australian SEC were a private company it would be placed in receivership and its directors would be put in gaol which produced a few threatening letters from some incompetent lawyer that the then President of the Liberal Party, Mr Warner, presided over at the time. It took three letters before he could even send me the Press clippings of where this alleged defamation took place. I eventually ignored them when he sent them to me and I have heard nothing from him since, nor do I expect to. This was published in Western Australia and the SEC got a bit annoyed. Senator Stone might be interested to hear that Mr McCarrey, who was then the Under Treasurer in Western Australia, rang the stockbroker and said, `You will recant that statement or there will be no more business for your firm from the Western Australian Government'. In other words, this objective analyst was doing Charlie Court's dirty political hatchet work. Senator Stone —It is outrageous defamation. Senator WALSH —It is outrageous that he did it; I absolutely agree. I do not believe that Senator Stone would ever have done anything like that when he was Secretary to the Commonwealth Treasury. But that is the sort of background Mr McCarrey has. Mr McCarrey is a right wing ideologue who is a retired former political hatchet man for Charlie Court. Senator DURACK —My question is directed to the Minister for Justice in his capacity as Minister responsible for the Australian Federal Police. I refer to the incidents in Parliament House last night where it is obvious that a number of people, fully knowing the situation, helped themselves to food and drink on the basis that it was free and they were provided with it on the same basis. As Minister responsible for the Australian Federal Police, will he ask the Federal Police to conduct an inquiry into the circumstances to ascertain whether charges should be laid against either the providers of the free food and drink service last night or those who knowingly took advantage of the situation in what may well amount to theft from the parliamentary dining facilities? Senator TATE —I do not think Senator Durack has really established a case that those who partook of the food and drink which was provided formed an intention never to pay the bills as they might be due. Indeed, the Deputy President has indicated his intention to pay the amount that would properly be due in respect of food and drink which he and his guests consumed. I certainly intend to do the same and I imagine that almost every senator and member will do the same. Without any real evidence of any criminal activity at this point and, without further information, I do not see any point in calling in the AFP in this regard. Senator DURACK —Mr Deputy President, I ask a supplementary question. In my question I made a clear distinction between those who, having partaken of this food and drink were then told that they were not going to be charged, and those who, on some evidence that is available, were taking advantage in advance knowing that they were not going to be charged. Senator TATE —There is a distinction between partaking knowing that one will not be charged on that occasion and partaking with a firm intention never to pay in respect of the food or drink enjoyed. I believe that most members and senators and their staff members will do the right thing. Senator COATES —I ask the Minister for the Arts, Sport, the Environment, Tourism and Territories where he has yet received any recommendations from the Tasmanian Government for projects to be funded under the National Estate grants program this year. Is the Minister aware of the extreme length of time it consistently seems to take the Tasmanian Government to make these recommendations to the Federal Government? Given that National Estate grants are purely Commonwealth funds, does the Minister know the reason for the reluctance of the Tasmanian Government? Is there again a danger, as there was I think last year when I raised a similar question with his predecessor, that Tasmania may miss out on these important grants? Senator RICHARDSON —It was only in October 1987 that the Tasmanian Government provided the Commonwealth with information on applications received for projects under the National Estate grants program for 1987-88. However, no recommendations were received from the Tasmanian Government as to the suitability of that number of applicants, and no indication was given by the Tasmanian Government as to the priority it would like to place upon them. Accordingly, in January 1988 the Commonwealth responded by suggesting that there be some priorities amongst those applications, and awaited the response of the Tasmanian Government. In March 1988 the advisory committee from the Tasmanian Government wrote back to the Commonwealth Government to advise that its meeting for March had been cancelled, and that at this point it had no other date set for a future meeting to consider the Commonwealth's correspondence. The Commonwealth is concerned about what it can do from this point on to make sure that a large sum of Commonwealth money is passed on to the Tasmanian Government to ensure further work is done to protect the National Estate. I do not know what difficulties the Tasmanian Government experiences with this program. Pretty obviously, they are difficulties not experienced in any other State. I cannot even criticise Queensland, in that respect, Senator Boswell. Tasmania is unique in its incompetence on this point. I am going to write another letter today in which I will ask the Tasmanian Government what is wrong, what happened and why it is that Tasmania is the only State that cannot get its act together and tell us what it will do about the National Estate grants program. It appears the Tasmanian Government simple does not have a great interest in receiving this money. We should all ask why it does not have a great interest in receiving this money. There can be only one answer. Its attitude to the National Estate has been well and truly public for years. It wants to pay no attention whatsoever to Australia's heritage, either natural or built. The Liberal representatives from Tasmania in the Senate have made sure that we are all well and truly aware of that after hearing their speeches over the last week. The Tasmanian Liberal Party has no interest in the National Estate, neither has the Tasmanian Government. I hope they do get their act together, because at least those of us on the Commonwealth side want to make sure that the National Estate grants program does proceed. Senator BOSWELL —My question is addressed to the Minister for the Arts, Sport, the Environment, Tourism and Territories. I refer the Minister to the proposed visit by three technical experts from the International Union for Conservation of Nature and Natural Resources (IUCN) to north Queensland in April to assess the Commonwealth's nomination of the north Queensland rainforests for inclusion on the World Heritage List. Can the Minister advise the Senate whether there is a detailed itinerary prepared for the three representatives? If there is, what is it? Will the Minister advise the Senate whether provision has been made for the three IUCN delegates to meet representatives of the Queensland State Government to discuss an appropriate management plan? Will the Minister make arrangements to allow the IUCN representatives to meet a deputation of people affected by the nomination? Senator RICHARDSON —I am delighted that Senator Boswell has asked this question, given the comments made in this place yesterday by Senator Puplick. The reality is that the detailed itinerary is not yet finalised. It is being prepared in consultation with Dr Thorsell, who is the leader of the IUCN assessment team. As soon as the detailed itinerary has been completed, I will make it available to the honourable senator and the Senate. It will certainly not be secret. There will be provision for the IUCN team to meet with the Queensland Government. That was always our intention, and it remains so. There will also be provision in that itinerary for the IUCN team to meet with interested groups in north Queensland, be they environment groups, affected timber workers or mill owners. I intend to make sure that the IUCN team gets a comprehensive view of all that is occurring in north Queensland in regard to this nomination because I am absolutely confident that this nomination will stand up to the most rigorous examination. I want to make sure that the IUCN team gets every bit of our cooperation to have that rigorous examination. Unlike Senator Boswell, I have read the scientific evidence and I know where it is heading. Senator GILES —My question is directed to the Minister representing the Minister for Foreign Affairs and Trade. What is the Government's attitude to the reported massive chemical weapons attack on the town of Halabja in the course of the continuing war between Iraq and Iran, as television news broadcasts revealed yesterday? Senator GARETH EVANS —The Government condemns absolutely and in the strongest possible terms the use of chemical weapons against civilians in the town of Halabja. It is horrifying that thousands of people may have died in these attacks. The use of chemical weapons in the Gulf war was confirmed by three United Nations investigations, in 1984, 1985 and 1987, in which an Australian scientist participated. The latest reports strongly suggest that this has been the worst single incident of chemical warfare since World War I. The extent of the casualties, and the fact that they are unprotected civilians, make the accounts particularly shocking. Australia has repeatedly condemned the use of chemical weapons and stated unequivocally that their use cannot be justified in any circumstances. We share the international community's concern that violations of the 1925 Geneva Protocol constitute a very serious erosion of international norms. The latest reports strengthen Australia's resolve to continue its efforts to achieve a comprehensive international convention banning the development, production, acquisition, stockpiling, transfer and use of chemical weapons. Australia has been playing a very positive and active role in the efforts to achieve a chemical weapons convention in the Conference on Disarmament in Geneva. Senator SHORT —My question is directed to the Minister for Home Affairs. I refer him to Research Report No. 2 of 1988, released recently by the Australian Electoral Commission, and entitled 1984 Redistribution, Forward Projections of Enrolments Report. I ask the Minister whether he is aware of the statement on page 3 which states: In so far as any `actual' enrolment at any moment of time is affected by on-going activities in the roll maintenance process, a degree of rubberiness in that figure must be expected. Thus December (1987) enrolments included a number of entries identified for deletion under the objection process following the 1987 general election, but not sufficiently progressed to be removed. So, in Victoria, the State's total enrolment was about to be reduced by approximately 60,000 . . . Does this mean that 60,000 people in Victoria, that is, 2.2 per cent of the total voting population in that State, who voted in the July 1987 election either should not have voted at all or voted in the wrong electoral division? If it does not mean that, what does it mean? In which electorates did this occur, and what was the proportional magnitude of this factor in each of those electorates? What are the corresponding figures for other States and electoral divisions within those States? Finally, if the Minister still supports the Australian Electoral Commissioner's claims that no Senate or House of Representatives seat was in doubt as a result of administrative errors during the 1987 election, errors which the Commissioner described as major but which the Minister chose to describe as possible minor inadequacies at a local level, does he extend this support to include other factors that may have influenced the results, including multiple and phantom voting practices? Senator ROBERT RAY —Senator Short has asked about ten to twelve questions. I am conscious that we have to finish by one o'clock, so I might just go to the broad aspects rather than the absolute specifics. The process of habitation reviews being under way in the period 1986-87 means that every household in one way or another is canvassed to see whether the roll is in fact accurate. Quite often, what occurs in terms of enrolment is that when people move from one electorate to another they tend to be placed on the role in their new electorate before they are taken off the roll in their old electorate. In some cases there is that duplication. There is no evidence, however, that any of those people vote in both electorates. Usually, if they have made the conscious effort to enrol in a new electorate-or their names are placed on the roll in their new electorate via the habitation review, which throws up many of these problems-there is, and always has been, a lag time in their names being taken off the roll in their old electorate. Before anyone suggests that this is something new, I say that this is somethng that has happened virtually since Federation. I sometimes become a little irritated by the criticisms from those opposite of the electoral process-which, after all is, and always has been, user friendly-which suggest that suddenly something has dramatically changed in that regard. Senator Short tried to link the question of enrolment, the up-to-dateness of the rolls, and whether the result of any election might be put in doubt because of this, with those administrative errors in the statistics of the election. Of course, there is no correlation with that. It is recognised in the Commonwealth Electoral Act-for those in New South Wales and Victoria who may take an interest in this matter, it is recognised in the New South Wales and Victorian electoral Acts-that the correctness of the roll cannot be a factor in challenging an election result. I, as Minister, and my predecessors in this role, can never absolutely guarantee that every roll is accurate at one time. We are talking about nine million names on a roll. It is a fairly staggering thing to keep up to date. We are trying to keep that roll as up to date as possible. At the moment that process is assisted by habitation reviews every two years. We are trying to negotiate with the States to pick up part of the cost so that we can embark on habitation reviews every year. We are looking at computerisation of the rolls. When I say computerisation of the rolls, of course the names of electors are on computer tapes. I am referring to a direct process from divisional returning officers to the central computer so that the rolls are constantly updated. Senator Short would realise from his knowledge of this area that a lot of that is tied up with the regionalisation proposals that have not progressed. As a throw-away line he referred to false enrolments, phantom voters and double voters. Quite frankly, in the time available to me, I cannot address those matters. But I will be very happy to do so at another time because I think that a lot of myths are put around. I must criticise the Press-I do not often do it-for its gullibility in quite often running stories unchecked. This is especially true of talk-back radio people in Sydney who have quite often run stories in the last eight months about vulnerability, crooked elections, or whatever. When I write to these people and say, `That was an interesting view, please put forward one piece of evidence that substantiates that view', I never get a response. Our electoral system could not be described as not being vulnerable to attack. It is user friendly. There is no major evidence at this stage that it has been attacked. If it does become vulnerable and people-not so much from organised political parties but people with anarchistic views-decide to attack it, the remedies that we will need to put in to protect the system are fairly draconian. Senator Bishop —It has great gaping loopholes. Senator ROBERT RAY —Senator Bishop says that it has gaping loopholes. It had the same loopholes when the Opposition was in government that it has now that we are in government, but we now have a far more accountable system. These days we do not just sit back and say, `We are not going to worry about this. We are not going to run statistical checks or constant habitation reviews'. Some of the problems that may have existed from 1901 are being exposed a little more because of the rigorous examination methods. I see that Senator Short wishes to ask a supplementary question. Senator Short —I want an answer to the first question: Does this mean that 60,000 people in Victoria voted who should not have voted? Senator ROBERT RAY —No, it does not mean that. There is no evidence of it. I explained that there is a lag time in taking people off the roll; not the same lag time as putting people on the roll. It existed in 1987; it existed in 1977; and it existed in 1957. Sitting suspended from 1 to 2 p.m. Senator TATE —Yesterday in Question Time Senator Tambling asked me whether the Australian Federal Police was investigating allegations concerning the links of a certain Japanese businessman in relation to his purchase of the Burswood Island Resort Hotel and Casino in Perth. The answer is no. Therefore, the other parts of the question do not fall within my portfolio interest whatsoever as the Perth casino is a State responsibility. Senator TATE —Also in Question Time yesterday Senator Teague asked me a number of questions about telexes from the Australian Federal Police (AFP) contingent in Cyprus, including whether there was more than a one-digit difference in the telex numbers of the AFP in Canberra and the Russian Embassy. I am advised by the AFP that the AFP telex number in question was 62606 and, as Senator Teague informed us yesterday, the Soviet Embassy's telex number is 62602-a single digit difference. Bill returned from the House of Representatives without amendment. The ACTING DEPUTY PRESIDENT(Senator Powell) —I present the publication Business of the Senate for the period 14 September to 31 December 1987. Ordered that the paper be printed. Senator BOLKUS(South Australia-Minister for Consumer Affairs) —I table the explanatory notes of certain departments relating to the Additional Estimates of expenditure for 1987-88. Copies of these explanatory notes are being distributed to members of Senate Estimates committees. Other senators may obtain copies from the Senate Table Office, if required. The ACTING DEPUTY PRESIDENT(Senator Powell) —The Deputy President has received a letter from Senator Messner proposing that a matter of public importance be submitted to the State for discussion, namely: The widespread alarm in the community concerning the Government's threat to tax people's superannuation. I call upon those senators who approve of the proposed discussion to rise in their places. More than the number of senators required by the Standing Orders having risen in their places- Senator MESSNER(South Australia)(2.03) —The Hawke Labor Government has lost its direction. In no area of public policy has it lost it more than in that of retirement income security for Australians. Since the day of its first election in 1983, it has broken promise after solemn promise on superannuation to the Australian people. First, it introduced a lump sum superannuation tax. Then it wiped out access to the pension for people over 70 years. Finally, it introduced the infamous assets test with its hidden traps and anomalies for the unwary. We are not just talking here about the aged in the community. It is important to recognise that we are now faced with another terror for the whole community-tax is to be applied to superannuation funds so that the benefits which people expected to collect at the end of their working lives will have been so substantially reduced that their hopes of financial independence will be dashed on the rocks of Paul Keating's twisted view of political economics. Let us just see what undertakings have been given by this Government in recent times on the question of taxation on superannuation. Mr Hawke in recent days has said, `The Government will not consider changes which could impact adversely on already accrued superannuation'. Secondly, he said, `The Government will not make any changes which would stop people taking lump sum superannuation benefits'. Thirdly, he said, `Superannuation will continue to be treated on a concessional basis'. All these things are chock full of weasel words. They provide opportunities for the Government to hedge on any of the decisions that it finally takes in May. To say that none of the measures that will be taken are retrospective is ridiculous. They will reduce the potential for people to accumulate superannuation over the years of their working lives. Mr Hawke has not said that existing 100 per cent lump sums may be affected or that taxing lump sums in a manner which makes it more attractive to pensioners will not occur. If there is going to be a concessional basis for taxation of superannuation, what degree of concession will be applied? These matters are still very much in the air and in the minds of the Australian people at present. They are worrying them silly. We could see an increase in the lump sum superannuation tax; we could see a tax being applied on the income of superannuation funds; and we could see a reduction in the tax concessions granted not only to employer contributions, but also to the self-employed. The introduction of a levy, such as the Medicare levy, could be applied as well. Worst of all, especially for the business community, we may see a fringe benefits tax being introduced on contributions to superannuation funds. Let us just consider what kind of people are being affected by these proposed actions. If young people just entering the work force see that these things are likely to come into force, they will say, `Why bother to join superannuation funds? By the time I reach retirement the Government will have cut my entitlement by as much as a third, a half, or more. I won't be able to live off the income anyway. What is the point in struggling to put money away today when I can better use it for my own benefit right now?'. The family situation is important. Families moving through the most expensive time of their lives with children to educate and mortgages to pay will be tempted to drop out of superannuation funds when they see the Government taking so much of their savings. Many people who have not previously been in superannuation are now being enrolled in current union-based superannuation schemes. We have always supported schemes of that kind where they are properly and independently managed. Those funds, while not complete and absolute in their structure, will provide some capital for retiring workers. But having watched the progress of this trend to union superannuation schemes, the Government now eyes it off and sees it as a lucrative source of extra revenue. The Government is now going to impose penalty taxes on superannuation funds. Eric Risstrom, the Secretary of the Australian Taxpayers Association, says that that rate of tax could be as high as 50 per cent on the income of those union-based superannuation funds. It is almost as though the Government has deliberately set up a milking cow by encouraging union-based superannuation and now proposes to start the milking. In other words, Mr Keating has established a new tax base for the Government to milk. This is despite Mr Keating's speech to the Life Insurance Federation of Australia last year when he said: I hardly need remind you that such a tax would significantly reduce the level of retirement benefits paid to fund members. It would therefore diminish the net value of employee and employer contributions and would inevitably lead to an increase in wage costs as the superannuation benefit losses were made up `in the field'. That came from the Treasurer. Senator MacGibbon —He really said that? Senator MESSNER —Yes, he really said that. Those words indicate that, if the Government is to take the action that is now contemplated, it is going to run directly in opposition to its stated policies on wages and incomes in this country. The confusion of this Government grows. Who loses if these taxes are to be imposed? Certainly not the big companies because they have paid their contributions to the funds anyway. Certainly not the Government because it is going to get extra revenue out of all this. It is the ordinary worker who is going to cop it in the neck. He is the one who is going to miss out on the extra payments. He will find that his benefit, when he comes to retire, is reduced by as much as a third or a half of the total amount he expects. He is the one who is going to miss out, and it is this Government that is going to bring this about. Yet the Government sits on its hands and watches Mick Young take his full superannuation, as well as his $3,000 a week job with Qantas Airways Ltd, even though it has legislated to provide that such parliamentary pensions could be reduced by income from statutory authorities such as Qantas. The Government has deliberately not acted to apply the provisions of the law when these are available to it. As Senator Newman said here yesterday, even Mr Gough Whitlam voluntarily gave up part of his pension when he took a government job in Paris. Minister Button thought that such a move would not be intelligent. This Government is peopled by a Ministry which has lost touch with the real world where people are battling to exist. Mr Howe, the Minister for social insecurity, is more concerned with his prospects of being the next Deputy Leader of the Australian Labor Party when Hawke and Bowen go at the end of the year than with the interests of the less well off. Let us see what Mr Howe has been saying in recent times about superannuation. Mr Howe confirmed a few weeks ago that an income tax on superannuation fund income is inevitable. He attacked superannuation contributors and the managers of superannuation funds. Of course, by implication, he attacked all of those thousands of agents who work in the field for superannuation funds and distribute advice to people for the investment of their funds. By implication he has called those people deliberate avoiders of taxation. In other words, he is saying to those three million Australians who contribute to superannuation funds, `You are all a bunch of tax cheats'. That is what this Government thinks of people who are trying to provide for their own independence and security in retirement. Mr Paul Keating, the Minister for economic tautology, is getting so impatient for the top job that he has given the ultimatum to Bob Hawke to leave by the end of the year. Hawke said that if the Party wants him to go, he will. Keating and Howe are left to make up their minds what they will do. It is obvious what that will be-one will go for the leadership and the other the deputy leadership. The Centre Left, as usual, cannot make up its mind who should replace either of them. It looks as though the Right is so disgusted with Hawke that it wants to bring Barrie Unsworth into Federal politics to offer some kind of alternative. Taxes on superannuation are on the Australian Labor Party's agenda for May. A report that came through the news service yesterday indicated that Mr Keating wants to reduce taxes on big companies and, to achieve that, he wants to be able to tax superannuation funds. Obviously, the only people who are going to miss out here-and I repeat this-are the little people who are members of superannuation funds who will receive less as a result of those taxes being applied. This Government will see to it that big business benefits by reduced company rates of tax while the little people receive lower superannuation payouts. Even that proposition is subject to a great deal of challenge. An article in today's Australian by Laura Tingle headed `Super levy ``could not fund tax cuts'' ', states: A submission to the Treasury from stockbroker McIntosh Hamson Hoare Govett Ltd argues that it would be extremely unlikely the Government would be able to raise or offset the $3.5 billion that the Treasury estimates present tax concessions cost revenue last financial year. Even that stratagem, if the Government is contemplating it, will not work, according to a firm of experts directly interested in the field. No doubt the Government would argue that it cannot afford the $3.5 billion worth of tax that it claims to lose every year through superannuation. The Government has always failed to analyse that figure, which has almost been accepted generally in the community as fact. It is wrong to accept the figure as it is because it fails to take account of revenue collected on income generated from superannuation investments. It also fails to take account of savings from superannuation from reduced pensions paid when income is earned from the investment of superannuation moneys. So what is the case for superannuation? We know that now and in the future, particularly in the next century, the population of Australia will age considerably, which will automatically lead to increased expenditure, whether of a private or a public kind, on age and service pensions and other income for people in that category. As an example, if pensions per head of population remained constant in real terms over that period, the cost of social security pensions for each member of the working population would increase by around 1.2 per cent per year in real terms, or 60 per cent over the period to 2025. If, however, the real value of pensions were to increase broadly in line with increases in labour productivity and wage rates, the share of pension outlays expressed in terms of gross domestic product would rise from 2.8 per cent, or $5.8 billion, which it was in 1985, to 4.5 per cent or $13.9 billion in 2025. This is a growing and intolerable burden on the taxpayers, which leads us to the conclusion that the encouragement of self-provision for retirement should be the objective of all governments. The long term objective must be to encourage the entire work force to contribute, preferably on a regular basis, to their own retirement income, whether through superannuation, specifically identified savings, or other means. With an ageing population and an unsatisfactory replacement level, people should be encouraged to make a substantial contribution towards their own retirement incomes so as to reduce the pressure on the tax system to finance higher levels of pension for greater and greater numbers of recipients in the future. Surely that objective stands unchallengeable. The Government should stop peddling this misleading stuff about the cost to the taxpayer of superannuation. It knows that it is wrong. It should admit that it is wrong, and immediately turn 180 degrees and start to encourage self-provision through superannuation, rather than seeking to impose further taxes on superannuation, as proposed in the May statement. We ought to contemplate why the Government wants to do this type of thing. Let us think through the cynical political mask for a moment. We realise that it is because the Government thinks that it is politically less difficult to take away from people a chunk of their superannuation now by way of tax rather than to tax other things in the community, which people will feel in their pockets today. This is because people will not realise just how much this tax has cost them until they come to retire-some years in the future. The extra 50 per cent of their superannuation money that they expected just will not be there when they retire. So it is the least damaging political fallout that Labor is on about with these proposals. Too bad about its effects on the future living standards of the people. Too bad about the present living standards of the people, if that point needs to be made. This means that there is no hope for the future because the Government is attacking future living standards, as well as present ones. I refer to the effect that this will have on people who have to retire early because of the conditions of their work-people in the armed forces in particular. The people who are least informed will suffer as a result of these taxes. They are the ones who are struggling to build up some little stock of capital for the future. They will be disillusioned. About a month ago the Sydney Morning Herald ran an editorial which summed up the situation very well. It said: The superannuation debate is far too important to be hidden away in Canberra's committees. The long-term implications are far too significant for all Australians to be decided without debate. It's about time the Government came clean with a Green Paper to stimulate discussion and to calm the fears which could arise in the minds of thousands of Australians who are saving and investing for their retirement. The people of whom that editorial speaks are concerned. They are concerned not only about the future but also about the immediate future and what will happen to their savings. The future of those people will disappear into some black hole of higher taxes. We recall the Government's campaign in recent days to tell us that taxes are somehow good for us. However, tomorrow the people have an opportunity to tell Mr Keating and Mr Hawke what they think about this because there is a by-election in Port Adelaide. This is a wonderful opportunity for ordinary people to enter the debate which is spoken of in the Sydney Morning Herald in the most effective way. They have an unparalleled chance to let the Government feel their displeasure at the taxes that are being proposed. They can let the Government know right where it hurts most-right in the ballot box. Senator WALSH(Western Australia-Minister for Finance)(2.23) —This little exercise is a stunt designed to distract attention from the fact that the Liberal Party will introduce a consumption tax if it ever gets into government. We know that this matter will be discussed at the Liberal Party's federal council meeting-it was dragged out of John Howard yesterday like a rotting molar. John Elliott, to whom all Australians owe a considerable debt in some respects because he keeps blowing the whistle on what is really on the Liberal Party agenda, starts talking about the absolute necessity of a consumption tax every time he gets a microphone thrust in front of him. Naturally that annoys Mr Howard because he would rather it not be known that the Liberal Party plans to introduce a consumption tax. This exercise this afternoon is just a continuation of that attempt to throw up a smokescreen, to divert attention not only from the fact that the Liberal Party intends to introduce a consumption tax but also from the fact that the President of the Liberal Party wants the Liberal Party Leader's job. Mr Elliott has two things on his agenda: one is his version of tax reform-that is, a consumption tax on the people who eat their pies in the outer while he sits up in the Fosters box at Princes Park, having a free lunch and free booze and getting a free ticket to the footie as well. This is all paid for by the people in the outer munching their pies, on which he wants to put a tax. He also wants to tax the tickets that those people have to buy to get into the ground. This is what this exercise is really about. Senator Messner spoke about parliamentary superannuation and I am very glad he did because it gives me the opportunity to let the world know of the parliamentary superannuation arrangements which applied when this Government came into office. Firstly, 100 per cent commutation was allowed. There was no tax on that lump sum payment other than 5 per cent of it being subject to normal income tax. So a maximum of 3 per cent could have been paid on the totally commuted pensions that a number of people took at that time. Fraser, Anthony, Lynch-there is a whole string of them-all ran off with more than half a million dollars and paid 3 per cent tax on the amount. That is not the end of the story. If they then croaked, a reversionary benefit of five-sixths of the pension entitlement was available, notwithstanding the fact that the pension itself had been commuted to a lump sum, by a factor of ten. Not only was there a half a million dollars plus lump sum there for the taking, with only 3 per cent tax on it, after the lump sum had been taken, but if the retired politician croaked and had a spouse the spouse also picked up 84 per cent of the pension entitlement that had already been commuted. When I tell people that story they often think I have got the facts a bit confused or they have misunderstood me. They have not; that was the system which applied when this Government took office. There has been a clean-up since then. Firstly, there is a meaningful tax on lump sums. Secondly, only half of the pension entitlement can be commuted. Thirdly, the double dip whereby a reversionary benefit of 84 per cent of the original pension could come back to the spouse of a deceased retired politician has been wiped out as well. No wonder Senator Messner is annoyed. We cleaned up that rort that he had set up for himself and his mates, that Fraser and Howard had set up for themselves, that Fraser himself took advantage of, along with Anthony, Nixon and Lynch-- Senator Maguire —Sinclair. Senator WALSH —Sinclair has not gone yet, unfortunately. One could put an argument that it would have been worth half a million to get rid of Sinclair, that it would have been in the national interest to do so. We cleaned up that rort. No wonder Senator Messner is angry about it. He thought he was going to get in there for his double and triple dip. Since the Opposition has such a great interest in public sector superannuation, may I read from a note prepared for me by the Department of Finance some time ago. It said that it would be possible for a person to accrue a Defence Force retirement and death benefits (DFRDB) pension, a Commonwealth superannuation scheme (CSS) pension and then a pension under the Parliamentary Contributory Superannuation Act. A person could serve 20 years in the military-it is possible such a person could go out by age 35-have 20 years in the Commonwealth Public Service, retiring at 55 with a pension entitlement, serve eight years in the Parliament and get a triple dip. Senator Bolkus —Who would do that? Senator WALSH —Senator Bolkus might think that is such a highly improbable proposition that it could never happen, and to my knowledge it has not happened. But I can tell him that something very close to it has happened. I am pleased to see that Senator Newman takes a particular interest in public sector pensions, so much an interest that she asked a question about it yesterday. This brings me to the specific case which is very close to the hypothetical example that the Finance Department pointed to; that is, that Senator Newman's spouse has a parliamentary pension of the order of $32,000 a year and a Defence Force retirement and death benefits pension of the order of $16,000. He may have commuted one or both. He may have commuted part of either or all of the parliamentary pension for all I know, but if he is still receiving it as a pension that is the pension he is getting. It is a double dip-$32,000 plus $16,000 and if he did commute any of it, he is effectively getting even more, particularly from the DFRDB component of it. If Senator Newman were to expire to- morrow, her spouse would be entitled to a reversionary benefit under the parliamentary superannuation scheme as well as receiving the double dip he already gets. Senator Bolkus —How much? Senator WALSH —Of the order of $19,000. So there is the triple dip. Senator Messner —I raise a point of order, Madam Acting Deputy President. Senator WALSH —The honourable senator does not like this. She will be sorry that she stirred this up. Senator Messner —I ask you to rule under standing order 418 that the Minister, by using a hypothetical case, is reflecting upon the integrity of a member of the Senate. I understand that his comments in respect of a former member of the Houses of Parliament cannot be applied under this particular standing order but I ask you to rule in respect of his comments on Senator Newman which I believe to be highly irregular and offensive to her. Senator Newman —On the point of order, Madam Acting Deputy President: I draw your attention to the Minister's interjection which I find quite intimidatory. He said that I would be sorry that I raised the matter of superannuation. I take that to mean that the Minister is, in fact, trying to prevent me from exercising my responsibilities as a senator. I urge you to take action to have that struck out and to make the Minister behave. Senator MacGibbon —I raise a point of order, Madam Acting Deputy President. Under standing order 418 the Minister is clearly attributing improper motives to a member of the Senate and as such he must withdraw. Senator Bolkus —On both points of order, Madam Acting Deputy President: I put it to you that firstly, superannuation is the subject of this debate and that is precisely what Senator Walsh was talking about. I also put it to you that in political debate if a senator cannot stand the heat in the kitchen that senator should not come into it. I suggest that to Senator Newman. The ACTING DEPUTY PRESIDENT(Senator Powell) —I inform Senator Newman that unfortunately, possibly because I was listening to somebody else speaking at the time, I did not hear the exact remark which she attributes to the Minister and, therefore, I am unable to make any comment on that. On Senator Messner's point of order, I rule that the debate so far has certainly been relevant. Matters of fact have been raised. Certainly, hypothetical speculations have been made, as pointed out in the point of order but, to this point at least, I do not rule that the information that has been put in the debate thus far is a reflection on any individual, either a former member of the Parliament or otherwise. Senator WALSH —Madam Acting Deputy President, you are of course correct. Senator Messner himself raised the subject of the parliamentary pension scheme in his contribution. Of course, all of the other matters I have raised are relevant either to that or to public sector superannuation schemes in general. Senator Newman —Are you going to tell public servants that they are not entitled to any benefits? Senator WALSH —Senator Newman, I am not trying to intimidate you. I am just letting you know that when you live in a glass house with wafer thin walls-- The ACTING DEPUTY PRESIDENT —Order! I ask the Minister to direct his remarks through the Chair. Senator WALSH —I am sorry, Madam Acting Deputy President. If Senator Newman lives in a glass house with wafer thin walls and starts throwing a few stones, something will happen to her. I am not intimidating Senator Newman; I am just pointing out the facts. The double dip which her husband already gets is a parliamentary pension of $32,000 and a DFRDB pension of $16,000. If she were to expire-none of us want that to happen, of course, but something could happen-he would have an entitlement to another $19,000 reversionary benefit because of that. So that is a triple dip: $32,000 plus $16,000 plus $19,000. Some people might think that she is worth more dead than alive, but I hope that does not lead to any untoward actions. I have given an account of the sort of shabby inheritance which this Government was left by the previous Government. We had a parliamentary pension scheme that was outrageously rorted. The conditions under which that outrageous rort was possible were set up under Malcolm Fraser and John Howard. Nixon, Lynch, Fraser and Anthony all took off with half a million dollars plus, paying only 3 per cent tax on it-and if they croak their spouses will get a reversionary benefit equal to 84 per cent, which would be a pension of the order of $37,000 a year, even though it had already been commuted. That is what we inherited and we have cleaned it up. Honourable senators opposite are very angry about that. I suppose what really worries you, Senator Newman, is that you are frightened that something might be done about the existing double, and the potential triple, dip that your spouse is into. Senator Newman —Tell the public servants that you are going to stop their entitlements. The ACTING DEPUTY PRESIDENT(Senator Powell) —Order! I remind the Minister that I have asked that remarks be directed to the Chair. Senator Newman, I want to hear the Minister's speech in relative decorum. Senator WALSH —Certainly, Madam Acting Deputy President. When Senator Messner opened up he went through some of the facts. He mentioned that the Liberal Party and the Country Party-or the National Party, as it calls itself these days-had opposed a lump sum tax on superannuation. I have already given one effect of that opposition, had they been able to proceed with it: there would still be only a 3 per cent tax on the lump sum that the politicians are entitled to take, although they have only half the lump sum that they could have taken in the days when Fraser and Howard ruled the roost. The Opposition opposed the imposition of an assets test, the prospective abolition of the over-70s pension and so on. It is true that honourable senators opposite opposed all those things. The reason that they opposed them all is that they are financially irresponsible. They are fiscal ratbags. Honourable senators should not just take my opinion about that. Let me quote what the then Secretary to the Treasury wrote in March 1983 in a note which would have been delivered to the coalition Government had it been returned at the 5 March election. The then Secretary to the Treasury, as we all know, was Senator Stone. He wrote at the beginning of March 1983: Due to a series of post-Budget expenditure decisions, and slower than expected economic activity, it is estimated that outlays in 1982-83 will reach $48.7 billion, $1.6 billion higher than budgeted and 18 per cent higher than the previous year. This represents a real increase of around 7 1/2 per cent, the highest in the post-war period, with the exception of 1974-75. Senator Stone continued: When the estimated cost in 1983-84 of the new policy proposals announced in the policy speech is added- Fraser's policy speech- the prospect is for a Budget deficit of almost $10 billion. Such a deficit would be equivalent to 5 1/2 per cent of projected GDP, the highest in Australian post-war history. He continued: First, the magnitude of the fiscal imbalance is unprecedented in Australia during peace time, as is the level of Government spending. That is what Senator Stone said about it. Honourable senators need not just take my word that the present Opposition, the then Government, is a bunch of fiscal ratbags. Once one is a fiscal ratbag it is quite easy to say, `We are going to cut tax for everyone and increase benefits for everyone'. The way in which those opposite went down that path was to leave us with a prospective Budget deficit of $10 billion. Of course, they can keep pursuing their policies in opposition because they are not really held accountable for anything. Let us look at their more recent record. In the last election campaign-again, this supports the charge of fiscal ratbaggery-$8 billion worth of taxation cuts were not accounted for. They just cut $8 billion off tax. That is a popular thing to do, of course, if people can be conned into believing that it can actually be done without bringing some catastrophe down on their heads. Well, they did not con the people. Of course we then have to consider technical competence as well, because they made a massive $1,500m error in their arithmetic. As I said, they are fiscal ratbags and they show no indication at all of mending their ways. Maybe the sooner John Elliott gets in here and takes over the leadership, the better. I want to make one last point, again in reply to Senator Messner. He said what a terrible thing it would be if employer contributions to superannuation funds were to be subject to a tax. I remind Senator Messner that his leader has in fact endorsed that proposition. On 11 February this year, which was a day or perhaps two days after the release of the New Zealand tax package, that package was warmly endorsed by Mr Howard. Mr Howard said it was a wonderful idea, and that we would have to go the same way. A number of other people said similar sorts of things, and I remind Senator Messner about one integral part of that package. (Quorum formed) John Howard has endorsed the New Zealand tax package which contains a 24 per cent tax on employer contributions to superannuation funds. The ACTING DEPUTY PRESIDENT(Senator Powell) —Order! The Minister's time has expired. Senator HAINES(South Australia-Leader of the Australian Democrats)(2.43) —With the recent release of the Economic Planning Advisory Council report entitled Economic Effects of an Aging Population, and with ongoing rumours of further changes to superannuation likely to appear in the May economic statement, I suppose it is understandable that the issue of superannuation has become a central part of the current economic and political debate. So I welcomed the information this morning that Senator Messner was going to raise this as a matter of public importance this afternoon. I had hoped, however, that the debate would rise to a somewhat higher level than it has, with the diatribe of the Minister for Finance (Senator Walsh) being absolutely no help whatsoever, enlightening nobody, instructing nobody and barely answering the elements that Senator Messner raised in his matter of public importance-namely, the widespread alarm in the community concerning the Government's threat to tax people's superannuation. Mind you, I would have to say that Senator Messner's contribution, although less hysterical and less abusive than the Minister's, was not a great deal more helpful since he seemed to be under the misapprehension that ordinary workers have reasonable access to superannuation and that ordinary workers are the ones at risk from whatever changes the Government may make to superannuation. Senator Messner finished his contribution by drawing the attention of the electors of Port Adelaide to what is likely to happen to them in the May economic statement. I would not have thought that there were too many electors in the Port Adelaide district fortunate enough to be in receipt of superannuation or in the sort of job likely to lead them to large lump sum payouts or significant superannuation benefits of any sort. Even if there were, it is also worthwhile that the electors of Port Adelaide realise that the last time the Hawke Labor Government changed the superannuation scheme, it did so with the support of the Liberal-National Party Opposition. It argued that the legislation was a Budget Bill and therefore the Opposition was not in a position even to support an Australian Democrats amendment that would have allowed recipients of small lump sum superannuation payments to be more or less cushioned against the effect of the new tax. Probably what is more important to the electors of Port Adelaide-and I do not consider it highly likely that any of them are listening to today's debate or, if they started, that they have got this far-is that they should remember that it was with the full support of the Liberal- National Party senators that a number of other Labor Government initiatives were effected, initiatives that are far more likely to have an impact on some of the low income families in the Port Adelaide area. These issues include the delay two Christmases ago of consumer price index increases to pensioners and beneficiaries, the removal of Austudy grants to 15-year-olds in low income families, and the 1981 attempt by the Liberal-National Party Government to impose a sales tax on food, clothing and home building materials. These are all things which would have had a dramatic effect on low income families and which we were able to prevent. The fact remains that, for a number of reasons, superannuation is a problem area. First, Australia has an ageing population. There is an increasing and, I suggest, unjustified criticism of our welfare bill from some quarters. Business and industry are anxious to encourage the Government to cut back on our welfare payments because they argue that the payments are a drain on the economy. I suggest that these people remember that people have contributed through the tax system towards their pension and benefits post-retirement. That is not as easy to see as it used to be pre-1950, when the Menzies Government made a significant change to what was then the Income Tax and Social Services Contribution Assessment Bill and introduced a single levy rather than the double levy, with the single levy to be substituted for the former two separate levies which, as Mr Fadden said in his second reading speech: . . . will be known as `income tax on social services contribution'. This title will serve as a constant reminder to taxpayers that a substantial proportion of their payments will be devoted to Commonwealth social services. Provision will be made in a separate bill for special appropriations from the single levy, to ensure that the element of social services contribution in each person's payment shall be appropriated to the National Welfare Fund, and that that fund will have an assured income to meet its purposes. I remind the Senate, if it needs reminding, that the national welfare fund was dispensed with a couple of years ago and we have now no easy way of reminding ourselves that through the tax system we are contributing not only by way of an income tax levy but also to the social services contribution system in particular. So to argue that our ageing population is an unnecessary drain on the welfare budget and one which has not been contributed to in any way is a fallacy. The second reason that superannuation remains a problem is that the cost to revenue of superannuation concessions appears to be a genuine drain in the current economic circumstances and is likely to be a bigger revenue problem in the future. In 1986-87 Treasury estimated that superannuation tax concessions cost revenue $3.74 billion. That same year age pensions and allowances cost revenue $6.25 billion, and that figure is estimated to rise to almost $7 billion in 1987-88. But I repeat that a significant proportion of that has already come from contributions through the taxation system. As long as many Australians are still excluded from superannuation, or get very little benefit from it, while a few relatively better off Australians get massive taxpayer subsidised benefits, superannuation funds will remain a prime target for a government which believes it needs more revenue now in order to meet business demands for a surplus, or which wants to introduce greater equity into the distribution of the superannuation concessions. Lump sum superannuation tax concessions are a classic regressive tax benefit, putting the largest benefit in the pockets of the highest income earners. I refer any honourable senator who is interested in this matter to the Australian Society of October last year, and to the very excellent article by a lecturer at Monash University, Rick Krever, entitled `Super: the upside-down subsidy'. That should get a few people's priorities straight. In fact, every dollar that the Government pays to the well off through tax concessions in the superannuation system is a dollar that it does not have to fund age pensions, or to reduce tax rates, or whatever else it may have on its agenda in order to introduce some sort of equity into the system. We have then three problems: firstly, the ageing population; secondly, the cost to revenue of superannuation concessions; and the third problem is that the coverage of occupational superannuation still leaves many groups disadvantaged despite the recent moves to increase coverage via the productivity increase. Perhaps Senator Messner will be interested in some of the statistics that relate to coverage of superannuation, that relate to who benefits and who benefits most, in particular, through the superannuation scheme. Senator Messner —But it is growing, is it not? Senator HAINES —I acknowledge that. One of the benefits of recent legislation is that women are now no longer exempt, as they used to be. The superannuation funds are no longer excluded from conforming to the sex discrimination legislation. But it will be a lot longer than most of us have around this place before women are treated as equitably as they should have been. In August 1986 it was estimated that 39.4 per cent of employees were members of a superannuation or retirement benefits scheme which was arranged or provided by their current employer. A further 7.9 per cent were estimated to be covered by schemes not provided or arranged by their employers. All in all, a total of 47.3 per cent of employees were covered by superannuation schemes-less than half the work force. The incidence of employees covered by current employer arranged superannuation varies significantly according to a number of factors. These include: gender, full time or part time status, occupation, whether the employee is in the public or the private sector, the industry that is employing that individual, the age of the individual, and the weekly earnings of that employee. For example, 49.2 per cent of all males are covered in comparison to slightly over a quarter of all women in the work force. As far as full time and part time status is concerned, only 7 per cent of part time employees were covered compared with almost 47 per cent of full time employees. Across occupational groups, coverage by current employer arranged superannuation for all employees varied markedly-16.8 per cent of sales people were covered compared with almost 60 per cent of managers and administrators. So we are looking increasingly at a situation where selected and selective groups are covered and other significant proportions of the work force are omitted. As far as industry is concerned, there were large variations ranging from a very low 11.2 per cent of employees in the recreation, personal and other services industry groups, to 85.4 per cent in the communications industry. The first group, needless to say, is very largely female dominated. Despite Senator Messner's comments about the problem facing young people entering the work force if the Government should change the system, there is very little participation by young people under the current scheme. Employees in younger age groups tend to have very low coverage; something like 10 per cent of the 15- to 19-year olds, and a little over a quarter of the 20- to 24-year olds are covered by current employer arranged superannuation, compared to over half of the 45- to 54-year-olds, and 56 per cent of 55- to 59-year-olds. But the biggest discrepancy comes in a comparison of weekly earnings, where it is quite clear that the higher the earnings of employees, the more likely they are to be covered by employer arranged superannuation, irrespective of gender. I say irrespective of gender, knowing that in those higher echelons there are only a minority of women. Nevertheless, when they get there they are also able to be covered by these employer arranged schemes. Only a little over 3 per cent of employees earning under $120 a week are covered, compared with over 70 per cent of those earning $520 or more a week. At the very top levels of management, executives with an average salary of $300,000 per year before retirement, are eligible to receive a lump sum payout of $2.1m. Such executives of course have an incentive to receive part of their salary as payment to a superannuation fund I point out that that is not taxed, rather than as income, which is. So to argue that there is any current equity in the superannuation scheme is to ignore the fact that the higher one's income, the higher one's position in the employment ladder, the greater one's chances are of receiving taxpayer subsidised benefits for one's retirement and, of course, since large numbers of them are received in lump sums, there is the potential to spend that on a luxurious home and to set oneself up nicely with enough investment to bring in a weekly income that does not cut one out of receiving the pension, and then to go on to a consolidated revenue sourced welfare payment. I welcome the fact that Senator Messner has raised this issue today, because I think it is something that the electorate generally and members and senators do have to consider, and do it soon. The ACTING DEPUTY PRESIDENT(Senator Powell) —Order! The honourable senator's time has expired. Senator CHAPMAN(South Australia)(2.58) —It is no wonder, as indicated by Senator Walsh's speech in this debate earlier today, that the Government is running scared on the issue of superannuation taxation, because as this matter of public importance states, there is widespread alarm in the community concerning the Government's threat to tax people's superannuation. Senator Walsh, the Minister for Finance, in his contribution to the debate, completely ignored the issue which is of central importance to the people of Australia, that this Hawke Labor Government wants to get its hands on a bigger portion of their superannuation. He slurred various people who had received superannuation in the past. He referred to several irrelevant matters, but he made no impact on the Opposition's case whatsoever. Quite simply, the Government has placed thousands of Australians who are about to retire, who are thinking of retiring soon or who are planning for their retirement at some future date, into a tailspin of uncertainty. The likelihood of radical changes to superannuation taxation arrangements can be compared to a football match in which the umpire is changing the rules while the players are still on the field. In answer to a question regarding this matter in the other place on Wednesday, The Prime Minister (Mr Hawke) claimed that `one cannot have . . . a review of the total business tax system without looking at superannuation'. The Prime Minister has also not ruled out the possibility of taxing the investment income of superannuation funds or employer contributions. But superannuation is not a question for discussion on the subject of business taxation. Superannuation is the property of the individual worker, the individual Australian and the individual businessman. That is what superannuation is about. It does not concern the subject of business taxation. Superannuation is the way in which the ordinary men and women of Australia use their dollars to provide for their future. If superannuation is taxed on a similar basis to other investments this will act as a positive disincentive to Australians to make provision for their own retirement. Destroying superannuation will not solve the problems of excessive taxation. Destroying superannuation will only create further problems for the whole of Australia. The Minister for Social Security (Mr Howe) believes that those who have superannuation are tax cheats and, by implication, those who sell superannuation cover are also tax cheats. He said that taxation on superannuation was inevitable. In Port Adelaide there are 22,000 superannuants. Senator Bolkus —None of them will be affected. Senator CHAPMAN —According to the Minister for Social Security, they are all cheats. They certainly will be affected if these proposals go ahead, Senator Bolkus. Senator Bolkus —I rise on a point of order, Madam Acting Deputy President. Senator Chapman has just stated that on the basis of a statement by the Minister for Social Security, whom I represent in this place, people in Port Adelaide are all cheats. My understanding is that in all the statements that the Minister has made, no such allegations have been made and none of these people will be affected. The ACTING DEPUTY PRESIDENT(Senator Zakharov) —Order! There is no point of order. Senator CHAPMAN —There certainly is no point of order, because the point made by the Minister whom Senator Bolkus represents was that superannuation was part of tax avoidance. By implication he is calling those who have superannuation tax cheats. There are 22,000 superannuants in Port Adelaide. I hope that they recognise the attitude of this Government towards them. Thousands of people around Australia are selling superannuation schemes because they believe that they are working within the context of the law. But this mob opposite like to regard these people as taxation frauds and cheats. The people of Port Adelaide are joining the 3.2 million Australians who want to be financially independent in their retirement. In the Port Adelaide by-election tomorrow the Government will see yet again a repudiation of its policies and of this sort of arrogance when the people will have the opportunity to determine whether they want to pay more tax on superannuation. It is probably fair to say that the people of Australia regard the Hawke Government as the biggest tax cheat that this nation has ever seen. It has been into people's pockets to such an extent that it is one of the major reasons that the standard of living of ordinary Australians has fallen. It has frozen tax thresholds, pushed low income earners into high income tax brackets, grabbed their money and set about engineering a fall in the living standards of all Australians. If there is any reference to people being tax cheats, I am sure that the people of Australia-particularly the people of Port Adelaide-will say that that is a description that should apply to the Government rather than to those people who have sought to provide for their future by taking out superannuation. The superannuation proposals are nothing more than a reflection of the Hawke Government's inability to discipline its spending and provide sound economic management. As at May 1988, the Government will have only one fundamental objective: to take from superannuation every possible tax cent that it can get. Of course, the Australian people are sick and tired of that. The Government is saying, `Join a 3 per cent productivity scheme; get into superannuation. We want people to save for their long term financial security in retirement'. But beneath the reality one detects its hidden agenda. What the Labor Government really wants to say to people is, `Join a superannuation scheme so that we can tax you more'. Then, as part of its business tax review-of which it regards superannuation as a part-it will reduce company tax for its mates in big business. The retirement incomes of employees will be sabotaged to enhance the after-tax profits of big business. Senator Haines, in her remarks, made reference to the fact that blue-collar workers are not affected by this issue. As a result of the 3 per cent productivity provision, an increasing number of blue-collar workers are now entering superannuation schemes. They will be able to afford to gain full benefit from those schemes and get worthwhile retirement incomes only if the funds remain untaxed and if the employers' contributions remain untaxed. If the tax provisions are changed the retirement benefit will not be sufficient to make it worthwhile for blue collar workers to enter a scheme. One may ask why the Government has bothered to ask Dr Bettina Cass to involve herself in a very expensive and detailed inquiry into retirement incomes, the results of which will not be available until June, when there is every likelihood that this Government will introduce tax changes to superannuation in the May mini-Budget. That is yet another example of this Government's incompetence and arrogance. We are to have new taxes on superannuation in May and then, in June or later, a report from Dr Cass telling us how superannuation can fit into retirement income policy. She will probably make the most obvious observation that taxing superannuation at too high a rate will force people out of superannuation rather than encourage them to join superannuation schemes. An immediate grab for extra tax dollars in this way is outrageous. It is most important to look beyond the immediate in discussing reforms to any legislation about incomes which will be derived later in life. Nobody can predict what will happen tomorrow, let alone next week. However, the Government approaches this issue as if all that counts is the operation of its tax and revenue system-irrespective of the needs of different people-without recognising the dehumanising effects of such arbitrary legislation. The very great majority of people who take out superannuation do so many years in advance of their expectations of gaining benefit from it-20, 30, 40 or more years hence. They do not know how much they will need when they retire, in what form they should take it or how best to apply it; they do not know whether they will be in good health or poor; they do not know whether they will have large debts or small; they probably do not know how many dependants they will have; and they do not know what the financial and material standing of their children will be. They may, for example, still owe large amounts on their homes and have disadvantaged children, sons with families which have fallen on hard times, or daughters who have become deserted wives with young children. On the other hand, their children may have done well and be financially secure in their own right. Their spouses may be healthy and secure or in ill health and requiring special care. Anything can happen. The further ahead anybody tries to predict the future, the less chance there is of covering all the possibilities. To force on people an inflexible system which reduces the degree of free choice available many years ahead would, humanly, socially and impractically, be a seriously regressive step-one bordering closely on deprivation of human rights. Senator Sheil —It is socialism. Senator CHAPMAN —As Senator Sheil says, of course it is socialism. For many people, superannuation has only just begun to meet their needs. Some workers have been unable to provide for their futures simply because of the lack of portability of superannuation schemes in the past. I guess journalists in the Press gallery would know something about that. In contrast, relatively generous retirement benefits have been taken recently by a spate of former Federal Labor Ministers who had been sitting in judgment on likely legislative amendments to a system which a large number of people feel already discriminates against them. This explains the outrage in Port Adelaide and elsewhere about Mick Young accepting a $3,000 a week consultancy with Qantas Airways Ltd over and above his parliamentary and ministerial pension. It is no wonder that John Bannon, South Australia's Labor Premier, blamed Young for Labor's loss in New South Wales. Tomorrow the people of Port Adelaide will have their chance to demonstrate their repugnance at the hypocrisy of Labor politicians in planning to tax people's superannuation while rorting the system for all they can get from a combination of superannuation and jobs for the boys. No doubt Mr Hawke has a unique superannuation scheme mapped out for himself on retirement. Dare one speculate on the directorships he will be offered on leaving politics-Thomas Nationwide Transport Ltd, Ansett, Bond Media, Consolidated Press Holdings Ltd, News Ltd and, of course, Kimberley-Clark Australia Pty Ltd, which makes Kleenex tissues. Most people have no choice other than, for the best part of their lives, to plan ahead in one direction. Only now, at the eleventh hour, they find the choices they expected to have suddenly reduced, through the hidden agenda of this Labor Government. There are two areas of extreme financial uncertainty to the ordinary Australian-two areas vital to our society. Those are the purchase of a home and provision for old age. It is most annoying and frustrating to people that, whereas almost anything else can be purchased at a set price and under stable conditions, those two things cannot be. Simply at the stroke of a pen, it seems to many people, the Labor Government could mess up the carefully laid plans of years and dash an entire family's hopes because the Government has fouled up along the line and the public has to pay for its short-sightedness. Is it right that a hardworking citizen can do everything expected for decades, only at the eleventh hour of life to discover that someone in Canberra has changed the rules and a life-time's plans go down the drain? If superannuation rules are changed people will not have enough to do what they have been encouraged to save for for most of their lives; they will have to start all over again. Even for younger taxpayers who have their lives in front of them and more time to adjust to any philosophy of saving that might arise from these changes, tax on superannuation, whichever way it is levied, smacks of a tax on tax and being an insidious degradation of human entitlement. The original ethic of superannuation was to encourage a stable work force and reward diligence and thrift. All this proposed tax will do is encourage more and more people to opt out of superannuation and into social welfare or investment schemes other than superannuation which will guarantee that the same rules apply 30 years down the road. This is what the Government is all about-removing incentives, reducing everybody to a common denominator, making everyone dependent on and subservient to the state, turning the system into a cold numbers game where individual excellence and effort mean nothing, simply aiming to keep the ledgers balanced at all costs and, of course, looking after its mates. That is what is being done to Australia by a government which has been shrewd enough to make accommodation with a few of the super rich and with the powerful minority who control the work force but which has lost touch with and the faith of the people. Quality of life means nothing if life ends badly. In not too many more years most of Australia's population will be in the latter half of life. A third of South Australia's population will be in that category in about two decades. So legislation on superannuation today will have a far greater bearing on and importance to Australian society then because that is when the maximum effect will be felt by people who are about 40 years of age today and halfway through their lives. Today's 20-year-olds will find themselves in the same position provided the rules are not changed again before then. The Government should be trying to offer the decent, industrious people of Australia more options and more incentive to provide for their retirement years-not less. On regular occasions politicians have been accused of having three-year foresight-from one election to the next. But this Government has by-election foresight. It keeps its decisions from the people until its by-elections are out of the way in the current mess of political circumstances in which it finds itself. As I said, what we need in the superannuation system is additional incentive, not repressive penalty. As Senator Haines mentioned, in the past women have largely been locked out of superannuation, largely because they make up 81 per cent of the part time work force. Less than 8 per cent of part time employees have superannuation. Again, we need more incentive in the system to encourage women to enter into superannuation so that they also can provide adequately for their retirement. This proposed tax is most damaging to the Australian community and, indeed, to the capacity of the Government to provide for those in need in future years because it will result in more claims on government social security revenue in the future. The only way this nonsense can be stopped is by the people of Port Adelaide voting Liberal tomorrow. The ACTING DEPUTY PRESIDENT(Senator Zakharov) —Order! The honourable senator's time has expired. Senator COONEY(Victoria)(3.13) —This is an interesting matter that has been raised for discussion today. It is interesting because it has been brought forward by the Opposition in the context of the Port Adelaide by-election which is to take place tomorrow. This being a political chamber it is understandable that the Opposition would bring forward matters which it thought might improve the case that it will put to the electors to decide upon tomorrow or to try to damage the opponent's case-that is the case that the Government has put forward. The very interesting thing about this matter is that it is all built on supposition. Tomorrow the people have to decide between two parties. One party, the Opposition, is coming forward within 24 hours of the election and putting forward not a policy that it will want to pursue, not something positive and not something that might give the people of Port Adelaide hope, but an attack-not on government policies or government programs-but on what it says the Government might do. How bankrupt is the Opposition when it is unable, within 24 hours of a by-election, to bring forward any positive policies and it is unable-and this is the significant point-to attack any Government policy at all? Senator Parer is to speak after me. Senator Chapman —And he will make a good speech, too. Senator COONEY —Of course he will make a good speech. I want him to tell me in that speech why his side has not been prepared to take on any Government policy and why it has not been prepared to put forward its own. I ask the Senate to look at the matters that the Opposition could have discussed within 24 hours of an important by-election in South Australia. The Opposition made no attack on Government policies in respect of the economy, wages, industrial relations, social security, conservation, industry or consumer protection. I note that Senator Bolkus from South Australia is in the chamber. The Opposition has not attacked any policy that he has put forward or anything that he has done. The issue I am talking about is a by-election in Adelaide, the city which Senator Bolkus so ably represents. I also notice that Senator Foreman has come into the chamber because of his concern for the city of Adelaide. But no attack has been made on the consumer affairs portfolio which the Minister for Consumer Affairs (Senator Bolkus), from South Australia, represents. The Opposition has made no attack on Government policy in respect of Aboriginals, health, community services, youth or employment. Senator Bolkus —Or ethnic affairs. Senator COONEY —I thank Senator Bolkus. The Opposition has made no attack on the ethnic affairs policy of this Government. Why is it-and Senator Parer has the opportunity to answer this because he is next to speak-that the side that the honourable senator represents is unable to find any Government policy to attack? Why is it that the Opposition has to turn to what it says this Government might do? Senator Jones will appreciate this: why is it that, on the day before the Port Adelaide by-election, the Opposition comes into this chamber and is unable to attack any policy this Government pursues or put forward any policy of its own which might give the people of Port Adelaide some hope? It is an attack aimed at rousing the fears of people. The Opposition is adopting the politics of fear and ignoring the politics of hope. One would have hoped that the Opposition would have come in here and said, `Look, this is our plan for the electorate of Port Adelaide'. Senator Jones —They have no policies. Senator COONEY —That is the only conclusion that we can draw. Can Senator Foreman, who is in the chamber at the moment, think of anything positive that the Opposition has put forward for the people of the electorate of Port Adelaide? Senator Foreman —Absolutely nothing. Senator COONEY —The Opposition says, `Mr Howe and this Government are going to attack superannuation'. Let me make it quite clear from the start that the Opposition has raised a very important issue. What has this Government said about superannuation? Honourable senators are aware of what the Prime Minister (Mr Hawke) had to say about superannuation, but it is worth repeating. He said that the Government will not consider-it will not even consider; it is not a matter of not adopting-any changes that will have an adverse impact on superannuation benefits that have already been accrued. What that means-and the guarantee is absolute-is that whatever people now have will not be subject to any attack. They will be able to keep what they have. Senator Messner —What sort of guarantee is that? Senator COONEY —That is a good question. It is a guarantee given by a government which has produced a growth in employment of about a million jobs and an increase in pensions to almost 25 per cent of average weekly earnings. Senator Messner —That is because real wages have fallen. Senator COONEY —That indicates what this movement is all about. It is to the credit of the many workers in Port Adelaide that they have shown, as workers, as true Australians, a capacity to make sacrifices for this country. They have taken a fall in wages which has increased employment and set this nation on the road to recovery. This Government will ensure that the workers of Port Adelaide benefit from its economic policies because they have made the sacrifices which the Labor movement, including the union movement, has asked them to make in the interests of the country. Senator Parer, the next speaker, when considering the position of the people in Port Adelaide might explain the anti-union activity which, unfortunately, because of his background, he supports in this chamber. Fundamentally he is a decent sort of a man but he has a blind spot in this area. He attacks union superannuation and says that unions should not run their own superannuation funds. Senator Messner —He does not say that at all. Senator COONEY —Senator Messner, in his speech, said that he thinks union superannuation is all right, as long as it is properly managed and as long as the unions do not have a part in its management. What sort of attitude to the workers' representatives, to the unions of this country, is it to say that they are not able to run a superannuation fund? That is what the honourable senator implied. I hope he has looked at the union superannuation fund run by the Australasian Meat Industry Employees Union in Victoria-an outstanding example of how workers, through their unions, can run their own funds. Yet Senator Messner and Senator Parer attack the capacity of the workers to control their own funds. That is the sort of thing they say about superannuation. That is the sort of attitude they have to the workers of Port Adelaide. So pensions have risen from 22.7 of average weekly earnings, in 1983, when this Government came to office, to almost 25 per cent of average weekly earnings today. It is true that generous restraint has been shown by the workers of this nation. This is the Government which will look after the workers and protect them in the future, and it has the policies to do so. Let us consider where we stand on this issue. Senator Parer will probably tell us what he believes about the ability of workers to look after their conditions. What does he say about penalty rates, overtime, and the ability of workers to earn extra when they work longer? What does he say about work practices and the capacity of workers to control their own future, to work in decent conditions and to get a decent wage, including overtime and penalty rates when they are earned? Why has the Opposition suddenly become enamoured of workers whom it cast onto the scrap heap when it was last in government? I ask Senator Parer why the only time there was negative growth in this country since the war was while his Party was in power and why, in just over 12 months, more than 300,000 Australians in the prime of their working lives were thrown out of work and onto the scrap heap. The results are still evident. People in the prime of life, with families to keep and children to educate, were cast onto the scrap heap. Contrast that with the fact that this Government has created one million jobs. Let us have a look at what this Government has done for pensioners, for people who are getting on in life. In the few minutes I have left, I shall outline the facts. This Government has put money back into the pockets of pensioners. It has added $40 to the pension since 1983 and the pension is now 25 per cent of average weekly earnings. In real terms this Government has increased pensions by 8.4 per cent. That is in contrast to the Liberals' callous disregard for pensioners which saw the pension rate drop in real terms by 2.4 per cent. Perhaps Senator Parer could explain why, under his regime, the pension rate dropped by 2.4 per cent, while under this Government it has risen by 8.4 per cent. The maximum rent assistance for age and other pensioners has been raised from $10 to $15 a week. In addition to twice-yearly pension indexations, the Government has now raised the income limit eligibility for pensioner health benefit cards according to the rise in the cost of living. In December 1985 the Minister for Social Security (Mr Howe) set up the first government review of social security in the last 40 years. All this is evidence of this Government's concern for the working people of Australia-those sorts of people who live specifically in the Port Adelaide electorate and to whom this debate today is directed by the Opposition. We have done many very positive things, the sorts of things that give those people hope and the ability to say that there is a positive future ahead. The Government has been very positive in its approach, both to the economy and to social security benefits. In contrast, the Liberal Party has displayed a negative approach to life. Again, I ask Senator Parer to answer a question: Why has his leader, Mr Howard, promised to abolish labour market programs so that there is no chance of people ever getting work again? What does he propose to do to reverse these tragedies which have been imposed upon the people? He will cut unemployment benefits. He has said there will be big savings in social security expenditure. Where will that come from? What is he going to do about the consumption tax? Will he load a consumption tax on the people of Port Adelaide and make their goods more expensive than they are now? Will the Party follow John Elliott? What is Senator Parer's position on that matter? Given this negative debate-negative in the sense that it is proposed by the Opposition, which relies on fear to win the seat of Port Adelaide-what does Senator Parer say about the very positive policies that this Government has put into operation? Why was he not prepared to debate those areas as distinct from what-- The ACTING DEPUTY PRESIDENT(Senator Powell) —Order! The honourable senator's time has expired. Senator PARER(Queensland)(3.28) —Today we are debating a matter of public importance, raised by my colleague Senator Messner, on the widespread alarm in the community concerning the Government's threat to tax superannuation. It would give me great joy to respond to the many questions asked by Senator Cooney; his invitation to attack a range of lousy Hawke Labor Government policies. I would be delighted, but to do so would be to move away from the matter of public importance so I will just mention a few. First, reduced standards of living have been brought about by this Government. Ask anyone out there who goes to the supermarket. The high inflation rates has persisted in Australia despite what has happened overseas-it is more than double that of overseas countries. During the present Government's period in office we have had the highest interest rates in our history, which has affected the mortgage rates of everyone buying a house. This is also the highest taxing government in Australia's history. I mention those facts because Senator Cooney invited me to make a few comments about the sort of policies that could be attacked if we had the time. But we are talking about superannuation. Superannuation is basically a simple process but it is not understood by the majority of people. That is why we have highlighted it. If people do not really understand such things the Government can zero in and take their savings away from them. Superannuation is simply savings made by individuals in their working lifetime to provide for their own retirement. That is what superannuation is-nothing more, nothing less. A variety of funds are set up to achieve this, with different end products. For example, one is a benefit promise program in which the pay-out at the end is a guaranteed multiplier or percentage of final average salary as a lump sum or as a pension. These are mainly employer-employee funded and have to be checked from year to year to make sure that they are actuarially sound so that when a contributor retires the fund can make the proper pay-out. The second type of fund is the accumulation or occupational type fund. In such funds contributions are made by an employer or employee, or both, and the pay- out on retirement depends simply on how the funds have performed-what sort of interest factors there have been, what sort of returns have been received over the time the funds have been invested. Finally there is what is known as the 23fb fund. Such funds are available to self-employed people, who may make a tax deductible contribution of up to $1,500 a year for their superannuation. Apart from the obvious benefit to the community of individuals paying for their own retirement, there is the added benefit that contributions represent savings and thus investment rather than consumption spending. The question we have to ask is-I think everyone who does not really understand superannuation should listen to this-what is the current tax position on superannuation? This is vitally important as the tax incentive is what encourages Australians in their working lifetime to put money aside for their retirement. As it now stands, employer contributions are tax deductible in respect of pay as you earn taxpayers. Employee contributions are no longer deductible because the Hawke Government removed tax deductibility of employee contributions. As I said, contributions of up to $1,500 a year to 23fb funds are deductible for self-employed people. Income from investments of superannuation contributions are not taxed. This maximises the pay- out on retirement. If a lump sum is taken on retirement, tax is levied at the rate of 15 per cent on the first $55,000 and at 30 per cent for any amount over that. Of course, the recipients also have to pay the Medicare levy on the lump sum. Senator Walsh mentioned that under the Liberal Government tax was paid on only 5 per cent of the lump sum. The Government has calculated that tax incentives for people who contribute to their retirement, use their savings, are about $3.5 billion a year and it wants to get its fingers onto those savings of ordinary Australians. Government members are not the only ones; the Australian Council of Trade Unions, which is supposed to represent the aspirations of the working man, has proposed in its publication Australia Reconstructed that superannuation savings of individuals be offered to companies the ACTU supports at low interest rates. Not only has the Hawke Government lost touch with the battler; so has the ACTU. Money that would be earning, say, around 15 per cent would be offered at a much lower rate to business to the detriment of the wage earner, whose payment on retirement would thus be substantially less. The Government has said that the taxing of superannuation is under review. Notwithstanding repeated questions about what it has in mind, the out of touch Hawke Government refuses to come clean. All Senator Walsh could do was launch an attack on Senator Jocelyn Newman. He evaded the question altogether. He made a cowardly attack on a very fine lady. The refusal of the Government to come clean has caused enormous concern and confusion in the minds of every Australian who has superannuation entitlements, whether it be in the near future or down the track. In addition, I understand that new contributors to self-funding of their retirement have virtually dried up. It is what the Australian, in its editorial today, calls a `superannuation mess'. It is worth quoting from that editorial. It states: The Federal Government has still given no solid indication of its intentions regarding the possible imposition of a tax or taxes on superannuation. It further states: Although the Opposition's persistence . . . is completely justified in pointing to the muddle which now surrounds superannuation in this country and the economic and social costs of not clearing up the muddle, responsibility for most of which can be attributed to the present Government. What can the Government do? It can do a lot of things to get at one's savings. Bear in mind that contributions to superannuation funds, people's entitlements, are their own savings. They are savings for retirement. I will mention two things the Government can do. Firstly, it can remove the tax deduction for employer contributions or charge a fringe benefits tax, as has occurred in New Zealand in recent months. This would really affect only the average income earner as it would be a disincentive to employer contributions to occupational funds. Secondly, it can tax the income of superannuation funds. The effect of this would again be to the disadvantage of the average income earner as it would automatically reduce the amount of money available on retirement. Let me give the Senate an example. If a person, his employer, or a combination of both, contributed $1,000 per year-$20 a week-over 25 years to a fund which earned 15 per cent a year, currently untaxed, he could expect a pay-out of $244,700. The introduction of a new 15 per cent tax on superannuation fund investments would mean that the individual would receive $168,788, a loss of $75,924 to the individual. This Government would steal just on $76,000 of savings from the individual which he would normally use in his retirement. The Government can also introduce a retrospective tax on lump sum pay-outs. I would say that nothing was beyond this Government. The Prime Minister (Mr Hawke) and his Government have lost touch with what he and Senator Richardson referred to as the `common people', a term that I believe to be quite derogatory and that I and most Australians would find totally offensive. The term `common Australian' used by Senator Richardson and used in articles about the Prime Minister smacks of George Orwell's great book Animal Farm and a statement in that book when the pigs took control. Those honourable senators who have read the book might remember this statement: `Everyone is equal but some are more equal than others'. As an indication of how this Government has lost touch, the former member for Port Adelaide, Mick Young, went around his electorate holding himself out to be the champion of the working man. He retired from Parliament and collected a massive superannuation pay-out. He picked up a consultancy job with Qantas Airways Ltd at around $1,000 a day, but he was not content with that, so the Prime Minister rang around the business community for more jobs for Mick Young. Yet the same Prime Minister has the gall to write 50,000 letters to Australian Labor Party members in an expensive self-promotion campaign saying: Being a real Labor Government means helping the needy and we've done that. It means restraining the greedy and we've done that. All I can say is that that is hypocrisy. What Mr Hawke says is not what he practises, and the whole of Australia knows it, as reflected in the results of recent elections. Families are battling to make ends meet and the Labor Government does not want to know about them. Certainly, measures have to be taken to encourage more people to contribute during their working lifetime to their retirement so that they are not a burden on the taxpayer of the day, but neither we nor the embattled wage earner will tolerate what appears to be the preferred option of this Government-I say `preferred' because we do not really know and the Government will not come clean-to impose a tax on the earnings of superannuation funds, people's savings, which will reduce quite substantially the amount of money due to a taxpayer on his retirement. It is all summed up in an article in today's Sydney Morning Herald by Robert Haupt, who says: . . . the Micks and Bobs of this world look after each other in retirement; don't expect them to spare a thought for you. The DEPUTY PRESIDENT —The discussion on the matter of public importance is concluded. Senate adjourned at 3.41 p.m. until 2.15 p.m. on Tuesday, 12 April 1988 The following papers were tabled: Seat of Government (Administration) Act-Determination made under the Motor Omnibus Services Ordinance, dated 19 February 1988. Quarantine Act-Determination under section 86e, dated 24 March 1988. The following answer to a question was circulated: (Question No. 187) Senator Puplick asked the Minister representing the Minister for Housing and Aged Care, upon notice, on 16 February 1988: (1) How many National Health Scheme prescriptions were filled during the month of December 1987. (2) How many were filled in the same month of each of the previous three years (1986, 1985, 1984). Senator Cook —The Minister for Housing and Aged Care has provided the following answer to the honourable senator's question: (1) and (2)- December 1984 8,950,000 prescriptions December 1985 N/A December 1986 6,146,500 prescriptions December 1987 10,817,000 prescriptions Any comparison between these figures should be undertaken with caution: It is not possible to provide an accurate estimate of the number of prescriptions dispensed in December 1985 because of the large number of pharmacists' claims that were the subject of advance payments at that time. Many of these claims were settled with pharmacists without being fully processed. While it has been possible to estimate annual processing data for this period, accurate estimates for individual months cannot be made. The number of PBS prescriptions dispensed in December 1986 was artificially low because of the increase in patient contribution and introduction of the safety net scheme the previous month. The figure for December 1987 is high because of the safety net arrangements under which cards expire at the end of the calendar year.