1998-12-083911SENATE138901998-12-08The PRESIDENT(Senator the Hon. Margaret Reid) took the chair at 2.30 p.m., and read prayers.Ministerial Arrangements138914:31:001389Hill, Sen RobertSenator HILLBH4SALPEnvironment and Heritage10—by leave—Madam President, Senator Newman is still absent today for the same personal family reasons as yesterday. In her absence, I will again take questions relating to the portfolios of family and community services, and defence.Questions Without Notice138913891389Lundy, Sen KateSenator LUNDY7G6ACTALP00—My question is to Senator Minchin, the Minister representing the Minister for Sport and Tourism. Minister, is it a fact that the Department of Industry, Science and Resources dispatched the wrong paperwork to Mr Alan Jones regarding his appointment to the board of the Australian Sports Commission? Is it a fact that this is the only reason Mr Jones was appointed to deputy chair rather than as just another member of the board? Is it a fact that both the Prime Minister's office and the minister for sport had previously decided that Alan Jones was too politically risky for the position of deputy chair because of his right-wing leanings and his bias towards the Liberal Party? Can the minister inform the Senate whether this is in fact the same Alan Jones who was described by the former Victorian Liberal powerbroker Michael Kroger as `very influential in the Liberal's 1998 election victory'?1389Minchin, Sen NickSenator MINCHINJX4SALPIndustry, Science and Resources10—I thank Senator Lundy for her question. It is true indeed that the government has appointed Mr Alan Jones as deputy chairperson of the Australian Sports Commission. I commend and congratulate Mr Jones on his appointment. Mr Jones is an outstanding Australian who has served this nation well in many respects. He has made an enormous contribution to sport. He is widely regarded as the most successful Australian rugby union coach ever. He will bring a lot to the board. He brings great skills and experience. The Sports Commission is the better for his appointment. I am sure he will serve that commission and the nation well.1389Lundy, Sen KateSenator LUNDY7G6ACTALP00—Madam President, I ask a supplementary question. Minister, can you confirm that a bureaucrat in the department has been severely reprimanded for this mistake and has further action has been taken? Is it usual practice for a person mistakenly offered a significant government sinecure to be appointed to the post regardless, simply to avoid the embarrassment of having to rectify the stuff-up?BH4HILLSenator Hill—Madam President, I think there could be a better choice of language to meet the high standards we would expect of senators on the other side.10000PRESIDENTThe PRESIDENT—Senator Lundy, were you planning to rephrase the last part of your question?7G6Senator LUNDY—I am happy to exchange the word `stuff-up' for the word `mistake', Madam President.1389Minchin, Sen NickSenator MINCHINJX4SALPIndustry, Science and Resources10—I am not aware of any bureaucrats having been reprimanded over this matter.13891389Ferris, Sen JeannieSenator FERRIS5L6SALP10—My question is to the Leader of the Government in the Senate, Senator Hill. Will the minister outline the coalition's achievements in health policy, in particular the practical steps it has taken to support Australia's public hospital system?1389Hill, Sen RobertSenator HILLBH4SALPEnvironment and Heritage10—With pleasure, because the government's record in health stands in stark contrast to the mess we inherited after 13 years of Labor government. Just recall for one moment the Labor legacy. A hundred thousand people were on waiting lists for public hospitals. The number of people with private health insurance had plummeted from 70 per cent to 35 per cent. The cost of premiums for private health insurance had skyrocketed by 40 per cent between 1986 and 1988 alone. Twenty thousand public hospital beds were closed. Public hospitals were overflowing with people who had the capacity to pay for private cover but refused to do so, such as the former Labor Prime Minister, Mr Keating. Low income earners were dropping out of private health insurance, which we all know. There was a crisis in rural health and Medicare costs were skyrocketing—in fact, they were out of control.As I said, in contrast we have taken steps to address the problems of Australia's health system. We believe that all Australians should have access to high quality health care with both strong and viable public and private systems working together. We have taken practical steps to support public hospitals. This year we signed a new agreement with the states that will increase public hospital funding in real terms by 19.2 per cent over five years.We are providing $31.3 billion in funding for public hospitals over the next five years—$31.3 billion, more than any other government in Australia's history. We are spending $120 million to reduce waiting lists in public hospitals. We are spending an extra $750 million for funding for veterans being treated in public hospitals. We have provided an additional $260 million for rural health services, such as rural GP retention grants to help rural communities keep their doctors, and 30 new regional health services centres.We stand for a strong public system and an equally strong private system. The Labor Party, as we know, for base ideological reasons opposes the private sector and, by doing that, undermines the public sector which they profess concern about. Under our plans, the private health system will contribute over $400 million a year to the public health system. It is time that the Labor Party and the Australian Democrats listened to the majority of Australians who want more affordable private health care.This government is proud of its achievements in the health area. For example, we have introduced the Immunise Australia program to promote vaccination as a simple vital preventative measure. Just recall: in 1996, Australia's full immunisation rate for children was only 53 per cent and now 94 per cent of children have been immunised for prevention of measles; new preventative strategies for the 650,000 Australians with diabetes; the largest and toughest anti-smoking campaign in Australia's history; the establishment of the Mental Health Council, the first national body; extra assistance for people with mental illness; a $10 million package for carers of people with dementia; 31 new Aboriginal health centres to address poor health of indigenous Australians; and the Get Tough on Drugs strategy. This is a proud record. What we now want to do is to go forward to ensure that Australians who wish to take out private health insurance can afford that also.1390Ferris, Sen JeannieSenator FERRIS5L6SALP10—Madam President, I ask a supplementary question. Has the minister's attention been drawn to the following statement: `As fast as we hurled money at the hospitals, there was a further abandonment of private health cover and a further rise in demand on the public system'? Who made this statement? Will the minister further outline any other government achievements in health policy?1390Hill, Sen RobertSenator HILLBH4SALPEnvironment and Heritage10—That is right. Who was so wise as to say, `As fast as we hurled money at the hospitals, there was a further abandonment of private health cover and a further rise in demand on the public system'? Of course, it was Bob Carr, the New South Wales Labor Premier. He recognised that to put money into the public sector alone will not solve the problems of health care. He reinforced, in fact, what Labor's current spokesman, Jenny Macklin, said, which I stated yesterday. She recognised also, when she was not in her current office, that to simply put money into the public health system does not solve the problem because it undermines the viability of the private health system to meet its share of the burden. If you listen to even Labor's spokesman outside of the atmosphere of the current debate, outside of the short-term point scoring which they are engaging in at the moment, it demonstrates that they recognise that for a healthy public system in Australia you need a healthy private system. And, therefore, you need to make it affordable for people to join and stay in the system. (Time expired)13911391Mackay, Sen SueSenator MACKAY9L6TASALP00—My question without notice is directed to the Minister for Regional Services, Territories and Local Government, Senator Macdonald. Does the minister recall telling the Senate on 26 November this year, `Local government is very keen on the GST and the tax reform agenda of this government'? Is the minister aware that the Local Government Association of Queensland, his home state, has said that Queensland councils have been given a `raw deal' under the tax package and that, `We are bitterly disappointed that the federal government has turned its back on local government'? Is the minister aware that the Local Government Association of Queensland has launched Operation Rethink, aimed specifically at the coalition, to change elements of the tax package that are `detrimental to local government'? Will the minister now apologise for misleading the Senate?1391Macdonald, Sen IanSenator IAN MACDONALDYW4QLDLPRegional Services, Territories and Local Government10—If there is any misleading of the Senate, it is in that particular question. The Local Government Association of Queensland is a fine organisation, and one with which I am very familiar, and have been for some time. I have not just blown in and had one meeting with them like you have, Senator, just the other day. You are feeling a bit excited about that. I think I could class Councillor Tom Pyne—the president of the Local Government Association of Queensland and the Mayor of Cairns, a fine city—as a good friend of mine. He is, however, a life member of the Labor Party. I have got to say that, in spite of Councillor Pyne being a great fellow and a great Queenslander, he understands which side his bread is buttered on. Most of the local governments in Queensland—and I attended a meeting of the North Queensland Local Government Association not long after I was appointed—understand the system once it is explained to them. Once you cut away the Labor lies on the GST and once they understand it, they understand that the GST will not impact on local councils.9L6MACKAYSenator Mackay—No, they don't.YW4Senator IAN MACDONALD—If they do not, Senator, it is because you tell them lies, you misrepresent it to them.10000PRESIDENTThe PRESIDENT—Senator, I ask you to withdraw that and, in addition, to direct your remarks to the chair and not across the chamber.YW4Senator IAN MACDONALD—Thank you, Madam President. I will withdraw. But one of the problems with local government is that many Labor senators and members of parliament have mischievously given misinformation to everybody, including local councils. Once they know the situation, once local councils understand it, they embrace it. They think it is a great system because they will obtain $70 million in direct savings from the indirect application of the wholesale sales tax.The Local Government Association of Queensland itself said that local councils in Queensland would save up to $18 million in reduced costs on fuel. They have introduced this campaign—what is it called?—Operation Rethink. That is about the financial assistance grants going from the Commonwealth to local government. They understand—as do the New South Wales Local Government Association whom I met with last week while you were up in Queensland—that, for the first time ever, funding from the Commonwealth to local government will be guaranteed. That does not apply at the moment. A federal government can give money to local governments—and does—but they do not have to. Under our tax reform system, for the first time ever funding will be guaranteed to local government.9L6MACKAYSenator Mackay—How?YW4Senator IAN MACDONALD—The senator who asked the question has absolutely no idea of how the GST system works, how tax reform works and what our proposals are for federal, state and local government relations. This is how it works, Senator, and pay attention: all the GST money goes not to the Commonwealth but to the states. The states are pushing themselves aside to sign up on the bottom line to get that money, because they see it as a growth tax. We will only give the money to the states on the condition that they guarantee existing payments to local government. When I say `guarantee existing payments', I mean existing general purpose grants and existing untied road funding. (Time expired)1392Mackay, Sen SueSenator MACKAY9L6TASALP00—Madam President, I ask a supplementary question. I thank the minister for his answer and I hope that, in answer to the supplementary, he can describe what precise mechanism will be used in terms of this guarantee. I would remind the minister that at the meeting I attended there were many people who were also members of the Liberal Party and the National Party and who agreed with great concern in regard to this.10000PRESIDENTThe PRESIDENT—Ask your question, Senator. You should not direct your remarks straight across the chamber.9L6Senator MACKAY—Thank you, Madam President. Is the minister aware of the motion carried by the 1998 National General Assembly of Local Government, representing 700 councils across Australia, that rejected any proposals to transfer responsibility for local government funding to the states and territories? Will the minister admit that local government not only in Queensland but also all around Australia is utterly opposed to the handing over of funding to the states?1392Macdonald, Sen IanSenator IAN MACDONALDYW4QLDLPRegional Services, Territories and Local Government10—First of all I would like Senator Mackay to name these Liberal and National Party members and even the other Labor Party members who oppose it, because most of them when they understand it—even the Labor local government people—accept and support this proposal.The mechanism is very simple. The states will get that money on the condition that they continue at least the current payments to local government. That is, the existing general purpose grants, the existing untied road funding and the current escalation clause. So it will go up with population and CPI increases. Those guarantees were given in our election promises; they are guarantees that we have given subsequently; and they are guarantees that will stick. It is quite obvious that Senator Mackay in her enthusiasm has been concentrating on other matters rather than getting an understanding of this issue. (Time expired)13921392Lightfoot, Sen PhillipSenator LIGHTFOOTWP6WALP10—My question is directed to the Minister representing the Minister for Employment, Workplace Relations and Small Business. Will the minister inform the Senate how the government is creating opportunities for workers to improve their pay, to boost the productivity of their workplaces, to promote jobs growth and to further reduce unemployment?1392Alston, Sen RichardSenator ALSTONLD4VICLPCommunications, Information Technology and the Arts10—By now I think it ought to be obvious to all those who take an intelligent interest in this subject that Australia is better placed than any other country in the region. And it is no accident that that is the case. It is because we took those tough decisions. The commitment to reducing the budget deficit, which Senator Cook and others simply denied ever existed, was something that we only achieved with a great deal of political pain. But we are now reaping the rewards and, of course, so is Australia. Australian workers, as Senator Lightfoot quite rightly points out, are also significant beneficiaries.What has happened over the last two years to the June quarter is that the Reserve Bank index of wages and salaries has increased nearly 10 per cent after inflation, which is a fantastic performance given that we have probably the lowest inflation rates for the last 30 years. Again, that is no accident. It is very instructive to read an article in today's Financial Review by John Edwards, who is described at the bottom of the article as the `chief economist at HSBC' but who is probably better known to most of us as a former senior Labor adviser and a Keating biographer. The article states:The secret of this economic magic is productivity growth. Australian productivity growth has been drifting up over the expansion in a way we have not seen in the last 20 years.He goes on to explain why this is so:The most probable specific explanation is the cumulative impact of exceptionally high business and public investment over the course of this expansion . . . While investment has been rapidly increasing, employers have also found greater freedom to reorganise work. This is the result of enterprise bargaining— which, of course, Labor is now deadset against—the weakness of trade unions—in other words, their recognition that they have very little to contribute to productivity, so they butted out of the game—and an Industrial Relations Commission which more often facilitates than blocks productivity enhancing changes in work practices.He goes on to say that a lot of the new investment embodies new ways of using chips. So the computer revolution is a very important factor. He goes on:the . . . greater freedom to rearrange the job is changing the way Australia works.That is a devastating indictment of the Labor Party. These are the pessimists, these are the doomsayers, these are the people who are not interested in the sorts of reforms that got Australia to this position. Unless you are prepared to go down the path of reform and modernisation, you will go nowhere. Why is it that we still have this backward looking, rear-vision mirror view of the world? It is simply because in the Labor Party if you espouse new ideas, new reforms, you get sent to Coventry. Look at Mr Latham. He will never make a comeback, because obviously his approach is anathema.Senator Sherry interjecting—LD4Senator ALSTON—He will make a comeback? I am very pleased to hear it. Good luck to him. He has our support. I am delighted to know he has a few mates over there as well. While Kim Beazley is keeping the seat warm for him, there is no doubt he will have plenty of opportunities to really start delivering the goods. I am sure if you asked Mr Latham, he would tell you in spades that you have got to have more of these reforms and you have got to be committed to productivity improvements, not just union delivered handouts, not just trying to keep the lid on growth at all costs.Mr Beazley is the very person whose own biography has now been remaindered; it is discounted by something like 30 per cent. Guess who wrote the foreword to it? Tony Blair. Tony Blair would be too embarrassed to send him a Christmas card. He would not know what to say. He would not believe how much this bloke has gone backwards since he last gave him some advice. It is tragic. (Time expired)Distinguished Visitors13931393The PRESIDENTThe PRESIDENT10000PON/A10—I draw the attention of honourable senators to the presence in the chamber of a delegation from the United States Congress led by the Chairman of the Subcommittee on Trade of the House Ways and Means Committee, the Hon. Phillip Crane. On behalf of honourable senators, I welcome you to the chamber and trust that your visit to this country will be both informative and enjoyable.UNKNOWNHonourable senatorsHonourable senators—Hear, hear!Questions Without Notice139313931393Lightfoot, Sen PhillipSenator LIGHTFOOTWP6WALP10—Madam President, I ask a supplementary question. Is the minister aware of any alternative industrial relations policies, and what would be their impact if they were implemented?4J4SCHACHTSenator Schacht—Is this really in order, Madam President?1393Alston, Sen RichardSenator ALSTONLD4VICLPCommunications, Information Technology and the Arts10—Yes, it certainly is, Madam President, because it goes to the heart of the matter.10000PRESIDENTThe PRESIDENT—Order! Senator Alston, you should not start speaking until I call you. I call Senator Alston.LD4Senator ALSTON—I am sorry, Madam President. This supplementary question goes to the heart of the real issue—in other words, what is it that drives productivity, what is it that makes Australia the envy of the region? It is all the sorts of things that you do not believe in anymore. You ask yourself how it was that you defied gravity—10000PRESIDENTThe PRESIDENT—Order! Senator Alston, direct your remarks through the chair.LD4Senator ALSTON—The Labor Party ought to ask itself how it managed to defy gravity for all those years and stay in office. It was because it actually believed in something. It was committed to deregulation of the financial system. It wanted to liberalise foreign investment. It wanted to privatise. It wanted to introduce franking credits. In other words, it had its eye on the ball.What we see now is a Labor Party that is totally bereft of any ideas. It is not interested in delivering the goods for workers. It is simply interested in pandering to the unions. John Edwards, in quoting Mr Keating in those years when Labor was actually considering privatisation of Telstra, described Mr Beazley as pathetically weak and spineless, captured by the unions. That is what it is all about—captured by the unions. (Time expired)10000PRESIDENTThe PRESIDENT—I call Senator Carr.AW5CARRSenator Carr—No, Madam President.10000PRESIDENTThe PRESIDENT—I call Senator Murphy.13941394Murphy, Sen ShayneSenator MURPHYFX5TASALP00—My question is to the Minister for Regional Services, Territories and Local Government. Can the minister recall telling the General Assembly of Local Government on 9 November 1998 that:Only on fee for service charges will there be any GST in the same way as it would apply to a commercial service provided by a private company.Then in relation to applying a GST to swimming pool fees, you said:Some people go out and say `gee whiz', some of us have got to pay a little bit more.Minister, are you aware that the Liberal Party Director, Lynton Crosby, told local government in correspondence on 17 September 1998 that:The non commercial activities of government will be outside the scope of the GST. That means that where a service is provided free of charge or for a nominal charge, the GST will not apply.Minister, who is correct?1394Macdonald, Sen IanSenator IAN MACDONALDYW4QLDLPRegional Services, Territories and Local Government10—I must say that the question is confusing—I suspect like the senator's understanding. Perhaps I could start with the conference. I was told that your representative at the conference, and also the Democrats' representative, promised to give local government 6.5 per cent of GST takings. Is that right? Is that what you said, Senator Mackay? How can you give them 6.5 per cent of GST takings if you are opposing the GST? You are opposing the GST, yet you are giving them that. That is what I am told by some Western Australian mayors. I must say, Senator Mackay, that I did not hear your speech, thankfully, but some Western Australian mayors tell me that that is what you promised—and you too, Senator Lees. You promised them 6.5 per cent of GST takings, yet you are opposing the GST. It just does not ring true.Senator Murphy or Senator Carr, whichever one you are: if it is a—10000PRESIDENTThe PRESIDENT—Senator Macdonald, your remarks should be directed through the chair.YW4Senator IAN MACDONALD—Thank you, Madam President. The question from Senator Murphy quite clearly recounted what I said. What I said is correct, and it is what Lynton Crosby also said. Non-commercial activities of local government will be GST free. Rates, water, sewerage and regulatory charges, all GST free. That is quite correct. But on commercial activities where local governments compete with private enterprise, their customers—not them—will pay a GST fee, the same as customers of any private organisation.I use the example of a swimming pool. Customers who are now paying $2 to get into private swimming pools that are operating around Australia will pay an extra 10 per cent or 20c. So they will pay $2.20. But remember that the people who are paying that will have some $40 to $50 extra in their pockets each week as a result of the tax reform package. Out of that $40 or $50 extra each week, they could afford to pay the 20c extra on the swimming pool. If it is a swimming pool that does not charge, Senator Murphy—and perhaps there are some like that; I am not aware of any—then you will still pay 10 per cent on the entrance fee. But if the entrance fee is zero, 10 per cent of zero is zero so it will not apply. Senator Murphy, you obviously share your shadow minister's misunderstanding or complete lack of understanding of how the GST and the tax reform system works.I invite Senator Murphy, as I invited Senator Mackay, to come around to my office and get a briefing on how the GST works. Once you understand how it works, you will find that it is a great system. It is good for Australia and it is good for your constituents. Your constituents will, generally speaking, end up with more money in their pockets.Senator Murphy mentioned the cost of living going up. I have said that everyone will experience that and understand it. We have made no secret of it. We said that the cost of living would go up by 1.9 per cent. But we set out to make sure that no-one suffered and that if you are in the work force your tax reductions are more than 1.9 per cent. If you are on a pension or some other government payment, your payments go up by four per cent to cover the 1.9 per cent increase. It is pretty simple. It is great for all Australians. I do wish that Senator Murphy would understand it.1395Murphy, Sen ShayneSenator MURPHYFX5TASALP00—Madam President, I ask a supplementary question. Obviously local government has not understood the minister. If his answers to local government are anything like the answer that he has given here, they would be about as clear as mud. The minister might like to answer this supplementary question. Will the Vos report recommendation that goods and services sold at less than 50 per cent of market price by charities be GST free, be extended to local government? Do you believe that parents of children paying extra to use their local, and usually non-profitable, swimming pool and the elderly paying extra to attend social activities at their local seniors centre will really say `Gee whiz' to every additional charge?1395Macdonald, Sen IanSenator IAN MACDONALDYW4QLDLPRegional Services, Territories and Local Government10—Most other Australians can understand the GST. During the election campaign, I went around, as did all my colleagues, to any number of organisations, including Rotary, businesses and schools—everywhere. Once it was explained—once you said, `Don't believe the Labor lies. This is how it works',—you could actually see most people go, `Gee, that is good, isn't it.' They voted for it because they understand it. They understand that it is a good system. But, obviously, it is beyond the wit of the people that the Labor Party put into the Senate. I can understand that, because I happen to know that nearly every senator opposite has never had a real job. They have only ever been union organisers or organisers of the Australian Labor Party. There are one or two teachers. Teaching is a good profession, but Senator Ray left it—they probably kicked him out. Senator Faulkner left it—they probably kicked him out. (Time expired)13951395Bartlett, Sen AndrewSenator BARTLETTDT6QLDAD00—My question is directed to the Minister representing the Prime Minister. I refer the minister to Senator Lightfoot's outrageous attack on the judiciary in this place last night when he referred to a decision of a Federal Court justice as insane. I ask: is the Prime Minister concerned about the growing, undeniable pattern of attacks by the government on the judiciary, which this week has been fuelled by the Deputy Prime Minister, the Minister for Immigration and Multicultural Affairs and now Senator Lightfoot? Isn't this similar to the established pattern of attacks by the executive on the parliament through a deliberate public relations strategy to foster the false image of a hostile Senate? Has the Prime Minister given explicit approval to the obvious PR strategy to attack and undermine the judiciary, which represents a threat to the executive in general and to the coalition's born to rule mentality in particular? If not, will he act to put a stop to the repeated attacks by members of his government on the very fabric of the Westminster system?1395Hill, Sen RobertSenator HILLBH4SALPEnvironment and Heritage10—The public will be able to judge later this week whether there is a hostile Senate. It will have the opportunity to vote on the government's private health care rebate—a policy that was taken to the Australian people within the last few months and put to them specifically, and upon which the government was in part re-elected. So if that gets voted down against the public's wishes, reinforced by polls showing over 70 per cent public support, within a couple of months of the election, the public will then know that they have a hostile Senate. That is probably the best judge they have.Senator Carr interjecting—BH4Senator HILL—He asked me about a hostile Senate. I am telling him the best test that he will be able to apply. He will be able to apply it within a few days.We on this side of the chamber do not disapprove of debate on judicial decisions. We do not see that there is anything wrong with debating a judicial outcome. We think it is quite a healthy thing within a democracy such as ours. But in doing so, we seek not to attack judges personally or to attack the system. In fact, we on this side of the chamber seek to support the system, because judicial independence and a strong judicial system is critical to the health of our democracy. Senator Bartlett should see that distinction. Certainly on this side of the chamber, we think that to quarrel about a particular judicial judgment—to argue about the law or the application of the facts or whatever—is quite healthy. We do not see any reason to apologise for that.1396Bartlett, Sen AndrewSenator BARTLETTDT6QLDAD00—Madam President, I ask a supplementary question. I thank the minister for that interesting answer to a small section of my question. I notice, as Minister Vanstone helpfully and very eloquently informed me yesterday in question time, that everyone has a right to criticise in a democracy. That is why the Democrats are criticising the executive's ongoing and apparently coordinated campaign to undermine the legitimacy of the parliament and the judiciary. Wouldn't the minister agree that the Prime Minister has a special responsibility to ensure that the judiciary is not exposed to a pattern of what looks, walks and quacks like a coordinated campaign to undermine its public reputation by coalition members?1396Hill, Sen RobertSenator HILLBH4SALPEnvironment and Heritage10—Certainly the Prime Minister accepts his responsibility, as we all do, to uphold the integrity of the judicial system. As I just said to the honourable senator, it is a cornerstone of our democracy. We do not shy away from that at all. But, on the other hand, we will not condemn somebody who criticises a particular judgment or who argues about or debates a particular judgment. We regard that as a sign of the totally healthy state of our democracy as well.13961396Hutchins, Sen SteveSenator HUTCHINS84PNSWALP00—My question is directed to the Minister representing the Minister for Transport and Regional Services. Can the minister confirm that the proposed Western Sydney orbital will cut the transit time for vehicles, such as big trucks, travelling from the Hume Highway south of Sydney to the Pacific Highway in the north by over one hour? Can the minister further confirm that the Western Sydney orbital will greatly improve Western Sydney's transport system, reducing traffic on suburban streets and improving access to Sydney for people living in the central west of New South Wales? Can the minister explain to the Senate why his government has failed to match the commitments given by the Australian Labor Party both in government and in opposition to provide significant Commonwealth funding for its development?1396Macdonald, Sen IanSenator IAN MACDONALDYW4QLDLPRegional Services, Territories and Local Government10—What I can tell the senator is that this government has made a special effort to look after roads in Australia. In fact, we have reintroduced some programs that your party got rid of, like the black spots program—a great program. Your party introduced it when you were in government and then, inexplicably, you stopped it. We have recommenced that; we have recommitted funds to it; and those funds will be well used for roads right around Australia.I recently had the honour of representing Mr Anderson at the opening of the extension of the F3 freeway at Newcastle, and I know Senator Tierney did a lot towards that particular extension by constantly badgering many governments over a long period of time. So we in fact have made a real commitment to roads and we will continue that commitment.I understand Senator Hutchins is concerned about roads. He was, as I had occasion to mention last week, a member of the Transport Workers Union. He had some serious position in that, I assume, but never drove a truck. I guess that is what it is all about. It is typical of the Labor Party that it is pretty good to come in here and play games, pretty good to organise strikes and pretty good to get involved in the waterfront, but when it comes down to real jobs and when it comes down to really understanding what roads are all about—10000PRESIDENTThe PRESIDENT—Senator Macdonald, I do draw your attention to the question.5K4FAULKNER Senator Faulkner—Thank you, Madam President. The point of order I was going to take is that it would be pretty good if the minister had a crack at answering the question about the Western Sydney orbital.YW4Senator IAN MACDONALD—I can understand Senator Faulkner looking after Senator Hutchins because it was Senator Hutchins who got enough votes in the Senate election to bring Senator Faulkner in.5K4FAULKNER Senator Faulkner—And I thanked him for it.YW4Senator IAN MACDONALD—You thanked him for it? I didn't think you talked to the right wing of your party.10000PRESIDENTThe PRESIDENT—Senator Macdonald!YW4Senator IAN MACDONALD—I have been distracted, Madam President, and I apologise for that. We do have, in fact, a great commitment to roads, as a government that is concerned about—5K4FAULKNER Senator Faulkner—What about Senator Macdonald? That is who we did in—your namesake. Our team seemed to go a hell of a lot better than yours.10000PRESIDENTThe PRESIDENT—Order! There is far too much noise for me to hear what Senator Macdonald is saying.BH4HILLSenator Hill—Madam President, I rise on a point of order. This is hopeless. He was quick to his feet when he thought he had a point of order, but the interjections by which the minister is not able to answer the question are equally disorderly and he ought to stay in his seat.5K4FAULKNER Senator Faulkner—Madam President, on the point of order: I suggest you direct the minister to answer the question that was directed to him about the Western Sydney orbital. He has not even tried to answer a serious question that was asked by Senator Hutchins. We are willing to accept all the credit for defeating Senator Sandy Macdonald in New South Wales, but get him to answer the question!10000PRESIDENTThe PRESIDENT—Senator Faulkner, you are grossly in breach of the standing orders and you were shouting during the answer to the question. There are other senators interjecting as well and that is also disorderly. Senator Macdonald, I draw your attention to the question that you were asked and remind you to address your remarks to the chair.YW4Senator IAN MACDONALD—The amount of money that this government has spent on roads in New South Wales is quite dramatic—unlike, I have to say, the current New South Wales government. Apparently every time an election comes up the Labor government in New South Wales promises a road somewhere. It never eventuates. It is typical of Labor Party actions on that.I have a list, which I can provide at some later date to honourable senators, of the amount of money that this government has spent on roads in New South Wales—quite a dramatic list of money that has been spent because we understand how important roads are, and we will continue to fund them.1397Hutchins, Sen SteveSenator HUTCHINS84PNSWALP00—Madam President, I ask a supplementary question. I do not recall, in any of that answer, that Senator Macdonald referred to the importance of the Western Sydney orbital to people in Western Sydney, so I will ask this as a supplementary: isn't the government's failure to build the Western Sydney orbital symptomatic of the wider problem of the Howard government's cutting of road funding—cuts which have seen over $600 million cut from the Labor government's forward estimates for the national highway? Furthermore, isn't it true that roads in marginal Liberal seats have been preferred over major projects, such as the Western Sydney orbital, which would bring massive benefits to people who live both in regional New South Wales and Western Sydney?1397Macdonald, Sen IanSenator IAN MACDONALDYW4QLDLPRegional Services, Territories and Local Government10—The New South Wales government seems to be pretty good at giving Senator Hutchins questions to ask, but pretty poor on actually funding roads themselves.UI4RAYSenator Robert Ray—You're a liar.YW4Senator IAN MACDONALD—Someone mentioned about me being a liar. Let me put the lie to the questioner. In fact, this government has increased road funding from $1.597 billion in 1995-96 to $1.612 billion. That is a pretty good increase from this government. We have increased federal funding to $750 million to rebuild the Pacific Highway from Hexham to the Queensland border. Do you know where Hexham is? It is in your state, Senator.We have spent $450 million on roads of national importance. We have spent $149 million on road safety black spot funding. We have provided an enormous amount of money—$61 million for the Raymond Terrace bypass, $130 million for the Bulahdelah to Coolongolook deviation, and so the list goes on. (Time expired)13981398Brown, Sen BobSenator BROWNQD4TASAG00—My question goes to the Minister for the Environment and Heritage, and it is about the Tarkine wilderness in north-west Tasmania. I ask the minister: is a third of this wilderness, namely, the Arthur-Pieman conservation area, to be protected as such under the Regional Forest Agreement signed by the Prime Minister last year? Is the state government of Tasmania currently negotiating to downgrade that 101 hectares of magnificent wild country from conservation area status to regional reserve status at the behest of the mining industry—along with some 46 other areas, including every protected beach area in Tasmania? Can the minister say whether the RFA is renegotiable, or is there some mechanism by which the state government could unilaterally downgrade these reserves? If not, will the minister give an assurance that no such reclassification will take place?1398Hill, Sen RobertSenator HILLBH4SALPEnvironment and Heritage10—As I understand it, Senator Brown is expressing concern at the action of the Tasmanian Labor government. I would have thought he is probably much closer to Labor in Tasmania than I am. But, no, they cannot unilaterally change the RFA. The RFA negotiated between the coalition government here in Canberra and the then predominantly Liberal government in Tasmania achieved excellent outcomes. It created 396,000 hec tares of new reserves, including 29 new areas of national park and state reserves, which increased the conservation reserve system by 17 per cent, and I presume that Senator Brown is applauding that, by inference, in his question.On the other hand, although he was not as interested, it also created 550 jobs in plantations, and intensive forest management and infrastructure development through the Commonwealth's $110 million contribution to the RFA outcome. I remind the Senate that the package included $70 million for a hardwood plantation, intensive forest management and an industry development program. It also included $10 million for infrastructure, including tourism facilities, and $30 million for the protection of private land.It was a good all-round outcome: good for conservation and good for jobs. I find it interesting that Senator Brown now comes in here and complains that the Tasmanian Labor government might be trying to undermine the conservation outcomes of that negotiated agreement. They cannot do it unilaterally, that is true. But, in criticising the Tasmanian Labor government, perhaps Senator Brown might also reflect upon the New South Wales Labor government. The basis for this is that in Tasmania we were able to protect 88 per cent of forest ecosystems under the JANIS criteria.The unilateral decision of the New South Wales Labor government to abandon the negotiation with the Commonwealth government means that they have protected just 36 per cent—36 per cent against the Liberal's 88 per cent. In relation to old growth, what we did in Tasmania was protect 83 per cent. What Mr Carr is prepared to protect is only 18 per cent. If ever there were a demonstration that it is the coalition and Liberal governments in the states that are really interested in conservation reserves and conservation values, I would have suggested those figures are the proof of that fact. If Senator Brown sought to use his influence on Labor governments around Australia, he would better achieve the conservation outcomes which he claims to represent.1399Brown, Sen BobSenator BROWNQD4TASAG00—Madam President, I ask a supplementary question. I would agree with the minister that the Labor government in Tasmania is a disgrace to the word environment when it comes to government. But I asked the minister to further clarify his assurance that there is no way that the RFA can be used to downgrade the status of conservation areas. Can he give a commitment that there will be no mining within the Arthur-Pieman conservation area and no damage to forest, through mining or any other mechanism, in this area that he has so eloquently said is his intention to protect under the regional forest agreement? Or is it true that, despite having the name conservation area applied to it, he plans to allow mining to take place in this area which includes magnificent Aboriginal sites, one of which was damaged—in fact, destroyed and stolen—in a recent raid on the area by thieves so far unknown.ZW4SHERRYSenator Sherry—Not by the mining industry, though?QD4Senator BROWN—We don't know.1399Hill, Sen RobertSenator HILLBH4SALPEnvironment and Heritage10—As Senator Brown would know, the regional forest agreement sets out various levels of conservation reserves and uses that are permitted in those reserves that are compatible with the conservation values. They are included within the RFA which is being legislated upon in Tasmania at the moment. The Tasmanian government is obliged to maintain the categorisations that are included within the RFA. It is a simple is that.13991399Carr, Sen KimSenator CARRAW5VICALP00—My question without notice is to the Minister representing the Minister for Education, Training and Youth Affairs. Minister, do you recall stating in the Senate recently that the Howard government had created some 55,000 extra vocational education and training places last year, and that this had been done through efficiencies? Is the minister aware that two Victorian TAFEs are close to insolvency because of government cuts, and that these two institutions are located in Melbourne's northern suburbs, an area with an extraordinarily high level of youth unemployment? I draw to the minister's attention that the Kangan-Batman TAFE, even after severe budgetary restraints, will finish 1998 with a cash balance covering less than five operating days. Also, the 1999 budget of the Northern College of TAFE contains a funding cut of $1.8 million, which, as the chief executive officer has stated, means that the college can no longer continue to operate in the long-term in its current form. Minister, will you now concede that the government's policy of growth through efficiencies has resulted in a severe funding crisis for many of the nation's TAFEs?1399Ellison, Sen ChrisSenator ELLISON9X5WALPSpecial Minister of State10—The start of Senator Carr's question is wrong because I never said that the Howard government had created 55,000 new positions. I said that we had done so with the cooperation of the states through growth through efficiencies. Senator Carr ought to remember that that was brought about by the ANTA agreement, which he quizzed me on to a great extent in this very chamber. That was about working with the states and territories in achieving growth through efficiencies. That could only be done by a cooperative effort with the states and territories. Whilst the 55,000 is correct, it was done by that concerted effort. As to the ramifications of that in each state, Senator Carr is perhaps best off asking the relevant ministers. The state of Victoria has a very good vocational education training system. Preliminary NCVER data from June 1998 shows that there have been at least 111,000 new apprenticeship commencements and recommencements in the 1997-98 financial year. That is something the Howard government does take credit for.1399Carr, Sen KimSenator CARRAW5VICALP00—Madam President, I ask a supplementary question. Minister, are you aware that the Victorian minister for vocational education and training, Mr Honeywood, has attributed the shortfalls in funding to the Commonwealth government's cutback under the ANTA agreement? Will you now acknowledge, with the mounting evidence that TAFE is facing a crisis in this country and given that this government is seeking to establish 500,000 additional places within five years with no additional moneys from the Common wealth, that such cuts cannot be imposed without serious cuts to the quality of the service provision across Australia's 84 TAFEs?1400Ellison, Sen ChrisSenator ELLISON9X5WALPSpecial Minister of State10—I remind Senator Carr that across this county there are in excess of 186,000 people in training at this moment. That is a record figure. That displays only a system which is working. That shows that the government policies are on track. I say once again that the states and territories signed up to the ANTA agreement. They were happy with that agreement. Senator Carr, you will recall that you tried to say at the time that this was an agreement that would not work. It has resulted in a record number of people in training. It has resulted in 55,000 places. That is where we are going with vocational education and training in this country; we are going towards record levels of people in training.14001400O'Chee, Sen BillSenator O'CHEEEU4QLDNP10—My question is addressed to the Minister for Justice and Customs. Yesterday, Customs and the Australian Federal Police seized the largest haul of cocaine in Australian history. This follows a number of other record seizures of illicit drugs, for example, heroin and amphetamines.Opposition senators interjecting—10000PRESIDENTThe PRESIDENT—Senators on my left are making it hard for me to hear the question.EU4Senator O'CHEE—He is too busy exhaling, Madam President. My question to the minister is: how has the government's balanced approach through the Tough on Drugs strategy assisted in these seizures?1400Vanstone, Sen AmandaSenator VANSTONE7E4SALPJustice and Customs10—I thank Senator O'Chee for the question. This government has a three-pronged approach to drugs, which is well understood by anybody who is interested in government policy: law enforcement, harm minimisation and education. My role focuses on the law enforcement aspect with Ministers Wooldridge and Kemp focusing on the harm minimisation and education. Successful law enforcement strategies help to prevent the flood of drugs into our community. Some, sadly, seek to denigrate any focus on law enforcement, to diminish its achievement and its successes, by doing one of two things. They choose, whenever there is a law enforcement success, to highlight what we all agree with—that is, that law enforcement alone is not enough; everyone agrees with that. We recognise that we need harm minimisation strategies and we recognise that we need education programs as well.Opposition senators interjecting—10000PRESIDENTThe PRESIDENT—Order! Just a minute, Senator. Sledging is disorderly.7E4Senator VANSTONE—We are funding all three. But the need for those other two programs should never be allowed to darken the light over law enforcement and the achievement it makes. Some, even more sadly, do not acknowledge the role of all three and just say there is far too much emphasis on law enforcement.The Australian Customs Service and the Federal Police yesterday made the largest cocaine seizure in Australia's history. We had 13 years of Labor, but we have had the largest cocaine seizure in Australia's history and that follows the largest heroin seizure in Australia's history and the largest seizure of amphetamines in Australia's history.Madam President, you may remember—perhaps Senator Stott Despoja does not—the words of Carole Bayer Sager's song: `It looks as though we are doing something right'. It really does look as though we are doing something right. We would have hoped to have all-party support for success in the law enforcement area in relation to drugs. This is another devastating blow against major international drug syndicates. We make no apology for the fact that the law enforcement arm of Tough on Drugs is aimed quite specifically at smashing the transnational organised crime groups that would flood Australia with illicit drugs if left unchecked. As I said, we had hoped for all-party support on that matter.We do not think there can be too great an emphasis on the law enforcement arm of that three-part strategy. This seizure represents a street value of over $50 million, one million hits of a dangerous and addictive drug taken off the streets. It follows a seizure in October of over 400 kilos of heroin. Since July of this year, the Federal Police have seized over 500 kilos of heroin. We are working effectively to break up major syndicates and to make it much more likely that street level impacts will emerge.Politicians as role models in Australia do need to send a clear message to young Australians condemning illicit drug use and supporting efforts to keep drugs out of Australia. You are not a cool banana if you indulge in amphetamines. You are not a cool banana if you try heroin or cocaine. That is the proper, responsible message that should go to young Australians. Law enforcement alone is not enough; we need education and we need harm minimisation. This government will never go soft on drugs. We will never say, `Bring it all in and we will rely on the good sense of young Australians to say no,' because that is a very stupid policy to follow, and we will never endorse it.14011401Evans, Sen ChrisSenator CHRIS EVANSAX5WAALP00—If I can recover from the cool banana analogy, I want to ask the Minister representing the Minister for Health and Aged Care a question. Will the minister give the guarantee that Dr Wooldridge was unwilling to give yesterday that, in return for their $1.5 billion bonus, the private health insurance funds would at least be required to comply with all of the consumer protection provisions in Commonwealth law?1401Herron, Sen JohnSenator HERRONVW4QLDLPAboriginal and Torres Strait Islander Affairs10—I thank Senator Evans for the question because it brings up the very important point of the rebate that the government is putting forward to the Senate to allow the government to give people an incentive to either retain their private health insurance or attract them to private health insurance. I can assure Senator Evans that at all times we will ensure that the law is followed. I have no doubt that Dr Wooldridge would support me in that.The question before us put by Senator Evans is to the legality or otherwise of what we are proposing. There is no question about that. I do not understand the insanity of the opposition to what we are proposing in that the alternative is a completely publicised health system, which is, I suppose, ideologically pure for the Labor Party to pursue. Over the 13 years of their government, they deliberately tried to destroy the private health system of this country. I suppose they are being ideologically pure in that because the alternative to what we are doing is to overload the public hospital system. They do not seem to realise that. I am sorry, Senator, that I have to lecture you again on this because you obviously do not understand it.10000PRESIDENTThe PRESIDENT—Any lecture should be through the chair.VW4Senator HERRON—My apologies, Madam President, but I keep getting congratulated by the other side on the lectures that I give them on the health system of this country because they just do not understand it. We are trying to say to the mums and dads of this country that, if you insure yourself, we will give you a rebate on that insurance of up to $750. We are saying, `Please take out private health insurance to take the pressure off the public hospital system.' It is as simple as that.We want to maintain that balance between the public and the private hospital systems of this country, and we can only do it if people take out private health insurance. Those on the other side do not seem to realise that those people are already paying the Medicare levy, if they have a taxable income. They are already paying that. In addition, we are trying to give them an incentive to take out private health insurance. It is fairly simple. It will achieve a successful result.It has been estimated conservatively by us that it will bring in about another three per cent, or half a million people. It has been estimated by others that it will bring in a much greater number. So the opposition and the Democrats should get on with agreeing with our legislation so that we can get an equitable system once again in this country.1401Evans, Sen ChrisSenator CHRIS EVANSAX5WAALP00—Madam President, I ask a supplementary question, and I will read the Hansard to try to interpret what the minister actually said then. Does the minister acknowledge that the funds have not been complying with consumer protection requirements? Is he aware that the Private Health Insurance Ombudsman has slated the health funds for failing to use plain English in policy documentation, changing the rules governing members' entitlements without making these publicly available, failing to give benefit protection to consumers who pay premiums in advance and misapplying the test of `pre-existing conditions' to deny consumers coverage? What action does the government propose to take to enforce the law?1402Herron, Sen JohnSenator HERRONVW4QLDLPAboriginal and Torres Strait Islander Affairs10—I thank Senator Evans for the question. The opposition leader actually said that the funds ripped their members off. That is what their leader said. It is obviously a gross exaggeration.The number of complaints to the Private Health Insurance Ombudsman has risen over the last 12 months but, to put this in context, the Ombudsman received fewer than 2,000 complaints while health funds processed more than 30 million claims in that year. For 30 million claims, they got 2,000 complaints. I think that is an outstanding result, but the opposition leader has gone right over the top and said that they are ripping off their members. Compared to the previous year, it is likely to reflect an increase in public awareness of the Private Health Insurance Ombudsman. Even Senator Evans should be aware of that. He complains about putting things in plain English. I suggest he put his questions in plain English too while he is about it. (Time expired)BH4HILLSenator Hill—Madam President, I ask that further questions be placed on the Notice Paper .Miscellaneous1402140215:33:001402Macdonald, Sen IanSenator IAN MACDONALDYW4QLDLPRegional Services, Territories and Local Government10—On Thursday, 3 December, Senator Woodley asked me a question relating to airport privatisation. I undertook to obtain further information from the Minister for Transport and Regional Services. Mr Anderson has provided me with a detailed response, and I seek leave for that document to be incorporated in Hansard .Leave granted.The document read as follows—The major (core regulated) airports except Sydney are subject to a CPI-X price cap where X is a different percentage for each airport. In effect the airport operators must reduce real prices for five years on a specific set of aeronautical services. The services were formally declared by the Treasurer under the Prices Surveillance Act.Price increases must be notified to the ACCC, and the ACCC will use this information plus the financial statements of airport lessees, to assess compliance with the price cap. In addition to the price cap on aeronautical services, a set of aeronautical related services are price monitored by the ACCC.There seem to be three main areas where BARA is concernedCounter Terrorist First Response (CTFR) chargesThe CTFR function is currently required by Air Navigation Regulations to be performed at the highest categorised airports in Australia. In essence it is a guaranteed presence of an empowered force to provide a deterrence against, and an initial response to, an act of terrorism Previously the Australian Protective Service (APS) had a virtual monopoly on providing the CTFR function, but the government has recently allowed airport operators to seek expressions of interest from the Australian Federal Police and relevant State/Territory police, as well as the APS, should they wish.BARA is concerned at having a "third party" role in this matter ie. paying for a function, through airport operator charges, which reflects the cost of meeting a Government mandated requirement on airport operators. However the government is taking airline views into account, along with other interested parties, in examining the CTFR function.Following privatisation, costs have been fully devolved to each airport. As a result there have been significant increases in CTFR costs, particularly at airports with relatively few international flights. The Government is completing a review of the need for a CTFR requirement at Townsville, Hobart and Alice Springs, in the light of the low risk at each airport. The Government has a strong interest in achieving more efficient CTFR arrangements and will consider any reasonable proposals which could contribute to the lowering of costs. However this will not be at the risk of compromising a proper CTFR regulatory response in the event of an incident at our biggest international airports. Development CommitmentsAs part of the sale agreements the privatised airports committed themselves to almost $700 million in investment, although this amount includes some items such as maintenance that are not new investment.There is no direct relationship between the Development Commitments and the prices oversight regime.It as largely a matter for the airlines and the airports to negotiate over airport lessees' proposals for new capital expenditure and the costs associated with such proposals. The outcome of these discussions would then need to be put to the ACCC for its agreement.Fuel Throughput LevyPrior to privatisation, the Federal Airports Corporation negotiated contracts with the fuel companies for leases over refuelling facilities at most Federal airports that included provision for throughput levies on fuel. Some airport lessees are now seeking to implement these levies however the airlines have complained to the ACCC that implementation of the levies is an abuse of market power by the airports. The airlines argue that the fuel throughput levy will significantly reduce the benefits from the CPI-X cap at those airports where it is implemented.Under the post-privatisation prices oversight regime, refuelling facilities are aeronautical related services (ie outside the CPI-X price cap) monitored by the ACCC. It was the Government's intention in structuring the prices oversight regime as it did that the ACCC would oversight implementation of the regime. The ACCC sought and received submissions on the fuel throughput levy earlier in the year and the issue is currently under consideration.140315:34:001403Mackay, Sen SueSenator MACKAY9L6TASALP00—I move:That the Senate take note of the answer given by the Minister for Regional Services, Territories and Local Government (Senator Ian Macdonald) to a question without notice asked today relating to local government and the Government's goods and services tax.I would like to commence by clarifying what we are saying here. We are saying that local government does not understand the GST, local government does not agree with handing funding over to the states. It is not just the Labor Party saying this. This is not just about misinformation by the Labor Party.What we have and what we saw with the Local Government Association of Queensland is a multi-partisan view with regard to this. It is just not good enough for the Minister for Regional Services, Territories and Local Government to come in here and continue what I regard as a fairly patronising attitude and slag off local governments. By the time Senator Macdonald has finished, he will have bagged just about every local council in Australia. When I did a Hansard search in relation to Senator Macdonald, that is pretty much what I found—not much on local government policy whatsoever.Local government are very annoyed about their exclusion from the process. They are very annoyed about the fact that they were actually cut out of it. They are very annoyed that the coalition will not come clean as to what mechanism will be used in terms of guaranteeing funding from the Commonwealth to local governments. As far as they are concerned, money will be handed over to the states and the states will do what they wish. The only hint we have—and that is why I was pressing Senator Macdonald—is what mechanism will be used. We have a hint that it might be a memorandum of understanding. Our response to that is that it is not good enough. The response of local government to that is also that it is not good enough.Local government do not understand the GST. It is simply misleading for the minister to come in here and assert they do. As I said in the Senate the other day, his own council of the Burdekin Shire have produced documentation which says that 50 per cent of the services they provide are in the grey area—they are unclear as to whether the GST is applicable or not. Logan council, also in his home state, have produced documentation. As far as that council are concerned, they are unclear as to whether a GST is applicable to 30 per cent of the services they provide.This is why the Queensland Local Government Association have decided to launch Operation Rethink. I will quote exactly what Operation Rethink is. Tom Pyne, who I think is a terrific person—and I acknowledge that Senator Macdonald said that as well—is also a card-carrying member of the Labor Party. That is fine. There were plenty of card-carrying members of the National Party and the Liberal Party at the meeting I attended. This article states:The Local Government Association has launched Operation Rethink in an attempt to curb the handover of local government funding to the states.The LGA has launched the campaign to try to change some aspects of the Coalition's proposed taxation and intergovernmental financial arrangements that it sees as detrimental to local government.How much clearer can you get? Executive director of the Queensland Local Government Association, Greg Hallam, was quoted as saying:We're saying to councils, give consideration to requesting your local federal Coalition member or Senator to attend one of your council meetings in February, or March, and explain to the council and more importantly the community why this had to happen.Why local government couldn't get the same share as the states, and what safety guarantees are there beyond the three year transitional period.That is from the Queensland Local Government Association. We have already expressed very strongly the view that was provided by the Australian Local Government Association, and I have had occasion now to meet with a number of councils and local government associations, and the message is the same: they do not agree with the transfer of funding over to the states, they are completely in the dark as to what mechanism is going to be used and, if it is a memorandum of understanding, that is not good enough.I note that in the tax bills the only mention of funding between the federal government and the states was in the preamble, which said that there was a Premiers Conference and certain undertakings were given. There is nothing in there about local government except to say that every single act where the fiscal situation is articulated will be repealed. What does that mean? We are here asking questions and local government also want to ask questions. I think it about time the government, instead of asserting that everything is okay and everybody understands it, actually came clean and gave people some answers. 15:39:001404Calvert, Sen PaulSenator CALVERT5F4TASLP10—Here we are again one week later and we have the same old story, the same old attack, the same old Labor lies and the same old Labor Party scare tactics which have been going on for the last six years. I have been involved in local government in one way or another for most of my life. I know how local government is funded and I also know that, in recent times, local government has become very efficient by contracting out and privatising a lot of its operations.Senator Ian Macdonald, as a former councillor, is also very well aware of how local government operates. He came in here today and answered the same questions about local government that he was asked last week. One has to ask what the Labor Party are on about. We have sat here through this whole session and all we have heard from the Labor Party are these negative attacks on the GST. All through the election campaign all we ever heard was negative attacks on the GST. When are they ever going to come up with something positive, something for the good of Australia?We have come forward with a tax reform plan which includes a GST, and it is going to be good for all Australia, including local government. The Australian Labor Party—Senator Mackay and the rest of it—have used misleading tactics. I have heard it all. I have heard through my local government contacts that there is going to be a GST on rates. That was a lie—wrong; absolutely wrong. I have heard that all the regulatory charges are going to have a GST on them. That is wrong. One of the doozies that was put around by the Labor Party was that there was even going to be a tax on parking fines. That was wrong.8O6O'BRIENSenator O'Brien—Who put that around?5F4Calvert, Sen PaulSenator CALVERT—You people put it around, like you put all the scare tactics around about everything about the GST. You know as well as I do, Senator O'Brien, that this country needs a very big shake-up as far as taxes are concerned. I know as a former local government councillor that one of the biggest problems we ever had was getting a decent share of money from Canberra. At least under a GST—as you know, Madam Deputy President, and as they know over there—money will be coming through on a regular basis. The Commonwealth government will get none of it. We have guaranteed that all the GST funding will go to the states and through the states to local government.Another Labor lie that has been peddled around local government is that the Commonwealth Grants Commission will still be kept to make sure that local government gets a fair share of government funding. Local government representatives campaigned long and hard before and during the election campaign in support of tax reform. They know as well as we that tax reform is essential to all Australia, including local government. They put a very persuasive case to the government with respect to the exclusion of rates, water and sewerage charges. You may remember that, during the Fightback campaign, there was some doubt about whether rates and services under local government were going to be exempt from a GST. This time there is an ironclad guarantee that there will be no GST on them.9L6MACKAYSenator Mackay—Congratulations to you, because you probably helped the lobbying.5F4Calvert, Sen PaulSenator CALVERT—Thank you for that comment, Senator Mackay. The fact of the matter is that local government will be better off under these new tax reform packages. One of the big problems that local government has always had—and I suppose always will have, to a certain extent—is a guarantee of funding. Local governments are the grassroots of government. They are the ones who deal on a day-to-day basis with the man in the street who, at the end of the day, is really only concerned about whether his potholes have been filled up and whether his sewerage works, et cetera.But, as I said, in recent times local government has become very efficient. It contracts out a lot of its services. It does not have the huge overheads that it used to have. I am particularly pleased to see that, in our state of Tasmania—even though the previous state government was defeated I believe basically over local government reform—business people and local people alike are making moves to amalgamate certain local government areas and to become more efficient.What we have heard from the Labor Party in recent times about tax reform has been like a cracked record. I cannot believe that, one week later, after all that is happening around Australia—all the good things and all the bad things—we get the same old questions to the same minister from the same people. They must have run out of ideas over there. Can't you come up with something a little different or something that is going to benefit this country? Honest to goodness, I cannot believe it! (Time expired)15:44:001405Murphy, Sen ShayneSenator MURPHYFX5TASALP00—I rise to take note of the non-answers from Senator Ian Macdonald with regard to GST and local government. Senator Macdonald is running a very close second to poor old Senator Kemp, who is the chief waffler on the government side with regard to non-answers and non-performance. That is really saying something for Senator Macdonald. Last week Senator Macdonald, in answer to a question from Senator Mackay with regard to how the GST will apply to local government, said:. . . local government, once the truth is explained to them—which obviously he has not been able to do—are very happy about the GST. They now understand that they do not pay GST at all.That is very interesting, because Senator Macdonald said something different from that in another statement and that was contradicted by Lynton Crosby, who said something different again.If local government is so au fait with what was going on and how the GST would apply, why are they writing to all senators, including all government senators and Senator Macdonald to boot? Why are they seeking to brief us? Why is the President of the ALGA saying things like, `I am seeking urgent and strong action from councils in support of this position, including representation to local members of parliament.'? Because they do not know how the GST will apply to them. They do not know what services it will apply to and what services it will not apply to, as was pointed out with regard to where nominal fees are paid for local government services, such as swimming pools, community halls, et cetera. Will the GST apply or won't it? Senator Macdonald does not know. He went on to say last week:. . . we will be working through in the next few months and clarifying exactly what is subject to a GST. It is where it is commercial and where commercial operators provide it.That is about as clear as mud. What does that mean? Under the compulsory competitive tendering processes, what will be the case with regard to the GST where a council has privatised a service? Will the GST apply to services such as part rubbish collection in Victoria, for instance? I would suspect that it would. It would have to. If a private company provides a service to local government which will not be subject to a GST, what is the case when that private company provides other services in the private sector which will be subject to a GST? How does that work? How would a company not be able to take advantage of a local government contract and also provide other services to the private sector? How does the government deal with circumstances such as that? I would suggest they cannot. I would suggest the GST will apply. It is about time the government was up-front and honest with people, including local government, and told them exactly what the GST will apply to.More importantly, in so far as local government services are concerned, in the future there will be changes of government and decisions have to be made with regard to maintaining the funding levels for local government and the provision of local government services. Local governments are equally concerned about that. They are equally concerned that there will be no equity. They already know that this government has reneged on promises that were made some time ago with regard to the maintenance of funding for local government—the money they need to provide services.9L6MACKAYSenator Mackay—Fifteen million dollars.FX5Murphy, Sen ShayneSenator MURPHY—Yes, $15 million, as Senator Mackay says. How do you maintain funding? Senator Macdonald says, `Oh, well, through the CPI and population increases.' That is interesting for rural and regional Australia. For most areas you can scrub population increase, because all the services that the government has been responsible for removing has led to a population decline. How do you answer that? Senator Macdonald, hazy as he is for most of the time and in a fog for the rest of the time—and we may well know how that fog is inflicted upon him—ought to clarify the issues for local government. He ought to come in here and give some answers that are clearly and easily understood. He has not done so in the past. (Time expired)15:49:001406Campbell, Sen IanSenator IAN CAMPBELLH15WALP10—It is interesting to hear the attempts day by day of Labor trying to bring down the tax reform proposals of the government. We are seeing rather pathetic tactics here today to pick up the comments of a couple of well-identified Labor Party stalwarts, which were identified by Senator Macdonald. That is not to say that those people cannot make a contribution, but we should not pretend in this chamber that the people making comments on behalf of local government are anything other than Labor Party stalwarts.As I said, they have a contribution to make. As Labor Party stalwarts, they would abide by Labor Party's centralist policies. The Labor Party is very keen to ensure that control of local government is kept in the hands of Canberra. This government has created an historic change to federal-state and federal-local government financial relations. Labor squeal and squawk because a government has come to Canberra that has not only grasped the nettle, as it was described at the press club by the speaker there on 5 June 1985, grasped the tax reform nettle, but also grasped the nettle of federal-state financial relations.We have said that we will ensure that funding decisions are decentralised. We have all these centralists opposite who would prefer to keep control of every purse string and every economic lever here in the national capital and away from the capitals of our great states and regions. They do not trust people in Perth, or in Brisbane, or in Melbourne, or in Sydney or in the great regional centres to make decisions for themselves. They do not trust them. They have to control them by a central piece of legislation, a bureaucrat and a handful of politicians sitting here in Canberra. This great decision, which has been made by a forward looking government that is interested in creating historic change, will have been delivered if it gets through this Senate. We encourage honourable senators to look at it closely.We also encourage members of the Local Government Association who are not Labor Party stalwarts to read about the reforms, to ask questions about the reforms—as many have done of me. When I speak to the local government people—as my friend and colleague Senator Ian Macdonald, the minister, does—the people walk away, saying, `That's fantastic. This is a good idea. It's great.' They even say, `Gee whiz, this is a great reform.'Senator Mackay interjecting—H15Campbell, Sen IanSenator IAN CAMPBELL—Senator Mackay, they tell me what they think of you and your appearance before them as well, but I would not say that in the Senate because it would be unparliamentary. I advise these local government people not to listen to what Senator Mackay and others say about the tax reform package, because they are opposed to it. That is unlike Mr Keating who, as Prime Minister, in his historic speech on 5 June 1985 at the Press Club—he might have had Senator Mackay in mind—said:For too long the politically unpalatable decisions have been put off in this country because our politicians have not had the strength of purpose to tackle the hard issues.When it has come to the crunch, short-term political interests have always come first. But I think it is fair to say that, at least to some extent the community as a whole has been prepared to let its politicians get away with that attitude.Senator Mackay is one of those politicians. They would rather score the short-term point. They do not want tax reform. They probably know in their own hearts that Australia needs it. But they failed. Mr Keating failed because of the union domination of the Labor Party in 1985. But this government is going to do it. It is going to be better for local government. It will reduce the costs of local government. They will be able to provide better services for their constituents. It will reduce their costs. And it is reform that is good for Australia. I advise people in local government, `Don't listen to Mr Beazley who tells you that the price of a used car is going to go up, when we know it is going to come down by $3,000. Don't listen to them when they say that the price of going to a swimming pool is going to go up, or when Senator Mackay says that it is not going to help local government funding. They will mislead you.' They are not politicians of the future. They are politicians of the past. They want to vote for a 1930s tax system when we should look forward to a tax system for the new millennium. (Time expired)15:54:001407Crossin, Sen TrishSenator CROSSIN7Y6NTALP00—The minister would have us believe today that the light has been switched on for local government associations around the country just because he has gone out and explained to them the impact of the GST. If that is so, why aren't we being flooded with press releases and letters from local government associations telling us that that is the case, telling us that we are on the wrong track? That is not the case. Time and again we are getting press releases seeking to have us make representations on their behalf.One of the things that local government said back on 22 October was that there must be a guarantee that local government will not be excluded from the GST negotiations, especially those related to intergovernment financial relations. Why was it then that this government failed to include local government in their terms of reference for the Vos report? Why was it then that local government was not included in detail when it came to next year's Senate inquiries? Why is it that, time and again, local government has been screaming out to be consulted about this, yet it is continually being ignored by this government?We have heard people on the other side of the chamber, particularly the minister, say that the GST is going to be good for local government and that local government will be better off. The minister's claims that the GST is going to be good for local government have not come to fruition. We assume that rates and regulatory matters will possibly be GST free, but I do not think the government has ever addressed the issues that have been raised by the Australian Local Government Association.It was interesting today to hear an attack made which suggested that a Queensland lord mayor was a life member of the ALP. In the Northern Territory we have probably got many local government members who belong to either political party. But if that is going to be the basis on which you attack their right to make a comment, then you have clearly got the message wrong. They are popularly elected members of their councils and they have a right, despite their political affiliations, to represent their local government councils on this issue.Time and again local government associations have raised the issue of the dramatic change to funding that this package is going to bring. The funding will now be going straight to the states or territories to hand out. There will be a change in the way the grants will be administered. I think there is no doubt that the government is consistently ignoring local governments. It is seeking, through the tax package, to undo 25 years of the tradition of the Commonwealth maintaining a direct relationship with local governments in order to achieve their goals. There has been no detail about how the states or territories will dish out this money. Local governments believe that, if they disagree with what is happening at a state level and they speak out strongly against the state or territory government's policies of the day, they will be penalised by simply not having the funding that they want passed on to them. Local governments have said time and again that what they are asking for is an increase in funding. Throughout this debate we have not heard any commitment by the government to recognise that plea. So again local government go unheard and unconsulted.Fifty per cent of council activities fall into a GST grey area. We still lack detail from this government about how the GST is going to impact on local government in relation to things like buildings approvals and inspections, parking fines, zoning maps, library fees, and we had some comment today about swimming pool activities. We still do not have any detail about that. I think I heard the minister say today that all that will be revealed in time. The Australian Local Government Association are saying to us that they want the detail now. They want to be able to make submissions to us and they do not want to wait for the details to become clearer over the next few months. The minister is confused over the GST and its impact on local government. The Local Government Association are calling for clarifications of activities and they are not at all convinced that the tax package will benefit them. (Time expired)15:59:001408McGauran, Sen JulianSenator McGAURANWH4VICNP10—Any cool-headed analysis would say that Senator Ian Macdonald has acquitted himself very well all this week under the barrage of questions, trick questions, leading questions, exaggerated questions, even downright wrong questions and dumb questions. Senator Macdonald has acquitted himself very well. We can now pretty much say that he has stamped himself in that position as a minister and it is going to be hard to dislodge him.The spurious point you raise today under the cover of trying to attack our GST is local government. Tomorrow it will be something else and yesterday it was something else again. It is really just a veil for an attack on the government's tax reform. The main question that local government had in regard to the government's tax reform, the GST, was this: would their rates—that is, their base funding—be subject to the GST? We made an announcement about that before the election. This was a question they asked before the election. I do not know why you are re-running it post-election. You lost. We answered the question pre-election. We said that rates would not be subject to the GST. They are GST free, along with water and sewerage, by the way. They are a GST fee-free zone. As other speakers have said, the point is that the government's tax reform is good for local government.7Y6CROSSINSenator Crossin—How?WH4McGauran, Sen JulianSenator McGAURAN—It abolishes wholesale sales tax, Senator. It abolishes the many taxes that the states place on local government. Taxable local government businesses will be entitled to claim a refund on all GST payable on all purchases. The wholesale sales tax will be abolished. The financial institutions duty will be abolished. Those who have been in local government know only too well that a great deal of money comes in and out of local government accounts because of things such as parking collections. In the case of the Melbourne City Council, the collection of parking fees is to the tune of some $20 million or more. That money is being washed in and out of the accounts, along with the rates that local government raises.The sheer abolition of the financial institutions duty and the bank account debits tax will bring great savings to local government. But the point is that there is nothing new about local government lobbying the opposition. I notice they are not coming to you directly. You kept saying that you were getting press releases and letters from them, as we do. It is unusual that they do not come to you directly, Senator Crossin. That being the case, there is nothing new about a local government and state government tussle and coming to the federal government to bail them out. Local government have always felt that they have been under the wing or under the thumb of state governments.AW5CARRSenator Carr—That's dead right, in Victoria.WH4McGauran, Sen JulianSenator McGAURAN—That is dead right. I was on the Melbourne City Council for three years, Senator, and I know only too well how city councils in particular tussle with their state government, let alone premiers and lord mayors. That is a daily event in local government. If local government could have their way, they would like a constitutional life, but they are in fact a life of state governments. They have always been a life of state governments. State governments can make or break local governments, hire or fire local governments. The bulk of a local government's funding comes from the state. There is nothing new about this. Do not get drawn into it, unless you are just using it as a veil to attack the government's tax reform proposals, which I suspect you are.The point is, as Senator Campbell said, that we have chosen as part of the tax reform package to introduce a historic state and federal financial relations agreement which goes along with the tax reforms. The funding decisions will now be decentralised. There will be a guaranteed amount that each state will get and can work off. There is no more of this coming to Canberra for the usual babble each year. It will be an increased amount, so it is a better deal. That will naturally flow on to local governments.9L6MACKAYSenator Mackay—Can you guarantee that?WH4McGauran, Sen JulianSenator McGAURAN—Guaranteed. The point is that we have a tax reform package. You are sticking to the old one. You are quick to analyse our tax reform, but you never bothered to get across your own proposal—that is, the existing tax system. (Time expired)10000DEPUTY PRESIDENTThe DEPUTY PRESIDENT—Order! The time for the debate has expired.Question resolved in the affirmative.140910001CLERK ASSISTANTThe Clerk—Petitions have been lodged for presentation as follows:140911YH4MacGibbon Sen DavidTo the Honourable the President and Members of the Senate in Parliament assembled:The petition of the undersigned citizens of Australia draws the attention of the Senate to the need to encourage participation in private health insurance both to allow individual freedom of choice and to maintain a viable health system.Your petitioners note with satisfaction the Government's proposal to provide a 30 per cent rebate on all private health insurance premiums, without means test, from January 1,1999. This is necessary to allow those persons who are prepared to take responsibility for their own health care to be able to afford to do so.We believe that health insurance is an essential part of our health care system.Your petitioners therefore ask the Senate to ensure that the legislation providing this rebate is passed without delay.Senator MacGibbonYH4Senator MacGibbon(from 11 citizens)1410469DT6Bartlett Sen AndrewTo the Honourable the President and Members of the Senate assembled in the Parliament.The Petition of the undersigned draws attention to the potentially damaging affects of National Competition Policy on small business such as newsagents.Your petitioners ask the Senate in Parliament to call on the federal government to review the decisions of the Australian Consumer and Competition Tribunal which threaten the viability of newsagents and introduce legislation to override these decisions and preserve the current system of distribution for magazines and newspapers through Australian newsagents.Senator BartlettDT6Senator Bartlett(from 469 citizens)Petitions received.Notices14101410The following notices were given:Senator Ian Campbell to move, on the next day of sitting:That the following bill be introduced: A Bill for an Act to amend the Wildlife Protection (Regulation of Exports and Imports) Act 1982 , and for related purposes. Wildlife Protection (Regulation of Exports and Imports) Amendment Bill 1998 .Senator Mackay to move, on the next day of sitting:That the Civil Aviation Regulations (Amendment), as contained in Statutory Rules 1998 No. 234 and made under the Civil Aviation Act 1988 , be disallowed.Senator Ian Campbell to move, on the next day of sitting:That the following bill be introduced: A Bill for an Act to amend the Ozone Protection Act 1989 , and for related purposes. Ozone Protection Amendment Bill 1998 .Senator Mackay to move, on the next day of sitting:That there be laid on the table by the Minister representing the Minister for Transport and Regional Services (Senator Ian Macdonald), no later than 5 pm on 10 December 1998, the Skehill report into the Civil Aviation Safety Authority.Senator Stott Despoja to move, on the next day of sitting:That the Senate—(a) notes that: (i) the health ministers from Australian states and territories and the Commonwealth, together with the New Zealand health minister, are meeting on 16 December 1998 to consider the labelling of food containing genetically-modified materials, and (ii) the Commonwealth Government has proposed a test for labelling based on the distinction known as `substantial equivalence', so that a food is labelled only if it is substantially different;(b) expresses concern the term `substantial equivalence' has an uncertain meaning and does not have meaning for most consumers; and(c) calls on the Government to label all food which is or includes genetically-modified materials.Senator Reynolds to move, on the next day of sitting:That the Senate—(a) supports the international Sri Chinmoy `Peace Blossoms' initiative which promotes the most fundamental cause for all humanity, the cause of peace;(b) confirms Australia's commitment to the promotion of favourable regional and global relationships including, through support for the work of the United Nations advancement of free trade and promotion of human rights; and(c) welcomes the proposal: (i) that Australia join the worldwide family of `Peace Blossoms' as the world's pioneer Sri Chinmoy peace continent, and (ii) as consistent with the commitment of all senators to work for peace and harmony between peoples and nations.141016:07:001410Calvert, Sen PaulSenator CALVERT5F4TASLP10—On behalf of Senator Crane, I withdraw business of the Senate notice of motion No. 1.1410Senator Brown to move, on the next day of sitting:That the provisions of the Regional Forest Agreements Bill 1998 be referred to the Legal and Constitutional Legislation Committee for inquiry and report by 22 March 1999, with particular reference to: (a) whether the bill, by treating companies differently depending on whether they are in a region covered by a regional forest agreement (RFA), provides for a discriminatory regime between one state and another which is inconsistent with section 99 of the Constitution;(b) whether the bill is invalid to the extent that it refers to instruments not yet in force (RFAs that have yet to be concluded) or to instruments that can be varied without reference to Parliament or without a specific power in the bill enabling the variation;(c) whether the compensation provisions in the RFAs are valid to the extent that they attempt to bind Parliament or fetter the exercise of executive power;(d) whether the bill will limit Australia's capacity to meet its obligations under international treaties, in particular the World Heritage Convention, the Climate Change Convention, and the Ramsar Convention;(e) whether the requirements of the Australian Heritage Commission Act 1975 , the Environment Protection (Impact of Proposals) Act 1974 and the Endangered Species Protection Act 1992 have in fact been met, notwithstanding declarations to that effect in the RFAs; and(f) any other matters that the committee considers relevant.Senator Brown to move, on the next day of sitting:That the provisions of the Regional Forest Agreements Bill 1998 be referred to the Environment, Communications, Information Technology and the Arts Legislation Committee for inquiry and report by 22 March 1999, with particular reference to:(a) the relationship between the Regional Forest Agreements Bill 1998 and the Environment Protection and Biodiversity Conservation Bill 1998, in particular, the activities regulated by each and the extent of the geographical areas covered by each;(b) whether the bill will fetter the capacity of the Commonwealth to meet its obligations under the World Heritage Convention and the Climate Change Convention, or any other international convention, and in particular whether native forests that are either listed, nominated or identified as being of World Heritage value could be logged;(c) the amount of compensation for which the Commonwealth would be liable if its actions directly or indirectly curtailed forestry or mining operations in areas covered by the regional forest agreement (RFA) as a result of Australia's obligation under the Climate Change Convention to reduce greenhouse gas emissions;(d) the amount of compensation for which the Commonwealth would be liable if an action by it resulted in curtailment of forestry or mining operations in areas covered by the RFA for any of the following purposes: (i) nomination or listing of an area for world heritage, for either cultural or natural values, (ii) protection of species or communities that are found to be threatened during the next 20 years, (iii) protection of the quantity or quality of water in a water catchment, and (iv) flood mitigation;(e) whether any remedy is available to the Commonwealth where a state is found to have breached the RFA, such as by logging illegally (as in East Gippsland) or by downgrading the status of reserves to permit mining (as in Tasmania);(f) whether the requirements of the Australian Heritage Commission Act 1975 , the Environment Protection (Impact of Proposals) Act 1974 and the Endangered Species Protection Act 1992 have in fact been met (notwithstanding declarations to that effect in the RFAs) and the environmental impact of RFAs overriding those Acts; and(g) any other matters that the committee considers relevant.Senator Stott Despoja to move, on the next day of sitting:That the Senate—(a) notes that: (i) the Dusseldorp Skills Forum will convene a significant policy forum in Canberra on 9 and 10 December 1998 on `Learning and Work Circumstances of Australia's Young Adults', that is, those aged 20-24 years, and (ii) the forum convened in 1997 by this organisation, `Australia's Youth: Reality and Risk', made a significant contribution to the development of policies relating to young people; and(b) supports the ongoing work of all delegates to this forum and of the organisers in providing such a valuable means by which some of the serious problems facing young people can be addressed. Senator Margetts to move, on the next day of sitting:That the Senate—(a) notes that: (i) on 7 December 1998, the Western Australia Environmental Protection Authority released a report on the Department of Conservation and Land Management's (CALM) compliance with the legally-binding ministerial conditions relating to the Forest Management Plan 1994-2003, (ii) the report also included advice on the preparation of the Regional Forest Agreement (RFA) for Western Australia, and (iii) the report found that: (a) CALM has not complied with many of the ministerial conditions, (b) CALM is not managing forests sustainably, and (c) there are major problems with CALM's role in the RFA; and(b) calls on the Commonwealth Government to: (i) immediately request the Western Australian Government to implement a moratorium on the logging of old-growth forests in Western Australia, and (ii) halt the Western Australian RFA pending the restructuring of CALM and the implementation of the Environmental Protection Authority's recommendations.Senator Stott Despoja to move, on the next day of sitting:That the Senate—(a) notes that, in the week beginning 29 November 1998, the Council of Australian Postgraduate Associations (CAPA) in Canberra convened the inaugural Symposium of Indigenous Postgraduate Students, which enabled indigenous postgraduates to exchange views with their peers and with policy makers on issues including: (i) intellectual property and ethics, (ii) the establishment of an indigenous students' journal, and (iii) accessing research funding; and(b) commends CAPA for organising this historic symposium. Business14121412Motions (by Senator Woodley, Senator Murray, Senator Lees, Senator Stott Despoja, Senator Bartlett, Senator Allison and Senator Bourne) agreed to:That general business notices of motion Nos 58, 60, 61, 62, 63, 64 and 66 standing in the names of Australian Democrats senators for today, relating to drug use and abuse, be postponed till 10 December 1998.1412Motion (by Senator Margetts) agreed to:That general business notice of motion No. 69 standing in her name for today, relating to the national competition policy, be postponed till the next day of sitting.1412 Motion (by Senator Brown) agreed to:That general business notice of motion No. 70 standing in his name for today, relating to ex-President Suharto of Indonesia, be postponed till the next day of sitting.1412Motion (by Senator Margetts) agreed to:That general business notice of motion No. 56 standing in her name for today, relating to East Timorese asylum seekers, be postponed till the next day of sitting.141216:12:001412Campbell, Sen IanSenator IAN CAMPBELLH15WALP10—At the request of Senator Patterson, I ask that government business notice of motion No. 1 be taken as formal. 10000DEPUTY PRESIDENTThe DEPUTY PRESIDENT—Is there any objection to this motion being taken as formal?16:12:001413O'Brien, Sen KerrySenator O'BRIEN8O6TASALP00—by leave—Before granting formality, I wanted to clarify some matters. Unfortunately, I was unable to make contact with Senator Calvert this morning. My understanding is that the proposal is that the sitting be extended this evening, that there be speeches in the second reading debate only between 7.30 p.m. and 10.30 p.m., that the debate not be closed off by the minister this evening, and that there be no divisions and no quorums. I am seeking clarification of whether that is the correct situation.16:12:001413Campbell, Sen IanSenator IAN CAMPBELLH15WALP10—by leave—I am happy to clarify that. I am happy to inform honourable senators that my understanding and the view I put to leaders, whips and Independent senators was that we would sit tonight on a `no divisions' basis to handle the private health insurance bills, that dinner would be from 6.30 p.m. until 7.30 p.m., and that we would sit until 10.30 p.m. or until the second reading debate had been completed. I certainly thought that, if it was going to be completed, the minister would sum up, so there would be a line drawn. But, if the understanding is that the minister not sum up, we will go home early as long as it is quite clear that the speeches in the second reading debate have concluded. I would regard it as a breach of faith if all of a sudden a second reading list appeared tomorrow and we had gone home early tonight. I would like to see, if it is possible, the speeches in the second reading debate on this bill concluded tonight and, if they are concluded before 10.30 p.m., for everyone to then go home—or at least for the question for the adjournment to be put.AW5CARRSenator Carr—But the summing up not tonight?H15Campbell, Sen IanSenator IAN CAMPBELL—I would have thought that the summing up could have been made tonight if there was an agreement that the speeches in the second reading debate would be concluded—unless, of course, the summing up meant there was going to be a vote.AW5CARRSenator Carr—That is one of our concerns.H15Campbell, Sen IanSenator IAN CAMPBELL—Fine. We could certainly make an undertaking that there would be no vote. But, if it is quite clear that the last speaker from the opposition side will be heard tonight and we will all go home after that, I am quite happy with that undertaking.AX5EVANSSenator Chris Evans—If that is by 10.30 p.m.H15Campbell, Sen IanSenator IAN CAMPBELL—Or before 10.30 p.m. if that last speaker has been heard. I will therefore undertake that the minister will not sum up tonight.10000DEPUTY PRESIDENTThe DEPUTY PRESIDENT—Is there any objection to this motion being taken as formal?16:14:001413Harradine, Sen BrianSenator HARRADINE6H4TASIND00—by leave—Could the minister advise the Senate when it is anticipated that the matter will come before the Senate in the committee of the whole?16:15:001413Campbell, Sen IanSenator IAN CAMPBELLH15WALP10—by leave—I think the question raises two matters. Firstly, when will the matter come before the Senate in the committee of the whole stage. That will be after the conclusion of the bill that we are debating at the moment. We are in an adjourned debate on the Payment Processing Legislation Amendment (Social Security and Veterans' Entitlements) Bill 1998 and the National Transmission Network Sale Bill 1998 , which I would hope to get to this afternoon. Then there is the Australian Radiation Protection and Nuclear Safety Bill 1998 and the Acts Interpretation Amendment Bill 1998 . That is all the legislation we have to do.I would anticipate that we would be able to consider the Private Health Insurance Incentives Bill 1998 on Wednesday or Thursday at the committee stage at the very latest. If we can get the second reading debate out of the way tonight, then that will advance things. We expect the Community Affairs Legislation Committee will be reporting this afternoon, so the Senate will have the value of the Senate committee report in a matter of a few minutes, if not an hour or so.Motion (by Senator Ian Campbell) agreed to:That on Tuesday, 8 December 1998:(a) the hours of meeting shall be 2.30 pm to 6.30 pm, 7.30 pm to 11.10 pm;(b) the routine of business from 7.30 pm till 10.30 pm shall be the government business order of the day relating to the Private Health Insurance Incentives Bill 1998 and 2 related bills, second reading speeches only; and(c) the question for the adjournment of the Senate shall be proposed at 10.30 pm.Miscellaneous1414Motion (by Senator Lundy) agreed to:That the Senate—(a) congratulates the participants and delegates of the inaugural National Children's Summit that was held in Parliament House from 4 December to 6 December 1998; and(b) encourages: (i) the participants and delegates to continue working on the very important issues raised during the summit, and (ii) the Government to look at the plan of action that lists the outcomes from the summit with a view to addressing the problems and concerns facing Australia's youth.Committees141414141414Motion (by Senator Calvert, at the request of Senator Payne) agreed to:That the time for the presentation of the report of the Legal and Constitutional Legislation Committee on the provisions of the Human Rights Legislation Amendment Bill 1998 (No. 2) be extended to 17 February 1999.Documents14141414141410000DEPUTY PRESIDENTThe DEPUTY PRESIDENT—In accordance with the provisions of the Auditor- General's Act 1997, I present the following report of the Auditor-General: Report No. 19 of 1998-99—Performance Audit—Planning of Aged Care: Department of Health and Aged Care .16:18:001414Evans, Sen ChrisSenator CHRIS EVANSAX5WAALP00—by leave—I move:That the Senate take note of the document.I have just had the opportunity to have a quick look at the Auditor-General's Report No. 19 of 1998-99. Unfortunately, I was not able to gain a briefing from the department prior to its tabling, nor was I able to gain earlier access to the report. This report is a very important contribution by the Auditor-General, because it gives us a snapshot of what is occurring as a result of the government's aged care reforms and the confusion and instability that has characterised this area of government policy for the last 2½ years. In its usual guarded language, the Auditor-General has nonetheless exposed a great deal of inadequacies within the system of aged care in this country and has raised very serious concerns about some of the departmental processes, particularly the transparency of processes in awarding contracts for aged care residential places. That will obviously have to be looked at in more detail, but I think there is reason for the Senate to be extremely concerned at what the Auditor-General is pointing to.To understand this report, we need to go back to the implementation of the government's aged care policy in the 1996 budget, which forced elderly people to provide quite enormous entry contributions to get into nursing homes. The government also sought to introduce a user pays approach to aged care in this country. The Auditor-General's report points to problems in the 1996-97 planning period because of the shemozzle of a policy that was operating at the time. As we well know, one minister lost her job courtesy of the Prime Minister and the other minister lost his job courtesy of the voters of Bass.The Auditor-General said that the 1997-98 planning period was more efficient than the previous year. But there are still major criticisms implicit in this assessment, which I think flow from—at last count—the 13 backflips on aged care policy that the government have undertaken in the last couple of years. One of my major concerns is that the government might well be considering another backflip as the reality of the failure of their policy in this area is sheeted home to them. I know that they are under pressure from providers to again review the aged care accommodation charge system that they finally settled on earlier this year, because it clearly does not meet the financing needs of the sector. I want to draw attention to the four major findings of the report in the short time available to me today. Firstly, the Auditor-General found it is a system that still does not allocate enough places to regional and remote areas nor to some of the special needs patients. That is a very important finding. Secondly, they found that the selection process employed by the department is ineffective. There are two- to three-year timelags in planning and implementing bed places, which has led to a shortage of some 10,000 bed places. Thirdly, they found that the job cuts and changes in the public sector have weakened the system by destroying the corporate knowledge inside the department—a problem which I think is being experienced by a whole range of departments in the Commonwealth Public Service. Fourthly, there are serious concerns about the transparency of the selection process, about the transparency of the tendering for new aged care bed places in this country.The report makes this finding in relation to regional and remote areas:. . . major inequities remain in the distribution of places between regions, especially between urban and rural areas. The number of aged care places has not kept pace with growth in the aged population. A contributing factor is that the planning process involves time lags of up to three years between the estimation of need and the provision of places.The report goes on to say:. . . the disproportionate numbers of places in some metropolitan areas persists and rural and remote areas remain underserviced. Administrative options to achieve greater regional equity are limited and difficult to achieve within funding limits. That was point 18 under the section headed `Key findings'. My concern is not only that this finding confirms what we have known—that there is a bias in the system towards metropolitan places, that we are not getting enough beds made available in rural and remote Australia and that we are not providing enough beds for people to stay in the communities that they live in so they are close to their relatives and friends—but also that the decisions taken by the government in financing this sector, the accommodation charge and other measures, actually discriminate against smaller providers. They encourage rationalisation into larger facilities, which works against the provision of smaller facilities in rural and regional areas.So I think there is a bias in the funding system. It is confirmed by this report that there is a problem—they are not getting enough beds put into rural and regional areas. There is a bias, as we know, in the financial system. It is a concern that I raised last week when we were discussing the accreditation bill, because I think the accreditation system will add to the pressures on rural and remote facilities and make it harder for them to continue to provide that service. So I think this is of serious concern, and it is one problem which the government must start to tackle.The second issue raised is that the selection process is ineffective, there are time lags in implementing bed places and there is a shortage of places. The report found that nearly 10,100 places would be needed. We are 10,100 places short. The report says that the ratios have not met the targets laid down by the government either. So these are very serious issues in terms of the government's failure to provide adequate places.I think what we do know is that the prospects of this being exacerbated are quite strong. We know that the government is under pressure from the industry to again look at its funding mechanism for nursing homes in this country. A recent submission from the Australian Nursing Homes and Extended Care Association to the government argued very strongly that the accommodation charge would not meet the capital needs of the industry. They confirmed what was said in the Auditor-General's report: that enough places are not being provided, that there is a serious undersupply. They say they will not be able to supply the beds needed in the future for our ageing population. They argue:The results of our survey indicate that the maximum accommodation charge of $12 per day is totally insufficient for the upgrading required. Unless immediate action can be taken, the government will go to the next election as the introducer of a user-pays system for which little was achieved.Basically, the industry argues that the government's financial arrangements for aged care in Australia will not supply enough beds to meet the needs. The Auditor-General already has established that we are 10,000 places short. The trend will only get worse because the government has failed to deal with the capital funding needed in this industry.The third point the report makes is that job cuts have weakened the selection system by destroying corporate knowledge. There are a number of findings which go to the fact that the attack on the public sector is taking its toll on this department, as in others. I think it is something that we will increasingly be made aware of. The departments have been cut back to the point where they are losing that corporate knowledge, losing the ability to implement proper public policy because of the attacks that have been made on the Public Service. There are a number of findings that go to that issue.The last issue, which is identified in a quick read of the report, is the serious concerns the Auditor-General has about the transparency of the selection process in awarding contracts for aged care facilities in this country. The Auditor-General's recommendations discuss at length the inadequacies of the selection process, the lack of training of officers, the lack of funds that are available to meet their needs to do the job properly and the differences in interpretations between state offices. The report raises a very serious concern about the adequacy of the purchaser-provider model in meeting needs, particularly in rural and remote regions. That is a fairly strong criticism of this competition policy gone mad, as we have seen in so many other areas.What we are seeing generally is a critique here of the transparency of the process, which raises very serious concerns that the Senate will have to look at, when awarding these contracts. I have to get to the detail, and I will be seeking a briefing from the department very shortly, but the lack of transparency suggests that there is a risk the department could miss out on providing bed places to newer players and there is a potential risk that the private nursing home industry could fall foul of anti-competitive practices. So I think there are very serious concerns that need to be looked at. I will be examining the report in more detail, but I recommend that other senators take an interest in this very important area.16:28:001416West, Sen SueSenator WEST1X4NSWALP00—This report by the Australian National Audit Office is very timely. It comes between the tabling of the draft report of the Productivity Commission into this subject and its final report, which I think is due in early January or February. A number of similarities in both reports relate to access to aged care by people in rural and regional areas and to the assistance that is needed by facilities in those areas to make sure that they remain viable and can continue to operate.Another point in the executive summary, the small leaflet that goes with the bigger document, concerns the targeting of places by region and special groups. It says that the Department of Health and Aged Care state officers use statistical data effectively to allocate new places between regions. However, the detailed local knowledge of project officers, which is an important supplement to the process, is diminishing through the loss of experienced staff and the reduced time that remaining staff have for direct community and industry contact. That is the complaint I keep getting all the time from within the aged care industry and other sectors that this government is dealing with.The government has taken the machete to the Public Service. It has been seen as a great thing to attack Canberra and reduce it and have fewer public servants. This government has forgotten that public servants do not all reside in Canberra. They are also in the regions.AW5CARRSenator Carr—The majority are outside.1X4West, Sen SueSenator WEST—The majority are outside. They are located in our capital cities and in our regions. They are in our provincial cities and towns. It is the local knowledge that they build up and bring to their jobs that is crucial when the provision of aged care is being addressed.The complaint I get is that they are always changing project officers and that nobody stays for any length of time. In New South Wales rural areas, they all hanker after the days when Hazel Teague was their project officer, because she had the time and knowledge. She travelled the bush of New South Wales. She knew her regions. She spent a lot of time talking to the people, particularly in those areas that were looking to build facilities. Because she had been in the industry and been a project officer for some time, she had experience that was necessary and essential to bring to the provision of aged care in regional and rural New South Wales. She knew what would and would not work in various areas. She knew who were reputable architects, builders and suppliers. She could give the sort of advice needed by the communities.Rural areas are not hugely profitable. In fact, some of the smaller places are almost not viable. They are run by community management committees. Hazel was able to nurture those committees and to encourage the growth of the individuals on the management committees. They experienced growth not only personally but as a committee, and they increased their management skills. She was able to help them make the right decisions. But because they have taken the machete and slashed indiscriminately through the Public Service, not just in Canberra but out in the regional areas, we have lost years and years of expertise and corporate knowledge.We see this in the comments of the National Audit Office in this report. It is a conservative and measured body. It says that the detailed local knowledge of project officers is diminishing with the loss of experienced staff and the reduced time that the remaining staff have for direct community and industry contact. This is obviously just another part of this continuing scene by this government. It is failing to consult properly with industry and organisations, and it is to be condemned for that. On previous occasions, I have condemned it, and I will continue to do so. We also note that it has concerns about the differing interpretations between the different states. That will always be an issue where you have a large organisation.It also has concerns about special needs groups. It recommends that the department provide clear directions to state officers to ensure that they are correctly interpreting the definition of persons who are to be considered in the special needs categories. It is very important that we become aware about the special needs categories. It is fine for the government to say that aged care is provided to everybody and that bed numbers are determined according to a certain percentage of the population over the age of 70. However, not everybody who requires aged care services has reached the age of 70. I have a constituent whom I have spoken about before. He is now about 56 or 57 and has Alzheimer's disease. It is a disease of ageing, but he has not reached the magical age of 70. That obviously has to be taken into consideration in the special needs categories.Another area of special need that we have not addressed and which this government will have to address concerns a group of people who already have disabilities. I think specifically of people with Down syndrome. We know it is now well recognised that the ageing process for people with Down syndrome commences earlier than for those people in the community who do not have it. We have to look very carefully at the provision of aged services for people with disabilities.We have done wonderful things in allowing them, encouraging them and teaching them to live more independently. That is fine. We are also encouraging and assisting them into employment. That is good. However, we have not addressed the next step, where that group of people will require assistance in their ageing because they have special needs.We are not yet looking terribly carefully or well at the aged care needs of the Aboriginal and Torres Strait Islander communities. What do they want? What suits their communities best? It is a question that this government needs to keep answering. It has not answered it correctly at this stage.I urge everybody to read recommendation 19. The Audit Office recommends that the department commence the selection of new providers as early as possible in the planning year in order to minimise delay in the provision of new places. The department's response is to agree. It states:However—there is always a `however'—the Department notes that the Minister makes places available for allocation in the planning process each year, and on occasion the timing of this approval must be subject to factors such as federal elections and budgets.One wonders: is the department giving us a bit of a hint here that in fact some of the recent announcements that we have seen for the provision of aged care services have been influenced by the recent federal election? I am not sure that I have proof of that, but it is an issue that I certainly will want to be pursuing and observing very closely.I think this is an important report. It is a continuation of the scrutiny of aged care provision in this country. Aged care provision has been very slapdash in recent times with the changes. Changes have been so frequent that the industry has had difficulty in keeping up with them, and obviously there have been so many changes in the Public Service that they have also had difficulty keeping up with them. We will continue as an opposition to monitor very carefully. We will continue to speak with the organisations in the industry and consult with them, which is obviously something that this government is not doing. I seek leave to continue my remarks later.Leave granted; debate adjourned.141814181418The ACTING DEPUTY PRESIDENT (Senator Watson)The ACTING DEPUTY PRESIDENT (Senator Watson)UNKNOWNUNKNOWNUNKNOWNUNKNOWN00—On behalf of the President and in accordance with the Auditor- General's Act 1997, I present the report of the Auditor-General: Report No. 20 of 1998-99—Financial Statement Audit—Audits of the Financial Statements of Commonwealth Entities for the period ended 30 June 1998 .Bills1418r614Billsr615Billsr61314181418O'Chee, Sen BillSenator O'CHEEEU4QLDNP10—On behalf of Senator Knowles, I present the submissions and Hansard record of proceedings relating to the report of the Community Affairs Legislation Committee on the Australian Radiation Protection and Nuclear Safety Bill 1998 and two related bills.Miscellaneous14181418Miscellaneous141814181418O'Chee, Sen BillSenator O'CHEEEU4QLDNP10—On behalf of Senator Crane, I present additional information received by the Rural and Regional Affairs and Transport Legislation Committee relating to additional estimates hearings for 1997-98 and the budget estimates hearings for 1998-99.Committees141814181418The ACTING DEPUTY PRESIDENT (Senator Watson)The ACTING DEPUTY PRESIDENT (Senator Watson)UNKNOWNUNKNOWNUNKNOWNUNKNOWN00—The President has received letters from party leaders and Independent senators nominating senators to committees.Motion (by Senator Minchin)—by leave—agreed to:That senators be appointed to committees as follows:Australian Security Intelligence Organization—Joint Statutory Committee—Appointed: Senators Sandy Macdonald, MacGibbon and Ray.Broadcasting of Parliamentary Proceedings—Joint Statutory Committee—Appointed: Senators Knowles and West.Community Affairs References Committee—Participating member: Senator Quirke.Corporations and Securities—Joint Statutory Committee—Appointed: Senators Chapman, Conroy, Cooney, Gibson and Murray.Economics Legislation Committee—Participating member: Senator Lundy.Economics References Committee—Substitute member: Senator Forshaw to replace Senator Conroy for the committee's inquiry into a new nuclear reactor at Lucas Heights.Electoral Matters—Joint Standing Committee—Appointed: Senators Bartlett, Faulkner, Lightfoot and Synon.Employment, Workplace Relations, Small Business and Education Legislation Committee—Participating member: Senator Lundy.Environment, Communications, Information Technology and the Arts Legislation Committee—Participating member: Senator Lundy.Environment, Communications, Information Technology and the Arts References Committee—Participating member: Senator Woodley for the committee's inquiry into the development of Hinchinbrook Channel.Finance and Public Administration Legislation Committee—Participating member: Senator Lundy.Foreign Affairs, Defence and Trade—Joint Standing Committee—Appointed: Senators Bourne, Chapman, Cook, Ferguson, Sandy Macdonald, MacGibbon, Margetts, O'Brien, Quirke, Reynolds, Schacht and Synon.Foreign Affairs, Defence and Trade References Committee—Participating member: Senator Eggleston.Migration—Joint Standing Committee—Appointed: Senators Bartlett, Eggleston, McKiernan and Tierney. National Capital and External Territories—Joint Standing Committee—Appointed: Senators Allison, Crossin, Lightfoot, Lundy and McGauran.National Crime Authority—Joint Statutory Committee—Appointed: Senators George Campbell, Denman, Ferris, McGauran and Stott Despoja.Native Title and the Aboriginal and Torres Strait Islander Land Fund—Joint Statutory Committee—Appointed: Senators Abetz, Crossin, Ferris, Reynolds and Woodley.Public Accounts and Audit—Joint Statutory Committee—Appointed: Senators Coonan, Crowley, Gibson, Hogg, Murray and Watson.Public Works—Joint Statutory Committee—Appointed: Senators Calvert, Ferguson and Murphy.Treaties—Joint Standing Committee—Appointed: Senators Bourne, Brownhill, Coonan, O'Chee, Reynolds and Schacht.Bills141914191419O'Chee, Sen BillSenator O'CHEEEU4QLDNP10—On behalf of Senator Eggleston, I present the report of the Environment, Communications, Information Technology and the Arts Legislation Committee on the provisions of the Broadcasting Services Amendment Bill 1998 , together with submissions and Hansard record of proceedings.Ordered that the report be printed.Bills1419r640Billsr639Billsr63814191419O'Chee, Sen BillSenator O'CHEEEU4QLDNP10—On behalf of Senator Knowles, I present the report of the Community Affairs Legislation Committee on the provisions of the Private Health Insurance Incentives Bill 1998 and two related bills, together with submissions and Hansard record of proceedings.Ordered that the report be printed.Bills1420r6001420Consideration resumed from 7 December.(Quorum formed)10000CHAIRMANThe CHAIRMAN—The committee is considering the Payment Processing Legislation Amendment (Social Security and Veterans' Entitlements) Bill 1998 and Australian Democrats request No. 1 on sheet 1179. The question is that the request for an amendment be agreed to.16:44:001420Harradine, Sen BrianSenator HARRADINE6H4TASIND00—I rise to speak in favour of the amendment moved by Senator Bartlett. That amendment will of course have the effect—if indeed it is accepted by the House of Representatives—of eliminating the two-year waiting period that is imposed on newly arrived residents. Many of those newly arrived residents are suffering an enormous penalty.I remind the chamber that in February of last year, when I spoke on this matter, I stressed the importance of the special benefit safety net payment. Indeed, on that occasion, both publicly and privately, the government assured me that it would have regulations in place to assist newly arrived migrants who were in hardship. I emphasise that point because the relationship between members of this chamber—and, indeed, members of the other chamber—and the government is rather important. We should be able to expect delivery on an indication when it is given. On that occasion, I was assured that the government would have regulations in place to assist newly arrived migrants in hardship.Honourable senators will recall that at that particular time the government did make some concessions in regard to family payments and so on, which they were not keen on, and that on the question of the special benefit it was somewhat hard-nosed. But the government did state that it would have regulations in place to assist newly arrived migrants. Since that time, I and a number of other honourable senators have been confronted with case study after case study of newly arrived migrants being denied special benefits, allegedly for not fulfilling the criteria. Yet it is obvious that these people are in great difficulty.While there is an exemption which enables special benefits to be paid if migrants have suffered a substantial change in circumstance, it appears that this exemption is restrictively applied. The guidelines, it seems, are too inflexible to incorporate the circumstances that may arise from time to time that result in destitution, distress and impoverishment for the people who are excluded and marginalised.Newly arrived migrants who are prevented from accessing this basic safety net payment are being denied rights which are really taken for granted in a reasonable society. According to the Welfare Rights Centre, many newly arrived migrants and their families are unable to buy sufficient food to eat, unable to access safe or suitable accommodation and unable to feed their children a nutritious diet. I interpose here by saying, `And the GST won't help.' Charities, already stretched to the limit, are struggling to meet demands on their services by people in this situation.In one case study which was provided to me, a New Zealand woman arrived in Australia with her partner on 21 April 1997. The woman was then seven months pregnant. Her means of support was her partner, who had brought with him $3,000 to support them and their child until he found work in the construction industry. The woman had only $100 with her. After a week, the client's partner left her and took her remaining $50. Without any money, the client hitched a ride into the city and was picked up by a woman who was concerned to see a seven-months pregnant woman hitchhiking. The pregnant woman lodged a claim for special benefits, which was rejected. Her situation did not fall within the criteria set out in the ministerial guidelines.The Acting Director of the Welfare Rights Centre, Linda Forbes, was quoted in the Sydney Morning Herald of 4 July 1997 as saying, `Immigration lets people in with very little money and then hits them. They don't even have the money to go back home.' The article, titled `Destitute on arrival', described those unable to access help as a `nascent underclass'. The Senate will recall that it was at my instigation that there was an inquiry into this matter. It will be interesting to revisit what was said in that inquiry by honourable senators from the opposition. They certainly saw the great problem that many newly arrived migrants have.I will quote some of the things that were said, for example, in the report titled The operation of the special benefit provisions relating to the newly arrived residents waiting period. In that report there are some very interesting comments made. I refer to the comments made by Senator Cooney in April 1998 in the Senate Legal and Constitutional Legislation Committee inquiry into the operation of the special benefit provisions relating to the newly arrived residents waiting period. He said this:The law's supporters say that hardship, distress, shortage of food and clothing, the inability to work, sickness and poverty do not in themselves provide an occasion for public assistance.That is Senator Cooney pointing to what the law in effect means. Then he goes on:Though the afflicted are Australian residents, they are too fresh here to justify support. Actual need ought to be the criterion for both public and private health.That is Senator Cooney's view—actual need ought to be the criterion for both public and private health. Hunger, ill health and penury do not visit their victims according to the length of time they have lived here.Having been provided with all of this information, having now before us the proof that this legislation, this two-year waiting period, is uncivilised and unworthy of a country such as Australia, I am pleased that we are revisiting it in this manner. I believe that, if it is not adopted here today and our request is not adopted by the House of Representatives, then the government will hear about it time after time after time, because we cannot allow these injustices to continue.I know the situation when the opposition was in power. It at least had a six-month period, which the government extended to a two-year waiting period. At least the opposition had a six-month period. I would be very surprised if the opposition would do anything but either support the proposition that has been put forward by Senator Bartlett or at least amend it with regard to the six-month provision. I quote from a debate going back as far as 25 November 1996 when none other than Senator Bolkus had this to say:There are some changes that the government has picked up as a consequence of the deliberations of the Senate committee that we accept but there are some government amendments that we deplore—amendments, for instance, which extend the two-year waiting period to yet another class of visa holders . . . I believe the Senate has an opportunity now to take action to ensure that we will be able to provide those newly arrived migrants who are destitute with the minimum of justice which is expected of a society that has any claim of being civilised.16:56:001421Evans, Sen ChrisSenator CHRIS EVANSAX5WAALP00—I want to indicate on behalf of the Labor opposition our position in relation to the Democrat request. We will not be supporting this request. I think Senator Harradine has made an important contribution to the debate and has spoken with great feeling and sincerity about the issue. The Labor Party, however, took a slightly different approach.Senator Harradine very correctly pointed to the referral of the application of the two-year migrant waiting period to the special benefit to the Senate Legal and Constitutional Legislation Committee earlier this year after the Democrats moved an amendment similar to the request before us today in the context of the youth allowance legislation. The committee released its report on 2 April this year. Labor senators, in the report Senator Harradine referred to, expressed their concerns about the issue in their additional comments to the report. They concluded that the policy and its implementation must be kept under review and suggested that they be subject to a major independent review after the provisions have been in effect for two full financial years.The Labor senators further suggested that that review address the overall effects of the provisions and also specific barriers to employment for people subject to the rule, the amount of employment assistance being provided to people subject to the rule by the Job Network, the economic and social costs caused by the rule and the quality of the advice given to migrants before they depart for Australia in terms of job opportunities and social security entitlements in Australia. We think those recommendations are very sensible and are a way of dealing with the issue in a constructive way.Senator Cooney went somewhat further. No-one has more respect for Senator Cooney in this place than I. He is a very compassionate man, but on balance the Labor Party is of the view that the government ought to pursue the suggestion made by the Labor senators in their additional comments and establish an inquiry as soon as possible after the second anniversary of the introduction of the two-year rule to properly assess the impacts of the rule. There have been serious concerns raised about the impact of the rule. Senator Harradine raised those concerns quite properly again today.The Labor Party is saying in this context that we will not be supporting the request in this form today, but we do think there are reasons why the government ought to initiate that inquiry and have a proper assessment of the impact of the rule. We urge the government to adopt that course. But, as I indicated, we will not be supporting the request of the Democrats.17:00:001422Patterson, Sen KaySenator PATTERSONLI4VICLP10—I indicate that the government will not be supporting the request of the Democrats. I reiterate that the two-year newly arrived residents waiting period measure was enacted following extensive debate in the Senate in September 1997. The parliament agreed to include special benefit for the two-year newly arrived residents waiting period.Earlier this year, the Senate rejected amendments proposed by Senator Bartlett similar to the request he is now making. This would have had the effect of exempting newly arrived residents from the migrant waiting period in relation to special benefit. As has been mentioned, the Senate at the time did, however, refer the operation of the migrant waiting period position in relation to special benefit to the Senate Legal and Constitutional Affairs Legislation Committee for inquiry. The committee concluded:. . . that there is currently no need to vary the provisions regarding access to Special Benefit, given the exceptional circumstances regime.It is important to note that the migrant waiting period changes were introduced to ensure that migrants and/or their sponsors, not the Australian taxpayer, provided their own support during their first two years in Australia. I refer to the example that Senator Harradine gave of the couple from New Zealand. I might ask why a couple may have come with so few resources. I would think very carefully about moving to New Zealand with so few resources, and I believe they have just introduced a two-year migrant waiting period as well. People coming to Australia do have an obligation to think very carefully about whether it is the right decision. We are not talking about refugees, who are in a different category and who are treated differently; we are talking about people who voluntarily choose to migrate to Australia.The Department of Family and Community Services has worked with the Department of Immigration and Multicultural Affairs to ensure that text about migrant waiting periods is included in general brochures and other information held at overseas posts for prospective migrants. It may be necessary for the government to look more closely at how well they are informed, and I admit that that is something that may need to be looked at.Migrants in the preferential family and concessional family categories have been sponsored to come to Australia. People have made a commitment that they will be able to support them. The two-year waiting period ensures their sponsors meet their obligations to support the people they sponsor. It is no good people saying they will sponsor them and then not being required to meet that obligation.Skilled and independent migrants can reasonably be expected to support themselves through the resources they bring to Australia. There is a safety net in place for those migrants whose circumstances change after they arrive in Australia and, as a result, are unable to support themselves through the resources they bring to Australia. So there is a safety net if some catastrophic event occurs or some untoward event happens. This policy is in line with community expectations. I believe it has been supported by the general community.17:02:001423Bartlett, Sen AndrewSenator BARTLETTDT6QLDAD00—I will not extend the debate greatly. I am obviously aware of the numbers, but I would like to get a couple of comments from the minister. I had a bit of a disagreement with Minister Newman during the election campaign about the cost of this measure. Last time it came up in this chamber, I thought the cost suggested by the government was around $19 million, but a different suggestion was put forward when the Democrats raised it during the election campaign. Can you just clarify that for me, if you do not mind?17:03:001423Patterson, Sen KaySenator PATTERSONLI4VICLP10—I am not in a position to give you that information. I do not know what Senator Newman said, but I will make sure that Senator Newman's attention is drawn to this part of the Hansard and I will ask her to respond to you as soon as possible.17:03:001423Bartlett, Sen AndrewSenator BARTLETTDT6QLDAD00—In relation to the comments you were just making about there being a safety net, I recognise that, in terms of the way the wording of the current legislation is drafted, that is a potential interpretation. But I draw your attention again to the many case studies such as the one to which Senator Harradine referred, which I am sure the minister and her advisers, if not you yourself, have seen, and to the article in the Sydney Morning Herald which I mentioned last night in this debate, which contained any number of case studies. I ask for an indication from the government: are you completely confident that all the case studies that were brought up in that article, for example, are not accurate?17:04:001423Patterson, Sen KaySenator PATTERSONLI4VICLP10—I would never rely on the veracity of stories in the press. I do not know the circumstances of the individuals in those articles. I believe we have a system which is equitable. I believe we advise people through the material that there is a two-year waiting period. They make a decision to come here. There is information available in that material on the cost of living in Australia and on employment issues, and there is a safety net.For those people who make a decision based on that information, and for those people who have genuine sponsors—and I reiterate that we are not talking about refugees; we are talking about people who choose to come and live here either as skilled migrants or people who are guaranteed of assistance by sponsors—it is a fair and equitable system.17:05:001423Bartlett, Sen AndrewSenator BARTLETTDT6QLDAD00—By way of final comment, one of our important roles as parliamentarians and representatives of the people is to try to listen to the evidence that is presented by people in the community and the people who actually have to deal with the reality that is out there. I just cannot accept that the government, or the Labor Party for that matter, does not believe all the evidence that has been presented not just in this newspaper article but by people in community organisations who have to pick up the pieces and deal with the impacts of the legislation that we pass. Effectively, by taking that position, the coalition and the Labor Party are saying that all those people basically do not know what they are talking about.This matter was referred to a committee for a fairly brief but nonetheless informative hearing. Again, I thought that enough evidence was presented to the committee that showed that there is a problem out there, that the safety net is not working adequately, that many people are suffering immense hardship. I do have to comment. I realise Senator Evans is just a representative in the chamber and perhaps may not be the primary decision maker in relation to Labor's backflip on this measure but, given that he is the representative here, I will have to direct my comments to him.As Senator Harradine pointed out, Labor has gone from deploring this measure to supporting it—and supporting it now that the evidence of the hardship it causes is on the table. Labor is basically saying, `There have been serious concerns raised, but we'll ignore them. We'll have an inquiry down the track.' It is saying to all those people who are suffering now, `You can just wait. We'll have an inquiry and maybe by then the evidence might come out that this hardship is there and we'll address it.' I do not know how much more evidence you need. There may be any number of reasons why these people are suffering hardship. I do not think it is an issue of fault; I think it is an issue of need. These people have a clear need.Senator Patterson indicated that we did have an extensive debate on this measure, and we did. As Senator Harradine said, the measure was agreed to by the Senate, by a small majority—agreed to only after a guarantee from the government, and that guarantee clearly has not been fulfilled. That may not be deliberate on the part of the government—I am not suggesting it is—but it is clearly a reality that that guarantee has not been fulfilled and that therefore we as a parliament are saying, `We don't care; we're ignoring the hardship that is out there.' We are basically saying to people who do run into hardship, `Well, gee, you're pretty stupid. You should have thought about that before you came here.' I am sure it makes them feel a lot better to get that message from the parliament.Never again can the ALP credibly accuse the coalition of chasing the Hanson vote and not be tarred with that same brush. We had an election where the policies of One Nation were soundly rejected and yet, following that election, Labor has gone back on the position it took via a vote in this chamber leading into that election. So, in effect, Labor has hard ened its position against migrants and is too scared to be seen to be different from the government—not wanting to give the government an opportunity to position itself as being tougher on migrants than the ALP. I think that is an absolute disgrace.17:10:001424Harradine, Sen BrianSenator HARRADINE6H4TASIND00—I believe the response by Senator Patterson to the question asked of her by Senator Bartlett was totally inadequate. For the minister to virtually say that they have not given a damn about the particular cases that were revealed in the Sydney Morning Herald paper is not a response which one would expect from Senator Patterson.I think you ought to remember why this measure got up, because you have forgotten. There were statements made publicly and privately by the government that regulations would be in place to assist newly arrived migrants suffering hardship. I remember that very well. I do not stand here and say that I remember everything, but that I do remember. One would not expect a person representing the government that gave those undertakings to come in here and virtually ignore what is being suggested. Senator Patterson should at least have a look, or have the department take a look, at those particular cases that were outlined in the Good Weekend Magazine in the Sydney Morning Herald. For a representative of the government to come in here and virtually say, `We are not sure what they do or what they are,' is nothing less than a disgrace.Senator Patterson, representing the government, owes it to the Senate—if the government does not owe it to me, it at least owes it to the Senate—to respond. And I have a good memory with respect to those matters. Senator Patterson should also respond to this question: will there be a thorough investigation into how the provisions of the legislation are applied to those newly arrived migrants who find themselves suffering great hardship? I will be listening extremely carefully to what Senator Patterson says about that and about whether there will be a thorough examination of how the provisions of the legislation in this regard are being applied and whether there are people falling through the net. As I said, there is case study after case study where that has proven to be the fact. Unless you have a very restrictive interpretation and application of the provisions of the legislation, these people are left destitute.I guess that the Labor Party still ultimately sticks with its `at least six months' approach, and I agree with what Senator Chris Evans says—that the statement was made by a number of those who were on that Senate inquiry, believing that there should be a thorough examination of the matter after two years of the legislation being in effect. The legislation came into effect on 4 March 1997. Is it the intention of the government, if it is not already doing so, to undertake a thorough examination at least in that two-year period?17:15:001425Patterson, Sen KaySenator PATTERSONLI4VICLP10—I respect Senator Harradine, but I was a little shocked by the fact that he said that I did not care—that I had not `given a damn' were his exact words. I did not say that. I just want to put on the public record that I said, in responding to Senator Bartlett's comments about individuals referred to in a feature article in a newspaper, that I did not always trust the veracity of reports in a newspaper. I do not have any personal experience of such cases. I have not had constituents coming to me indicating that they are affected by these measures.But I do say again that these people have migrated to Australia either with sponsors or as skilled and independent migrants whom the Australian public reasonably expect to support themselves. There is a safety net to deal with those people whose circumstances change—some event occurs with regard to their sponsors or they come with assets and for some reason unforeseen circumstances occur. I do give a damn, but I also believe that people have a responsibility when they come here to know what the rules are. Also, we have to have some integrity in the system, and I believe that the system currently is fair and equitable.I will pass on Senator Harradine's comments about a review. We are constantly reviewing. I know Senator Newman, in particular, constantly reviews issues. I have taken on board what Senator Harradine has done, and with my other hat on, as Parliamentary Secretary to the Minister for Immigration and Multicultural Affairs, it may be appropriate that we do more to inform migrants before they come that there is a two-year waiting period and to ensure that they are very clear about the role and responsibilities of sponsors. I will make a commitment to look at that because I think that is important.I do not want to see people here unable to support themselves. But I also think there is an obligation on the part of the migrant coming to know what the requirements are. There is an obligation on us to tell them about the requirements. There is an obligation on them to meet us halfway. We have done that by providing a safety net. I know that Senator Newman will continue to review all her programs as well as this one.17:17:001425Bartlett, Sen AndrewSenator BARTLETTDT6QLDAD00—It is worth emphasising, particularly for those who are listening to the debate, that this amendment does not reverse the two-year waiting period as a whole; it simply removes its application from special benefit payment. It is probably worth emphasising, which I did not do earlier, that that payment is the payment of last resort. It is very restrictive. It has the most ruthless income test in the country. It is something that people are not able to access unless they are already destitute.The existence of this measure introduces the concept of blame and applies it only to people who are newly arrived residents. They are residents; they are not illegal migrants. They are not people who came here under false pretences. Again, the fact that it only applies to special benefit means that it is not an expensive measure. It does not compromise the integrity of the system that Senator Patterson upholds. In my view, it is far more economically sensible to make this small amendment, which is not very expensive, than deal with the very real impacts that are having to be dealt with out in the community. I would suggest the cost to us even in dollar terms, let alone in human and social terms, is far above that.Whilst I recognise the government's indication that they are monitoring the operation of this, I cannot see how that can be being done very effectively if they are not aware of the impact of this. One only has to talk to the people who have to work with these people and pick up the pieces and deal with some of the suffering that is highlighted. It is not just highlighted in a newspaper article—I referred to that mainly because it is a good summary—but in evidence that has been provided time and time again by groups in the community who have to deal with this situation. Not surprisingly, they get very emotional because they find it difficult to believe that people are being put in such enormous hardship. The only response from us as a nation is: you should have thought it through a bit better before you moved here. I think that is an inadequate response as a nation, to put it mildly. Question put: That the request for amendment (Senator Bartlett's ) be agreed to.17:26:00The committee divided. (The Chairman—Senator S. M. West)10Allison, L. Bartlett, A. J. J.Bourne, V.* Brown, B.Harradine, B. Lees, M. H.Margetts, D. Murray, A.Stott Despoja, N. Woodley, J.48Bishop, T. M. Boswell, R. L. D.Calvert, P. H.* Campbell, G.Campbell, I. G. Carr, K.Collins, J. M. A. Conroy, S.Coonan, H. Cooney, B.Crane, W. Crossin, P. M.Crowley, R. A. Denman, K. J.Eggleston, A. Evans, C. V.Ferguson, A. B. Ferris, J.Forshaw, M. G. Gibbs, B.Gibson, B. F. Heffernan, W.Herron, J. Hogg, J.Hutchins, S. Kemp, R.Knowles, S. C. Lightfoot, P. R.Lundy, K. Macdonald, S.MacGibbon, D. J. Mackay, S.McGauran, J. J. J. Murphy, S. M.O'Brien, K. W. K. O'Chee, W. G.Parer, W. R. Patterson, K. C. L.Payne, M. A.Quirke, J. A.Ray, R. F. Reynolds, M.Sherry, N. Tambling, G. E. J.Tierney, J. Troeth, J.Watson, J. O. W. West, S. M.Question so resolved in the negative.Bill, as amended, agreed to.Bill reported with amendments; report adopted.1426Bill (on motion by Senator Patterson) read a third time.Bills1426s187Billss1881426Debate resumed from 25 November, on motion by Senator Ian Campbell:That these bills be now read a second time.17:30:001426Bishop, Sen MarkSenator MARK BISHOP2L6WAALP00—Sometimes in the life of organisations, companies, public authorities, not-for-profit entities and a range of public and private institutions they become tired and listless, cease to function properly, no longer fulfil their purpose, are superseded by technological developments or just become irrelevant, unnecessary and redundant. It is often appropriate in some or all of those circumstances to radically alter the particular organisation to give it a new or different purpose. Oftentimes that purpose is achieved by sale to a new owner.Most of that change process has already occurred in the National Transmission Agency. Some years ago, the NTA was an organisation characterised by low staff morale, high turnover, a dissatisfied client base and non-fulfilment of capital works. Since its establishment as a separate agency some years ago, the improvement has been little short of dramatic. A few examples highlight the quality of this organisation at the present time and demonstrate how efficient it has become. Last year's draft annual report indicates that the following has happened in the NTA. There has been a permanent reduction of network operating costs by $26 million without affecting the quality or reception of ABC or SBS services. The network has grown rapidly from 1992 until 1997. The number of transmitters has grown from 862 to 1,197.In a period of operational cuts and radical management restructure, 54 new transmissions have been established, extending the services to a further 1.3 million people. The ABC youth radio Triple J has extended to a further eight regional population centres and SBS has extended its coverage to two additional major regional areas. The average age of transmitters is only seven years and the average life is now 15 years. There has been considerable improvement in the average age of the transmitters in the period 1992 to 1997, reflecting ongoing capital investment.All of these efficiencies have been achieved despite massive budget cuts and a decline in capital expenditure from $54 million in 1993-94 to $30 million in 1996-97. In the last five years, the NTA has undergone the following: corporatisation, radical management transformation, permanent reduction of network operating costs, extension of radio and TV services, an increase in the size of the network, and an improvement in the age of the capital stock. In short, efficiencies have been gained, costs reduced, the value of the organisation increased and government funding requirements reduced. In short, it has become an efficient and effective agency.Notwithstanding this background and how the NTA has grown into a relatively efficient and capable organisation, one questions what value is gained from these bills through the privatisation process of the NTA. The government has to date advanced two separate arguments for the privatisation of the NTA. Firstly, the proceeds gained from the sale will be used to further reduce the levels of public debt. Secondly, the national broadcasters will be able to establish a more commercially based relationship with transmission service providers and will have greater control over service levels and planning of new services.With respect to proposition one, the opposition observes that Commonwealth debt levels are at historically low levels, interest repayment costs are down and getting lower and selling off assets below their replacement cost is an odd way, in the scheme of things, of reducing debt. In respect of the ABC-SBS position, the opposition observes that, in recent years, the ABC and SBS campaigned to own the National Transmission Agency—not sell off another arm of government—as a way of improving their commercial client and service focus.Indeed, one responds to this argument by pointing out that this government has cut the budget of the ABC in recent years. The ABC and SBS, whilst fully funded for the five years for the cost of transmission services, will now have to deal essentially with a private monopoly in large areas of Australia. One presumes that both the ABC and SBS have factored this into their planning post the first five-year period. In any event, maintenance of currently mandated CSOs is one matter, but removing the NTA from public hands to private hands prevents the development of further worthy initiatives in this area.In summary, the opposition says that the NTA has successfully restructured itself internally in the last five years to be an efficient and effective organisation and should remain in public hands. The government's arguments concerning debt are not sufficiently strong and are rather benign to persuade us to alter our position in a good economic environment of five per cent growth. The position of support of the ABC and SBS is not persuasive to the opposition because of stronger arguments concerning the consequences of transferring service oriented public monopolies to profit motivated private monopolies in many parts of regional Australia.In substance, I am advised by the government that the current bills are the same as the 1997 bill with only technical changes. I thank Senator Ian Campbell for providing a copy of those technical changes to the Labor Party last week. The amendments in these bills have been considered in that light. The principal reason for opposing these bills is that we believe they are not in the national interests. In this context, I refer to page 7 of the minority report which said that CSOs were much more limited than those currently in existence and do not provide any guarantees on issues of charging, access price issues and fear of closure by commercial broadcasters if the full market rate or above market rates are extracted by the new private owner.We are concerned about transmission services to rural and special interests. The bills require no guarantee with regard to maintenance of services in rural and regional areas. Again, we are fearful of the consequences of market decisions and their impact in rural and remote areas.Finally, two other issues need to be addressed. Firstly, there is the issue of digital transmission. We have received correspondence and been lobbied by the ABC on this issue. We have received amendments and a background brief from the Australian Democrats which outlines their position on the issue of digital access.The cost of conversion from analog to digital, we are told, is in the order of $180 million to $200 million. It is the system of the future and requires huge injections of capital to maintain the ABC's and the SBS's relevance so they are able to compete with commercial broadcasters and serve their own particular markets.The ABC is of the view that the first bill allowed it access to digital transmission. However, a close reading of the EM to the first bill suggests it was always the government's intention that the bill only apply to analog. The first bill perhaps did not make that position as clear as it could have. The current bill does make it clear that it does not apply to digital and it only applies to analog transmission. That is further confirmed by correspondence from Senator Campbell to me last week. This means the ABC will have to make separate arrangements for access to the new digital system. Essentially, the ABC will be left to its own devices in five years time. The ABC—and the SBS, presumably—and other community broadcasters will have to negotiate separately with the new owners of the National Transmission Agency. This obviously has implications for funding and requires a commitment to resourcing on the part of the government. We will be seeking undertakings from the government and asking questions on this issue in the committee stage of the bill. I foreshadow that the opposition will support the amendments circulated by the Australian Democrats to establish a fund in order that the proceeds of the sale, if successful, fund national and community conversion to digital terrestrial broadcasting.There were some earlier comments foreshadowing limitations on the continued reliance on CSOs by community or public groups other than those specified in the bill. The Democrats amendments seek to broaden that list to additional groups: emergency service operators, commercial broadcasters in declared remote areas, non-profit bodies and government bodies. I presume it includes any bodies that come under those headings. The opposition will support the Democrats amendments.In summary, the opposition opposes the bill and will vote against it at the relevant time. We believe this organisation has much value and that it should remain in public hands as an effective organisation in its own right. We do not believe the range of community and government organisations that provide services—often essential services—in this area in much of regional Australia should be left to the vagaries of the market. Finally, we believe the ABC and the SBS should be guaranteed funding for digital conversion and not left to cope with old and dated technology.17:40:001428Lundy, Sen KateSenator LUNDY7G6ACTALP00—As my colleague has outlined, the Labor Party will be opposing the National Transmission Network Sale Bill 1998 and the National Transmission Network Sale (Consequential Amendments) Bill 1998 . There is a very good reason for our opposing these bills: these measures seek to sell off what is an essential and crucial part of Australia's communications infrastructure—infrastructure that provides metropolitan, regional and rural Australia with their broadcasting services.These bills seek to sell off the assets that are currently managed by the National Transmission Agency, owned by all Australians and managed for the good of all Australians. The National Transmission Agency can be held up as an impressive organisation. It is, in fact, one of the world's largest broadcasting facilities. The assets of the NTA include 1,197 transmitters, used to broadcast the ABC and SBS radio and television services right around the Australian continent. Perhaps that gives us an insight as to why this government is selling the network: with what they are doing to the ABC and SBS, there probably will not be too much to broadcast soon.The NTA facilities also accommodate 503 transmitters belonging to licensed broadcasters and more than 1,000 radio communications transmitters. Why is it that Australia has such an impressive and large broadcasting infrastructure network? Because, unlike this current government, some former administrations have had foresight, commitment and the understanding of why it is so important for a vast country such as ours to have such a network—a network that is managed by government to ensure that broadcasting services are available to everybody. This egalitarian approach by previous Australian governments has really put this whole issue into perspective and is one point of great contrast between the current government and previous governments.Of all the assets that the NTA manages, there is one component that is invaluable, and that is the people who work there. It is a credit to them that the NTA has been able to play such an important and critical role, one which has become more and more admirable over the years. It is because of the dedication of those who work there that we have seen the NTA go from strength to strength with more efficient services, with the people who work there clocking up some very impressive achievements along the way.It is because of the NTA's excellent performance in recent years that there can be no argument or justification for the government to be bringing these bills before this place. It is not as if the NTA has not been performing. The government would not even release the scoping study to the opposition, and I think that this point highlights more than ever how this government operates. It is one thing to attempt to justify certain actions; it is another to pursue with blind ideology a privatisation campaign that just does not make sense. How is this parliament able to decide whether this government is proceeding down the best route if they will not release this information? How will we know they are acting in the public interest? Does the government expect us to do it on trust? I have to say that this government does not deserve the trust of senators in this chamber or of the Australian people, because I believe that we will all pay a hefty price for these measures in the long run.We have concerns with many aspects of these bills and I would like to go through some of them. Although the bill guarantees access to the NTA facilities for the ABC and SBS for the next five years, there is very little information as to what will happen after those five years. Imagine the difficulty that the national broadcasters are going to be in when they seek to negotiate with a company, or perhaps even a series of companies, which will have a clear monopoly over transmission facilities and the transmission network. I am also quite bewildered as to how some senators on the opposite side of this chamber, who claim to represent rural, regional and remote Australians, are supporting these bills considering that they contain no guarantees regarding the maintenance of services in rural and regional areas. While some members of the government have made certain claims that the contract with the purchaser of the network would look after these matters, this guarantee must appear in the bill if we are to have any faith that the government and the new owner will meet these obligations of looking after those in the bush. We have seen through harsh experience in both the estimates and other processes in this place that commercial-in-confidence presents an impenetrable shroud for many of the issues contained within contracts with the providers of services that were previously delivered by government and that are now in the hands of the private sector. Whilst ever this barrier of commercial-in-confidence and lack of public accountability exists, we would be very foolish to believe the government and their flimsy guarantees.It is not political rhetoric stating how important the NTA is to rural Australia. On recent visits to places like Cootamundra, Boorowa and Young in this region, access to broadcasting and communications infrastructure was one of the main issues that were raised with me by both shire councils and community groups. I was surprised at the vehemence of their representations on these issues, but I should not have been because communications and access to information infrastructure—such as that provided by the NTA—is really what keeps the bush alive. It gives them the opportunity to keep in touch with what is going on. With converging technologies where digitisation will bring together both the methods of delivering entertainment—across TV sets and through the use of the Internet—the issue of where this infrastructure is placed and how it is managed will be absolutely critical to not only the communication networks but also the potential economic growth of rural and regional Australia.Many times over the last two years it has been the Australian Labor Party who have highlighted the concerns of regional Australia with this government's narrow and small-minded agenda. The sale of Telstra, the cuts to the ABC and the resulting reduction in regional services all stand to paint a very comprehensive picture of withdrawal of a government services presence from rural and regional Australia. This is just another incremental step in that government withdrawal from supporting those Australians who do choose to live outside metropolitan areas.I ask: where are those supposed voices of rural Australia opposite? I do not hear them speaking up for the bush when this government is making a decision that will affect the people in rural and regional Australia most significantly. Nonetheless, the Labor Party will continue to stand up for people of rural and regional Australia and oppose this bill, even if National Party senators will not.The problems with these measures do not just stop with the risk they run with regional Australia's broadcasting services. There is nothing in this bill to guarantee that the current policy objectives of the National Transmission Agency will be maintained. While this bill does contain some limited community service obligations, these are much more constrained than those that are currently in existence.How ironic that when the government is deciding to sell off Australia's broadcasting infrastructure they actually reduce the community obligations on those who will control the transmission network. Are we going to experience the same backlash that was experienced with Telstra in the face of one-third privatisation where the services dropped to such a point that, in the recent election campaign, the government was forced to beef up its rhetoric in order to improve that delivery of service? With respect to the SBS and ABC, the minister claims that a compact will be drawn up with the two broadcasters which will spell out what the coverage and quality expectations will be for those who own the national transmission network. The government claims that in return it will be covering the cost of transmission contracts for the next five years. I assume that that undertaking is as good as Minister Alston's undertaking a couple of years back when he guaranteed that ABC funding would be maintained. When you look at the financial detail you will see that there are many questions left unanswered with respect to this bill. These are the reasons why we remain very concerned about its impact.I do not believe the government has made a case for privatising and selling the National Transmission Agency's assets. It is very difficult for anyone to claim that the NTA today is an inefficient organisation or does not do what it was established to do. The NTA has, over the last few years, dramatically expanded its network, resulting in the substantial expansion of radio and television services to regional Australia.The expansion of the network since 1992 has facilitated an extra 1.3 million Australians having access to national radio and television services. ABC services alone have been extended to a further 468,000 Australians over the last six years, with 453,000 Australians also now having access to SBS television. This is simply because of the dedication of the team at the NTA in achieving their charter—and of the former Labor government in providing the appropriate levels of support—to expand the network. This dedication for improvement of services is sadly lacking from this government and will certainly be absent from the private sector. Like Senator Hill and many others who have made such a claim, I am a keen listener of Triple J. One of the great achievements of the NTA through its expansion of the network has been facilitating the broadcast of Triple J to the regions. Triple J has been revolutionised as a result of regional broadcasting and has acted not only as a wonderful new service to young people in rural and regional Australia but also as a form of communication between the youth of metropolitan and rural Australia.Triple J's series of `Unearthed' concerts have been a great example of how people in our cities have been exposed to the great Australian music in rural and regional areas. The Labor Party believes that the ABC and SBS should continue to be able to use the facilities of an organisation that is owned and controlled by the Commonwealth of Australia. It is an organisation that has been committed not only to expanding its services to all Australians but also to maintaining a modern network. The NTA has successfully done both.The NTA understands how important it is that a network of this size has equipment that remains relatively up to date to ensure maintenance costs stay down and service quality stays up. Because of this dedication of the NTA management and staff, it has been able to make these dramatic improvements. As I said previously, these have resulted in the delivery of a first-class, efficient service to both national broadcasters and taxpayers—a service which has been very good for the Australian community.There are so many issues with respect to this bill. Another is local community radio stations. If any local community radio or television stations are shut down as a result of the government's decision to privatise the NTA, then it will be a backward step for the community and the broadcasting industry, particularly considering the very vibrant role that community broadcasters have played in Australia. It will also represent a winding back of the diversity currently contained within the radio content that is available in this country.Community radio has played an excellent role right across the country in promoting far wider views and different music formats, and it has given access to radio to many Australians who otherwise would not have had it. There are some very good examples of that in my own community with the local community stations. If they were expected to pay full commercial rates for access to these transmitters, then I expect many of them would be forced to close down, and that would be an absolute tragedy and terrible loss for the community.This bill is simply designed to facilitate a grab for cash by the government. It is a grab for cash that will put at risk the integral part of Australia's broadcasting infrastructure. It is a grab for cash that shows how persistent the government is in its mindless drive to privatise public assets.We will all pay a very high price if the NTA is sold off. There is no doubt that communications infrastructure of this nature is absolutely essential to the quality of our lives in the future. With the convergence of communications infrastructure and different forms of entertainment and access to information, every government has a responsibility to ensure that no Australian is at a disadvantage, and you cannot do that if you dispose of all of your assets in this area and just rely on the contents of a hidden contract—a contract that is not available for public scrutiny and, therefore, not able to be given the public interest test as to the merit or otherwise of giving to a private owner what was previously public infrastructure.All Australians will ultimately pay a price for this government's agenda. In closing, I remind those senators opposite who purport to represent rural and regional Australians that, once again, it is those Australians who are likely to be most disadvantaged by this piece of legislation.17:56:001432Crossin, Sen TrishSenator CROSSIN7Y6NTALP00—The National Transmission Network Sale Bill 1998 seeks to sell assets that are currently contained within the National Transmission Agency. I rise to speak in this debate, coming from one of the largest geographical and most dispersed electorates in this country. The bill proposes to sell off one of our assets for what the opposition sees as no apparent sound reason other than, as my colleague Senator Lundy said, to make a grab for cash. There is no reason to sell it, especially when you look at the kinds of services this agency provides to people in my electorate.The NTA is one of the world's largest broadcasting facilities. It has 1,197 transmitters that are used to broadcast specifically the Australian Broadcasting Corporation and the SBS radio and TV right around Australia. Its facilities also accommodate 503 transmitters belonging to licensed broadcasters and more than 1,000 radio communications transmitters.The NTA is a very important organisation and it has performed its role more than adequately over the last few decades. Because of the NTA's excellent performance in recent times, the government has no argument for bringing these measures to sell off the agency before the parliament. This bill does not provide any guarantees about long-term access to the NTA facilities. It does not provide any guarantees about maintenance of services in regional and rural Australia. It provides no guarantees that the current policy objectives of the NTA will be maintained.The NTA is an efficient organisation and over the last few years it has expanded its network. In June 1992, the NTA's predecessor was looking after 862 transmitters broadcasting national services. But by June 1997, there were 1,197. It has only been in recent years that people in Darwin have enjoyed watching SBS. That is something people down here have long enjoyed. When senators on the other side of the House bring these sorts of bills before us, you forget that there are still parts of Australia that are trying to catch up with what cities on the eastern seaboard have had for many years.The expansion of these services has seen SBS television provided to another 453,000 Australians, and the NTA has dramatically extended its network, particularly in rural and regional Australia. I particularly want to talk about the expansion of Triple J. When you go out to a remote Aboriginal community in the Northern Territory, you find there are two things that people generally listen to. In fact, there are only two things they can generally listen to: Radio Australia or Triple J. If you are a young person in that area, you rely very, very heavily on Triple J.I remember when the Australian broadcasting cuts were first initiated by this government 2½ years ago. There was a deluge of calls and representations in the Northern Territory by young people, particularly in remote communities and particularly by young Aboriginal people. They made many pleas that at least Triple J be not cut or axed. It is in fact their lifeline to what other youth are thinking. It is their lifeline to find out what goes on in the world and to feel in remote parts of Australia that at least they can be in touch with what happens with other youth around this country. I am sure that young kids in the bush in the Northern Territory would not have dissimilar views about the role that Triple J plays in their life if they lived in Queensland or Western Australia.The expansion of Triple J has revolutionised Triple J. It has been good not only for listeners in the bush but also for the nature of the service that Triple J provides to its listeners in capital cities. Senator Lundy commented on its Unearthed concerts and its CDs. It not only allows city people to have better access to terrific Australian music; it is a vital link for youth in rural and regional areas.I am concerned that a private operator would not have a commitment to maintain the infrastructure on a national basis. Remote transmission facilities in regional and rural areas would not be maintained at the same levels as those facilities serving dense population areas. There is nothing in this bill that commits or locks in the maintenance of those levels and facilities.Services to rural and regional areas have already been reduced. There is a risk with this bill that those services will be further reduced. The bill contains no guarantees regarding the maintenance of service in regional and rural areas. There is a risk that commercial programming and services could be prioritised to the detriment of the ABC and SBS. Although the bill guarantees access to NTA facilities for the ABC and SBS for the next five years, there are no guarantees after this period. It is possible that the ABC will have to dip into its programming funding, effectively reducing the ABC budget further.There is also no guarantee that there will be a further expansion of the network into regional and rural areas. In the past few years, the network has expanded into regional areas, as I have said before, taking Triple J, ABC TV, SBS and Radio National to new audiences. The value to remote communities is self-evident. In many cases, the ABC and SBS are relied upon as the main media and information links to rural and regional areas.There is no argument for privatisation. Over the last five years, the NTA has expanded the transmission network by about 40 per cent while reducing costs by about 30 per cent. Further, the cost to the government for funding the network has been reduced as far as possible. There are no further efficiencies to be found. That was confirmed by the NTA's general manager, Vic Jones, in his draft report of 1996-97.The government has been unable to provide information as to why the network should be privatised. It appears that the retirement of public debt is the rationale. The cost to rural and regional communities outweighs this rationale. The government has shown no regard for the long-term delivery of services to rural and regional areas. I do not accept that the sale will lead to any economic or social efficiencies. As I have said previously, the National Transmission Agency has achieved substantial efficiencies over few years.In summing up, I think it is imperative that we put the interests of rural and regional areas before this chamber. As I said, this bill provides no guarantees regarding the maintenance of those services in rural and regional areas. It provides no rationale for the sale of this network. The bill is nothing more than a capricious effort to sell off public assets for outdated ideological reasons. There is no regard for the long-term future of national and community broadcasting or the delivery of services to rural and regional areas. The government has not provided sufficient information in relation to the compact with national broadcasters, the anticipated sale price or the benefits to the nation. It is for this reason, on behalf of rural and regional Australia, that at least my party on this side of the chamber recommends that the bill not be supported.18:04:001433Harradine, Sen BrianSenator HARRADINE6H4TASIND00—This measure is one that I believe should not be supported. I listened carefully to what Senator Bishop said. What he said is consistent with my views on the matter. No valid or convincing reasons have been advanced by the government for the sale of this agency. In principle, I feel that the sale of the NTA should not be supported. But we have to come down to the guts of it and see what would occur if we did oppose this measure in this chamber.Let me make it perfectly clear again that I am opposed to the privatisation of the NTA. Looking at what can happen, I have independent advice that the government can do it anyway administratively. Therefore, I believe it is best that we look at the measure here in such a way as to, where necessary, improve it and, where necessary, get undertakings and clarifications from the minister.I know that the government has been saying that it can sell the thing administratively anyhow. The government is also saying that the decent thing to do in a parliamentary democracy is to bring it to the parliament. Frankly, that does not really wash with me because that is not always the case. I am not talking only about this government, of course. Governments of all persuasions seem to be able to do things administratively happily without feeling the need to bring them before the chamber.My advice is that the sale can take place administratively. It has been canvassed, and my independent advice is that there are no obstacles to this, but let me note a couple of points. The sale bill creates an access regime based on that which applies to telecommunications carriers, and this may be able to be replicated in any contract between the Commonwealth and the purchaser of the network, that is, making it a condition of the sale that access be provided in the corresponding circumstances. However, I am advised that a requirement set out in the legislation is tidier than one based only on a contract. Similarly, the restriction on the transfer of assets—and you will need to have a look at the Bills Digest for explanation—could also be contained in any sale contract.There is the objection, of course, that the consequential amendment bill amending the Australian Broadcasting Corporation Act 1983 allows the minister to direct the ABA to conduct an investigation into transmission quality where a complaint is received and is not appropriately dealt with within 60 days. My independent advice is that the minister could make such a direction to the ABA under existing section 170 of the Broadcasting Services Act. So, from a parliamentary point of view, it is important that this matter comes here and that it not be sold in an administrative manner.I am advised that the only real advantage to selling the network by an executive contract is the obvious simplicity of avoiding parliamentary approval. I am also advised independently that it may be that the corresponding advantage to enacting legislation to provide for the sale is that it may make the process more transparent.So there we are. My independent advice is that yes, the sale can take place administratively. If we defeat this, the sale can take place administratively and the government can get away with virtually what it likes in that particular instance. As indicated in my independent advice, an advantage for the executive is the obvious simplicity of avoiding parliamentary approval.I hesitate to suggest this, but I believe—and maybe the minister could confirm this at some stage—that one of the reasons the government wants to do it by the parliamentary route is to save $20 million. There is nothing wrong with the government saving $20 million of taxpayers' money, although approximately $15 million of that would be going to the states in stamp duty. I will give the government the benefit of the doubt. No doubt it has thought about these matters, considered the proprieties of it and has come before us with the proposition for parliamentary approval one way or the other. But if it is the other, we have been given very clear indications by the government that it will go the administrative route anyhow.While I am opposed to the measure, I feel that under those circumstances I would have to vote for the bill at the end of the second reading stage. But I will have a number of matters to raise in the committee stage—and this is very important—which deal with the question of what will happen to the workers who are currently involved, the question of Australian ownership and the question of community radio. There will be a number of other matters that I will wish to raise in the committee stage, so I indicate to the Senate that I will be voting for the bill very, very reluctantly, for the reasons I have stated.18:13:001434Campbell, Sen IanSenator IAN CAMPBELLH15WALP10—I thank honourable senators for their contributions, and particularly those who kept them brief. I indicate to Senator Harradine that there is a range of reasons why the government would prefer to see the legislation passed, but I do make it absolutely clear that—as announced by the Minister for Finance and Administration and the Minister for Communications, Information Technology and the Arts, Senator Alston, on 29 July—the government's clear intention is to proceed with the sale of the network, and we would wish to proceed with it regardless of the outcome of any votes in this place. That is the government's policy and, as I think Senator Harradine has articulated better than I have heard anyone do so today, there is nothing particularly unparliamentary or anything else about that process.Governments go about doing these things, and they have legislative and constitutional power to do so but there are some reasons to proceed down this path, and one of them is the financial reason, Senator Harradine. I would not want to confirm the exact amount but I think you mentioned a figure that is probably in the ballpark. It also gives some of the people who are potential bidders more certainty about their positions. I think it is fair to say that it could be achieved in a more timely manner if the process had legislative support.There are a number of reasons why the government wants to proceed with this sale. We do not of course accept the arguments put by some opposition senators that it is just a grab for cash. In terms of providing rural and regional services, one of the coalition's strong commitments is that we want to enhance the coverage and the quality of transmissions to rural and regional Australia. We believe that by having a privately owned and operated transmission authority we will achieve that.Previous governments of both political persuasions have had to make decisions on funding expansions of the network into regional and remote areas based on the demand for those services—I guess political considerations in some cases but, ultimately, on the funding that is available. I make the point that we have a government that is running surplus budgets, is reducing Commonwealth debt and, therefore, interest repayments—which is something I think Senator Bishop referred to.We have an economy that is growing at five per cent. We are not running deficit budgets, as the previous government did. For 10 years out of the 13 they ran—in 1998 constant dollars—$10 billion deficits. When it comes to demands from the community for services of one kind or another, that makes it impossible for the government to meet those demands. On the other hand, unless you have a government such as the Howard government with Treasurer Costello in control of the economy, a government that can design a tax system that can fund those services into the next millennium—rather than having a 1930s tax system that was described by former Prime Minister and Treasurer, Mr Keating, as ramshackle and about to fall over—you will not be able to fund those demands.The decisions about the expansion of the national transmission network into the future and the decisions about the expansion of services into regional and remote areas will be made, just as they were made by previous governments. This government will fund those expansions. This government will be able to afford to fund those expansions. I say to the people sitting on their tractors or headers out in regional Australia and listening to this broadcast that you cannot fund expanded services for regional and remote and rural Australia if the government is almost bankrupt—which is what it was when we came into power.One of the ways that we have turned Australia around is through an ambitious privatisation program ensuring that, as we privatise, community service obligations are upheld and the government's commitments to the community are upheld. We are using all of the proceeds of these sales to retire debt. That is why we have been able to reduce the Commonwealth's debt so significantly and bring down interest rates, thereby helping the people in regional and remote areas who have to pay interest on the loans they have taken out to buy the very headers they are sitting on as they listen to this speech.That is one of our motivations. We do want to sell this. We want to expand services to regional and remote areas. We want to use the funds to reduce debt even further. We believe in low debt. We believe in balanced budgets but we also believe in improving services to regional communities, and that can occur through this measure. I commend these bills to the Senate. Question put: That the bills be now read a second time.18:24:00The Senate divided. (The Deputy President—Senator S. M. West)33Abetz, E. Boswell, R. L. D.Calvert, P. H. Campbell, I. G.Colston, M. A. Coonan, H.*Crane, W. Eggleston, A.Ellison, C. Ferguson, A. B.Ferris, J. Gibson, B. F.Harradine, B. Heffernan, W.Herron, J. Kemp, R.Knowles, S. C. Lightfoot, P. R.Macdonald, I. Macdonald, S.MacGibbon, D. J. McGauran, J. J. J.Minchin, N. H. Newman, J. M.O'Chee, W. G. Parer, W. R.Patterson, K. C. L. Payne, M. A.Tambling, G. E. J. Tierney, J.Troeth, J. Vanstone, A. E.Watson, J. O. W.31Allison, L. Bartlett, A. J. J.Bishop, T. M. Bolkus, N.Bourne, V. Brown, B.Campbell, G. Collins, J. M. A.Conroy, S. Cooney, B.Crossin, P. M. Crowley, R. A.Denman, K. J. Evans, C. V.Gibbs, B. Hogg, J.Hutchins, S. Lees, M. H.Mackay, S. Margetts, D.McKiernan, J. P. Murphy, S. M.Murray, A. O'Brien, K. W. K.*Quirke, J. A. Ray, R. F.Reynolds, M. Schacht, C. C.Sherry, N. Stott Despoja, N.West, S. M.Alston, R. K. R. Woodley, J.Brownhill, D. G. C. Cook, P. F. S.Chapman, H. G. P. Lundy, K.Hill, R. M. Faulkner, J. P.Reid, M. E. Carr, K.Synon, K. M. Forshaw, M. G.* denotes tellerQuestion so resolved in the affirmative.Bills read a second time.Sitting suspended from 6.27 p.m. to 7.30 p.m. Bills1436r640Billsr639Billsr6381436Debate resumed from 30 November, on motion by Senator Minchin:That the bills be now read a second time.19:30:001436Evans, Sen ChrisSenator CHRIS EVANSAX5WAALP00—The Private Health Insurance Incentives Bill 1998 and cognate bills are about election politics. The private health insurance bills are not about health care and are certainly not about health economics. The bills tell us an awful lot about the priorities of the Howard government. They provide $1.7 billion of taxpayers' money to prop up the private health insurance industry.This is a government that cannot afford dental care for low income earners and pensioners who cannot get their teeth fixed so they can eat. This is a government that cannot afford to tackle the enormous waiting lists that exist in public hospitals in this country. This is a government that cannot adequately fund disability services. This is a government that cannot maintain staff at Centrelink offices throughout Australia so that people can get service from their public service system. But this is a government that can find $1.7 billion to prop up private health insurance—$1.7 billion for what is nothing more than a blatant election bribe.The government are fond of talking about battlers, but $900 million of this money will go to existing members of private health insurance who earn over $70,000 a year—$900 million to subsidise those already in private health insurance who earn more than $70,000 per annum. This is not about the battlers. This is not about helping those in society who are struggling to pay their private health insurance. This scheme is not targeted at them. It is not meant for them. I know numbers of them have been misled to think this is about them, but it is not. This is about subsidising high income earners back into private health insurance.Only $120 million of that $1.7 billion will go to providing hospital cover for new members. This is just economic madness. There is no support for this measure in terms of economic argument or in the wider community. The only support comes from those who will directly benefit from the scheme, those who have a vested financial interest in it.Despite what the government says, it is not about reducing pressure on the public hospital system, because it does not do that. The government's priority is to hand out $900 million of taxpayers' money to those on more than $70,000 per year who are already in the scheme, who are already in private health insurance, who have already made that decision for themselves. The 70 per cent of people in the public system will continue to confront long waiting lists while those who can afford it will go with their subsidised private health insurance into private clinics.This rebate does not tackle the problems that are bedevilling private health insurance and making it unattractive for customers. It does not deal with the large out-of-pocket expenses, the gaps that patients have to pay every time they access a service. It does not do anything to tackle the exorbitant increases that the funds have made in premiums in recent years.This is a blank cheque to those funds to continue to increase the cost of premiums, knowing the government will pick up 30 per cent of the bill. We will underwrite those bills forever. We will pay 30 per cent of whatever they charge. This is a policy of `pay them now and hope that we might be able to negotiate something out of them later in return'. The government talks about mutual obligation everywhere else except when it comes to propping up the private health insurance industry. They have no obligation in return. We give them $1.7 billion of industry assistance, they give us nothing. They can put their premiums up again tomorrow. They can continue to run an inefficient industry, and we will support them with public funds. It is a disgrace.The Labor opposition is not opposed to private health insurance. We support a mix of public and private health systems in this country. But we are strongly opposed to bad policy. We are strongly opposed to wilful mismanagement of Commonwealth funds, and that is what these bills represent. They will not reduce pressure on public hospitals. They will not restrict increases in premiums. They will not remove the gaps faced by insured patients. They will not provide health care assistance to those on low incomes. The report of the Senate community affairs committee into these bills—the Labor, Democrat and Green report—provides ample evidence of the problems with these measures. There is no justification for them.I want to address a range of questions in my speech tonight that have not been on the agenda, that have not been discussed enough. They are the questions as to what can be done with the additional money, who will gain by the rebate, what are the real problems of private health insurance and what impact will these measures have. Those are the questions that need to be asked. Those are the questions the government is keen not to debate.If the government's aim is to reduce the current pressure on public hospitals—and they have $1.7 billion with which to do it—there is a much better way to spend the money. The $1.7 billion is a `combination of the proposed $1.4 billion subsidy on top of the $300 million that is already paid under the Private Health Insurance Incentives Scheme'. That is the scheme the government introduced a couple of years ago with the same policy objectives as this proposal today, but at least that scheme was targeted at low income earners. It was designed to try to help those who needed assistance in paying the very high premiums they get charged.What could we do with the money instead? For a start, we could put the $100 million back into the Commonwealth Dental Scheme, the money that the government took away. The government said to pensioners who needed their teeth fixed so they could eat that we as a community could not afford to provide funds for that sort of priority. They said, `We as a community are not rich enough to be able to pay so that you can have decent dental care,' but apparently we can find $1.7 billion now to prop up private health insurance. This does nothing for the half a million people who were relying on the public dental scheme to have decent dental care.We could also use the remaining $1.3 billion to fund 520,000 admissions into the public hospital system. We could actually deal with the waiting lists by putting this money directly into public health. We could wipe out the waiting lists by applying the same amount of money to those problems. That way we would reduce the pressure on public hospitals and solve the health needs of those who are waiting for treatment—some of the people waiting in agony to get operations in hospitals. They should be our priority, not propping up private health insurance. If we have that sort of money to spend in health care in this country, surely those people in pain, waiting months and months to get necessary operations, should be our priority.If the government is serious about dealing with health care in this country and if it is serious about spending this sort of money on health care, there are far better ways to spend it. This way of spending it will not address any of the fundamental problems that bedevil health care in this country. The answer is not to indirectly subsidise private health insurance in this way. We can spend the money much more wisely. That is a debate this Senate ought to take a real interest in, because this proposal is very bad public policy.I turn to who will gain from the rebate and where the money will go. $1.25 billion will go to existing members—people who are already in the private health insurance schemes. We will not attract one new member with that money; we will just reinforce the membership of those already in there. Of that money, $900 million will go to people over the income limits of the existing PHIIS—that is, to people on incomes of over $70,000 a year. Only $150 million will go to the 500,000 new members that the government hopes might result from the introduction of the rebate. It would be cheaper just to go out and recruit those people and pay their memberships for them—a much more effective use of the money.And who are those who will be collecting the $900 million in public subsidy? Someone on the Prime Minister's salary of $205,000 a year benefits—that is who. A person on that salary, who has top private health insurance cover worth about $3,000 a year, would get this sort of support from this measure. They would get $900 a year from the rebate. In addition, they would avoid the Medicare levy surcharge, which would require them to pay $2,050 in additional tax. So they would get the subsidy and they would get the effective tax discount as a result of these measures. So, in effect, a family on the Prime Minister's salary with full family cover would be subsidised $2,950 by the taxpayer to buy $3,000 worth of insurance. We, the taxpayers of Australia, are going to subsidise people on John Howard's salary by an amount of $2,950 so they can buy $3,000 worth of insurance. This is supposed to pass for good health economics in this country. This is supposed to pass for good public policy. It is a nonsense, it is unfair, it is bad economics, it is bad public policy and it should not be supported.In contrast, a low income family surviving on, say, $20,000 a year, who have an insurance policy worth about $1,800 a year, are already eligible for the existing rebates to the value of $450. They will receive additional assistance under this measure of $90 per year. So, if you are on $200,000 a year, you get a whacking great subsidy, close to $3,000. If you are on $20,000 a year, struggling to pay your premiums, the net impact of this sort of measure is a net $90 a year. That will be eaten away by one increase in premiums. Next year when the funds put their fees up, that will go, so you will have no net benefit.You can see where the scheme is targeted. The scheme is purposely targeted at high income earners. The benefit is all directed at the upper end of the market. This is not about the battlers. This is not about helping those who are struggling to pay their health insurance bills. This is about the government's election bribe and about helping those who can already afford to help themselves. People who pay taxes in this country, who are struggling to raise a family, will be subsidising John Howard and other people on high incomes to enjoy a rebate and a tax advantage. It is a nonsense, it is bad policy, and it ought be opposed.We all know the real problems with private health insurance. Those people who have insurance and those people who have left know what the problems are. This bill does nothing to fix the problems of rising costs—premiums going up 16 to 20 per cent a year; the out-of-pocket expenses for gaps, large gap payments being required of people; people putting off operations because they know they cannot afford to pay the gap even though they have private health insurance; and multiple bills from hospitals. There are also the problems inherent in the industry—the inefficiencies and high administration costs of the industry. These are the problems of private health insurance. These are the problems that have to be tackled if the government is serious about supporting private health insurance in this country.It is no good saying to people, `You can have private health insurance,' if even on the AMA recommended fee it is going to cost $890 for a hip replacement, $1,150 for a bypass or $1,380 for cataract surgery merely in gap fees. Ordinary people cannot afford to pay those fees on top of their premiums. People with insurance are choosing to go into the public hospital system anyway because they cannot afford to pay the gaps. These are the real problems of private health insurance. These are the issues that public policy in this country ought to be confronting, not the `throw the money at it' solution that the government is talking about.The other thing people have to understand about this is that if private health insurance is a bad product, if it does not meet your needs, you will not buy it even if the government subsidises you by 30 per cent. People are voting with their feet, because the product is not one they want to buy. It does not meet their needs. Underwriting this will cause only a temporary blip in the long-term decline in private health insurance. It will do nothing to solve the problem. It will be a waste of tax payers' money. We will be underwriting inefficiency and ongoing cost blow-outs, but it will not make it any more attractive for people. If premiums increase at the rate they have in recent times, the subsidy will be eaten up in two to three years. In two years time consumers will effectively be paying the same dollar contribution as they are paying now. The subsidy will get eaten away. We have to tackle the real issues, otherwise real long-term assistance will not be provided to those who want to stay in private health insurance.Then there is the whole question about what impact this rebate will have. Suffice to say that at the committee hearing the best the department could do was say that their's is a best guess, but it is a best guess by the same people who got it wrong last time. They issued projections for the PHIIS scheme. They were proved wrong. We threw $300 million at the problem last time. That did not alter the slide in membership. Now they come back and the best they can say is: `If you throw $1.7 billion, we're more hopeful that it might work this time.' There is no economic modelling. There is nothing to support the argument other than blind hope. They got the assumptions wrong last time. I suspect they have got them wrong again this time.Sure, there might be a slight increase in membership as a result of throwing this sort of money at it. Clearly, if you are on $200,000 a year and the government will pay for your insurance, you may as well be in it. But it will do nothing for those struggling, nothing for those on $40,000 or $50,000 or $60,000 a year. It will not help them buy private health insurance in the long run because the continuing rising costs and the continuing gaps will eat up any benefit they get from this scheme.As I say, the government claims that this will achieve a 33 per cent participation rate in private health insurance. The private health industry says that it will achieve 45 per cent. Who is right? There is only a 12 per cent difference among friends. That is how much of an inaccurate science this is. It is voodoo economics. They do not know. They hope that by throwing $1.7 billion of taxpayers' money at the problem it might help the 30 per cent of people who are in private health insurance to stay there. It will not help them and it certainly will not help the 70 per cent who are not in private health insurance. They will still be queuing, waiting to get into public hospitals—public hospitals that do not have sufficient funds to do the work they need to do.Clearly, the government is not dealing with the problem. It is throwing money at the industry as part of an election bribe, but it is not solving the problem. An interesting point that came up in the committee inquiry the other day was what is really happening, and even the Victorian government can see this: people with private health insurance are buying the cheaper products with the large front end payments and larger gaps to take advantage of the tax benefit that they gain from being in a fund, but they are still using the public hospitals, as is their right. The fact that they have private health insurance does not mean that they stop using the public hospitals, because they cannot fund the gaps.The figures for Canberra were given to us the other day at the inquiry. It is interesting that 35 per cent of people in Canberra have private health insurance but only eight per cent of them say when admitted to Canberra hospitals that they are privately insured—35 per cent are in private health insurance but only eight per cent of the admissions are for privately insured patients. They are going in as public patients, as is their right, as I say, but they are making it clear that the system is not working for them. They are buying their insurance, but they are not using it because they get better and cheaper service in the public health system. Unless we deal with those sorts of issues, we will not advance the cause of public health care in this country at all. The government is not tackling the root causes of the problems in health care. It is a political bribe, not a solution to the pressures in our health system.No case has been advanced by the government or the industry for the introduction of the rebate. The existing PHIIS is targeted at those on low incomes. This rebate is blatantly aimed at those on high incomes. We are going to pay to force high income earners into private health insurance. We might as well go out and buy it for them because the effective public policy cost is about the same. These bills, if passed, would put $900 million into the pockets of people on high incomes who already have private health insurance, for no net public good. They will ensure that families on $205,000 a year get a net benefit of $2,950, while those on $20,000 a year only gain $90. Clearly, it is iniquitous.The resultant transfer from the public to the private system is in the order of about $120 million of health care. It is just a complete waste of money. The bills will not reduce current demand on public hospitals. They will not provide real assistance to people on low and middle incomes. They will not solve the problems of the gaps. They will not stop the funds continuing to put up premiums. For all these reasons, we oppose the bills. They are not a solution. The government needs to formulate a proper strategy to deal with the problems of health care in this country. The opposition and the minor parties are willing to participate in the development of that strategy that addresses the real problems.We should not just be throwing money at the problem. We tried it two years ago; it did not work. More money will not solve the problem. We have to make the products more attractive and flexible. We have to make them products that people want to buy. Most of all, we ought to address the major health priorities in this country. We need to get people off waiting lists, give them proper dental care—meet the needs of Australians, not meet the needs of the private health insurance industry.19:50:001440Lees, Sen MegSenator LEES8U4SAAD00—I would like to begin by saying that the Private Health Insurance Incentives Bill 1998 and cognate bills have absolutely nothing to do with good health policy, but they have everything to do with buying votes at the election that we have just had and, in particular, distracting people from the GST. I think this legislation was mainly designed to distract those on low incomes, particularly self-funded retirees and those on pensions, from what will be quite significant impacts of the GST on them. This was meant to be a giveaway. This is a pork-barrelling exercise and nothing else.The bottom line is that we are supposedly taking pressure off the public hospitals. If you look at the way in which this is meant to work, you will see that the opposite is actually true. As has just been explained by Senator Evans, even if there is an increase in the number of people who are insured, more and more Australians who go into public hospitals are choosing not to use their private insurance. They are worried about the gaps. They know they cannot jump the queues once they get into a public hospital, that they will be treated on the basis of need, so quite rightly they decide to remain a Medicare patient.If this measure works and we actually see more people insuring, as well as the tendency that is growing not to admit to being insured we will see money taken out of the public hospitals to pay for it. If the private health insurance industry and the private hospitals are right and this measure attracts 45 per cent of Australians into private health insurance, that would rob the public hospitals of close to $1 billion a year. In other words, we are taking money from the public system in order to pay for a private insurance product. Let us look at some of the comments from those people who do have some expertise in health. The Consumers' Health Forum said:The rebate will be inefficient . . . the rebate will increase the cost of health care.Professor Bob Douglas, of the National Centre for Epidemiology and Population Health, said:It will not fix the problem that it seeks to fix, it will probably make the problem worse and it is highly unlikely to do anything to improve the quality of health care available to the Australian people; . . . the huge proposed transfer payment will be more efficiently used in other ways.The Australian Consumers Association said:It is not a good policy; it does not actually address the issues.So it goes on. One only has to look through the evidence put before the Senate committee to realise that the government was well and truly defeated in the battle for commonsense and a proper and thorough approach to what this country expects out of a government by way of health policy. We can go on and look at comments from bodies such as the Australian Healthcare Association and the Doctors Reform Society. Professor John Deeble said:You could have the same effect as this legislation with $400 million . . .That is, not the $1½ billion to $1.7 billion, but $400 million. He further said:. . . it is the same as putting $400 million directly into the public hospitals.Mr Roy Harvey, Principal Research Fellow of the University of Wollongong, commented:The Private Health Insurance Incentives Scheme would encourage people to use less efficient providers of health services and less financial organisations.It does not matter how we try to measure what this government is planning to do, it simply should be thrown out. However, in the interests of trying to get some money where it is desperately needed and also to acknowledge that this government's mind-set is on this exercise of what it believes is buying votes, we have looked at trying to reach some compromises with government. That compromise position is one that puts roughly half the money the government planned would go into this scheme into it, but with a means test. This means test would phase out for families at around $50,000 and for individuals at around $30,000. This would bring into the net that could qualify about 68 per cent of families and about 77 per cent of singles.This compromise also asks the government for some specific public health expenditure. Firstly, by freeing up $800 million of the $1.6 billion expenditure, we could institute a special national waiting list reduction scheme to provide thousands of those Australians who have been on waiting lists for over 12 months with an immediate solution to their health problems.Secondly, as the Senate committee that looked into the Commonwealth Dental Health Program found, we have Australians waiting two and three years—in New South Wales, close to four years—for basic fillings to be fixed. If that does not have an impact on the health of Australians, particularly of elderly Australians, I do not know what does. The sum of $120 million would restore that program for those on the lowest incomes. The third issue that we believe needs urgent attention is a coordinated care program for older Australians. We direct the government's attention to the submission from the Catholic Health Care Association and ask that that be immediately implemented with about $400 million of the residual that we are not using for this program. That would mean that Australians over 70 years of age could again really have some confidence in our health care system. They are, after all, putting enormous pressure on either the public or the private system. Indeed, it is their needs that are partly responsible for the increasing costs of private health insurance. If we could have a proper coordinated care program where those Australians had confidence that their needs would be met—whether by way of an in-home program, hostel, nursing home, or hospital—that would take a lot of pressure off the private health insurance industry. They would no longer need that product.The fourth area that we believe deserves immediate attention is that of rural health services, particularly looking at emergency services, mental health services and multi-purpose health centres. For that, we believe that $180 million is the absolute minimum that should be spent in the short term.The third issue as part of the compromise package we have put to government is that we really do need to reform the funds. As Senator Evans has already mentioned, there are major problems within the industry, but this particular measure is going to do nothing but increase their profits and help the shareholders in many of the companies. It will do nothing for our health system. Detailed on page 192 of the report are some submissions to the productivity commissioner relating to unexpected costs. One comment reads:The hospital gap and also that of 22 doctors totalled over $50,000, despite my being a "Foundation Member" with top cover, of Medibank Private, who only covered intensive care for six days.Another comment reads:After all of the operations and worry the bills started coming in, I was nearly flattened with all of the extras I had to pay that Medicare or the— a particular company which is not mentioned—did not cover. After nearly going bankrupt, I had to write to all involved and work something out in paying these bills.So it goes on. I am sure everyone here has had constituents write to them and explain that they simply could not meet out- of-pocket expenses. Yet one of the groups that this government is trying to keep in private health insurance is low income earners. For them to be encouraged into a product that is going to see them facing, just for a hip replacement, an average of at least another $800, when you are on a pension of $9,500 to $10,000, is unconscionable.Then there are all the problems with the billing system, which is confusing and cumbersome. There are many more quotes for those who want to have a look at this report. Also looking at the averages for co-payments, the average hospital co-payment is around $120 and the average medical co-payment is $191. In other words, for each episode we are looking at an average of $311. For people on low incomes, that is simply not affordable.Looking at the committee hearing, we had a lack of evidence from those on the government side. They made a range of insupportable statements about what this is supposed to do. They were not able to back up in the committee their claims that this scheme would reduce pressure on the public hospitals. After sitting through the evidence, as I have just said, the impression I was left with—the evidence speaks for itself—was that the pressure on public hospitals will actually increase if this measure is successful. If we pass this bill, we are effectively voting for a decrease in funding for our public hospital system.The leading health economists, health experts and those who came before the committee will be more than happy to sit down with this government and go through a range of different proposals if what this government really wants to do is support the private health industry. Just looking at the private hospitals, many Australians, particularly for day surgery, are choosing to insure themselves. If we go back and look at a measure that was removed by the Labor government—that is, the bed day subsidy—we would put back into balance the support given to those who use a bed day in the private hospitals.Remember that we are already extensively supporting those people who choose to go private. They take their doctor's bill, their pathology bill, radiology bill, all of the anaesthetist's bills, et cetera, and get the Medicare rebate. Their fund pays a percentage of the extra, but they are already tapping into Medicare. What we need to remember is that Medicare is used by many of these people who choose to go public in the public hospital system and all the time when they see their GP.When you look through the evidence, the only groups that seem to be supporting this rebate are those who stand to profit from it. In particular, I mention the private health insurance industry, who have organised one of the strangest lobbying campaigns—if they actually want to get people on side—I have ever seen. The volume of letters has done more for the Save the Children Fund, whom we give our second-hand stamps to, than it has in convincing us that there is anything legitimate in these arguments.Indeed, a growing number of faxes and letters have been sent out by the funds to people to send on to us that have been changed. In fact, even insured people are writing back to us saying that we should not be supporting this measure. I will just quote from a few. One said:Dear Senator, I have been asked by my health fund, HBF, to fax you seeking support for the 30% rebate. I instead ask the opposite. A rebate like this that is not means tested is really a subsidy for the rich.DX5MARGETTSSenator Margetts—I got that one too.8U4Lees, Sen MegSenator LEES—You got that one as well? Good. And there are quite a few more. Remember that these letters that were supposed to impress us were very well planned by the funds. They already had our names and the name of the sender on them. They just had to be signed on the bottom. This person has crossed the letter out and written:I am not in favour of the above letter and trust all Democrats will vote against the proposed legislation.Another letter said:Somebody has kindly put your fax number in the newspaper asking that we advise you how we feel about the 30% rebate . . .This person goes on to say:The 30% rebate would notprovide one new medical facilityupgrade one existing medical facilitycreate one new medical provider positionassist any "Aussie Battler" to pay an already hyper inflated premium . . . The letters go on. I do promise that we will get back to the various respondents. We will be doing that over Christmas. But I just say to the health insurance industry that this is a blatant exercise in trying to protect your own nest.We were also inundated with emails from people who were supportive of our position. One email said:Firstly, I wish to express my concern over HBF's stand on the issue. As a health professional it is my belief that HBF stands to gain far more from the planned rebate than my customers.I say to the industry that it is fairly obvious where your interests lie. If you do organise lobbying exercises in the future, going back to some plain, ordinary economics and looking at how best we can work together to get Australia's health system working is far better than this enormous amount of paper and stamps that people have invested in.I now turn very briefly to the committee report. We have seen the government stand by the legislation, which was to be expected. But the depth of the other reports such as the minority report from the Labor Party, the Democrats and the Greens very clearly showed that it was the only government senator who, during that committee, found that the evidence was in any way in favour of this measure.I listened with interest to the minister's rejection of our compromise proposal tonight. One of his comments, also made on the floor in the other place, was that the government is putting money into the public system and money is going into hospitals. Yes, we acknowledge that it certainly is. After years of cutbacks from the former government and the slash and burn in the first budget of this government, we have seen some money go back in. But let us look at a whole range of other issues in health where this money should be going.Let us start by looking at carers and the needs they have. Remember that some of these issues have not even been covered in the package that we put to government. But listen to this. Over half a million people with handicaps who live in households did not receive enough help to meet their needs. Some 20 per cent of those caring for a child have been in that caring role for over 20 years or more. Some 52 per cent of principal carers have a personal weekly income of $200 or less. Some 57 per cent of carers in the 1998 Carers Association of Australia survey earned too little to pay income tax. A 1996 report from the Australian Institute of Health and Welfare found that 7,700 people with disabilities were being cared for by a parent aged over 65 years, many of whom have been caring for more than 30 years.If this government has no idea what they can do with this money, I will go on and look at dental health. I refer to the waiting lists for those people who are in need of dental treatment in Taree, New South Wales. The average waiting time for conservative or restorative procedures such as fillings, et cetera, in this region is from four to five years. The average waiting time for dentures is approximately two years. I think many Australians would be astounded to know that this government completely cut the Dental Health Program and has left many Australians without any support whatsoever. By the time these people are going to be treated, their teeth will probably be beyond treating.Let us look again at some of the dental needs. This time I refer to the committee hearing into the Commonwealth Dental Scheme, or the lack of it. I refer to a comment from Dr Deborah Cole, Director of the Royal Dental Hospital in Melbourne. She says:It horrifies me that many people, especially decision makers, have no realisation of the dental consequences for the financially disadvantaged. These people with their broken down mouths have their job prospects diminished, are more likely to have problems dealing with landlords, bank managers, the police, doctors, lawyers and many other people they come into contact with in their daily lives. The value judgements that all these people make on a daily basis . . . come into effect to help these people stay in the poverty trap.I could go on and on looking at areas of dental needs, looking at areas in public hospitals—indeed, going through many of the experiences I have had in recent months in public hospitals which are pushing their nursing staff not to 40 hours a week but to 50 hours and 60 hours a week to make up shortages because they simply do not have the money to employ any more staff on a regular basis.I say to this government, in closing, that this is nothing but a pork-barrelling exercise. This was designed to be dropped into the election campaign at a time when this government was concerned about the impact the GST was having, particularly on low income families. It was simply designed to attract votes. It has nothing to do with good health policy whatsoever. We certainly cannot support it in its current form. I move:Omit all words after "That", substitute "the Senate: (a) notes the evidence provided to the Community Affairs Legislation Committee that the rebate scheme will not take the pressure off public hospitals and is an inefficient and inequitable use of public funds; and (b) resolves that the bill not be read a second time; and (c) calls on the Government to: (i) introduce a means test to restrict eligibility for the rebate to hospital insurance for people on low incomes; (ii) implement a review process to evaluate the rebate scheme against defined outcome measures; (iii) require health insurance funds to achieve improved performance outcomes; and (iv) address the key areas of need in the public health sector, including coordinated care for older Australians; wait ing lists in public hospitals; public dental health services; rural health services; and the health care needs of indigenous Australians.The second reading amendment that I have just moved requires that before we give this bill a second reading the government means test this rebate and put the other half of the money into the areas that I have already mentioned.20:07:001445Margetts, Sen DeeSenator MARGETTSDX5WAG(WA)00—I rise to speak on the Private Health Insurance Incentives Bill 1998 , the Private Health Insurance Incentives Amendment Bill 1998 and the Taxation Laws Amendment (Private Health Insurance) Bill 1998 . The Greens (WA) have fundamental problems with this package of bills. However, before I launch into those, I would like to outline the elements of the bills that we favour, and there are some.Firstly, the Greens are pleased to see that the government is prioritising health by earmarking additional funding for the health system. But I will go into a more detailed critique of where they are going later. Secondly, we are supportive of encouraging choice and diversity in the health system—we always have been—so that people have a range of options for health care. That is why, for instance, the Greens (WA) have supported such things as access to complementary health care options such as chiropractic, homoeopathy and naturopathy. Different treatment options may work for different people in an episode of care. So the Greens (WA) have sympathy with the government's agenda insofar as they are trying to support choice for Australians in the pursuit of health care.However, the Greens (WA) are concerned that this measure is heading in the wrong direction and that it will not produce an increase in choice or better health outcomes. A huge issue that was debated in the Community Affairs Legislation Committee was: will this bill meet the government's objectives? That is a reasonable question to ask, considering the amount of money involved.The government's stated objectives for this measure are (a) an increase in the take-up of private health insurance and (b) a decrease in the stress on the public health system. Let us have look at these to see whether they match up. I will deal, firstly, with the increase in take-up of private health insurance. There have been wildly varying estimates as to what the impact of this measure will be on the take-up of private health insurance. The government assumes what they call a `conservative estimate' of 33 per cent, whereas the Australian Medical Association and the Australian Private Hospitals Association have estimated that membership would rise to about 45 per cent. Moreover, there is no modelling or evidence to support the claims that participation in private health insurance would continue to drop without the circuit-breaker rebate. So we are dealing with estimates without modelling. The reality is that there has not been thorough investigation into how this rebate will affect the number of people insured privately over time. The reality is that the groundings for these estimates are based on hazy opinion polls, which have a questionable statistical basis. In fact, the Council on the Ageing have opinion polls taken from their membership which produce very different results.If you were to go to people and say, for instance, `Would you be in favour of decreased health insurance costs?', what would you expect people to say? I have to admit that I was collared by a doctor last weekend at a conference who said he would really like me to support the health care rebate. And I said, `What information have you been given on the impact on health care?' And he said none. But, of course, like anybody else, he was asked to lobby in support of the rebate. So I spoke to him on a few of the issues I was concerned about and he said that he did not know about them. Here you have a GP that is in there saying he wants this increase in the assistance but not knowing the wider issues associated with the actual proposal.The Council on the Ageing have opinion polls, as I said, taken from their membership which produced very different results. The reality is that the government have continually ignored their own PHIIS program, introduced in July 1997, which had absolutely no effect on accelerating the take-up rate of private health insurance. And it is questionable whether it produced a slowdown effect in the abandoning of private health insurance either. The predictions in relation to PHIIS were inaccurate, so it is legitimate that we have a certain level of scepticism in relation to the modelling—or the lack of modelling—now.This is—and this was mentioned very clearly by Senator Evans—a very expensive way of gaining new members or retaining members. Whatever the analysis, or lack thereof, behind the figures, it is still a relatively expensive way to attract more people or to stop the decline. That extra 3 per cent of the population—an extra 10 per cent of privately insured people—represents about half a million people. So essentially the rebate is costing about $2,500 per new member. If this were the marginal cost of reducing pollution, the government would have never looked twice at it. Or if it were being seen as a welfare measure to be spread across all members of private health insurance, then it would give around $250 per person. As health economist Mr McCauley pointed out, if this is a welfare measure, then it should be expressly named as one which is perversely aimed at high income earners.Let us look at whether or not it lessens the pressure on the public health system. This is the second claim about the rebate. With more people paying their own way, this objective will not be met—full stop. This is the case for a number of reasons.Firstly, let us look at the movement of specialists. This objective does not take into account the fact that even if finances can increase certain resources in the health system cannot. For instance, the number of medical specialists cannot miraculously increase. Specialists can obviously choose to work in either the private or the public health system. Many witnesses expressed concerns that an increase in people using the private health system may mean a move of specialist skills away from the public to the private system. Considering that a patient in the private system will generally be subject to more procedures when compared with a public patient with the same condition—and that is statistically proven—this draining of resources is likely to happen with the current limited number of specialists.Secondly, if the take-up of private health insurance is significant, then the amount of money that is paid to the states under the Australian health agreements will reduce. Even if the demand decreases, the payments also decrease. So the pressure on the public health system actually stays the same. Effectively, we are left with a public health system in the same state as before the measure—or worse—and private health insurance schemes with a few more members. So what have we gained for the huge expense that the rest of the taxpayers have been asked to bear?The next issue is whether the demand will actually decrease. There is evidence that people with private health insurance still use the public system with some frequency. They will often fail to disclose the fact that they have private health insurance and will use the public system. Why would people do this? The reason may be significant gaps in payments, and we have heard about some of those from both Senator Evans and Senator Lees tonight. The result could be that there is a similar amount of demand for public health services—less money, so more pressure on them.The government's rhetoric behind this measure is predicated on the decline in the private system. We are told that the private system will collapse unless the decline in private health insurance is arrested. There is no evidence of this decline in the private health system. Indeed, the private health system is doing exceptionally well even though private health insurance membership is falling. Revenue from private insurance and from most other sources has been rising steeply, from a total of $1,287 million in 1985-86 to $2,817 million in 1995-96—over double the 1985-86 figure. The key issue is to pull apart the unnecessary link between private health system and private health insurance. One of the major influences in this link, in this emphasis on private health insurance as being the absolute key to all this, was probably ex-Senator Richardson. There is still this belief that what he said in relation to health insurance was always correct. I think we have to go back and examine that very carefully. If the private health system were in dire straits, then I would be more amenable to providing subsidies or assisting in this area—perhaps. The private health system is important in providing people with some choice in their health care options. This is a valid concern, but doing this through the subsidy of private health insurance is a very long and inefficient way around. Can you imagine what would happen if social security was so inefficient in its delivery of outcomes?This leads us into the issue of opportunity cost in providing this rebate. This perhaps is the major issue for the Greens (WA). Many witnesses in the committee shared our concerns. The spending of such a huge amount of money is a big issue, especially considering that the tax debate is to be upon the Senate in just over six months and there will be wrangling over tight resources. With basically no benchmarks for evaluation, with basically no comprehensive research, with the weight of evidence suggesting that the measure will not produce good outcomes, with no measures to stop premiums rising, with no measures to alleviate crucial issues in private health insurance such as gaps or multiple billing, with an unwillingness to institute a review of the rebate within a reasonable period, with no measures to address the issue of overservicing, with relatively few measures to address issues of preventative health in the private system and, considering the higher administrative and management costs in the private health system—for all of these reasons, it is difficult to say that the money could not be better spent elsewhere, almost anywhere, in the health system. In 1997 the Productivity Commission concluded that such a rebate is unlikely to be the most cost-effective option to reduce the strain on the public health system. Seventy per cent of the population does not have private health insurance. All taxpayers' money is being used to subsidise a product which only 30 per cent of the population have chosen to purchase. When the government has cut money from such a huge variety of programs over the last three years and placed such incredibly stringent criteria on those receiving social security, the Australian public deserves to have proper research into the variety of options, stronger regulations to ensure that outcomes are achieved—or any regulations would be good in this particular case—and specific benchmarks by which to judge this measure. One would think they would be basic requirements.The issue of opportunity costs relates heavily to the issue of equity. The Greens (WA) share the grave concerns expressed during the committee inquiry about the equity of this measure. The government's proposal is for a non means tested, across the board rebate of 30 per cent. This is a regressive measure in a number of respects. Firstly, the public health insurance premiums and private hospital costs are regressive to start with. Low income people pay exactly the same for their premiums and out-of-pocket expenses as people on high incomes.Secondly, the rebate is 30 per cent on whatever insurance you take out, which Senator Evans explained quite well in his contribution. The high income earners who can afford to take out the most extensive cover will receive a larger rebate. The issue of ancillary cover is obviously relevant in this context. Ancillary cover is mainly held by high income people who can afford the nonessential add-ons.Health economist Ian McCauley, a lecturer at the University of Canberra, has done modelling suggesting that ancillary cover would be taken by 48 per cent of households with an annual income above $52,000 and 27 per cent of households with an annual income above $73,000. Seventy per cent of Australians do not hold ancillary insurance, so they have to finance their own dental, optical and other ancillary care. It is downright unfair to be pulling money out of the pool of taxpayer funds and putting it into subsidies for physiotherapy, optical and dental care for those who can afford to pay for it themselves.Thirdly, the proposed rebate scheme does not give an extra 30 per cent windfall to everyone across the board. In light of the current Private Health Insurance Incentive Scheme, or PHIIS, the rebate would reduce premium prices by around 12 per cent to people entitled under PHIIS, whereas those outside the ambit of PHIIS—those on higher incomes—would have their premiums reduced by the full 30 per cent. People on high incomes are more likely to have private health insurance than people on low incomes, as has been mentioned earlier. That is, about 70 per cent of those earning over $70,000 have private health insurance. The bottom line is that these people do not need government assistance to pay their premiums.While the issue of cross subsidy in private health funds is valid, is this really the best way to achieve fund viability? The whole concept smacks of the trickle-down effect. The government is essentially proposing to hand out around $900 million to people who do not already receive some kind of subsidy—with no evidence that people on high incomes need this rebate to afford premiums or that they are likely to drop their insurance if they do not receive the rebate.Surely a better and more equitable option would be to increase the stick—that is, to increase the Medicare levy payable. Taxpayers' money should not be used to subsidise wealthy people purchasing an optional product they can already afford in the hope that a few who do not have it will pick it up.Another equity issue relates to those who self-insure—that is, they pay for their private health services themselves instead of through private health insurance funds. These people are not a burden on the public health system; they may just be more disciplined or find it more economical to save for their own medical expenses rather than use a private health insurance fund. These people are making a reasonable choice and taking some responsibility for their own health expenses, but they may be penalised for this through missing out on government private health insurance subsidies. Private health insurance as it stands is already regressive, as everyone regardless of their income has to pay the same premiums. This proposal will increase the ever growing gap between the rich and the poor in Australia, and it is something that the Greens (WA) cannot support.The Greens have considered the Democrats compromise position. We see some positives in it. It is certainly a vast improvement on the government's attempt, but everything is relative in this debate, isn't it? We are concerned that the Democrats proposal, if passed, will give legitimacy to a policy direction based on the private health insurance products—a sort of Richardson factor, I guess. The overwhelming evidence in the committee was that this was not the way to proceed and that the system could not be fixed by fiddling around at the edges.However, we do acknowledge that the Democrats proposal is a much better interim measure than anything else on the table. It puts more money into the public health system—in particular, the $120 million would be a much welcomed relief for many people in desperate need of dental care—and a means tested approach to the rebate goes some way to addressing issues of equity. Also, the Greens are supportive of explicit performance outcomes for private health funds and a review of the rebate.But `interim' is the word. The Greens (WA) would only support the Democrats compromise on the basis that a full inquiry is established to address the broader issues of health financing in this country. Many people giving evidence to the committee agreed that an inquiry into the issue of health funding in Australia—not just health insurance, but the issue of health funding and delivery—is well overdue. All parties, we believe, must work cooperatively to achieve a strategic blueprint for Australia's health system. If we can achieve this over the next 12 months, then it may be worth while giving the government the breathing space they are asking for. A comprehensive inquiry, as I said, is well overdue. A comprehensive inquiry is what the Productivity Commission themselves called for in their inquiry. That is what we have called for in our dissenting report to the committee and it is what we are proposing in our second reading amendment.Our second reading amendment refers this broad issue of financing the health system to the Community Affairs References Committee to report in around 12 months time—not a rushed job, but 12 months time. This committee will investigate the raft of issues including but not limited to: health financing, including state and federal cost shifting incentives, and we heard a lot about these issues during the committee; integrated health systems and coordinated care, including the assessment of the role of private insurers; the role of co-payments; competitive neutrality between competitors in the system; the market power exerted by players in the system, including supply constraints in the medical market; community rating; information management; and the progress of protocol development. I am sure if such an inquiry got up, more well deserved elements would be added when looking at health outcomes.I will only foreshadow that we have a second reading amendment, because I realise Senator Lees has moved her second reading amendment. I want to add my thanks to the committee for their efforts in trying to deal with the issues as they were being presented and trying to deal with the rushed timetable that inevitably occurs in these kinds of situations, especially at the end of a sitting. So thank you to the committee secretariat for their good work. I commend my second reading amendment to the Senate for when it is able to be moved, but I ask that the government listen carefully to these arguments, listen to what the community is saying—including those people who know because they have looked at the issues and the modelling—and work out whether they have a position which they can sustain.20:27:001449Knowles, Sen SusanSenator KNOWLESTH4WALP10—I first of all wish to make a declaration in speaking to the Private Health Insurance Incentives Bill 1998 and cognate bills tonight—that is, I am a holder of 30 years of private health insurance and proud of it, because I do not believe that I should ask for someone else to pay for my hospitalisation and medical treatment if and when I need it. I do not believe that senators and members should walk down the queue and bump off other people on lower incomes who are in a public hospital and require treatment. It would be interesting to know how many senators and members actually do have private health insurance and are prepared to pay for themselves.I have to say that, in my 14 years in this parliament, the content of this legislation has been the most commonly called for initiative that has ever been put before me. People who have given up their private health insurance or are struggling to pay for it have consistently said to me, `Why don't you reintroduce tax deductibility for private health insurance and I will either stay in it or get back in it?' I wish to say on the record right here and now that this is the equivalent of full tax deductibility for 80 per cent of Australian taxpayers, and this is what the opposition parties want to knock on the head.Many people can remember what the system was like before Labor started to tinker with it—the higher income earners paid more tax to cover those who could not afford private health insurance. That is what they did freely and willingly because there was no question about it. Some people were insured, and those who could not afford to be insured simply got free treatment. Not only that, they got full tax deductibility for their premiums.At that stage, before Labor started to tinker with the system, 70 per cent of the population were insured. Today, after 13 years of their tinkering with it and after the removal of every incentive that was ever dreamt of, we are now down to 30 per cent thanks to the opposition parties, and here they are saying that they are going to vote against this measure again.I really have to question very seriously the role that the Australian Democrats are playing in this debate. The major plank of their election platform has consistently been to keep the government honest and to its election promises. They are actively seeking, not only in this legislation but also in tax reform, to ensure that the government does not keep its election promises. I think that is unforgivable. I cannot understand their policy turnaround. There has been no explanation by Senator Lees tonight or on any other occasion as to why they now refuse to keep the government of the day true to its promises.But there is an expectation in the community that we will deliver on this promise; make no mistake about it. It is interesting to note that two Western Australian senators and a South Australian senator have spoken tonight. I am the third Western Australian, and I believe that a South Australian will probably follow me. In South Australia, 31 per cent of the population is insured. In Western Australia, 34.9 per cent is insured. That is interesting, because clearly the senators in those states are going to vote against those people who made that free choice. A Labor senator in this chamber the other day freely confessed to holding private health insurance. When asked why, the answer given concerned freedom of choice. I commend that; it is fine. However, they should not stop other people from being able to afford that freedom of choice.Another fact that needs to be remembered is that, on the last figure I have available, as at 30 June 1997, there were 847,000 people aged 65 years and over who held private health insurance. That represents nearly 38 per cent of people aged 65 years and over. They are the very people that the opposition parties today are trying to do in the eye.The notion that somehow it does not matter if high income earners are not included, as Senator Lees and some senators on the other side claim, is something that, quite frankly, I just do not understand. If you do not have high income earners to cross-subsidise those on lower or middle incomes, where will the money come from? Will we actively force people out? Are we going to say that it does not matter if high income earners do not take out private health insurance? There are currently over four million people earning under $70,000 per year who hold private health insurance. It is those very people who will reap the reward of the equivalent of full tax deductibility if this legislation goes through.What I fail to understand is why the opposition parties want higher income earners to push the lower and middle income earners off the queue. If a member of parliament went into hospital and asked for treatment, do you think he or she would sit at the end of the queue without pulling rank? I really and truly doubt it. Therefore, one has to ask why they do not pay for themselves. This notion of people self-insuring is commendable. It is more commendable than not having private health insurance. However, once again, those people are not contributing to the wider pool of those who need or choose to have private health insurance.In saying that the higher income earners should not be forced to take out private health insurance, the opposition parties obviously want to encourage the greater incidence of hit and run members into the funds. Those who are not members join a fund and have a medical procedure undertaken. They then bail out of the fund, so the fund pays for them. Why would they want to do that? Why would the opposition parties seek to do that?The Labor Party, the Democrats and the Greens complain that the income targeted Private Health Insurance Incentive Scheme, commonly known as PHIIS, did little to increase membership. They have actively criticised that measure. From the day it was announced, there has not been one good thing said about it from the other side. Yet at the committee on Friday and again here tonight the opposition parties have been trumpeting that we have to have a similar system. If they complained that the other one did not work, why are they now saying that somehow or other this one will work?Basically, there are three answers to the accusation that it did little to increase membership. First, it was certainly better than what Labor did over 13 years of government, because they did nothing other than remove incentives. Second, if they claim that the target approach did not work, why are they advocating it now? Third, the means tested scheme kept higher risk elderly or sick people in the scheme. But it has certainly not kept better risks in the system. Why do they advocate that? It means that if you keep the higher risk people in the scheme, premiums have to go up.The health insurance industry asked a very real rhetorical question as a consequence of no-one suggesting ever that Medicare should somehow be means tested. I have never heard anyone suggest that. But what is the difference between allowing a millionaire to use Medicare without fees while imposing a means test on higher income families who are contributing significantly to the overall pool of health funds? It is purely and simply illogical. It also needs to be remembered that every person who is privately insured frees up one bed day per year for the uninsured. Why do the opposition parties not want more bed days available for the uninsured? I thought that was the whole principle of the thing. They have come in here tonight and they have been in the House of Representatives and in a committee on Friday clearly indicating that they do not want to free up more beds for the uninsured by the measures they are taking right here and now.The opposition parties have trumpeted loud and long about the benefits of Medicare, but what they do not seem to contemplate or understand is that its success depends on a large insured population. It simply cannot survive in its current form without a significantly large insured population.The Australian Private Hospitals Association state that private hospitals could treat an extra 665,000 patients each year over the 1.8 million they are currently treating. Imagine what that would do to the waiting lists in the public area if that were so. Even if it were only a percentage of it—even if their figure were exaggerated—imagine what it would do if you could put more of those people into the underutilised private hospitals and free up the public hospitals.The only key to such an increase is getting more people into private insurance. In many cases the private sector provides more services than Medicare, even though only 31 per cent of the population is privately insured. For example, 60 per cent of lens procedures, 52 per cent of hip replacements, 51 per cent of hernia procedures, 71 per cent of knee procedures, 67 per cent of dental extractions and restorations and 55 per cent of treatments for eating and compulsive disorders are handled in the private sector. No-one can say that those are insignificant figures, and yet the opposition parties want to see that burden taken from the private sector and transferred to the public sector. How on earth can that be done? It is an undeniable fact that the 31 per cent of people who are privately insured contribute 54 per cent—at least—of the nation's hospital budget.Last Friday and again tonight we have heard about how dreadful it is that the Dental Health Program was abolished. I want to state quite clearly and unequivocally: that was a Labor program that was set in place with $243 million to treat 1.5 million people, and it had a finite time on it.LI4PATTERSONSenator Patterson—Because the Labor state governments stuffed up dental health.TH4Knowles, Sen SusanSenator KNOWLES—Exactly, Senator Patterson. The Labor state governments had really and truly neglected their responsibility in dental health. It was for a finite time, and Senator Richardson and the former minister for health, Carmen Lawrence, both clearly stated that it was for a finite time. The target was met six months early and the program ended in accordance with Labor's plan—not the coalition plan; Labor's plan. And there was certainly no mention of its continuation in the Labor Party's policy in the 1996 election. So when that program ended, in accordance with Labor's timetable—not the coalition's timetable—they then expeditiously scaremongered around the place that the coalition was cutting funding for dental health. It is about time they were honest about what is going on.A lot has been said about gaps and the excessive payment of gaps. I do not blame people for being concerned about gaps, but the fact of the matter is that people need to know that something is being done about gaps and simplified billing. The average gap that patients pay is $106. I am not saying for one moment that there are not some that are higher, and clearly there are some that are a lot less, but that is the average: $106.This government, as opposed to 13 years of Labor, have undertaken seven trials of simplified billing and informed financial consent and have explored new approaches to address two of the biggest complaints about private insurance: the number of bills received after hospital treatment and the uncertainty about the size of out-of-pocket medical costs. The most notable of these is the project at the Melbourne Private Hospital, and it was one of the first projects to declare that it had intro duced a simplified billing system that also eliminates out-of-pocket expenses for privately insured patients. The National Association of Obstetricians and Gynaecologists has supported a proposal by National Mutual Health Insurance to cover an agreed gap between what the obstetricians charge and what Medicare pays for delivery of a baby, and that system is referred to as Mediplus Ezyclaim.There is so much being done by this government to try to solve the problem which the previous government neglected that it is a bit rich for Senator Evans and the other opposition senators—and I include the minor parties in that—to come in here and complain about it. They did nothing over all of that time.There has been such a great neglect of the truth and the facts about the increase in funding. I was astonished to listen tonight to Senator Lees talking about the need for more funding for carers. No-one would deny that there is a need for more funding for carers, but it has taken a coalition government to announce—only this year—a $180 million package for carers. What did Labor do about it? They did absolutely nothing; it has taken a coalition government.There has also been a substantial increase in funding for Aboriginal health, rural health, medical research and public health. It is simply not right to say that that funding is going backwards. The recent Medicare agreements that were signed with the states have provided the greatest funding level ever, and yet we had witnesses last week who quite clearly tried to imply otherwise.The other question that I want to cover in the couple of minutes left to me is ancillary cover. Somehow it is implied by the minor parties and the opposition that it is an elitist thing to have ancillary cover. To claim that only wealthy people use ancillary services is absolute and utter nonsense. Ancillary products cover such things as dental, optical, physiotherapy, chiropractic, osteopathy, podiatry, emergency ambulance transport, speech therapy, hearing aids and non-PBS pharmaceutical prescription services—hardly what I would call elitist things that people want.These are essential services and they are particularly used by families with incomes of under $70,000. They are not the high income earners, but the opposition parties want to let the high income earners off the hook. People who the opposition party has conveniently redefined as wealthy are the people who are now earning under $70,000 per annum. I might add that 76 per cent of all people with health insurance have both hospital and ancillary cover, which shows that Australians across all income levels simply value ancillary cover. Over 700,000 people with private health insurance are on incomes of under $20,000, and a lot of those people are the aged, the self-funded retirees, the people on pensions, whom this government is quite clearly trying to help and whom the opposition parties do not want to assist.There is obviously a strong link between different types of cover. People who choose to take out hospital cover believe that ancillary cover is important—and quite justifiably so. I could go on for a considerable length of time tonight about the benefits of this legislation and why it should be carried. It disturbs me that it is not going to be, by the look of what has been said this evening, and I think that it is a responsibility of the parliament to ensure that this government delivers on its promise that was made to the people on 3 October this year. It is a worthwhile promise for the health of this country and the future health and livelihoods of all Australians and not just of those who can afford to pay.20:47:001452Crowley, Sen RosemarySenator CROWLEYZF4SAALP00—What a lot of rhubarb! Senator Knowles, you cannot go on saying to people that they should listen to you and understand that we are telling fibs and lies and you are not, and that we did nothing in 13 years. Do you know what the Labor government did, Senator Knowles—before you leave the chamber? When we came into office, there were two million Australians who had no health insurance. That was because, under Mr Fraser, for seven years of Liberal government there were five variations on a health scheme. It drove people stark raving potty-bonkers trying to work out what on earth was up and which way was down. The result of it was that two million Australians were not insured.Medicare has been introduced, and it is quite surprising that you—who, in all your literature say, `We believe in Medicare; the Australian people like it, and we will support it'—do not understand what Medicare is. Medicare is insurance, a total cover against health costs and doctors costs against the person's outlays. That is what it means. Everybody is insured. They no longer have the threat of big bills. They no longer have to worry about a gap.Senator Knowles leaves the chamber because I do not think she really wants to run through the history that is so important. Private health insurance was introduced in this country quite some time ago, in the late fifties or thereabouts, to offer people some protection from increasing costs of health bills, particularly for surgery and hospitalisation. Over the years, that system became clearly unworkable and also very divisive. There were those people who could afford it or else who could not really afford it but struggled to find the money for it; and then there were those who could not afford the insurance system, who were lodge patients or any other descriptor for the poor, who copped what was left in the way of services.The other thing that has happened over recent years, though not in the past three years, is that there has been a commitment to excellence in our large public hospital systems. There is no doubt at all that that excellence is under threat with the cuts by the current government. It is a really big shame to have a splendid system and see it suffering because of lack of funding. It is important to understand that, with the introduction of Medicare and with a commitment to a public hospital system and to excellence of services—which, in fact, Australia should be able proudly to acknowledge—there is a splendid health system in this country for the majority of people, and that system is something that we should be defending and not white-anting with this quite extraordinary legislation. I listened in question time today, I think it was, to Senator Kemp explaining to us that the surcharge on superannuation was a matter of equity and that the people at the top end of town should pay more. I actually remember hearing myself say, before I could stop myself, `Ha! Quite different from their proposals under health insurance.' Firstly, why would you take $1.7 billion and direct it to the top end of town as a matter of equity? That is a remarkable step to take.Secondly, why would you make it an open-ended contribution, with no cap on it at all? The private health insurance system will be laughing all the way to the bank if this legislation goes through: `Whacky-do! We will put up the cost of premiums, and the government will just keep paying 30 per cent of them!' There is no restriction in the legislation at all to stop the insurance companies doing as they did under your previous private health insurance incentive system. All that did was see the cost of private health insurance premiums go up so that, in no time at all, all the benefits to the people who were eligible for that assistance were lost.Thirdly, there is no cap on any of the charges. It is the most extraordinarily bad economics. Occasionally, Dr Wooldridge has indicated that he is interested in good economics. One has to wonder whether he was not rolled in his own cabinet on this. He has been rolled before. I can think of the proposal he had for who should head up the National Health and Medical Research Council. That name actually got into the public arena; he thought he might actually prevent any nasties happening if he put the name on the public record—instead of which he was rolled and he then had to deal with the embarrassment of having somebody else put in over his nomination.Could it be that Dr Wooldridge was rolled in this case? There is no way that a government that has devoted three years to restraining, let alone directly cutting, costs in health expenditure—look at the changes in pharmaceutical policy and at the cuts, with the dental service not continuing; there are a number of other areas where Dr Wooldridge and the government were into restraining health costs—should then suddenly find $1.7 billion, a `B for Betty' billion, to subsidise the top end of town's health insurance. It makes one gasp.Most health ministers drool at the thought of having $1.7 billion to spend on services, to spend on providing better assistance to people, to spend on providing rural health, dentistry or anything else. What are this mob doing? They are actually paying that money to underwrite private health insurance premiums. They are doing nothing except firing to the top end of town with no restraint at all on costs.Poor Senator Knowles had to come in and defend the totally indefensible. She suggested that people who have private health insurance do not queue jump on public hospital waiting lists. Blessed be Senator Knowles's heart. It is a nonsense. It is also grossly offensive of her to suggest that everybody in this place who has to attend the public hospital system and who does not have private health insurance would pull rank and jump the queues. If queues are being properly managed—and there is some evidence that in some places they sometimes are—then services are allocated on medical need, not on whom you are or how much importance attaches to you.I would also concede that it is highly likely that, if the Queen of England or somebody else fell over and broke their leg or hip, people would be inclined to say, `Because of their position, you would be inclined to help them.' But, by and large, if we are to believe the doctors and the evidence, then our waiting lists are based on medical need. A few colleagues over there sneer at that suggestion. It is you who are the government and you should do something to ensure it is based on medical need and not on who you are and how much you cross the palms of whoever is pulling the strings to make the list.This legislation does not deal with the major concern of many of us, that is, the fair and proper allocation of precious dollars to the health system. It will not reduce waiting lists because many people using the public hospital system have private insurance. They choose to go in the public system because they do not want to pick up the extra costs. It is bad enough having to pay your health premiums. But getting the bonus issue of the gap fees on top of that is making many people flinch and turn away. It is the cost of the gap as much as the premiums that is making people drop out of private health insurance.I heard recently one of the most illustrative stories of why people drop out of private health insurance. A man told me that some few years ago he had to have a hernia operation and, curiously enough, so did a colleague of his—another man. Both of them were in hospital at the same time and both of them were treated by the same doctor, but as the gentleman speaking to me said, `Since I was 15 and working, I always thought it my right and proper duty to contribute to my health care, so I bought private health insurance.'So he went in as a private patient and his mate went in as a public patient. Two weeks later they were, by and large, fit and ready and on their way again. His mate kept grinning because he had no extra costs, but the gentleman with private health insurance—for the same doctor and for the same procedure—had an extra bill on top of his private health insurance of $1,900. He said his mate grinned even wider. The result of that was he went straight down to the private health insurance company he belonged to and told them in no uncertain terms that he would no longer and never insure again. That was a brilliant case of what is wrong with private health insurance.Some few years ago—and I think still, but largely undercover—there was a thing called casemix. This is a question I would like to put to the minister during the committee stage of these bills. Casemix was able to make an assessment of the cost of any procedure. If you went to have an appendix operation, it would say it will cost X dollars—$100, $500 or whatever. I do not know what the figure is, so I will use the figure of $100 to illustrate the point, which is not even a guesstimate.Why does it not cost the same $100 to have an appendix operation in a private hospital as it does in a public hospital? What are the add-ons? What possible justification is there for that same appendix operation costing more in the private sector? Indeed, it should cost more in the public sector because the public sector enjoys the extra costs of educating nurses, doctors and all sorts of ancillary health professionals, and it provides pathology and all sorts of other services. If there were a case to be made, you would have to say that the procedure is most likely to cost more in the public sector. But, indeed, it costs more in the private sector.The only person who I think has really touched on this on the public record is Senator Harradine. He asked in the committee hearing on Friday last—and got national coverage for it—what this will do to restrain the costs of doctors' fees. He did not quite say it like that. I do not do justice to you, Senator; I do not have your quote on the record here. But why is the gap, the gap? Because doctors are charging well above the medical benefits schedule fee.Casemix suggests that there should be no reason for doctors doing that. I have never heard any justification for why an operation should cost more in the private sector than in the public sector. Even more amazingly, why should it cost more in a public hospital if you are privately insured—that is, a private patient—than in a public hospital when you are a public patient? I would be very pleased if the department and the minister at the table during the committee stage of these bills can tell me the answer to that question.Private insurance and subsidies to the top end of town will do nothing to restrain these costs. This is extraordinary and amazing legislation. It is $1.7 billion—precious taxpayers' dollars—that will not assist better health care and will not assist people who are waiting in extraordinarily large numbers now for our dental hospitals. In fact, in South Australia something like 90,000 people have been on the waiting list for at least a year for dental care assistance.If Senator Knowles's description is right—and I have no reason to doubt her—that when the previous Labor government put some money to the states to deliberately reduce those waiting lists for people with poor dental care, it was so effective it reached its goal within six months, why on earth would this government want to cut it away? If you were being so effective in assisting people with dental care, why would you want to take away that program?The senators opposite can say what they like. They are the government. They cut that funding back. They cut the program out. Now they are planning to chase not $100 million to restore the program but $375 million, according to some figures, to subsidise private health insurance for extras so that those people who have the biggest incomes and the largest insurance claims will get assistance but the poor people who have no private health insurance for extras will get nothing, and they will just have to wait longer.There is no justification for this legislation. It certainly will not increase the number of people with private health insurance. There are figures that it might increase the number insured by two per cent, up to about 33 per cent. Some other people, in wild heroic dreams, put the figure at 45 per cent. If that happens, the government's bills will not be $1.7 billion but $750 million more. Most people know that there is no substance for that wild guesstimate, but that is what it is said, or at least postulated, to be.It is very interesting to look at the impact of increasing or reducing the cost of private health insurance—sometimes called price elasticity. The jury is out on what the effect is. By and large, for all sorts of reasons people hang onto private health insurance long past the time they know it is no longer economically efficient. When they finally do let go, it would take a massive reduction in premium costs for them to be bothered buying back in again. This is particularly because most people do not leave just because the premiums are high; they leave because the premiums are high and when they finally used their private health insurance they got a big bill.All of you over there know those letters. You have received many of them, like I have. `Dear Senator, I am a pensioner and for 30 years I have paid my private health insurance premiums. I thought it was the proper and right thing to do. I thought it would give me protection should I ever need surgery. I have now had an operation and, as a result, I now have a bill for $3,000. Senator, what will I do? I am a pensioner, and there is no way I can see that I'll ever be able to pay this bill. I might have my surgical procedure in the past, but I now have an enormous ache, stress and worry in my life.' That sort of letter comes into my office often, and none of these bills will address it.Secondly, as I have said, this will not ease the burden on public hospitals because so many people with private insurance are already using the public hospital system, as they are entitled to. In passing, I was also interested to note that Senator Knowles was claiming that buying private health insurance is exercising choice. It is quite interesting that Senator Knowles does not allow the same kind of approval to people who exercise their choice by using Medicare only. They are free to choose that.It seems to be a curious coalition policy that choice is that particular thing you exercise when you have the right to pay through the nose for it. Senator Vanstone used to argue in here that you had more choice of education now that you could pay $100,000 for your degree as distinct from before when you got it for free—at least free at the point of attending at the university. It is not a view that I find persuasive and, indeed, neither do many citizens.These bills do not address the claims of government. They will not ease the burden on the public hospitals. It is very doubtful that they will increase the number of people with private health insurance. Even if they did, that will not restrain or restrict health costs in this country. One of the things that Medicare has done has been to help this country keep its health costs at around eight to 8.5 per cent of GDP. This country should be very proud that such a good health service is delivered with that kind of restraint. This will do nothing to keep that figure at that level. Anybody who compares us with other countries will know that the cost for England is about 6.6 per cent—I may be a little bit wrong—and it has the fewest number of people with private health insurance. Whereas in America, which has the largest number of people with private health insurance, the cost of health is 14 per cent plus and rising.We have an excellent system under Medicare. The coalition is committed, they say, to preserving it. If that is the case, why on earth would you put $1.7 billion to the top end of town to reduce their premiums, to increase the costs of health, to do nothing to restrict the costs of doctors fees, and at the same time take money out of the public hospital system? If we were serious about increasing Medicare, many of those precious dollars would be directed to the public hospital system because that is where the largest number of people in this country choose to go. If choice is the animal, let us pursue choice.There are a couple of letters that I wanted to highlight. I thought it must be some interesting policy because on page 42 of the Sydney Morning Herald of 5 December 1998 there were three letters: one from Dr Bruce Shepherd in Cremorne, and I suspect he is the Bruce Shepherd we all know from times past; one from Dr Jodhi Menon from Private Doctors of Australia; and one from Denis Mahon of Mollymook. Any system that manages to get Bruce Shepherd and Jodhi Menon on the same side and totally in opposition to a coalition government does deserve an analysis, and I shall be drawing this to the attention of my colleagues more closely. I urge people to look at both of those letters. Both of them are loud in their disparagement of what the government is proposing here.The last letter was another one of those about a person who finally had to undergo major surgery, as a result of which, instead of being protected by private health insurance, finished up with a bill of $4,600 from the doctors. What on earth is the good of a system that is increasing the costs of health not only to the whole system but also to individuals? They know. They will not be fooled. When you use a product like private health insurance that has long since passed its use-by date and all you get is the cost of increasing premiums and a big bill, you will not be fooled by this legislation.21:07:001457Colston, Sen MalcolmSenator COLSTONPF4QLDIND00—The Senate is currently considering a package of three bills: the Private Health Insurance Incentives Bill 1998 , the Private Health Insurance Incentives Amendment Bill 1998 and the Taxation Laws Amendment (Private Health Insurance) Bill 1998 . Together, these bills will legislate to effect a Commonwealth funded 30 per cent rebate of private health insurance costs. The scheme was a prominent and clear component of the coalition's health policy taken to the Australian people in the recent federal election. Before proceeding, I indicate that I may have an interest in this bill because my wife holds a family membership in a health insurance fund.The principal aim of providing the rebate is to make health insurance more affordable and thus encourage Australian citizens to either maintain their health insurance or join one of the funds. The rebate is generous—30 per cent off the cost of insurance. A fund member whose premiums are $2,000 a year, for example, would receive a rebate of $600, leaving a net premium of $1,400 payable.Private hospitals are an integral part of Australia's system of health care. In times gone past, private hospitals were small and could cater for only a limited number of medical conditions. The situation is far different now. Private hospitals are well accepted in the delivery of health services and provide a complementary role to the public health system.The government's reason for proposing a rebate of health insurance costs is to arrest the decline in, and even increase, health insurance membership. The proportion of the population covered by private health insurance has declined from 65 per cent in the early 1980s to just over 30 per cent nowadays. A consequence of the declining membership has been increased premiums, as the young and healthy shun the funds and the older contributors, with increasing health problems, remain. Increased premiums reinforce the reluctance of contributors to remain in the funds or to seek new membership. A vicious circle of rising premiums and dwindling fund memberships then prevails. In the meantime, extra pressure is placed on the public health system, which has considerable problems of its own without having to cope with an overflow of patients who, other things being equal, could be patients in a private hospital.While the proposed rebate is generous, it does raise some philosophical difficulties. Should the same percentage of rebate be available to high income earners and low income earners alike? It is highly likely that, on the whole, upper income earners will have more comprehensive health cover, which will cost more, and will therefore have a greater rebate than their low income counterparts. Another question is whether public funds should be diverted to private organisations—in this case, the private hospital system. It is possible to argue that higher income earners should not receive the same percentage rebate as their lower income counterparts. On the other hand, it is possible to argue that the rebate should be set at the same rate for all fund members. If the higher income earners receive a lesser rate, they may decide to leave the funds, exacerbating the decline in fund membership which has already occurred. This is a matter which can be argued both ways, as I expect it will be in the committee stage.Whether public funds should be used to assist private organisations is also a relevant question to pose. Under normal circumstances, it would be reasonable to suggest that public funds should not be used for private purposes. However, hospital care in Australia is provided by both the private and the public sectors. A weaker private system would place greater demands on the public sector, which, with its extensive waiting lists, cannot without detriment accept patients who would otherwise be cared for in private hospitals. If the bill is not passed, it is highly unlikely that the unexpended funds will be diverted to the public health sector.Overall, I have some reservations about the government's proposal. First, there has been little in the way of modelling to determine whether the proposed rebate will arrest the decline in fund memberships or, indeed, increase membership. Second, there is the question of an equal percentage of rebate being made available to contributors irre spective of income, to which I have already referred. Third are the funds themselves. Are they taking every possible step to make their own organisations lean? Perhaps they are but, if they again propose an increase in subscriptions next year, it would be hard to accept that they are playing their part in making health insurance more affordable. In this respect, contributors join funds to access health cover, not to win TV sets or motor cars—as at least one fund has been promoting. Whether those promotions are intended to encourage non-contributors to join or to snare contributors from other funds, those TV sets and cars must be paid for by the funds themselves out of money paid in by contributors. It is hardly a wise use of contributors' funds.Many honourable senators may be aware that my office, and those of others in this place, have been inundated with thousands of pieces of mail from a campaign on this issue. That superficial campaign has been orchestrated by private health insurance funds. One fund has even gone so far as to use their members' fees to set up a reply paid address for my office for what they claim to be the `genuine' views of their members. These so-called genuine views read:My health fund is working hard to achieve a better balanced health system. I/we strongly urge you to support the proposed 30% private health insurance rebate in the Senate and other measures to enhance Australia's mixed public-private health care system.While I have made known my own comments on that and similar campaigns, it may be worth while considering a comment of a fund member who wrote to me after being confronted with that campaign. The member's comments read:I strongly disagree with views expressed on the enclosed card, and with the way it was presented to me, with a demand that I sign it there and then in the presence of the [fund] employee whom I had just asked to undertake a service for me, as a member of [that fund]. I believe that you and Senator Harradine would have received far fewer of these cards had [the fund] merely distributed them to the customers/members and left it to them to decide whether to sign and send them in some privacy. Some members are likely to have signed them for the sake of a quiet life: to avoid embarrassment. The member goes on:If Mr Howard is concerned to make private health insurance affordable to people on low incomes, he could introduce a means tested rebate. I urge you to do everything you can to prevent the passage of legislation for the proposed 30% rebate for the cost of private health insurance, at least, in its present form.A similar campaign was organised among medical practitioners. In that case, many forwarded an exact replica of a letter they had been urged to send. Some simply faxed the letter without removing the title, which read:Sample letter in support of the 30 per cent health insurance rebate.I am pleased that none of those who exhibited such slipshod work is one of my medical advisers. Nevertheless, some misleading points have been raised in many of those letters. One such example includes the bold statement that `about 370,000 Australians are forced to drop their cover each year'. While 370,000 Australians may not be renewing their private health insurance each year, they are certainly not being forced to do so. They may discontinue health insurance for a variety of reasons, including increasing costs, dissatisfaction with the product offered or a decision to self-insure. None of those reasons, however, would include compulsion.The letters have also spuriously drawn favourable but flawed conclusions from simplistic survey research. Those conclusions are linked to the finding that `56 per cent of people surveyed will definitely consider maintaining or taking out private health insurance if the cost was substantially less'. There is a distinct difference between `considering' and actually writing a cheque, so what percentage of that original 56 per cent would take the next step of signing up is not known. Whether it is wise to spend up to $1.8 billion per year when such findings are among the best arguments mounted by the private health industry is also debatable.Despite the defects which may be present in the proposal, it must be acknowledged that the scheme which the Senate is voting on is the same scheme that was put to the voters by the coalition at the last election. If the mandate theory has to have any effect, surely the coalition has a mandate to implement its proposal. If it does not work, the government will have the explaining to do. If it does work, it will be an indication that the Senate should not have second guessed the mandate.In spite of the fact that the government's proposal is taking us into uncharted waters, in spite of the atrociously banal avalanche of mail I received which occurred at the behest of the funds and in spite of medical practitioners who wrote, word for word, the same letter, I am prepared at this stage to support the proposition that the bill be read a second time.21:20:001459Gibbs, Sen BrendaSenator GIBBS6L6QLDALP00—As my colleague Senator Evans said earlier tonight, this private health legislation is merely for election purposes. It is nothing more than pork-barrelling. It is a scam designed to try to fool people into believing that this will enhance the health system in the country. A 30 per cent rebate on private health insurance should not even be on the agenda while public hospitals are suffering from a chronic lack of funding. The Howard government wants to pour more money into the private health system at the expense of public hospitals. Essential services are being threatened as this government seeks to line the pockets of the wealthy at the expense of those less fortunate.The government claims the rebate will encourage more low income earners to take out private health insurance. In reality, it will merely provide a bonus for wealthier people who already have private health insurance. Under the current system there is a targeted flat rebate. Individuals with incomes below $30,000 and families with incomes below $70,000 can receive a rebate of up to $450 on premiums. This arrangement provides an incentive for low income earners to take out private health insurance without delivering an unfair advantage to wealthy people with health insurance. The proposal before us today would sweep away the income test and enable even the richest of people to take advantage of a rebate.Labor, on the other hand, remains committed to ensuring that all Australians have access to the best possible hospital care. We believe resources should be allocated on the basis of need, not according to wealth. Medicare provides a fair and equitable system with universal access. This government has forced public hospitals to suffer as it attempts to apply the user-pays principle to even the most basic of health care services.What is even more disgraceful is that this government now has the gall to ask Australians to support the 30 per cent rebate. They want to pour more money into the private system while public facilities continue to decline. If they have their way, in the future everyone will have to take out private health insurance just to get back many of the services that were once provided by the public system. This government expects average Australians to thank them for a 30 per cent rebate on something they would never have had to purchase if the public hospital system had been properly maintained. The money needs to be spent on providing more staff and facilities for public hospitals if waiting lists are ever to be reduced.The Australian Consumers Association has been highly critical of the government's proposed 30 per cent rebate. Like the Labor Party, the ACA has pointed to the fact that top cover family hospital premiums have risen by over 150 per cent in the last nine years. These premiums have risen by around 20 per cent in the past year alone. If such trends continue—we have no reason to assume that they will not—the 30 per cent rebate will be lucky to survive a couple of years in real terms. After that, any benefit will be entirely overtaken by inflationary pressure on premium prices.The ACA claims that the government's rebate is a bandaid solution and will do little to address the real issues. They claim that rises in the volume, range and cost of hospital and medical services are driving premiums ever upwards. The 30 per cent rebate will do nothing to address the underlying inflationary pressures that have made premiums rise so rapidly.In addition, the rebate fails to address the growing discrepancy between what private patients pay and what they are actually refunded. Increasingly, this so-called medical gap is rendering private health insurance useless to all but a wealthy few. For a total hip replacement, a private patient could face a gap payment of up to $890; for the management of labour, delivery and post-natal care, up to $1,010; and for a multiple coronary bypass, up to $1,150. These figures are based on the doctor charging the AMA suggested fee as opposed to the schedule fee. The average Australian is therefore unable to insure themselves effectively against many common medical procedures. A 30 per cent rebate on premiums will do nothing to change this fact.A submission to the Community Affairs Legislation Committee from the Australian Nursing Federation contains more damning evidence against the proposed rebate. The Australian Nursing Federation has fundamental problems with the proposed legislation. Nurses are sceptical that the rebate will be able to relieve pressure on the public health system. They believe that the government would be much better off spending their $1.7 billion directly on the public health system if they are really interested in alleviating the pressure on public resources. They point out that there is no evidence that an increase in the number of private patients will reduce pressure on public hospitals. If the government's untested assumptions are wrong, then they will have wasted $1.7 billion that could have been spent improving facilities in public hospitals.The Australian Nursing Federation also points out that a properly funded public health system must be maintained in order to ensure the provision of services to rural and remote areas. The diversity of needs across the community means that there are competing priorities for the scarce health funding currently available to state governments. State governments are often unable to institute the most cost efficient options for allocating funding because they also need to address the needs of the community. Rural and remote health services, for example, are not particularly cost efficient but need to be maintained if people are to be able to access adequate medical facilities.As funding for the public health system declines, it becomes more and more difficult for state governments to justify providing facilities at great expense to rural and remote areas, at the expense of more cost efficient services in metropolitan areas. The sum of $1.7 billion would inject a measure of security into some of these public health services. It seems ludicrous to consider refunding money for tennis racquets and fitness training when the most basic of health services to rural and remote areas remain under threat. Very few private hospitals exist outside metropolitan areas.The government has sought to promote this $1.7 billion as extra money on top of funding already being allocated to the public health system. The Nursing Federation points out that this is simply not the case. Even if the rebate does deliver its objective of increasing the number of people with private health insurance, the public hospital system could still suffer quite substantially. Funding arrangements between the federal and state governments mean that rises in the number of people with private health insurance could result in disproportionately large funding cuts for public hospitals.Health care agreements between the state and federal governments contain an arrangement whereby federal funding increases if private health insurance drops. However, the opposite can also occur under these arrangements. If the incidence of private health insurance rises, there could well be substantial cuts in federal funding to state and territory governments for health. If this were to occur, it would negate any positive impact stemming from the rebate. The rebate was supposedly designed to alleviate pressure on the public hospital system. If funding to public hospitals ends up being cut as a result, then all that will be achieved is a reallocation of resources away from the public health system into the private health system.The Nursing Federation claims that if private health insurance coverage climbs above a certain figure, then that state or territory starts losing about $450 for each extra person covered. I am particularly concerned about the potential implications of this mechanism for my home state of Queensland. At the moment, about 28.4 per cent of Queenslanders have private health insurance. We will start losing funding if the percentage exceeds 30.4 per cent. Queensland stands to lose $15 million in funding if this rate is exceeded by only one per cent. This seems somewhat unfair considering that 31 per cent of South Australians already have private health insurance, and yet South Australia does not start to lose funding until that percentage climbs to 33.1 per cent. Hence, Queensland will have already lost over $30 million in funding before it even reaches the threshold allowed to South Australia.Queensland is a large state that encompasses many rural and remote communities. I do not see why we should be penalised simply because our rate of private health insurance might rise to the rate enjoyed in other states. If only 28 per cent of Queenslanders can afford private health insurance at the moment, then surely it would be insanity to allow the public sector to decline any further. Mr McAuley told the Senate committee on Friday that the rebate would not diminish public hospital waiting lists at all. He claimed that waiting lists were primarily the result of limited resources and specialist services being stretched to the limit. Any funding cuts stemming from increases in the number of people with private health insurance would therefore only exacerbate the problem of waiting lists. The rebate will steal scarce resources and skills away from public hospitals to benefit private patients.The Nursing Federation's revelations in particular exposed this package of bills for what it really is: an attempt to reallocate funds from the haves to the have-nots. Public hospitals providing vital services to people in rural and remote communities will suffer as this government refunds money to yuppies for their tennis racquet and alternative therapies. It is absurd to think that people still have to travel vast distances to receive vital medical attention like kidney dialysis when this government is wasting money on the private health system. Surely essential life saving public hospital services should not be compromised for the sake of a few optional extras. If this government would only take care of the public health system first, then many Australians would not be so desperate to maintain private health insurance cover.The 30 per cent rebate also seems exorbitant and contradictory given the Howard government's supposed commitment to cost saving. Privately insured people will receive a rebate of 30 per cent on their dental premiums. Hence, nearly $200 million will be spent on subsidising dental treatment alone for those with private health insurance. This is happening only two years after the government scrapped the dental scheme which provided essential treatment to pensioners and people on low incomes because they said they could not afford it. However, that scheme only cost $100 million. Clearly, the government's priorities are skewed considerably towards those who can already afford private health insurance.Those who are most in need of basic health services will be considerably disadvantaged by the implementation of the 30 per cent rebate. The big winners from the passage of this legislation will ultimately be the high income households who are already in a position to pay for private health insurance. Some 22 per cent of households earning less than $22,000 compared with 72 per cent of households earning more than $70,000 have private health insurance. Given these figures, it does not take Einstein to figure out that the lion's share of the rebate will be going to people who are relatively well off.Professor Deeble from the National Centre of Epidemiology and Population Health agrees that the 30 per cent rebate will unfairly disadvantage poorer sections of the community. Professor Deeble noted in his submission to the Community Affairs Legislation Committee that the demand for health insurance is relatively insensitive to price but is much more sensitive to income differences. Hence, a reduction in price will not produce a corresponding increase in the demand for health insurance among people on lower incomes.The Australian Consumers Association also believes that the rebate will not help the 77 per cent of people on incomes under $20,000 who do not have private health cover. These people will continue to be at the mercy of the public hospital system as funding decreases and vital services are eroded. This government seems hell-bent on taking from those who can least afford it in order to pander to those who can. This proposed legislation is just typical of their ongoing callous attitude towards the vulnerable in our community. Their slash and burn approach to aged care has been mirrored in the current approach to health, which will further institutionalise the divisions between the haves and the have-nots in Australian society.Labor governments worked hard to establish a fair and equitable system where all people had access to essential health care services. Australians now have to wait months at a time for some procedures while the government still refuses to allocate more funding to the besieged public health system. While country hospitals are struggling to keep their doors open, this government has sought to reallocate resources even further away from where they are really needed. Why don't they seek to address the problem of dwindling resources in country areas? Why don't they institute some sort of incentive system for doctors in the country to try to halt the exodus of medical expertise from rural and regional areas? Why have they scrapped the dental program designed to provide basic dental care for people on low incomes when they now want to subsidise cosmetic dental procedures?I will tell you why: because they simply do not care. The Howard government do not care about the battlers, the majority of Australian families who should not have to join a private health fund to receive the basic medical attention that we all should be able to depend on in this country.The crux of the matter is this: whether we like it or not, all of us depend on our public hospital system. If any one of us had a heart attack tomorrow, we would be rushed to the nearest public hospital, where we would expect to receive the best possible care. We would hope that the doctors and nurses there were well trained and had the necessary equipment at their disposal. We need to defend our public health system. It is, after all, a matter of life and death. The fact is, if one of us had a coronary in the street, all the tennis racquets and orthodontic work in the world would not save us—a public hospital could.21:38:001462Hutchins, Sen SteveSenator HUTCHINS84PNSWALP00—I rise to speak on the Private Health Insurance Incentives Bill 1998 , the Private Health Insurance Incentives Amendment Bill 1998 and the Taxation Laws Amendment (Private Health Insurance) Bill 1998 . I would just like to preface my remarks by referring to an advertisement that was placed in the Sunday Telegraph last week. That advertisement, put out by the Australian Health Insurance Association, mentioned a number of senators. It was an open letter to Labor senators and the people of New South Wales, and it was signed by Fred Edwards.The open letter mentioned a number of Labor senators—four of whom are still Labor senators and Belinda Neal, who is no longer a senator—but forgot to mention me. I was a bit taken aback by that because, as has been mentioned on a few occasions in the last few days, the process by which I was able to gain representation in this state through the system in my party in New South Wales has been alluded to by government ministers and senators. And I thought that an august body like the Australian Health Insurance Association might have taken the care to look up the names of the existing Labor senators from New South Wales to see who they might wish to put pressure on. I am a bit dismayed at that.I do note that the advertisement appeared on page 59. On page 58 of that paper there was an advertisement for men in my age group, between 40 and 70, who may have an inability to—EU4O'CHEESenator O'Chee—Pretty wide age bracket, Senator!84PHutchins, Sen SteveSenator HUTCHINS—I just made it over 40. The advertisement was for men who might have a problem with maintaining an erection—that was on page 58. Then, on page 60, there was an advertisement from the Woolworths group about a special on thick sausages for $2.99 a kilo.I certainly can say to Fred—if Fred is listening tonight or if Fred has an opportunity to read the speeches in Hansard on the private health insurance bills—that, because of his inability to make sure that he put pressure on the right people, he has lost my vote. As president of the party in New South Wales, I might have been a bit concerned about some of the threats that have been made but, unfortunately, because of their sheer inability to check up on the most basic of facts about who represents the good state of New South Wales, I cannot support this bill.EU4O'CHEESenator O'Chee—I wouldn't take it personally.84PHutchins, Sen SteveSenator HUTCHINS—I have taken it personally, and I probably should take an opportunity to see Fred and clear him up on the fact that I am a New South Wales senator and that I will take up a full-term spot in July next year.In my view, health care is without any doubt one of the most significant issues affecting people out in the Australian community. Whilst this parliament is often required to immerse itself in the minutiae of complex and at times esoteric public policy debates, there are few debates that strike a resonance out in the Australian community like those on issues of access to public services such as health care. Most Australians share the view that there is nothing more important than the health of their families and of their friends. Those of us who have been paying taxes all our lives, and more recently our Medicare levy, expect that when the time comes when we need to use the hospital system it will be there providing efficient, expeditious quality health care.There is no doubt that over the years since the introduction of Medicare the percentage of people taking out private health insurance has declined. Throughout this debate very little analysis has been done on why private health insurance has declined since the introduction of Medicare. In many ways this decline reflects an acknowledgment that Medicare has been an efficient and an effective system that has been able to deliver universal health care of an acceptably high quality to all members of the Australian community. Over the years, more and more people have chosen to opt out of private health insurance because of the undisputed improvements in publicly funded health care in Australia. Because of improving standards of publicly funded health care, people have increasingly found it difficult to see the utility in taking out private health insurance. Adding to this, the increasing cost and the perceived lack of value adding associated with private insurance services has seen an exodus from the private health funds over the last decade and a half. The unfortunate and unintended consequence of this exodus from private health insurance is that the pressures upon the publicly funded system have been growing, almost exponentially.In many ways the Medicare system, whilst an internationally recognised success, has been a victim of its own success. As a result, waiting lists in hospitals in some states have reached record levels. Patients requiring urgent treatment are being told that they must hop on the end of an ever-expanding queue. This unacceptable state of affairs has for some time now required an urgent policy response from the government. The initial position of the Howard government was to starve the system of much needed funds. In signing off on the renewed Medicare agreement, even conservative state health ministers such as Queensland's Mike Horan and South Australia's Dean Brown acknowledged that this government was abdicating its responsibility to ensure that the public hospital system was adequately funded.While short-changing the states over the Medicare agreement the government embarked on its first foray into the area of subsidies to individuals taking out private health insurance. When the government's original private health insurance incentive scheme was introduced, we were all told that this would not only stem the flow of Australians leaving private health insurance but also restore the level of private health insurance to 40 per cent. But this did not work. Instead, when the private health insurance companies were receiving a financial bonanza in the form of the rebate, the Howard government cut funding to public hospitals. Money that had been going to our public hospitals was now going to private health insurance companies via the rebate. We have all seen the results of the government's venture into the provision of these subsidies. When the Prime Minister claimed that the proportion of Australians with private health insurance would be restored to 40 per cent, he was predicting that an additional 8.4 per cent of people would be induced by the government's incentive scheme to take up private health cover.As we look back on the Prime Minister's forecasts 15 months down the track, the only conclusion that we can reach is that the government has clearly failed to turn around the trend of declining health insurance membership. After 15 months and somewhere in the order of $300 million, the government has not only failed to restore the rate of private health insurance to its predicted 40 per cent but also presided over a further decline of 1.3 per cent.The Labor Party is committed to maintaining existing levels of assistance which are tightly targeted and designed to give low and middle income earners some choice in relation to private health insurance. It is clear, however, that government subsidies of this kind cannot be relied upon to address the underlying causes behind declining membership rates.The defining difference between the existing scheme and the proposal before us this evening is that the proposed scheme before us does not contain any means testing. The government is now proposing that significant subsidies be extended to high income earners who choose to take out private health insurance. The removal of the means test has rendered this proposed regime inequitable and unfair. The government seems intent on delivering a massive rebate to high income earners, whilst low and middle income earners simply will not be able to afford private health insurance and therefore will not receive the benefit of the rebate. Under the existing arrangements, at least it can be said that assistance is only given to those who are battlers—those who may aspire to private health insurance but find the cost to be prohibitive—but now the government is attempting to convince us that we should support this handout to those who are amongst the most affluent in our society. We should note that the benefit to low and middle income earners will be less in real terms because they are already receiving the existing subsidy.It should also be noted that, by making the rebate 33 per cent of the cost of the relevant premium, greater relief is received by those who spend more on their health insurance. So the battler who has the most basic insurance cover will receive less benefit than the billionaire on blue-ribbon, gold plated health cover. Not only will this scheme be inequitable but it will also fail to achieve its objective of redressing the decline in private health cover. The government would have us believe that the proposed outlay of $1.5 billion in subsidies will entice people back to private health insurance in large numbers. In fact, many people in the private health insurance industry argue that the proposed measures will restore membership rates to 45 per cent. At best, these claims are unrealistic and unsupported by the experience of the current scheme, which has been operating for the last 15 months. Even if we were to assume, for the sake of argument, that these measures could in some way turn around the current decline in private health insurance, $1.5 billion seems to me to be an exorbitant amount of money to be spending on subsidies. This is particularly the case when considered in the context of the potential gain to be enjoyed by the national health care system. It is clear to us in the Labor Party that the most effective and efficient way of addressing the ongoing problems of hospital waiting lists and an under-resourced health care system is to channel the money directly into the public hospital system. Earlier this year, the states were complaining that the Howard government had failed to provide them with enough funds to fix the crisis in public hospitals. Horror stories about waiting lists and queues in emergency wards abounded. The public hospital system desperately needed more money. What did the Howard government give the states? Not what they were asking for. They were asking for $700 million. That is less than half the amount that the government is now proposing we spend on providing incentives for private health insurance. So this government is refusing to provide direct relief to the public hospital system—money that will go directly towards providing better health care for all Australians.Let us not forget that the states were staking their claim for that money on the basis that they would be able to fix the public hospital system by reopening the closed wards and all the closed regional hospitals, and by reducing the interminable waiting lists. Instead, this government would rather direct more money into a scheme that, by the government's own yardstick, has failed to achieve its stated objectives.This raises the question: why? Why is the government extending the scheme to high income earners and why has it chosen to direct money towards private health insurance subsidies when the public system is so desperately crying out for an injection of funds? One reason is that members of the government have never properly understood that the real crisis in health in Australia is in our public hospital system. Our public hospitals, which have been subjected to repeated funding cuts over the last three years of the Howard government, are at the heart of this crisis. The arguments in favour of subsidising private health insurance are always cloaked behind the claim that it will alleviate pressure from the public system. Assuming that the rationale behind introducing such subsidies is to alleviate pressure from the public hospital system, there is absolutely no justification for the extension of the proposed rebate to all ancillary services. This means, for example, that privately insured people will get a 30 per cent rebate on their dental premiums. The cruel irony of this is that nearly $200 million of the proposed rebate will go towards subsidising dental treatment of those who can afford private insurance, whilst just two years ago the government scrapped the $100 million dental scheme for pensioners. In western Sydney, waiting lists at the Nepean Dental Clinic have blown out. The Commonwealth Dental Health Program successfully and efficiently reduced waiting lists in the Nepean district and provided much needed heath care to elderly pensioners and low income earners. But the abolition of the Commonwealth funding for dental health has resulted in a situation where elderly pensioners can wait for over 18 months just to get their teeth looked at. The most direct and equitable way of providing dental services was through the Commonwealth Dental Heath Program. This private health insurance rebate proposal is a particularly cruel and heartless measure, albeit a fair reflection of the mean spiritedness of the government. When faced with the choice of channelling $1.5 billion directly into the public system or into private health insurance subsidies hoping for some benefit to trickle into the public system, the Labor Party supports the former over the latter. How often have the trickle-down theories failed to materialise into substantial benefits for those who really need them?However, we should never lose sight of the government's real motives in this whole debate. This proposal is not about addressing the underlying problems of contributing to the decline in private health insurance cover; it is about giving yet another tax cut to high income earners.The government says that this assistance is available to everybody, both battler and billionaire alike. However, we all know that this is really about giving a rebate to those who are wealthy and who already have private health insurance. Meanwhile, the government is offering the battler discounted private health insurance knowing full well that they cannot afford it anyway.Once again, the government has displayed its complete lack of commitment to the universality and accessibility of the Medicare system. In purporting to resolve the private health insurance dilemma, the government has failed to address the primary reasons behind the continued decline in levels of private health insurance.This proposal is a bandaid measure which is not addressing the cause of the symptoms—the real reasons that people are dropping out of private health insurance. The primary reason that people are choosing not to take up private health insurance is a lack of confidence in the quality of the product on offer. People want value for money. The real issue in all of this is the gap. People do not want to spend thousands of dollars on private health insurance only to be hit with hundreds and thousands of dollars of extras when they are unfortunate enough to need to use it.If the government was really genuine in its efforts to increase private health insurance, it would tackle the issue of the gap. After paying a premium year in and year out, there can be no greater disincentive to join private health insurance than the knowledge that, when you finally need to use the health system, you will inevitably walk away with a substantial bill.There is nothing in these measures proposed by the government that addresses these fundamental issues. The Labor Party has been accused of taking an ideological stance against these bills, but it is the coalition that is taking the ideological stance. The coalition is refusing to spend additional money in the public system where it will have an immediate and direct impact on the funding crisis facing our public hospitals. Instead, it is proposing to spend billions of dollars propping up private health insurance companies. In the absence of any serious attempt to tackle these problems, we must oppose these bills as presented and must condemn the government for what is clearly an example of poor public policy.21:54:001466Crossin, Sen TrishSenator CROSSIN7Y6NTALP00—These three private health insurance bills are intended to implement the government's election policy to give a 30 per cent rebate to all people with private health insurance, regardless of their financial situation. In the lead-up to the election on 3 October, I stood on a platform of backing our public hospitals and I stand by that commitment. This proposal does not address the fundamental problems in the private health insurance system—that is, escalating pre miums and big gaps. An injection of funds into the public system would be a more responsible approach to public policy.My colleague from the Northern Territory, Senator Tambling, who is also the Parliamentary Secretary to the Minister for Health and Aged Care, called on me today via his press release to support this legislation, saying the 35,000 Territorians who currently hold private health insurance would be severely disadvantaged if I did not support it. He went on to say:Failure to support this legislation would be a direct snub to the many hard-working Territorians who deserve some compensation for contributing to private insurance.Further, talking about me, he said:She would also perpetuate the burden on the Territory's public health system by denying those Territorians for whom private health insurance is currently out of reach, an opportunity to participate.I call on my colleague from the Northern Territory to be honest about the situation in the Northern Territory. We should place on the record that there are six hospitals in the Northern Territory and five of those six are public hospitals. The one and only private hospital that we have in the Northern Territory is situated in Darwin.Let me make this clear for the people on the government side who again seem to completely misunderstand rural and regional Australia and who continue to push at us a southern Australia, eastern Australia, big capital city policy ideology. In the Northern Territory, we are talking about five public hospitals. They are located in Gove, Darwin, Katherine, Tennant Creek and Alice Springs, and the one and only private hospital in the Northern Territory is in Darwin.Let us have a look at that. Let us ask ourselves why the Darwin private hospital has all but failed. Why has the emergency department of the Darwin private hospital closed down? Why did the Northern Territory government, in an effort to boost the private hospital system in the Northern Territory, announce very recently—in fact, last week or the week before—a decision to privatise the management of the Northern Territory's public hospital system? Not just one hospital, but all of them.An article in the Northern Territory News on 20 November under the broad heading of `Radical surgery for NT hospitals' says:Cabinet—talking about the Northern Territory government cabinet—this week gave Mr Burke—who is the minister for health in the Northern Territory—the go-ahead to seek private sector interest in running the Territory's public hospitals.Mr Burke argues greater private sector involvement will ease the burden on public hospitals which, in turn, need upgrading.That is an admission by the Northern Territory minister for health that the public hospitals in the Northern Territory need upgrading. Most of them are in an absolutely disgraceful state and need repair.The article also states that the consultants who did a report for the Northern Territory government said that many of our existing hospitals are in poor physical condition and that $200 million is needed to upgrade them. The consultants pointed out that the Darwin hospital is not functional. The article continues:The consultants say the growth in health services means that by 2006 the NT could be up for an extra $120 million a year.So we have a private health system in the Northern Territory that is in disarray. It needs quite a substantial upgrade and it is in need of attention. The Northern Territory government's answer to that is to farm it out so it is managed by private companies. The federal government's response to that is, `Let's just throw more money at it in the form of a private health insurance rebate.'The public hospitals system in the Northern Territory is in a mess. The answer by the Northern Territory government is to seek private companies to run their hospitals. They will have a duty to their shareholders to make a profit and will not provide access to health care. So in the Northern Territory we are moving to a situation where the quality of health care will really depend on the size of your wallet. Many Territorians will be forced to take out expensive hospital cover for the first time at a cost of around $1,196 per family under Medibank Private. Health care is a right that should not depend on where you live or your wealth.This initiative will cost the federal government $1.5 billion. What we could do with that amount of money in the Northern Territory, under a responsible health policy, is probably throw $720 million into the public hospitals system, repaint it, outfit it and upgrade it so that we do not get reports like this which say that they are in a dramatic state of disrepair. We could probably spend the balance of the money on private health care.What people in the Northern Territory really want is a decent quality public system and the problems with private health insurance rectified. Fifty per cent of the bed days in Northern Territory public hospitals are occupied by Aboriginal people. Few, if any, of them have health insurance, and they are not likely to.Let us recap on what I have said here. We are talking about an initiative by the federal government to offer a 30 per cent rebate for private health insurance. Firstly, only one out of six hospitals in the Territory is private. Secondly, at least a quarter of the population in the Territory is Aboriginal. Very few—a minimal number—of those people pay private health insurance. They never have and are never likely to, because most of them are in receipt of social security benefits.If asked whether they would rather have this rebate or an efficient public hospital system, many of the people who have contacted my office have said that they would prefer a decent public hospitals system. In regional Northern Territory centres they generally go to the public hospital for treatment. When they go to the public hospital for treatment, and if they happen to have no private health cover, the waiting list is long, and they generally give up and go away. Even if people are admitted to the private hospital in Darwin—and we are only talking about the people in Darwin here, because the only private hospital in the Northern Territory is there—in an emergency they are generally admitted to the public hospital anyway. That is because the public hospital is usually the place where they can get better treatment or equipment. In recent months, we have seen the private hospital borrowing doctors from the public system to maintain its accident and emergency system.So why would you have private health insurance in the Northern Territory at all, basically? Many people have it because they believe that the public system is not reliable. They are sick and tired of having to pay the gap in the Northern Territory. They do not want to go to a physiotherapist and pay $40 per visit and get only $15 back. They do not want to see the price of their fees increase continually when they really only use the private health system in an emergency.6E4TAMBLINGSenator Tambling—Or if they have to go interstate.7Y6Crossin, Sen TrishSenator CROSSIN—Exactly. They may need to fly out for treatment. That is a big problem in the Northern Territory. A lot of the care and service needed in the Northern Territory which people in eastern seaboard states take for granted is not there. Instead of the federal government actually putting money into services for Territorians and into a system where specialists live in Darwin and the equipment is in Darwin or Alice Springs and people can readily access it, Territorians are forced to take out private health insurance. They are forced to fly out of the Northern Territory to receive what we would probably see as a basic necessity these days, such as chemotherapy or major heart surgery.If you want to get access to specialist services in the Northern Territory, you have to fly out of the place. The federal government is not prepared to put funds into having specialists live there and having equipment there. It encourages people to not have it. The real reason people take out private health insurance in the Northern Territory, if they can afford it—and they are probably not Aboriginal—is that in an emergency or life threatening crisis they usually have to get out of the Northern Territory to access care. Specialists are not always available.This is a very bad public policy for Northern Territorians. It does not address their concerns. It does not address the fact that if they want access to the same kind of specialist care and private care that the rest of Australians get, they have to fly out of the Northern Territory. People are saying to me four things. They want the gap fixed up. They do not want a limit on the number of orthodontist claims that they can have each year. They do not want to keep paying a difference of X amount of dollars for spectacles or physiotherapy, for example. They do not want premiums to keep rising. They want a good public health system. Most people who have approached my office have said that they get annoyed at having to take out private health insurance in case they have to fly out of the Northern Territory in an emergency.This public policy is bad not only on equity grounds. It discriminates against people who live in rural and regional Australia. It discriminates against indigenous Australians. It is also about the efficient allocation of public resources. Minister Burke said on 15 October to ABC radio:I am a great believer in the private hospital system, particularly in the Territory where the privates have the capacity to capture money that the public system can't capture, and that is the health insurance funds money.Who in the Northern Territory is going to contribute to these health insurance funds who does not already contribute? If they cannot make one private hospital work, how are they going to make work what amounts to two different private hospitals pairing with two minor hospitals in regional Northern Territory? Who is going to contribute if they do not already? There is one private hospital in the Northern Territory, and it does not even operate effectively. The Northern Territory government is seeking to build up a private health system at the expense of the public health system, and it is being assisted by its mates in the federal government.There is no evidence to substantiate the claim that giving this rebate to people who are already in the private health system is going to increase the membership of the private health sector. It is not, and there is no reason for this to happen in the Northern Territory. This will not improve the situation in relation to public hospitals.I was listening in my office earlier to Senator Knowles, who talked at length about freeing up beds. Our aim should be to keep people out of hospitals. You might be interested to know that, in the Northern Territory, for every dollar that non-Aboriginal Australians access through Medicare, Aboriginal Australians receive 27c. For every dollar that non-Aboriginal people get from the Pharmaceutical Benefits Scheme for essential drugs, Aboriginal people get 22c. The Commonwealth health department funds the Aboriginal Primary Health Care Service to a level that goes some way to compensating for the lack of Aboriginal access to MBS and PBS funds. However, primary health care expenditure for Aboriginal people is still approximately $100 less per person per year than the national average of $600 per year. One would have thought that, with Aboriginal health funds being clearly inadequate, the aim of this government would be to keep people out of hospitals—not just indigenous Australians, but all Australians—and that the emphasis should be on primary health care.Between 1996 and 1998, private health insurance premiums have risen between 5.8 per cent and 7.4 per cent per year—in fact, 7.3 per cent in the last financial year. The Australian Consumers Association issued information on private health insurance premium increases by state and territory. If we look at the larger funds and the average annual costs for a family paying the top or 100 per cent private hospital ancillary cover, it shows that for hospital cover in the Northern Territory premiums increased in August of 1998 by 18 per cent. This is not as much as Queensland, which is 34 per cent, or Tasmania, which is 31 per cent, but there has been an increase of 18 per cent in the amount people are expected to pay. Mind you, this in a system where there is only one private hospital and, if you get really sick, you fly out of the place anyway. Ancillary cover, in fact, has increased by nine per cent.The rebate offered by the government is a means tested cash rebate of 30 per cent of the cost of health insurance, but it is not the case that everyone will get 30 per cent of the price of their health insurance. There is currently a means tested private health insurance rebate, and families who earn under $70,000 can get $450 a year off their health insurance now. With the new untargeted scheme, these families could get as little as $100 extra, while those on more than $70,000 will get $1,000 as a new subsidy.These bills favour high income earners, and they provide little new assistance to low income earners. The government will take their refuge in the number of low income people who have health insurance, but these people will receive little extra under the government plan.The 30 per cent rebate will not solve the problems faced by privately or publicly insured patients. The 30 per cent rebate will not stop premiums rising and it will not address the core issues: rises in the volume, range and cost of hospital and medical services. The 30 per cent rebate will not get rid of the gap, and it will not miraculously create more specialists working in the public health system or put more of them in the Northern Territory. Currently there are shortages of specialists in a range of areas, and a 30 per cent rebate will not help the 70 per cent of people on incomes under $20,000 who do not have private cover at all.These bills will not substantially increase participation in private health insurance. The real problems are escalating premiums for health insurance and the heavy gap fees. These bills seek to ignore the real problems in the Northern Territory of a crippled, downgraded, run-down private system, and they will not assist people who really have no choice. People in the Northern Territory who can afford private health insurance take it out for very different reasons than people here in Canberra would, and this rebate is really an example of bad health policy. The government should put additional funding into public hospitals or into primary health care, where funds are desperately needed in this country.22:12:001469Denman, Sen KaySenator DENMANFY5TASALP00—Tonight I speak as a representative of the Tasmanian people, many of whom are calling for the end of these ridiculous policies that are damaging our rural and regional communities. I have had many calls to my office about this, and I will come back to that later.This government is trying to give the private health insurance industry $1.5 billion at a time when they are suffering from a reduction in their membership but at the same time have recorded the best profit in years. As the Doctors Reform Society argues, this $1.5 billion amounts to a direct subsidy to the private health industry at the expense of the public health system, with the result that a dagger has been aimed at the heart of Medicare. This statement needs to be seen in the context of the 1993 World Development Report by the World Bank, Investing in Health, which stated:The OECD countries that have contained costs better have greater government control over health spending and a larger public sector share of total expenditures.The Prime Minister's long history of rejecting Medicare can explain why his government continues to endorse antiquated policies, focusing not on the real issue of private health costs—such as the increasing premiums and increasing gaps between what is covered and what is charged—but on a bandaid solution which can only serve to damage our public health system further.I now want to come back to the issue of the gap. The biggest percentage of calls to my office are about the gap. People are saying that they do not admit to being in private health insurance when they go to a public hospital because when they get their accounts the gap is large and they are not prepared to pay it. This seems to be one of the biggest problems that people who pay private health insurance have.The problem is that this government continues to skirt around the issue of rising premiums and costs associated with private health, unlike the Canadian government, which, when faced with this issue, took notice of the Hall commission when they warned that extra billing by doctors and fees levied were creating a two-tier system. In response, the Canadian government recommitted itself to the provision of a universal public health system and instigated penalties to discourage extra billing and fees.Importantly, the Canadian government did not contemplate giving private insurers a rebate, which does nothing to curb the problem of the ever increasing premiums. In the last years, premiums have increased between 5.8 per cent and 7.4 per cent, illustrating that, left to their own devices, private health companies are not containing the costs.The National Rural Health Alliance in their August 1998 discussion paper entitled `A blueprint for rural development' stated:People who believe that `the market' will produce the best results fail to recognise its deficiencies in areas of small or sparse population.. . . Failure to recognise its deficiencies in a market driven sector.This is the pertinent point of this quote. Time and time again this government's insistent, ideological drive has meant it has failed to recognise that its models are wrong for Australia and especially regional Australia.Regional Australia, particularly rural Tasmania, is suffering and we have the responsibility to try to ease this pain and not add to it. Taking funding from public hospitals to fund private health insurance, in the hope that it will encourage more people to join a private health insurance scheme, will inevitably result in the closure of small regionalised hospitals. In the area where I live we have small regionalised hospitals and only one private hospital.Health cuts in Tasmania under the previous liberal government led to the closure of 24 acute day-care beds in places such as St Marys on the east coast of Tasmania. Tasmania's health system is under a lot of pressure and cannot afford further cuts from the Commonwealth, which will inevitably arise from this legislation. Fortunately for the people who live in larger cities such as Sydney and Melbourne, private hospitals are more likely to exist in urban Australia. This is due to the reduced costs of maintaining larger institutions within close proximity of the main patient base and access to specialists that predominantly live in capital cities.Again, on the north-west coast of Tasmania, where I live, we have one private hospital—as I said—and specialists have to fly in from Melbourne to service that hospital. I know there are arguments put forward about keeping the skill base up and those sorts of things but it certainly is a problem in my area. Thus, regional Australia loses out again as the rationalisation process drives choice of health away from rural Australians.This legislation not only affects the medical options available to regional Australians but also could result in the closing of another mainstay of regional economies—the health care industry. Every dollar that is cut is another bed closed and another job lost and, consequently, less money circulating in rural communities. Again, rural Australia could be disadvantaged by ideologically driven policies that fail to see that cost is not just balance sheet and that social cost is also an economic cost, a fact that this government seems unwilling or unable to account for with its economic modelling.In a time when funding to public hospitals and health is needed more than ever, the government is still blinkered by an ideological framework driven by the Prime Minister's long record of Medicare resistance. Only someone driven by ideology could suggest that a substantial pool of public funds should be given to private health coffers instead of being used to address waiting lists in public hospitals.The complete stupidity of this rebate is staggering when a similar means tested policy resulted in nothing at all in terms of stemming the flow of people leaving private insurance. According to the private health insurance ombudsman's annual report, it is an industry rife with dishonest and questionable practices.Additionally, this government wants to drop the means test component of the rebate, with the result that this new policy will favour the wealthy disproportionately, as they represent the greatest percentage of private health consumers. In contrast, this legislation is revenue negative in terms of public revenue for health care and will therefore attack the people who can afford it least.This government's callousness is epitomised by its cuts to public spending—and no more so than its cuts to the funding for public health systems—at a time when socioeconomic contributors such as unemployment, lack of infrastructure spending, and rising inequities in wealth distribution are increasing the risk of serious health problems in this community. Time and time again the government speaks of the days when more of the Australian population had private health cover and simplistically suggests that, if we offer a rebate, people will decide that private health is great again.This illustrates, as do many other policies that this government has instigated since being in power, how out of touch they are with the plight of the average Australian. The May 1998 ABS figures show that 22 per cent of Australians earning less than $20,000 have private health cover, that 60 per cent earning between $50,000 and $60,000 have private health cover and that 72 per cent earning more than $70,000 have private cover.Thus it would seem that the greatest incentive to take up private health cover is greater disposable income. This would suggest that other social factors such as employment and equity would most likely raise participation rates in private health, not subsidising the rich who already have private health cover.The ineptness of this legislation is reinforced by Roy Harvey, Principal Research Fellow at the Centre for Health Services Development at Wollongong University. I think Senator Lees quoted from his paper earlier tonight. He acknowledges that increasing private health participation is an inefficient mechanism for reducing pressure on public hospitals and that financing health insurance through the taxation system is efficient since it does not require the creation of separate collection processes. Not only is the legislation inefficient in its aim but the efficiency of the centralised revenue collecting system such as Medicare is ignored by this government.Australia's public health system still represents one of the best value health systems in the world. As shown in the 1996-97 figures, our spending on health is 8.5 per cent of GDP compared with 14.2 per cent of GDP in America. America has significantly more of its population in private health cover, but it spends over five per cent more of its GDP on health care without the excellent value for money our system represents.These policies must be rejected. As I have conclusively shown, none of the objectives of these policies is achievable. Rather, these policies, like the aged care policies, are ill-conceived and superficial and ultimately discriminate against the lower and middle income earners and in particular regional Australians as this government continues to be driven by ideology rather than commonsense and principles of social equity and inclusion.22:25:001472Murphy, Sen ShayneSenator MURPHYFX5TASALP00—I have got about five minutes to say a bit about these private health insurance incentive bills—6E4TAMBLINGSenator Tambling—We'll give you some more time tomorrow.FX5Murphy, Sen ShayneSenator MURPHY—I note your interjection, Senator Tambling, but five hours would not be enough, quite frankly, to start to attack this most ridiculous proposition that this government has brought forward. One would have thought that it would not make the same mistake twice. Making the same mistake twice seems to be becoming a habit of this government. You had one bash at this with your $450-rebate proposal. You found that, for all the claims, that did not work.We are discussing the Private Health Insurance Incentives Bill 1998 , the Private Health Insurance Incentives Amendment Bill 1998 and the Taxation Laws Amendment (Private Health Insurance) Bill 1998 . What did the Minister for Health and Aged Care, Dr Wooldridge, say about the original $450 private health insurance scheme when he introduced it? He said, on 12 December 1996:The private health insurance incentives scheme will cost an estimated total of $8 million in 1996-97, $491 million in 1997-98, $609 million in 1998-99 . . . These costings are based on the assumption that the private health insurance participation rate will stabilise at just under a third of the population by 1 July 1997, and will then increase by two percentage points over time.What time I am not quite sure, but it must be a long time because the private health insurance participation rate at the time this measure was introduced was 33.6 per cent and it is now down to around 30 per cent. It really spells out how successful this proposal was at achieving stabilisation and increases to private health insurance membership. Moreover, the total cost over the period outlined in the minister's statement was in the order of $1.1 billion, but we know that thus far it has cost in the order of $1.7 billion, and there is still no end in sight.Moreover, there is the equity aspect of it. At least the $450-rebate incentive scheme, as it was called, was means tested. It was not very well means tested because it still provided a significant advantage for those people on higher incomes. If we listen to what has been said by honourable senators and, indeed, the minister for the government, the one thing they got right is that the people who do use the health system—and we should look at the social economic circumstances—are the aged, the unemployed and those on low incomes. These people are always the most suspect in our community with regards to the need for health services.So what did the original scheme do for them? I will give you an example from my state. For normal hospital cover a pensioner couple have to pay a health insurance premium of around $1,593. They are entitled under the current scheme to a $200 rebate. A family with an income of $70,000 can take out the same amount of insurance cover and pay the same premium and get the $450 rebate. If the pensioner couple want to take out ancillary cover, they have to pay another $400 for that and they only get an extra $50 rebate.What has changed? As I said, you would think the government would learn a lesson from something it monumentally cocked up in the first place. You would think it would learn its lesson. But, oh, no. It comes out with the proposition of a 30 per cent rebate across the board. As was very appropriately pointed out by the shadow minister in the other place, a family with a $70,000 income could pay a health insurance premium of around $3,160 for blue-ribbon, top of the line cover, with ancillaries and extras. Under the new proposal they will get a rebate of around $948. But we must not forget they also save themselves approximately $700 in terms of the additional Medicare levy they would be required to pay if they did not take out private health insurance. What sort of a system is that?Debate interrupted.Adjournment14731473The ACTING DEPUTY PRESIDENTThe ACTING DEPUTY PRESIDENT (Senator Sherry)10000PON/A10—Order! It being 10.30 p.m., I propose the question:That the Senate do now adjourn.147322:30:001473Watson, Sen JohnSenator WATSONVJ4TASLP10—The other evening on the adjournment debate I was talking about the difficulty Trust Bank is having with its mature customers—the problems of long queues and the difficulty it is having encouraging people to use ATMs. I would like to spend a few minutes of my time on the adjournment debate tonight to explore the future of the Trust Bank with its declining profits and loss of customers to the other trading banks, credit unions and building societies.Under the framework approved by the Tasmanian parliament, the Trust Bank has until the year 2001 to proceed to offer shares to the public, and its corporatisation process will culminate with a listing on the Stock Exchange. If one scans the letters in the papers of recent times, one wonders whether this is the right process. If one reads the letters to the Examiner and other newspapers, one may think that maybe it should stay a community bank. If that is the case, maybe there should be a public meeting to that end.The bank will remain a Tasmanian based institution under that legislation, and any strategic partner will hold no more than 49 per cent of the bank's shares after listing, so the legislation says. Did I say perhaps? Now might be an appropriate time to revisit that legislation and return the Trust Bank to a different management which would provide a community service, as was its original charter going back to the days of the old Launceston Bank for Savings, the Hobart Bank for Savings and so on.The 1998 annual report states the Trust Bank is continuing to explore three options for its future. These are interesting. They include: one, become a national bank in its own right with a public float of up to 90 per cent of its shareholding with the Trust Bank Foundation holding 10 per cent, as required by the corporatisation legislation; two, form a partnership with an overseas financial institution, which will have up to a 49 per cent shareholding, and then publicly float up to 41 per cent of the shares and the foundation will hold the remaining 10 per cent; or, three, form a partnership with a non-bank Australian financial institution in the field of banker assurance with the partner holding up to 49 per cent of the bank's shares, the foundation holding 10 per cent and the remaining 41 per cent being floated to the public.I wonder whether Trust Bank's goal is to best position Trust Bank for the future and to ensure that the Tasmanian community receives maximum benefit from the value of the bank that will be vested in the bank's foundation. Its charter is to act in the best interests of the bank, its customers and the Tasmanian public. So tonight I suggest that the Tasmanian public may well be better served by its bank—that is, the Trust Bank, which we love, own and do not want to see disappear—remaining as a community bank, as a trustee bank with less risk, at least in the short term.The Trust Bank has gone against the trend of the four big banks, and this is the worrying part about its position. Unfortunately, the Trust Bank's profit has decreased significantly each year since 1995. The bank attributes its falling profits to the cost of funds and the interest charged to customers. However, its bad and doubtful debts are the highest in five years. So, while its profits are going down, its bad debts seem to be going up, which shows an alarming inability to manage its credit system. It has a problem with its credit system, with its mature customers and with its new computer installation. It really does have problems.In an environment of a high proportion of costs to income and plunging profits, the bank is moving towards a full share float next year. But on what conditions and terms would somebody want to come in and keep its independence? We do not want to see it merged with another big bank and its identity lost. It has a lot of history, a lot of association and a lot of customer loyalty, despite the fact that quite a lot of people have left in recent times.Despite branch closures in Tasmania and significant staff cuts, the bank's operating profit before tax has dropped nearly 60 per cent since 1995 while total assets on the other hand have actually increased by 26 per cent from $1.7 billion in 1995 to $2.1 billion in 1998. I put it to the Senate that it is hardly in a position to attract a great deal of the right sort of interest in a share float. If it did go down this avenue, I suggest it would be at a discounted price, which would be unfortunate for the Tasmanian community.In the last six months, the bank has opened up low cost outlets in Sydney, Brisbane and Perth offering commercial and domestic loans without the local branch structure overheads, obviously following the trend of the bigger banks. As a consequence, the Trust Bank is, unfortunately, exposing itself to a greater risk, I suggest, and would be better served looking after its customer base at home and concentrating on its core competency before seeking to mix it too much with competitors who are investing their talents and financial resources in markets they know well and who have successfully and quietly mastered their transition to electronic data processing.I put it to the Senate and to Tasmanians that we want to keep our Trust Bank. We want to see it operating efficiently. We want to see it looking after its mature customers. It is almost a family tradition in Tasmania that people, including children, have accounts with the Trust Bank. We do not want to see it lost; we want to see it managed. We want to see it maintained and continue well into the future.147422:38:001474Murphy, Sen ShayneSenator MURPHYFX5TASALP00—I rise to speak tonight on a continuing forestry issue. But, before I do so, I would like to commend Senator Watson for his remarks about the Trust Bank, because what he said is quite true. I think the Trust Bank also is in a very suspect position. Moreover, I think the bloke who runs the show is very suspect. I think he is a crook. Quite frankly, if there were to be a Tasmanian public meeting, the first thing they ought to do is seek to remove Paul Kemp from being the manager of that bank.Senator Abetz interjecting—FX5Murphy, Sen ShayneSenator MURPHY—I hear Senator Abetz interject.VJ4WATSONSenator Watson—Mr Acting Deputy President, on a point of order.10000ACTING DEPUTY PRESIDENTThe ACTING DEPUTY PRESIDENT (Senator Sherry)—Order! Senator Murphy, there is a point of order. Please sit down.VJ4WATSONSenator Watson—While I might be flattered by Senator Murphy's comments, I think the reference to a certain gentleman in the bank as being a crook should be withdrawn.4J4SCHACHTSenator Schacht—On the point of order—10000ACTING DEPUTY PRESIDENTThe ACTING DEPUTY PRESIDENT—Senator Schacht, I do not need any help. There is no point of order, Senator Watson. It is getting fairly late. Can we please have a little bit of tolerance and respect for each speaker.FX5Murphy, Sen ShayneSenator MURPHY—If I can just go with this issue a little further, I would think that anyone who sells their private car back into the bank's car pool for thousands of dollars more than it is worth is a crook, and I do not retract or refrain from that. That is a known fact.N26ABETZSenator Abetz—Say it outside.FX5Murphy, Sen ShayneSenator MURPHY—That is a reality.5F4CALVERTSenator Calvert—Mr Acting Deputy President, on a point of order. I know it is the adjournment and there are no divisions and all the rest of it tonight, and I can understand Senator Murphy being colourful in his language. But to infer under parliamentary privilege that a person has carried out a certain act, which has yet to be proved, is not in the best interests of parliamentary debate. I would ask Senator Murphy to perhaps be a little fairer in his comments, because I do not think that is really what this place is all about.4J4SCHACHTSenator Schacht—On the point of order—10000ACTING DEPUTY PRESIDENTThe ACTING DEPUTY PRESIDENT—No, Senator Schacht. There is no point of order. The gentleman concerned can seek redress through the Privileges Committee process if he has been unfairly maligned.FX5Murphy, Sen ShayneSenator MURPHY—It is in the bank's records. You should check it out. As I said, I do commend Senator Watson with regard to his approach. I note his statements, and I am not going to try to incorporate my statements with his. He is talking about the future of the bank, and rightly so. There ought to be concern about the future of that bank. It ought to, as Senator Watson said, get back to actually doing what it should do best, and that is dealing with its customers in our state.But, as I said, I want to talk about an issue with regard to my state as well—forestry. Last week I circulated to all senators a letter that contained a number of photographs. Those photographs are a factual representation of what is happening in my state.5F4CALVERTSenator Calvert—There are no dates on them.FX5Murphy, Sen ShayneSenator MURPHY—For your information, Senator Calvert, they were taken Saturday week ago. We will at some point in the new year debate the regional forest agreement legislation in this place. I urge senators to seriously consider propositions that arose out of the national forest policy statement. We in government were committed to some very important industry development processes, one of which was the setting up of a wood and paper industry council.Although giving a public commitment prior to the election to maintain the objectives of the national forest policy statement, on coming to government the coalition scrapped the wood and paper industry council proposal, which was to oversee industry development and employment objectives. As I said in that letter, I have been involved with the industry for some 20 years. I have always been a very strong industry supporter, but I find myself not able to support what is currently happening.In the short time available to me in this debate, I want to come to the letter that has been sent to honourable senators from the Forest Industries Association of Tasmania in response to my letter and photographs, a copy of which I assume they received via some senators on the other side. The letter was written by the Chief Executive of the Forest Industries Association of Tasmania. He says, among other things, that my claims are not correct. Indeed, with respect to my photographs—which they recirculated and put little tags on—he says, `All of the timber in these photographs is to be burnt on the forest floor' and `Logs debarked and ready for delivery to the mill.'Let me tell you about Mr White—a former employee of North Broken Hill Peko. Mr White is a member of the Forest Industry Council. I wrote to him just last week. They wrote to me and said, `Senator, we congratulate you on your re-election. We invite you to participate in a field tour.' I rang them up and said, `Thank you for your invitation. I would like you to attend a field tour with me.' The executive officer said, `I will pass on your invitation to the board.' I heard nothing back, so I wrote to them and said, `I would like to extend the invitation that I gave to you verbally to attend a field tour with me to inspect these sites in the presence of the ABC 7.30 Report so that you will have a public opportunity to refute the claims that I have made.' And have they responded? No. But Mr White says these are `laughable claims'. I wrote to Mr White today and I challenged him—Senator Abetz interjecting—FX5Murphy, Sen ShayneSenator MURPHY—and I challenge you, you fool on the other side, to attend some of these sites and to have a look to see for yourselves instead of sitting there—I could say, with your head stuck in the sand, but I will not; it is probably stuck somewhere else.Mr White, I hope, will have the integrity in due course when he is proven to be wrong, and he will be, to apologise and write to all of you whom he has written to and say that he was wrong, because he is wrong.C16HEFFERNANSenator Heffernan—Straight to Hollywood for you.FX5Murphy, Sen ShayneSenator MURPHY—I know where it should be straight to for you, you goose. The process that is currently operating in Tasmania is totally unacceptable. Forestry Tasmania is saying that they have some plan for downstream processing like flitch mills. Last week I said to the Marketing and Sales Commissioner, Bob Gordon, `Well, Bob, if you get a developer who comes along and says, "I want to build flitch mills"—and they produce a high degree of residue—will that residue form part of the sale of wood that Forestry Tasmania makes to the export woodchip companies?' That is the only way any developer will get flitch mill operations off the ground. His response was no.It is patently wrong for Forestry Tasmania to purport that they have a plan for downstream processing when at the first hurdle they come to in dealing with the residue—there would be about 60 per cent residue from a flitch mill operation—they are not prepared to ensure that the residue would be on-sold and form part of the wood that they sell to an export woodchip mill operation. That is their position. I challenge senators, particularly those three senators on the coalition side who are from Tasmania—as I said to Senator Watson, I make an open offer to you—to come around the forest sites with me and talk to the contractors in the bush for once in your lives. You should make an effort to get out there and have a look.C16HEFFERNANSenator Heffernan—You ought to stay and listen to Eric's speech.FX5Murphy, Sen ShayneSenator MURPHY—I certainly will. It will be most enthralling, I am sure. This is the bloke who delivered the lowest ballot outcome ever for the Senate team in the Liberal Party in Tasmania. This is the bloke who has been the greatest asset to the Labor Party in terms of Senate voting outcomes we have ever had. I want to hear more from Eric Abetz. Of course I do, and why wouldn't I? This bloke has caused an investigation into the Liberal vote outcome in Tasmania for the first time in the history of the Liberal Party. Then he goes around trying to knock off John Watson so you can get Chris Miles back in here. What a set of circumstances!5F4CALVERTSenator Calvert—What has that got to do with forestry?FX5Murphy, Sen ShayneSenator MURPHY—It has nothing to do with forestry; it has everything to do with this bloke sitting opposite, who is going to get up here in a minute and make a speech, who seems to want to defend, I now suspect, the person who provided the letter I sent to Ian White.C16HEFFERNANSenator Heffernan—Have you ever caught a decent trout in your life?FX5Murphy, Sen ShayneSenator MURPHY—Well, there are plenty of fish biting over there. You would be one of the biggest ones I could ever catch, but the trouble is you would be no good to eat. As I said, Mr White ultimately will be proven to be wrong, and I hope he will apologise. (Time expired)147622:48:001476Bartlett, Sen AndrewSenator BARTLETTDT6QLDAD00—Surprisingly enough I rise tonight to continue the Tasmanian theme following on from Senator Murphy and Senator Watson and to be followed by Senator Abetz, and Senator Sherry is in the Chair.N26ABETZSenator Abetz—You're no Tasmanian, Andrew.DT6Bartlett, Sen AndrewSenator BARTLETT—Well, no. As Senator Murphy would well know, not too long ago I was in Tasmania and I bumped into him at about 8.00 one morning when I was passing through the bustling metropolis of Bothwell. Whilst I was in that state, I consulted with many people trying, as always, to get a view of what the situation was at the community level. It was quite interesting in fact. As many senators would know, one of the issues that I have an interest in is ensuring recognition of the rights of—Honourable senators interjecting—DT6Bartlett, Sen AndrewSenator BARTLETT—As much as I like the Tasmania flavour, perhaps Mr Acting Deputy President, you might call the chamber to order.10000ACTING DEPUTY PRESIDENTThe ACTING DEPUTY PRESIDENT (Senator Sherry)—Yes. Could we have some order, please. It has been getting a bit raucous in the last few minutes. Please respect Senator Bartlett's contribution.DT6Bartlett, Sen AndrewSenator BARTLETT—It is those Tasmanian people in the chamber at present. They just cannot control themselves. One of the areas of interest and concern to me is the need to ensure the recognition of the rights of gay and lesbian, bisexual and transgender people throughout Australia as well as around the globe. That was one of the issues I was exploring whilst I was in Tasmania.Coming from Queensland, I should hasten to add that many people in Queensland, and many other people around Australia, have a bit of a jaundiced view about the attitude of many Tasmanians towards gay and lesbian people. I was expecting to get a reinforcement of my prejudices about some of the narrow-mindedness of Tasmanians. But I am very pleased to report to the Senate that there was quite a positive response from many people in Tasmania about the importance of this issue in relation to the recognition of gay and lesbian people throughout Tasmania and, indeed, the quite impressive actions of the new state Labor government in relation to ensuring that the rights of gay and lesbian people are recognised.I want to pay tribute tonight to the legislation which was recently passed through the Tasmanian lower house, as I understand it, with the support of all parties, including the Liberal Party in Tasmania. I note that Senator Abetz is a power broker in the Liberal Party in Tasmania, and I am sure he had a lot to do with ensuring that this progressive legislation was passed without opposition in the lower house. I think it is an important issue.Just by way of highlighting why it is an important issue, the Tasmanian Gay and Lesbian Rights Group spoke out very positively in relation to the legislation that was put forward and passed through the lower house and they highlighted how crucial it was. In fact they hailed the legislation as the best in Australia. I want to pay tribute to Tasmania for highlighting this issue and for progressing it in such a positive way. Spokesperson Rodney Croome said that the legislation combined the best elements of all recent attempts to recognise the importance of anti-discrimination legislation in this area. It is indeed a positive thing that this legislation has passed through the lower house, and I hope it passes through the upper House in Tasmania in the not too distant future.As an example of why such legislation is important, I would draw the attention of the Senate to revelations which came out during the trial of a person in Tasmania who was charged with assaulting two gay men in July of last year. The person pleaded guilty to a hate motivated attack against the two men as well as to several other gay hate assaults. Another Tasmanian Gay and Lesbian Rights Group spokesperson, Nick Toonen, highlighted that the curbs on anti-gay hatred contained in the anti-discrimination bill were crucial to reducing the incidence of violence against gay and lesbian people. Mr Toonen stated:There is an obvious link between the incitement of hatred and the acting out of that hatred through violent assault.He called, as I call, on upper house members of the Tasmanian parliament to support the anti-discrimination bill because it places prohibitions on the incitement of hatred against sexual minorities without curbing responsible freedom of speech. I certainly hope that that call is heeded. It will leave a situation where—apart from Tasmania leading the way, which is a good thing, as I am sure the Tasmanian senators present would agree—every state except Western Australia has some form of anti-discrimination legislation in place which addresses discrimination on the grounds of sexuality. It also leaves the national parliament without any adequate legislation addressing that issue. I hope that that is one area that this parliament notes and acts upon in the not too distant future. This is an issue which affects people in their daily lives in quite a negative way. It is clearly an issue that can be improved via the benefit of legislative protection or legislative reinforcement of those rights.I would also draw the Senate's attention to recent decisions out of the Refugee Review Tribunal which, on occasion, deals with people who are trying to gain refugee status on the grounds of persecution due to their sexual orientation. In a decision handed down recently, which has not got a lot of attention, but which has given me some concern, a member of the Refugee Review Tribunal indicated that an applicant for refugee status could avoid serious harm in their country of origin just by refraining from making their sexuality widely known. The member also stated that there is not a fundamental human right to be able to proclaim one's sexuality openly. I would beg to differ from that particular statement. I would suggest that that is a fairly worrying principle to try to apply—to suggest that it is reasonable to expect homosexual people to remain silent about their sexuality and to pretend to be heterosexual just to avoid persecution. In Australia that may be just a matter of avoiding abuse or avoiding losing one's job. In some other cultures and some other countries, the consequences can be far more serious than that.In recognition of those sorts of issues, Amnesty International, a widely respected organisation throughout the globe, has made advances in recent years in terms of recognising this form of discrimination and persecution. Amnesty International, at their Cape Town International Council Meeting last year, resolved to seek to give greater visibility in relevant research and action materials to cases of human rights violations against homosexuals. It also agreed to support an intersectional meeting of Amnesty International groups and networks working on lesbian and gay concerns in order to strengthen organisational responses to human rights violations based on homosexuality. Those decisions were taken on the basis of principles that all human beings are born free and with equal dignity and rights; and recognising that human rights violations, including torture and arbitrary detention, continue to be directed at people because of their real or perceived sexual orientation.I think the fact that an organisation such as Amnesty International has recognised the extent and importance of this problem is an indication of how widespread it is around the planet and how important it is for us in Australia to be able to take a lead on this issue. As part of that, I do recognise the advances that the Tasmanian government has made—not just with their legislation but with a few other issues in recent times. I encourage this parliament, in particular, and also the Western Australian parliament, to take further action to try to address these issues, which do have a significant impact on the rights of many thousands of people throughout this country.147822:58:001478Abetz, Sen EricSenator ABETZN26TasLP10—A few days ago honourable senators would have received an open letter from one of their colleagues. It was signed by one Senator Shane Murphy. That in itself had my colleagues scurrying for the parliamentary handbook to discover who this particular person was. They were most surprised to find that he had already been in the Senate for five years and had made virtually no contribution. Nevertheless, they were not surprised to find out that the one and the same Senator Shane Murphy got the lowest personal vote of any sitting senator at the last federal election in his home state of Tasmania.Senator Murphy wrote to me and my colleagues on the topic of the Regional Forest Agreement legislation. This legislation will provide legislative backing to the Regional Forest Agreement, which has provided balance and security to timber workers, their families and their communities whilst placing an extra 400,000 hectares into reserves, which now puts more than 40 per cent of my state into reserves and parks; in other words, it is locked up. This balance was achieved through the cooperative efforts of a federal Liberal government and a state Liberal government.Senator Murphy's two-page letter takes 1½ pages to get to the point he was trying to make, which was to focus on log segregation—that is, the sorting out of logs and classifying them to ensure millable logs go for sawmilling. To make his points, Senator Murphy provides us with eight photographs. As an aside, he says that they were taken eight days ago. The letter was dated 2 December. Eight days ago would mean that they were taken either on 24 or 25 November, both of which days Senator Murphy is recorded in the Hansard as being present here to vote on legislation. But Senator Murphy himself appears in the photographs. So Senator Murphy was either able to fly down to Tasmania and back for the votes or, as I would suggest to the Senate, Senator Murphy got it terribly wrong.In relation to these photographs in which Senator Murphy features, I must say that some of my colleagues have very unkindly suggested that they did not notice Senator Murphy in the photos depicting heaps of timber because he blended in so well with all the other deadwood. Nevertheless, Senator Murphy alleges that these photos prove something. Allow me to quote from page 2. He asserts that these photographs clearly show that none of the commitments given by the state's forest authority as part of the NFPS, the National Forest Policy Statement, or the FFIS, the Forest and Forest Industry Strategy, is being met. These photographs show nothing of the sort.Indeed, the photographs are not identified as to time, date, location, coupe or contractor. So the challenge for Senator Murphy is to come clean. Who took the photographs? When were they taken? Where were they taken? In which coupe were they taken? Who was the contractor? Did he seek an explanation from the contractor? Does Senator Murphy indeed have the qualifications to assess the logs as he purports to do in his letter? Does Senator Murphy have a ticket or, dare I say, was he being a scab in trying to do somebody else's work?The photographs are described in terms which are somewhat emotive and definitely illogical. Senator Murphy claims that the timber in certain photographs is to be burnt. If you have a look at the timber, it would become fairly obvious that the timber has been sawn, debarked and put on a heap in a loading site. Why would a contractor want to chop down the tree, debark it and stack it ready for loading only to burn it? The mantra of the Labor Party is that these terrible businesses go into the forests for only one purpose—that is, to make those things called profits.Anybody motivated by the profit motive would not go into the forest and expend all the money of dropping the timber, debarking it and stacking it just so they can light it. I suppose the only motivation would be if you were a pyromaniac, but that was in fact one of the few allegations Senator Murphy did not make against people involved in the forest industry.You have to ask what has motivated all this. Senator Murphy used to be, as I understood it, a champion of the forest workers because he was an official of the forestry union or, in its new manifestation, the CFMEU. Unfortunately, it seems that Senator Murphy has gone the way of so many of his colleagues on the other side. They were trade union officials. They came into this place as champions of the working class, but the jetsetting and the chardonnay drinking has got to them after a while and they now champion the chattering classes rather than the workers who rely on the forest industry in Tasmania for sustenance for themselves, their families and their communities.We also have a situation in the photographs in which Senator Murphy in fact does not appear where there are marks with a red cross or a red X. That is the classification that is given by people who have a ticket—who have passed tests—to assort and determine what sort of classification a particular log ought to be given. What Senator Murphy is in effect asserting is that these logs have been misclassified and, if that is the case, he ought to be reporting this incident to the appropriate authorities so that prosecutions can take place, if he is genuine. But you will not even identify where the photos were taken, when they were taken, who took them, which coupe and who were the contractors responsible. You have given none of that but have given just bland assertions, seeking to try to endear yourself to the chardonnay-drinking greens in suburbia whilst deserting the workers of the forest industry in Tasmania.We also have a photograph of what is described as blackheart sassafras. If this blackheart sassafras is such a valuable timber—and it is—and it commands a good price for craftwood, who in their right mind would want to send that sort of timber to the woodchippers when you can get a much better price for it for craftwood? I thought all these terrible people who harvested our forests were motivated by the profit motive, because that is the mantra we get from the Labor Party and the Greens, time and time again. If that is their profit motive, why on earth would they want to do that? Why would they not want to command the highest possible price for each particular log they harvest? Next Senator Murphy will be telling us that the goldmines in Tasmania are being mined so that people who are harnessing the gold can use it as road gravel. It does not make economic sense to make these sorts of assertions.For Senator Murphy to come into this place and try to denigrate a very good industry which employs thousands of Tasmanians is, I have got to say, quite traitorous to the interests of our fellow Tasmanians. But it should not come as a surprise to us that Senator Murphy has engaged in this campaign, because Senator Murphy did exactly the same thing in recent times in relation to the woodchip regulations that this government sought to get through the Senate—and, might I say, we were successful in getting it through the Senate. On that occasion, Senator Murphy, I think, was still an office-bearer in the CFMEU in Tasmania.Senator Murphy interjecting—N26Abetz, Sen EricSenator ABETZ—He acknowledges that he was, but he was also sitting in this parliament. The national secretary of the Construction, Forestry, Mining and Energy Union's forestry division, Trevor Smith, branded the ALP's federal parliamentary approach to that forestry issue as `a sad joke'. I say, through you, Mr Acting Deputy President, that I cannot think of a better description of Senator Murphy's letter other than that provided by Mr Trevor Smith on that previous occasion—it is a sad joke.23:08:001480Senate adjourned at 11.08 p.m.Documents14801480The following government documents were tabled:Australian Nuclear Science and Technology Organisation Act—Nuclear Safety Bureau—Report for the period 1 April to 30 June 1998 (NSB.QRM 43).Commonwealth Authorities and Companies Act—Reports for 1997-98— Aboriginal and Torres Strait Islander Commercial Development Corporation.Australian Horticultural Corporation.Australian Tourist Commission.Civil Aviation Safety Authority Australia (CASA).Cotton Research and Development Corporation.Grains Research and Development Corporation.Great Barrier Reef Marine Park Authority.National Standards Commission.Sugar Research and Development Corporation.Copyright Act—Audio-Visual Copyright Society Limited (Screenrights)—Report for 1997-98.Department of Defence—Special purpose flights—Schedule for the period 2 January to 29 June 1998.Health Services Australia—Statement of corporate intent.Housing Loans Insurance Corporation (Transfer of Assets and Abolition) Act—Housing Loans Insurance Corporation—Report for the period 1 July to 12 December 1997 (Final report).Industry Research and Development Act—Industry Research and Development Board—Report for 1997-98.International Labour Organisation—Home work—Convention 177.Recommendation 184.Submission report on ILO instruments adopted June 1996.Local Government (Financial Assistance) Act—National Office of Local Government—Report for 1997-98 on the operation of the Act.Snowy Mountains Hydro-electric Authority—Statement of corporate intent 1998-99.Stevedoring Levy (Collection) Act—Report for the period 3 July to 31 October 1998.Telecommunications Act 1997—Australian Communications Authority—Telecommunications performance—Report for 1997-98.Putting Cables Underground Working Group—Report—Review of options for placing facilities underground.Trade Practices Act—Australian Competition and Consumer Commission—Report for 1997-98.Witness Protection Act—Report for 1997-98 on the operation of the Act. 1481The following documents were tabled by the Clerk:Child Care Act—Child Care (High Need Regions) Amendment Determination 1998 (No. 1).Film Licensed Investment Company Act— Film Licensed Investment Company (Application) Rules 1998. Film Licensed Investment Company (Criteria and Procedures) Determination 1998.Lands Acquisition Act—Statements describing property acquired by agreement under sections 40 and 125 of the Act for specified public purposes.Migration Act—Certification under section 502, dated 2 December 1998.